What is drop shipping model?

Drop shipping is a company model, which is usually used for an early stage product with a lower production cost than mass production. Companies that use the drop shipping model are a good example of a startup company. Drop shipping involves shipping a product out of the factory and not putting it into production. The reason why the product is shipped out of the factory is because the product has a lower production cost, but there is still a big potential in the product, which the company sells to customers in the market. It is great when a product has a good feature that is ready for the market, but it is not ready to become mass produced, therefore the company is able to focus on the big potential in the product. Why is drop shipping used for early stage products? Drop shipping is used to reduce the initial production cost for a product. With the drop shipping model, the manufacturing cost is less. It is also a very good option for a startup company, as it provides the company with lower costs that are not as high as if the product is mass produced. On the other hand, the manufacturing cost is a lower price in comparison to mass production. Why is drop shipping not a good option for mass production? The manufacturer needs to pay a lot of money and the time for the products to be manufactured. If the product is not ready to be mass produced, the manufacturing cost will be high.

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