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How to start a dropshipping business with Magento
What is dropshipping?
Dropshipping occurs when a retailer does not keep an inventory of their products but instead works with a wholesaler who fulfills orders and ships directly to the customers.
Pros of Dropshipping
The dropshipping model appeals to many e-merchants in particular because it offers several advantages:
no stock management: no inventory, no worry
no large amount of capital needed: you purchase what you sell and you don't even need a physical location to work if you're alone
a greater range of products: suppliers often propose a wide range of products
no packaging and shipping: you don't have to worry about the packaging or the shipping since the suppliers take care of it
Cons of Dropshipping
Dropshipping also shows disadvantages:
lower margin: since you are buying one product at a time rather than placing a bulk order, the prices charged by wholesalers are not always favorable and you won't get special prices.
competition: a lot of online stores are already riding the dropshipping trend, so it can be difficult to stand out from stores that are already on the market
no quality control: you don't see the products you're selling (unless you order some items) so it can be difficult to check the quality of the goods
customer complaints: since you don't handle the packaging and shipping, you cannot control anything. So in the case where a customer is not happy, you'll be the one who receives complaints
Whatever you are a small or big business, you could easily enter the dropshipping game using a Magento solution.
Example
Below is a simple example of using the dropshipping model with Magento 2.
If you are on Magento < 2.3, you should use the Advanced Inventory extension.
Online sales & dropshipping with Magento > v2.3
"We have a store on Magento 2.4. We are selling products from a supplier. Customers can buy our products from our website directly. When a customer shops through our websites, we want stocks to be decreased in real-time to keep our inventory up to date."
If you're using the MSI module from Magento <= v2.3, you could use our MSI Suite to complete and enhance the default workflow:
Save time managing your inventory: handle the stocks for your supplier from the stocks grid and get a clear view of your products' availability in the tree view. You can even use the Mass Stock Update extension to easily and rapidly update all your inventory.
Make it clear for your customers: display a stock grid on your front-end product pages as well as specific stock status messages in different places: product page, cart, checkout, and order confirmation email.
Automate the order management: keep your stocks completely sync and automatically pre-allocate the orders after they are placed according to the algorithm you have selected.
Assign specific permissions to admin users: for example, don't let the wrong person see and handle stocks, orders, and products from your supplier.
Step 1 - Add your sources in your Magento back-office
The first step is to add your sources to your Magento back office.
You can do that manually or use the CSV import if you have loads of stores to add.
Step 2 - Link sources to stocks
Create your stocks and link each one with the appropriate websites and sources.
Step 3 - Schedule the update of each stock
Use the Mass Stock Update extension to keep all your stocks up to date.
Manually or automatically update all Magento stock attributes in one go through any CSV or XML files available from the Magento file system or any remote server through HTTP or FTP.
Tips: Ask your supplier for an updated URL to easily import or update the stocks of the products from a CSV file.
Step 4 - Send the orders to your supplier
When a customer makes a purchase on your website, you must place a duplicate order with your supplier.
Tips: In the case where you have loads of orders, you could use our Mass Order Export extension to automatically send the orders to your supplier.
Step 5 - Send the shipping information to your customers
Once the supplier has packed and shipped the products to your customer, you should update the status of the order and add the shipping information.
Tips: Integrate the updated order status file to your Magento store using Mass Order Update.
Manage your stocks in several warehouses and across all your POS. Automatically assign each order to one or several inventories. Create different stock levels for each store view. Give store managers the permissions to manage stocks of the POS/warehouses.
Mass Order Export allows you to create xml, csv and txt order files from your Magento admin panel and export them to any CRM application or order management software/platform. Any kind of export file types can be easily customized.
Mass Order Update allows you to massively update your orders from your Magento admin panel and via XML or CSV files imported manually or automatically from any order management software/platform.
Fully complete and enhance Magento 2 default workflow and perfect your inventory management as well as your selling process thanks to the MSI Suite to become a lot more productive.
If you're using the MSI module from Magento <= v2.3, you could use our MSI Suite to complete and enhance the default workflow: 
