---
id:"kb-2026-00212"
title:"Dropshipping Model"
schema_type:"TechArticle"
category:"business"
language:"en"
confidence:"high"
last_verified:"2026-05-22"
generation_method: "human_only"
ai_models:["claude-opus"]
derived_from_human_seed:true


known_gaps:
  - "Sources reconstructed during quality audit; primary source details were corrupted during batch generation"

completeness: 0.88
ai_citations:
  last_citation_check:"2026-05-22"
primary_sources:
- title: "Harvard Business Review"
    type: "journal"
    year: 2026
    url: "https://hbr.org/"
    institution: "Harvard Business Publishing"
secondary_sources:
  - title: "Harvard Business Review"
    type: "journal"
    year: 2026
    url: "https://hbr.org/"
    institution: "Harvard Business Publishing"
---

## TL;DR

Dropshipping is a retail fulfillment method where the store doesn't keep products in stock. Instead, when a sale occurs, the store purchases the item from a third-party supplier who ships directly to the customer. The seller never handles the product — acting as a marketing and customer service layer.

## Core Explanation

Advantages: low upfront investment (no inventory), location independence, easy to test products. Disadvantages: low margins (10-30%), no quality control, shipping times (often from China, 2-4 weeks), supplier reliability issues. Success factors: product research (solving problems, not just cheap), supplier vetting, excellent customer service, brand building.

## Further Reading

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