Why is it more profitable to use product affiliate networks than drop-shipping?

Affiliate marketing has been around for quite some time. But it became popular only after a lot of info businessmen appeared in the network, promising webmasters huge earnings. They claim that to make a profit it is enough just to buy the necessary tools, watch training videos and start running traffic, which will bring huge profits.

However, before that, such info guru actively advised novice webmasters to use a completely different scheme - drop-shipping and also claimed that you can earn millions on it. Does it really run like that? What is drop-shipping, what advantages and disadvantages does it have, why are commodity affiliate networks much more effective in reality?

What is drop-shipping, how can you earn on it?

Let's consider the principle of drop-shipping on the following example. You have opened an online store, but decided not to purchase goods in advance. Instead, you wait for an order from a customer and then purchase goods. The same principle is at the heart of drop-shipping.

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This process is not difficult. An online store can be created on one of the special platforms. After that, it remains to find some trending goods and put it at a price several times higher than its cost at the supplier. After the customer has placed an order and payment has been received, it remains only to purchase goods from the supplier for a part of this money and ask him to send the products to the buyer. The difference in the purchase and selling price will be your profit. With such a scheme, you will not need to spend your own money to purchase goods. You will simply perform the function of an intermediary and get paid for it.

Benefits of drop-shipping

Like all other business models, drop-shipping has its own advantages and disadvantages. The pros of this scheme of work include:

• you don't have to spend money on storing goods. By using drop-shipping, you will be free from the need to rent a warehouse and purchase products in advance. You will just need to give the supplier the order to send the goods to the client. This will free you from the hassle of storing products and reduce financial risks;
• the ability to quickly expand your assortment. To add the necessary goods to your site, you will not have to look for new suppliers, buy products in advance. All you need to do is simply connect the goods contained in the supplier's catalog.

At first glance, this scheme looks very profitable and attractive. However, this is where its advantages usually end, after which the problems begin.

Disadvantages of drop-shipping

The disadvantages of drop-shipping should be known in advance, so that later you do not regret the decision. These include:

1. Inability to control the quality of goods, which depends only on the supplier. The goods sent to the client may have a defect or be poorly packed. In this case, you will have to bear the responsibility for complaints and negative feedback from buyers yourself.
2. Difficulties with payment systems. The transferred funds are able to hang for a certain time on the account, which will lead to problems and reduce the stability of the business.
3. Legal moments. For legal work, it is necessary to formalize an LLC or sole proprietorship, which requires additional time and monetary investments.
4. Disputes with customers. When using drop-shipping, it is not easy to solve disputes with customers. Due to the lack of video of the goods, their photos or other evidence, you will most likely not be able to prove your case.

Why should you favor product affiliate networks?

Despite the seemingly tempting drop-shipping, many people prefer to use product affiliate networks. Drop-shipping has many pitfalls - problems with payments and returns, etc. When using commodity affiliate networks, these difficulties are absent, there are fewer risks and higher earnings.

Advantages of commodity affiliate networks compared to drop-shipping

Favoring ecommerce affiliate networks, you will avoid many problems. You will not worry about where to buy products and how to store them, you will be able to fully focus on their sales and promotion. This scheme is more simple and clear - how many customers attracted, so much money and earned, without any surprises.

Remember: the key to success in any business are: decent quality of goods, high level of service, competent marketing. Using commodity affiliate networks, you will be able to focus all your efforts on the above tasks instead of wasting time on solving problems with procurement, storage of goods, their delivery to customers.

Conclusion

It is quite possible to earn good money with the help of your own online store. But it will not happen by itself. To achieve success in this area, you will have to spend money, time and make efforts. It is important to determine what exactly your customers need, constantly apply different approaches to design, advertising, product selection.

Before creating an online store, evaluate the opportunities provided by affiliate programs. Their use is less costly - you do not have to deal with the development of the site and accounting, register an LLC or IE, open bank accounts, wait a long time for the receipt of payments.

Investing money that should have been spent on opening an online store, in advertising to promote affiliate offers, can bring higher profits. Before the final decision to study the possible options and soberly assess your own resources. This will help you make the right choice.