When it comes to starting an online business there are two main options available at present. Those two are drop shipping and drop servicing. But many people tend to think that these two have the same procedure and characteristics when compared to each other. The truth is drop servicing is kind of different from drop shipping and it has a bunch of benefits when compared to drop shipping. Therefore, the following article is about the main differences between drop shipping and drop servicing.
- Products
The main difference between drop shipping and drop servicing is, that in drop servicing, you sell an intangible digital product. But when it comes to dropping shipping you have to sell a physical product most of the time.
- Flexibility
When compared to drop shipping, drop servicing is more flexible and easier. And also it is very straightforward than drop shipping. Drop shipping requires more time and attention but drop servicing it’s completely different. Even though people tend to go for drop shipping at present as same as they choose drop servicing, there can be some difficulties in dropshipping. This can happen especially if you are planning to do it in the long term. But, on the other hand, drop servicing is ideal for both the short and long term.
- Profitability
In drop servicing, you can expect a higher profitability level than drop servicing. Over the past few years, entrepreneurs have been earning a lot with drop shipping as that was one of the major online earning platforms and there were not that many people involved in that business as it was new to the market back then. But at present many people are already in the business and the competition is very high among them. So people tend to provide their service for a lower price in aim to achieve customers. In this situation, you cannot expect a good profit by doing drop shipping.
But when it comes to dropping servicing It’s a brand new business model that has substantial potential financial gain and could be highly fruitful and profitable as it is new to the market and has a lower usage level compared to drop shipping.
- Shipping
In dropshipping, you have to consider shipping sometimes. Especially when you drop ship an item from China to the US the costs, duration, and other situations should be considered in dropshipping. In dropshipping sometimes it takes a lot of time for customers to receive their orders.
Apart from that in drop shipping, you have to keep following up with customers and provide the tracking information as well.
But in drop servicing, you are selling an intangible product or a digital service. So that you can simply send it by using an online method and you don’t have to consider a shipping method at all. The other thing is in drop servicing you can send your service to the customer as soon as you received it from the freelancer or your working team. And in drop shipping, you have to wait till the site-owning company ships it to your customer.
- Competition
In dropshipping you will have to face tough competition as a lot of people are engaged with it at present. So the competition level in drop shipping is quite high when compared to drop servicing.
But in drop servicing, you will have less completion because it is kind of new to the market yet. And also many more websites are being created daily so that you can have more opportunities and customers daily to use in your business.
- Overhead
When compared to drop servicing, dropshipping requires a lot of overhead. In dropshipping, you may need to use some tools, apps, and some kind of a professional theme to make the process smoother and more licensed.
In drop servicing, your overheads and costs are very limited. You can directly mention your requirement and contact the customers and freelancers. To do this all you may need is a sale page where you can showcase your service.
- Order delivery
When it comes to ordering delivery you have to go through a 4-7 shipping period in dropshipping. This can be different and more extended when it comes to international orders.
In drop servicing the order, delivery can be from as low as 24 hours or as soon as you received the work from the freelancer. And you can simply send it over the internet
- Skills
To start over in a drop shipping business you may need some sort of skills such as writing descriptions, adding information to the product, and more. But when it comes to dropping servicing you only need a few skills to start it up. If you have the language knowledge and literacy, then you can easily set up and execute a drop servicing business. In drop servicing, you don’t do any task requested by the customer. You only have to convey it to the freelancer that you are going to hire.
- The B2B and B2C difference
Drop shipping is B2C. That means business to consumers. Here a drop shipper contacts the customer most of the time.
And Drop servicing is B2B. That means business to business. Sometimes there are some exceptions to this, but most of the time we consider drop servicing for businesses and drop shipping for customers.
- Risk involved
Drop shipping can be a bit riskier sometimes as it requires a bit more resources, apps, overheads, and more. And sometimes if you are planning to do your drop shipping business on a big scale, you might need to order a sample of the products you are willing to sell to make sure of the quality of the product. On the other hand, in the drop servicing business, you don’t have to go through that kind of procedure as you are selling an intangible product you can simply check the quality of the product by checking it instantly over the internet.