Dropship

What Is Reverse Dropshipping?

Have you heard anything about the term “reverse dropshipping” and how it works? Although drop shipping is getting more popular all over the world, shipping cheap goods from China to the US has become expensive after China began upping shipping costs. I know it seems crazy, while other countries have demand for cheap imported Chinese goods, Chinese people have demand for expensive imported high-quality American goods

This trend is happening because European and North American countries are implementing higher standards on their manufactured products and many wealthy Chinese people got tired of purchasing useless and unreliable goods in their country.

Definition of reverse drop-shipping

Reverse dropshipping is most frequently used to describe shipping high-quality USA-made items into China. However, it can be referred to any quality products made in Western countries being shipped to countries that are known for exporting, such as Japan, Taiwan, or South Korea.

After getting an order for the product you are dropshipping, you go to your dropshipping supplier and forward the order to them. Your supplier will proceed to ship the product directly to your customer.

What are the problems with reverse dropshipping?

In summary, reverse dropshipping has many advantages like a low level of competition and high demand for high-quality products. China is by far the top country in the world with the highest percentage of e-Commerce sales relative to retail sales. The next thing is that Chinese suppliers have many strict return policies, so returning an item is not be possible in most cases. But on the other hand, American or European dropshipping suppliers will offer good return policies to make returns easy for their customers.

On the other side, there are many barriers so many people refuse to start a business. The first thing is, Shipping products to China is logistically difficult and there are lots of limitations for non-Chinese people who want to work in the country. The second thing is the price & marketing. The sad fact is that only 1.5% of the Chinese population is wealthy enough to seek American goods so you must connect with an efficient network that can find true customers among more than 1.5 billion people. That means you also have to pay more for marketing and advertising so the final price for products will rise even more.

Is reverse dropshipping something we should try?

If you can speak Chinese or are willing to go through the effort to build the connections to make it work logistically then absolutely. Remember, although there are just a few percentages of wealthy people in China, if you multiply this number by the total Chinese population, you will find more than 20 million rich people who are willing to buy your products.

Conclusion

Reverse dropshipping is a relatively new business model that involves buying high-quality products in the US or Europe and selling them in China. As China continues to develop by exporting products to other countries, the demand will continue to increase for imported goods.

Although the government is trying to limit the import, if you are waiting for a nice opportunity for your business, this could be one of them.

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