Dropshipping and DropServicing are very close words when spoken but their actual meaning is a lot different when we see them from a business perspective, So let’s dive deep and see what’s the exact business model and the difference between these two terms.
What is Dropshipping?
Dropshipping is an e-commerce business model where someone creates a website that lists products and when someone orders on the website, he forwards that order to the supplier and the supplier fulfills that order.
You see here the drop shipper acts as a middleman who takes some commission and sells the product to the customer. It can be anything from clothing, bags, and makeup kits to fashion watches.
Anyone can start dropshipping you just need some knowledge about website development and Facebook ads.
Also Read: How to Start a Small Clothing Business From Home
What is DropServicing?
DropServicing is a business model in which a person takes a project from clients on freelancing platforms or any other sources like cold email and outsources a freelancer to complete that project at a low cost.
To understand this with a simple example, You are a website developer and have your profile on freelancing platforms with good ratings. Since you are a freelancer you are most probably working alone.
Now, you have to apply for many projects together, and when you get the clients you can outsource freelancers who are willing to work at a lower cost than the actual client is paying. the difference is your profit margin.
This is not something new in the market, agencies have been doing this for years but for individual freelancers, this can be a good opportunity if they are thinking about expanding their business.
How Does Dropservicing Work?
Here are simple steps to understand how Dropservicing Works.
- You choose a niche like marketing, SEO, Web Development any industry.
- Get clients from Fiverr, Upwork, or Cold Emails.
- Now you have the project, hire a freelancer to do the same job at less cost.
- Freelancer works on the project and gets paid by you.
- Finally, you submit the project to the client after it’s finished and you get the actual amount.
- The difference is your profit margin.
Benefits of Dropservicing
Dropservicing is a low-effort business, Getting clients is the hardest part but once you have a strong profile you can get clients easily. This is a proper business model, not some trick to make money quickly.
You don’t need to set up extra office space, everything can be done from home, you just have to update Clint about the project every day and you can do it effortlessly.
You can scale this business to a company once you start getting enough projects and hire a manager to manage all the projects efficiently. Most of the agencies have been doing this for years. Usually, agencies pick projects from popular freelancing websites like Upwork and Fiverr.
Dropshipping Vs Dropservicing
I hope you have some idea about the differences between dropshipping and drop servicing business models, I will clear it up with some more examples and points.
Dropshipping is an E-commerce business where one person sells and the second person buys that product while Dropservicing is a service-based business where Clint gives you some projects like website development or app development and you outsource freelancers to complete that task.
Both businesses require skills in dropservicing you require basic knowledge of website development, sales funnels, and Ads management, while in dropservicing your skills depend on the project.
Problem with DropServicing
Today many influencers on YouTube and Instagram are spreading information that you can start an agency without any skills without having any skills bu using this drop-servicing business model.
According to them, you would just ask clients and they would give you thousands of dollars for the project without looking at your profile history which is complete bullshit.
DropServicing business is a highly competitive market because you are directly competing with the agencies and just ask yourself why would someone give you work when there are hundreds of people with work profiles applying for that job.
Which One is Best For you?
It depends on your skills, if you already have skills like sales, funnels, and running social media ads, Dropshipping can work for you but the problem with dropshipping today is that it’s over-saturated means everyone is talking about this business.
This means you have to spend more on running ads to get more sales which will result in declining your ROI. But if you already have an established audience where you can promote the product by spending a minimum on ads this business is best for you.
Suppose you are thinking about starting a drop-servicing business. In that case, you need to have a strong profile so that you can get projects easily, in the initial stage it’s hard to get the first client but once your profile is established you can grow your business exponentially.
Conclusion
Dropshipping and Dropservicing both have pros and cons and mostly depend on your skill set. which business you want to start depends on you. Both businesses are profitable if you are doing it the right way, there are people making money from Dropshipping even today. All you have to do is start.
