Drop shipping is an order fulfillment strategy where products don't need to be inventoried in your warehouse. Instead, when an item is sold, it is purchased and shipped to the end customer directly from the vendor or manufacturer. Here are some cases where businesses might use drop shipping:
- They are purely an e-commerce store front and never carry stock.
- They are physically out of stock or running low.
- They sell rare items like seasonal products, one-off items or promotional products.
- The item is too big to inventory and it makes more sense to ship directly from the manufacturer (e.g. the steel industry).
- The vendor is geographically closer to the end customer and direct shipping will be faster and cheaper.
Watch this video to learn about drop shipping best practices and see how to accomplish them in SAP Business One. Here's a quick look at what's covered:
- Quickly define drop ship warehouses and items
- Automatically generate vendor Purchase Orders based on customer Sales Orders with drop ship items
- Drill down on drop ship reporting
- Useful drop ship tips and tricks