Drop Shipping – Why Its Popular
Supply chain management services such as AIT’s drop ship program is a fantastic way to get products to customers quickly. Applied Innovative Technologies (AIT) provides drop ship services to our customers as a way of supporting mutual business success. As an importer and distributor our supply chain role includes coordination with factories that manufacture merchandise based upon defined production schedules, logistics management of merchandise importation via ocean (in most cases) and overland transportation and management of warehouse operations including inventory control, packing supplies, shipping and handling.
An advantage of the AIT drop ship program is retailers do not need to manage inventory, which is a significant cost burden. Increasingly retailers large and small take advantage of drop ship programs that allow retailers to diversify their merchandise portfolio, improve cash flow and use operating capital for marketing and other expenses. From a bookkeeping perspective drop shipping eliminates the issues associated with FIFO or LIFO inventory control.
Often time’s retailers use a private label system of packing slips and invoices to keep the focus of the customer transaction on their company. There are several rationales for this behavior two of which are to manage competitive pressure and to promote a customer shopping experience that is unique to that company, which also includes a variety of customer service actions and responsibilities.
Many online retailers, which include brick and mortar businesses and catalog companies, take advantage of drop ship programs. Major online players such as EBay and Amazon.com have rewritten the map regarding online shopping that uses a drop ship program with more retailers entering the market daily. With significant growth in eCommerce this trend will continue. Evidence of this is the number of transactions now taking place over mobile devices and the general rise is online purchasing.
To learn more about how AIT can support your business via our drop ship program please Contact us.