Hi guys, I am just wondering if anyone can compare from their experience the profit margins of dropshipping vs affiliate programs. And when I say dropshipping I mean from suppliers that are known to a large audience (e.g. worldwidebrands list). The large audience will reduce the margins by the virtue of everyone selling from the same suppliers.
The problem is that whatever google gives you on dropshippers is junk (i.e. middleman, not real dropshippers). From the information that I've seen on the WWB list of dropshippers, you can get a margin of 20-30% on some products. I haven't dealt with an affiliate program yet, so I don't know what kind of margins to expect there. I am just wondering whether dropshipping is worth it, if an affliliate program can provide margins that are comparable.
When I first decided to do business onine I wanted to do a dropshipping program. There are a couple of drawbacks. 1. A lot of them are not really wholesalers. No matter what I looked into selling, I could not even come close to the pricing of major retailers. The price that the "wholesalers" were charging me was less than competitors were retailing the merchandise for. Most people online like to comparison shop, and unless you find some really really small niche, you'll have a problem moving a lot of the merchandise I think. 2 Because many of those places advertise heavily, there were a lot of people selling the same merchandise on all the familiar places like ebay, ubid, etc. Profit margins were minimal there. 3. You are not in control of shipping, but you are responsible to the customer because you in fact have their money. I think, if you can find an effective way to market the items, and find a "real" dropshipper and not some online company just claiming to be you might do okay.