[thwayunion]

> There's less margin but you remove all of the cost/risk of logistics and inventory

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.