Dropshipping vs Selling Your Own Product on Shopify
The shifts in the ecommerce world have been huge over the past few years. Platforms like Shopify have made it easy to set up your own online store in a matter of hours.
This phenomenon has made headways in two areas in particular: Dropshipping and small manufacturing.
On the one hand, you have businesses now that never even see their own products, just ordering from mass sellers like AliExpress directly to their customers. Most of the work comes down to finding the right product and then going ahead full speed with marketing. The massive world of dropshipping.
On the other hand, we now see small manufacturers avoiding resellers, retailers and wholesalers to go direct to consumers. And the trend here is not just down to Shopify. The reality is that consumers want to be much closer to the brands they purchase from, as mass sellers have become a toxic and impersonal blur.
But what if you’re thinking about selling on Shopify and don’t know where to go?
Well here are the main differences between the two approaches which can help inform your decision. Or if you already know, then you can see what’s happening on the other side of the pond and learn from it too!
1. The Product
Let’s go straight to the heart of the difference – the product.
On the one hand, we have dropshippers, who spend significant time before even starting their business to find the products they want to sell. There are a wide array of products being sold: mini air conditioners, shoe protectors, pet gloves, punching bags, and even scalp massagers.
Generally, they follow dropshipping trends and Google to see which products are on the rise. So once the right product is found it’s just a matter of marketing it the right way and selling in large volumes.
Product making businesses have the core difference here of well, making their own products. That means that a lot of their time is spent on manufacturing and working with their customers to gear the product to their needs.
The actual products they make could range from handcrafted skateboards to scented candles or leather handbags. Main point here is the focus on quality, rather than quantity.
2. The Operation
Okay so the product is one thing, and running a business is another.
On first look, it might well seem that dropshipping is the simpler of the two. You can set up tools which will automatically buy products from a third party to deliver to your customer once a sales order comes through Shopify.
But this does have the heightened risk of back ordering because your inventory is not in your control. That means that if a product suddenly spikes in demand due to competition then you might lose customers to late deliveries.
Of course, small manufacturers are also reliant on suppliers for materials but they can take a more sophisticated approach to Shopify inventory management.
They can use tools like Katana Smart Workshop Software to streamline their operations and make sure that deliveries are always on time, whilst also maintaining optimal inventory levels.
3. The Brand
Consumers of today feel tied up with the brands they buy from now more than ever. In fact, 64% of consumers say that shared values are the defining factor of a trusted relationship with a brand.
‘You are what you buy’ and all that jazz.
For dropshippers this can be a real mixed bag of news. If they are selling for established brands, then the work has usually been done for them. But if they are selling unknown products then it can be some hard work to get this trust. Creating valuable content and personalized recommendations for buyers can go a long way though.
For product making businesses this is a much clearer road. Establishing trust as the organization that manufactures the product means that you have control over everything: from sourcing materials to manufacturing processes.
It’s a lot easier to gain customers trust in this way.
And thankfully, there is a range of themes for Shopify that make building this brand image all the smoother.
Obviously, there are some fundamental differences between the two approaches when it comes to setting up on Shopify.
Not to mention that many entrepreneurs will be lacking the drive needed to create a product making business. There’s no doubt that it’s the more grueling route.
But it can ultimately be the more rewarding as well.
As consumers are being drawn closer and closer to the brands that make their products, it is likely that demand is going to keep increasing in this area.
Dropshippers are going to have to keep their foot on the gas if they want to make sure they don’t lose out.
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