When it comes to running an ecommerce business, there are two popular fulfillment models to choose from: dropshipping and FBA (Fulfillment by Amazon). Depending on your business needs and goals, one may be more suitable than the other. Let’s take a closer look at each option to see which one is best for you.
Dropshipping is a fulfillment model where the store owner does not keep any inventory in stock. Instead, when a customer places an order, the store owner transfers the order information to the dropshipping supplier, who then ships the product directly to the customer.
- Low upfront costs
- Easy to set up
- Slow delivery times
- Less control over the quality of products
FBA stands for Fulfillment by Amazon. With FBA, you can store your products in Amazon’s fulfillment centers and they will handle all fulfillment and customer service for you. When a customer orders one of your products, Amazon will pick, pack, and ship the item to the customer.
- Fast delivery times
- Amazon handles all fulfillment and customer service
- Your listings will get the Prime Shipping badge
- Higher upfront costs
- You have to abide by Amazon’s rules and regulations
Which One is Better?
Ultimately, it depends on your business needs and goals. If you want to focus on offering fast delivery times and excellent customer service, then FBA is the way to go. However, if you’re just starting out and want to save on upfront costs, then dropshipping may be the better option.