Many people are looking for alternatives to dropshipping.
Some people might be worried that dropshipping is saturated. Others might be looking for a more reliable online business model and may have a higher chance of success than dropshipping.
So, what is similar to dropshipping? What are some alternatives that you can try instead?
This article will give you eight examples of other business models that you can use instead of dropshipping!
8 Alternative online business models to try instead of dropshipping
Let's start with some alternative business models that are the most similar to “traditional” dropshipping.
As we go down the list, the business model will vary more and more, but they may still be worth trying!
1. Print on demand (POD)
We will assume that you already know how dropshipping works (but if not, click here!).
If you are looking for a dropshipping alternative that most closely resembles dropshipping itself, you should look at print on demand (POD).
Print on demand is a fulfillment model that allows sellers to design graphics for products. Once a seller receives an order, a manufacturer will “print” the designed graphics on the product and ship it to the customer.
Here is how it works:
Products sold on POD stores are often apparel such as shirts and hoodies. But you can also sell products like mugs, towels, art prints, phone cases, and even notebooks or mousepads!
|A print on demand store is easy to set up.||POD businesses generally struggle with low profit margins.|
|There are little upkeep costs needed to keep your business running.||It can be more challenging to deal with returns as the product is custom-made.|
|You don't have to invest in an inventory.||Your store is only as good as your designs.|
|Often, you don't have full control over the complete look of the product.|
If you are an artist or graphic designer and would like to learn more about the print on demand business model, take a look at the following articles:
- What Is Print on Demand: An Ultimate Beginner’s Guide (2023)
- Is Print on Demand Still Profitable Today in 2023?
- 15 Best Print on Demand Companies and Suppliers
2. Dropshipping with private agents
Like print on demand, dropshipping with private agents is a business model that is very similar to “traditional” dropshipping.
If you are looking for a dropshipping alternative because you are done with dropshipping suppliers that:
- Take ages to get the product to the customer
- Can't seem to offer high-quality products for a good price
- Don't offer any branding options for your product
Then you should definitely look into using private agents (a.k.a. dropshipping agents)!
A dropshipping agent is an alternative to a dropshipping supplier. It’s a person that sources your desired product by finding the best supplier for it. Then, they ensure that the product is stored, packed, and quickly shipped to your customers once orders start rolling in!
Let's check out the most important pros and cons of dropshipping with a private agent:
|Dropshipping agents can offer high-quality products for a lower price.||Some agents require you to have a minimum number of orders per day.|
|You will be able to achieve faster shipping times.||A fully automated order processing system will not always be present.|
|You will have 1-on-1 contact with your agent for quick support in case of any problems.||Trustworthiness is more of an issue.|
|A dropshipping agent can help with branding your store.|
|A dropshipping agent offers more consistent product pricing.|
Ready to learn more about dropshipping agents? If so, check out these articles:
- What Is a Dropshipping Agent? (And Do You Need One in 2023?)
- The 11 Best Dropshipping Agents to Grow Your Store in 2023
3. White labeling (or private labeling)
One of the cons of regular dropshipping is that it's often tricky to get logos on your product and build a genuine, long-term brand.
White labeling and private labeling allow you to sell products marked with your company’s brand. This can be done by putting your company’s logo on the product and packaging.
White label products are generic products manufactured by a supplier that are rebranded for multiple brands. In contrast, for private label products, no other brands can sell that exact same product.
Let's take a look at the pros and cons of white labeling:
|Brand the products you sell to increase their perceived value.||It's not as easy to start as a regular dropshipping business.|
|The competition will be less of a worry since no one will sell the exact same product.||Non-branded dropshipping products are cheaper to buy.|
|Your product's branding will positively affect your business' customer loyalty.||Many white or private label products require a minimum order quantity.|
Want to know more about white labeling or private labeling? If so, these articles will help you:
- 11 Great White Label Product Examples to Sell Online in 2023
- How to Get Started With Private Label Dropshipping (5 Steps)
4. In-house fulfillment
If you missed a feeling of control over the fulfillment process of your dropshipping store, then the in-house fulfillment model may be a great dropshipping alternative for you.
As you know, dropshipping involves working with a supplier that manages the storing, packing, and shipping part of the fulfillment process:
By choosing the in-house fulfillment model for your ecommerce store, you will take over those tasks. This means that you will have to make sure that your store has enough inventory and that once you get an order, those products will be packed and shipped to your customer.
As the name of in-house fulfillment implies, you can literally do this by keeping an inventory in your own house.
An alternative is to contact a third-party logistics (3PL) company. This way, you can send your inventory to them, and they will automatically take care of the packing and shipping for you!
|You will have more control over the fulfillment process. No more sudden delays or out-of-stock items!||Taking care of the fulfillment process yourself takes time, and outsourcing it to a 3PL company can lower your profit margins.|
|In-house fulfillment is an excellent opportunity to use custom packaging.||In-house fulfillment can distract you from other important tasks like marketing and customer service.|
|You will gain more experience with the whole fulfillment process of an ecommerce store.||If something goes wrong with your store's fulfillment, you are responsible.|
Although we don't have any articles published about in-house fulfillment, we believe these will help you to improve your ecommerce store:
- The 5 Best Platforms for Your Ecommerce Store in 2023
- The 8 Best Email Marketing Services for Ecommerce in 2023
5. Drop servicing
Next up on this list; drop servicing!
Drop servicing is an online business model that involves selling a service to a client of yours and then hiring someone else to do that service for your client at a lower price.
So, let's say you are designing logos for ecommerce stores. An online store owner may approach you with the request to design a logo for him for $50.
Once the freelancer is finished, you can deliver the logo to your initial client and keep the $30 difference as a profit!
Besides creating logos, drop servicing can be done with services like social media management, virtual agent services, video production, copywriting, and more!
|As you don't spend time on the service yourself, drop servicing allows you to scale your business to a usually unreachable level.||You don't have complete control over the quality of the service as you don't do it yourself.|
|Like a dropshipping store, a drop servicing business is not hard or expensive to set up.||You should ask yourself if it's ethical to do drop servicing if your client thinks you are doing the service yourself.|
|It may be hard to get your first clients as you won't have any reputation at the start.|
For more information about drop servicing, check out this dropshipping vs. drop servicing comparison guide!
6. Affiliate marketing
We have now reached the dropshipping alternatives that are so far off from regular dropshipping that we don't have any articles published about them on Do Dropshipping.
But don't worry, we will still do our best to provide an excellent overview for them and guide you in the right direction if you would like to learn more!
Have you ever clicked on a link for a product or service from a blog, social network, or someone's website?
Well, it was likely an affiliate link!
Affiliate marketing is a business model that generates revenue by using affiliate links. These are your own custom links that link to someone else's product or service. Once someone clicks on your link and buys that product or service, you receive a part of that revenue.
And it's really that big of a business.
According to statistics, affiliate marketing accounts for 7.5% of the total digital spend for retailers, and 81% of brands use affiliate marketing programs!
If you want to get started with affiliate marketing, there are several channels you can use to promote your affiliate links.
For example, you could start a blog around a niche you are interested in, like tennis. Then, you can write an article like “The best tennis rackets to use in 2023” and add affiliate links to Amazon product pages for each one of them!
Or, if you have a significant following on social media, you can start doing influencer marketing campaigns to promote products for ecommerce brands.
|After the initial hard work of setting up your affiliate marketing channels, this business model can turn into a passive income.||You will need to respect the terms and conditions of the affiliate marketing program you are working with.|
|You don't have to think about customer support.||You won't establish a loyal customer base.|
|Starting an affiliate marketing business does not require a significant upfront investment.|
Here's another great infographic for more information about how affiliate marketing works:
Tip: You can also use affiliate marketing as an ecommerce store owner. Check out this article to learn more!
As you may have guessed, this is the online business model that Richard, the creator of Do Dropshipping, has chosen!
Blogging is the act of starting a website (a blog) that publishes articles based on a particular topic of interest. The goal of a blog is to help your readers with whatever they are looking for.
If you think you would enjoy writing about a topic that interests you and will make people happy by helping them, then starting a blog could be something for you!
Now, you might ask: “But all articles on a blog are free to read, so how can you make money with it?”
Well, let me tell you.
Blogs mainly make money by displaying ads and by using affiliate marketing. So, each time you see an advertisement on a blog or use an affiliate link posted on a blog article, the blog owner may get some money for it!
|It is fun to start a blog if you enjoy researching and writing about your topic of interest.||A good blog requires a lot of hard work and regular updates.|
|Starting a blog requires little upfront cash.||It can take quite some time before you start making a significant amount of money.|
|You can establish yourself as an expert in your niche.|
8. Online freelancing
If you are good at a particular skill and are looking for a dropshipping alternative in which you are directly rewarded for your efforts, online freelancing might be the right choice for you.
Online freelancing works by performing services for others who don't have the time or skills to carry them out themselves. Online freelancers can earn some extra income from home by taking on jobs with only an internet connection required.
As you can see from the image above, the jobs you can do as an online freelancer vary greatly.
Everyday work done by online freelancers includes graphic design, article writing, programming, translation, data entry, and more.
|As an online freelancer, you can control your schedule.||To start with online freelancing, you need a “sellable” skill that you are also good at.|
|Generally, freelancers earn more for their work compared to if they were working on payroll.||There is no certainty that a client will order a job from you again.|
|You can choose who you work with.|
|As opposed to starting your own online business, online freelancing allows you to get rewarded for your work directly and without risks.|
Why should you start your own online business instead of working for someone else?
If you are interested in what is similar to dropshipping, you might be thinking about starting your own online business.
And that is great!
Starting your own online business can be a bit scary, but it offers a lot of perks!
When working on your own online business, you will always get the ultimate reward for your efforts.
Therefore, you may notice that your motivation levels will be much higher, as you will not be working with a boss that may not reward you if you work harder than everyone else.
Another incredible perk is that you will be able to control your lifestyle and schedule.
Often when starting an online business, the only things you will really need are a laptop and an internet connection. Therefore, you will be able to work from anywhere in the world and choose your own working schedule!
Last but not least, the income you will earn will not be capped by any corporate salary range.
For example, if you get more orders for your print on demand business, you can simply order more products from your print on demand suppliers, and in the end, earn more money!
4 Tips for success when starting your own online business
When you decide to take the leap and start your own online business, there are a couple of things you should never forget.
If you can manage to live by the following four tips, your chances of creating a successful online business will increase significantly!
1. Know that an online business is still a real business
One of the first things you should do is treat your online business as a real business (because it is!).
For example, starting an ecommerce store requires you to learn different things (or hire people for it) like digital marketing, web design, copywriting, etc.
But the thing that you need to understand is that starting an ecommerce store or any other online business is like starting a real business.
You will need to spend a lot of time optimizing everything, managing your cashflows, and creating marketing strategies. All of this is required to make a fantastic experience for your store visitors or clients!
The thing is that an online business is often very easy to start, but it's thereby also very easy to quit. Therefore, it's tempting to simply stop if you don't see the results you initially expected.
An online business is often very easy to start, but it's thereby also very easy to quit.
So, remember to stay consistent, treat it like a real business, and you will see that things will get better!
2. All information you need can be found online for free
When you are thinking about or have just started doing one of the online business models outlined above, you may be targeted by so-called “gurus” who claim they can teach you the “secrets” of the business model and guarantee you success.
The truth is, most of the information in paid courses is recycled from either another course or from any blogs or YouTube videos on the internet.
People selling these courses lure you in with the things like their fancy cars, saying that it will be easy, showing their (un)biased reviews, or even fake income screenshots.
Purchasing a dropshipping course is like purchasing a second-hand book with a 10x markup (meaning: it is sold at 10 times the original price).
Just take your time with the research, and you will see that you can find everything you need online for free!
3. Be prepared to learn from your mistakes
This one is straightforward. Not only will you have to accept that you will make mistakes, but you also need to be prepared to learn from them, too.
Take, as an example, this blog.
Several mistakes were made while creating this blog, from choosing the wrong hosting company to not “collecting” email addresses from the beginning (to get people to return to your website).
But it’s great to make mistakes because you learn from them. And if you don’t take it from us, take it from this amazing quote:
I hope that in this year to come, you make mistakes.
Because if you are making mistakes, then you are making new things, trying new things, learning, living, pushing yourself, changing your world. You’re doing things you’ve never done before, and more importantly, you’re doing something.NEIL GAIMAN
4. Don't expect to get rich quick
Last but not least, don't expect to get rich quickly.
In the beginning, the progress of your online business is likely to be pretty slow as you are learning new things. As mentioned above, you are likely to make mistakes, and you won't earn a lot of money (it's actually common to lose money in this period).
Let's take dropshipping as an example. Dropshipping isn't some magic way to earn thousands of dollars online.
It's just a business model that allows companies to sell products without purchasing them in bulk for their inventories.
This is great if you are not sure yet if your product will sell. But it doesn't mean that you will get rich quickly with it!
There you go!
In this post, you have seen eight alternative business models that are similar to dropshipping.
We feel like it's safe to say that most online businesses that are started today will use dropshipping or any of these eight business models!
And that is not because they will make you the most money out of any other business model but because they are proven to work.
Which one was your favorite? Let us know in the comments below!
Have a great rest of your day!