Dropshipping vs. Online Marketplace: Which Business is Profitable?

Jasmine

VIP Contributor
There are various ways to do online business, you can either dropship or sell through online marketplaces.

Dropshipping means you create your own store by buying domain, hosting and ecommerce management system, but do not spend money on products.

Selling via marketplace means you list your products on marketplaces like eBay, Amzon. Zazzle, Etsy and sell your products.

Between Dropshipping and online marketplace, which is profitable?

Selling from online marketplace cost less because you pay nominal listing fee or pay only when the product gets sold. However, in order to sell through online marketplace, you will have to spend money on products. If you want to dropship, you do not have to spend money on products but you will have to spend a lot of money in building your store.

Dropshipping can be expensive than selling via marketplace but you make more money as you do not have to pay commission.
 

Sotherefore

VIP Contributor
I believe dropshipping could be the most profitable especially if you have access to a large number of traffic because that will determine the profitability of any business. Both of them can be profitable but in a situation of large traffic I believe dropshipping will be the most profitable. It all depends on the one which you are interested on.
 

btaliat

VIP Contributor
My understanding of drop shipping is somehow different. I do believe that drop shipping involves someone else buying your products to sell based on his one price. But with your own definition, I will go for selling through market place as the better option because it will give access to more people
 

Mika

VIP Contributor
One of the major drawbacks of dropshipping is you need to build a brand before you can start selling. No one will buy from a random website, they will check the reputation before buying. Therefore, it is not easy to start selling through dropshipping. Therefore, selling on online marketplace can be better
 

laurentharp

New member
I believe you should choose one or the other based on your skills and based on which model you are most comfortable with. Everyone would have a different opinion.
 

Jasmine

VIP Contributor
Whether you are selling via online marketplace or doing dropshipping, the main skill you need is marketing, mainly digital marketing. You need the knowledge and skills to market on social sites, on search engines and also on blogs and websites. You can become successful only when you can market well.
 
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