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by thewataccount
1284 days ago
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> I'd have thought for most B2C sales you'd hold inventory yourself (that's always been one thing putting me off starting an online shop). Not sure if this is what you're talking about, but drop shipping (you're a proxy store) and Print-On-Demand (you sell t-shirts but they're made and shipped to the customer by the order from a different company - again you're just a proxy) are very popular. There's less margin but you remove all of the cost/risk of logistics and inventory |
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Risk isn't removed, only externalized. In this case you externalize it to the manufacturer. They know this and are happy to take on the risk... for a price.
That's why the kind of post-facto bulk rebates pitched in GP make no sense.
The Big Big bulk discount the big guys get is the "real" price, and drop shippers get smaller/no discount because they have to pay at least part of the risk premium induced by the drop shipping business model.