Niche-dropshipping?

**Bookworm** · 11-10-2006 12:44 PM

Is a niche like a way to get something cheaper or to make more money? Also what is dropshipping... All help is appreciated

~bookworm

**Mad Muppet** · 11-10-2006 12:57 PM

niche is referring to niche markets, they are typically smaller more targetted markets which are ignored by mainstream, mass market which is the opposite of niche where there is higher demand, smaller profit margin meaning they need to sell is mass to make profit, a niche market is a low demand but very high profit margin market that has been overseen or neglected by other companies, with higher profit margins means company need to sell less to make large profits.

Ill try and give examples, mass market product = mp3 players, tough market with high demand, and sales and low profit margins. Niche market product = bmx when it was first released. People will have different views on which is better both can be profitable you just need to decide whats right for you.

Dropshipping is where you dont hold any stock it is hold by the supplier who ships the products straight to the customers, the profit margin is less than wholesale because costs are added by the dropshipper for package and shipping. Dropshipping is a popular option for start up business as it requires low capital and general has low risk.

Sorry if i havent explained it very well but im tired :P

**Bookworm** · 11-10-2006 01:02 PM

No, thats a great explanation for me

... Thank you for your help. 1 more ? to anybody. What does low capital mean?

**Mad Muppet** · 11-10-2006 01:33 PM

capital is the business term for money, so it means the money a business or individual has. What i ment by low capital is that you dont need to pay for all the products like if you used wholesale, If you want to start a ecommerce site up selling dropshipped items than you could do it with very little capital because you could set it all up with £20 (domain name, free template and web hosting).

**Bookworm** · 11-10-2006 08:13 PM

Ok thank you... Im guessing that at the end of every shipping I would pay the total ammount? Once I have paid the company the rest would be profit?

**Mad Muppet** · 11-12-2006 08:49 AM

the customer pay you, you pay supplier and give shipping details. the profit is made from what you get from customer and what you give to the suplpier.