Daring zero stock, a revolution originally industrial, has spread in a dazzling way with the appearance of new technologies which have made it possible to apply this method on e-commerce sites. It requires anticipation of all market fluctuations and sometimes puts companies in difficulty.
This just-in-time production management, developed by Toyota in the 1960s with its 5-zeros doctrine, has established itself in much of the industry. Traditional distribution, too, strives to considerably limit its stocks by arbitrating according to sales forecasts: reserves can generally only meet the needs of the days to come, at best weeks.
Online sales are freed from the constraints to which physical stores are subject. It is now quite possible to launch an e-commerce site without any stock and to perpetuate its activity over time. A start-up can thus launch its online sales project by allocating its resources to innovation and communication, without tying up cash.
Drop shipping: from supplier to consumer
A store with empty shelves like a commercial site offering only unavailable products is likely to experience a turnover at half mast. But building up the necessary inventory to provide sufficient choice ties up valuable resources and even threatens the cash flow and financial health of a business.
Thanks to Direct delivery, an online store is free from any direct management of its stocks. Shipments to customers are in fact made directly by the supplier based on orders placed on your site. Drop shipping simply means drop shipping.
The relationship between the merchant site and the supplier can be more or less developed:
- The sending is sometimes anonymous, with a standardized package that does not include the name or contact details of the merchant. This solution, known as blind shipping, should be avoided. The customer experience is indeed doubly degraded: no information relates the package to the site where the order was placed, and the absence of a return address constitutes a pitfall in the event of withdrawal or exchange.
- Shipping can be customized, the supplier then specifies the name and return address and includes the invoice or any other document provided by the merchant. With private label shipping, consumers no longer necessarily realize that their package has been sent directly by the supplier: the use of drop shipping becomes more transparent for the buyer.
- An external logistics platform can also be entrusted with the management of shipments., as well as the consideration of returns and exchanges. With this solution, called full fulfillment in English, the merchant is in contact with a single point of contact who can manage many suppliers.
If you are tempted by drop shipping, you can select the suppliers that interest you yourself or work with specialized platforms such as Ecopresto.com, one of the French leaders in its field.
Gain visibility, commercial and prospective animation
Thanks to drop shipping, an online store can virtually offer as many references as it wants. The advantage in terms of natural referencing on Google is essential: more references lead to more pages and keywords and therefore implicitly a greater volume of expressions positioned on Google! However, it could be risky to completely lose the identity conferred by a relevant range strategy. Indeed, transforming a site positioned on a clearly identified market, for which it has acquired the legitimacy of a specialist, into a virtual bazaar, would be counterproductive.
You can use drop shipping to expand your existing range, and through this offer new references that will complement your catalog in the long term or participate in your commercial animation: it becomes easy to highlight different items according to consumer expectations, trends or seasons. Being able to sell new references without stock is also ideal for testing new markets and new product ranges without significant investments.
If drop shipping proves to be valuable to merchants present only on the Internet, it can also participate in a development strategy for online stores backed by a physical store: a brand such as Fashion Galerie, present online with its website fashiongaleriestore.fr, can thus order items in the dropper in the spring, such as beach bags, offer them on the shelves and online and stock up in real time for each new sale.
Launch your own marketplace: and why not?
Many online stores open their pages to third-party sellers, usually for a subscription and a commission on sales. The sellers benefit from the notoriety and professionalism of the site which welcomes them and makes its customer support available to them. As for the marketplace? It multiplies the references inexpensively since it no longer has to build up stocks to sell more and more references! A marketplace represents a real key factor of success: according to the figures published by the FEVAD (Federation E-commerce and Distance Selling) in 2018, marketplaces like Amazon or Cdiscount continue to share the share of the pie, leaving only very little room for smaller sites. However, we note that online purchases are increasingly involved in sales in traditional stores, especially relay points.
A marketplace is a convincing business model to start selling online. Third-party sellers can be both professionals and individuals: originally an auction site between consumers with a CtoC approach, Ebay.fr has become a real CtoC and BtoC marketplace. To succeed in your market place, it is better to define a differentiating positioning, such as dawanda.com etalittlemarket.com which, for example, rely on original creations.
An e-commerce site without stock: yes, but why?
Launching an e-commerce activity without stock is not an end but an alternative among others. Miracle solutions do not exist and drop shipping as well as marketplaces also have their limits. In the case of drop shipping, the margins are for example reduced because the supplier passes on the cost of the uncertainty: he does not know in advance the volumes that will be purchased by the online store. Regarding marketplaces, the challenge is twofold in terms of communication: to seduce both sellers and buyers. The balance between supply and demand is proving difficult to find, especially in the start-up phase: too few merchants and consumers will not be there, but a marketplace without customers is also likely to discourage sellers.
These two non-stock sales solutions must remain at the service of an innovative idea and a strong economic model. If they can play a powerful role of levers and open new horizons by opportunity, they will be useless and will even constitute dangerous mirages without any real project to support.