Dropshipping vs Wholesale - What's the difference?

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Joined: 11 Apr 12
11 Apr 12 10:40:31 pm
what is the difference between dropshipping and wholesale?
what is wholesale

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Posts: 5798
Joined: 27 Jul 07
11 Apr 12 11:29:54 pm
To put it simply, wholesale is buying products in volume. Price is based on amount sold, so the more you order, the better price you get per item. Drop shipping you are in essence selling someone else's products, you are acting as an agent. They provide you with permission to market their product/s, then upon sale, they ship to the buyer themselves, so you don't actually ever touch the stock.

Wholesale will almost always deliver better potential profit margins, as the cash outlay means the risk is higher for the retailer, where as with drop shipping, no or very little cash is out-laid , less risk equals less profitability.

Most retail business works on a very simple formula, risk equals potential reward. The higher the risk, the more potential reward is usually on offer.

Why do I use the word potential?

There are very few guarantees in life, and even less in business. Whatever the risk size, reward is only ever potential until a transaction is 100% complete and you have the cash in your account.

Mark (fudjj)

Community Manager

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Posts: 5221
Joined: 20 Oct 08
12 Apr 12 12:23:04 am
Marc has give you a very simple yet concise definition for both terms :)

Should you have other terms that you need help with I recommend consulting Link hidden: Login to view :)

To learn more about dropshipping and wholesale, I also suggest reading through our guides in Link hidden: Login to view section

All the best!


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SaleHoo Group Limited
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