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True or False: Dropshipping in inventory management technique eliminates the cost of holding inventory altogether.

This inventory management technique eliminates the cost of holding inventory altogether. When you have a dropshipping agreement, you can directly transfer customer orders and shipment details to your manufacturer or wholesaler, who then ships the goods directly to your customers. Thus you do not have to keep goods in stock, get to save on upfront inventory costs, and benefit from a positive cash flow cycle.

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Question ajoutée par Hany Helmy Haleem , Director of Warehouses , Nasco Automotive
Date de publication: 2015/03/08
Hany Helmy Haleem
par Hany Helmy Haleem , Director of Warehouses , Nasco Automotive

Drop shipping is a fulfillment model that allows you to buy products individually from a wholesaler and ship them directly to your customer.

Instead of purchasing a large amount of inventory, you simply partner with a drop shipping supplier and list their merchandise for sale. Then, once you receive an order you forward it to the supplier for fulfillment. The supplier will ship the product directly from their warehouse to your customer, and charge you only for the price of the shipped item.

Wasi Rahman Sheikh
par Wasi Rahman Sheikh , WAREHOUSE SUPERVISOR , AL MUTLAQ FURNITURE MFG

True<<<<<<<<<<<<<<<<<<<<<<<<Answer>>>>>>>>>>>>>

kwagala Ivan
par kwagala Ivan , Stores Manager , Kampala Executive Aviatiom

True and it requires little initial investment, has low operating expenses and offers flexibility. But there are challenges as well

Prabin Rai
par Prabin Rai , inventory officer , bijaya motor

It's called B2B and it's true 

Abdou warshan
par Abdou warshan , • مدير إدارة المخازن والنقل , شركة تمكين الدولية للأجهزة المنزلية

I am completely agree with Mr Hany

Archie Cunanan
par Archie Cunanan , LOGISTIC ADMINISTRATOR , ARCHIE MACAM CUNANAN

Yes, Dropshipping technique eliminates the cost of holding inventory altogether because having this agreement can directly transfer customer orders and shipment details to the manufacturer or wholesaler who directly ships the goods to customers.

Wellah Mae Gulmatico
par Wellah Mae Gulmatico , Senior Store Manager , Emirates Leisure Retail

TRUE.

Please see the below advantages of dropshipping:

Lower Capital Requirement: With drop shipping, you don’t need to invest thousands of dollars in inventory. Instead, you only purchase a product when you have an existing order to fill.

 

Wider Product Selection: When you don’t have to pre-purchase all the items you sell, you can offer a significantly larger number of products to your customers.

 

Reduced Risk: Without thousands invested in inventory, the risk involved with starting an online store is dramatically reduced. If things don’t work out, you aren’t stuck with thousands in inventory you have to sell at a loss.

 

Location Independence: Because you don’t have to worry about fulfillment or running a warehouse, it’s possible to run a drop shipping business from anywhere with a laptop and an internet connection.

 

Highly Scalable: Because you don’t need to manually fulfill each order, it’s relatively easy to scale a drop shipping business.

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