If you own or manage an ecommerce business, dropshipping is a convenient way to sell online without maintaining actual inventory. You can simply list suppliers’ products on your website, and when a customer orders an item, it’s shipped directly by the supplier. With dropshipping, you can open an online store without worrying about inventory management or shipping formalities.
Although this business model reduces financial risks, it requires transparency and well-organized processes. For instance, you’ll have to stay up to date with your suppliers’ inventory levels as well as share accurate order details with them. Dropshipping software can automate and streamline these processes to help fulfill shipments from different suppliers, so your customers get their orders on time.
A wide range of dropshipping software tools are available on the market, so choosing the right one for your needs and budget can be time-consuming. To help you, we’ve created a buyers guide that has all the information you’ll need to narrow down your shortlist.
Here’s what we’ll cover:
What is dropshipping software?
Dropshipping software lets businesses automate the process of listing items online, receiving customer orders, and sharing details with suppliers to fulfill these orders. It streamlines supplier-business communication, so customer orders are processed, shipped, and delivered on time. The software also allows users to adjust product pricing and track the status of orders.
Most dropshipping software tools can integrate with ecommerce software to help align supply chain processes and provide a good shopping experience to customers. An integrated dropship tool can automatically source product details, such as item descriptions and pricing information, from the ecommerce platform.
Viewing status of customer orders and transactions in DiCentral (Source)
Common features of dropshipping software
Different vendors offer different features in their dropship automation software. Selecting software with the right features is easier when you know what the most common features are and what they do. Here’s a look at a few of those features.
||Create and issue purchase orders to suppliers while maintaining up-to-date product data and inventory details on your website.
||Track the status of orders, share updates with customers, and record all shipping details in the system.
|Product information management
||Create your own product descriptions, or import and edit product information from suppliers’ third-party websites.
||Create dedicated supplier profiles with information about products, product categories, delivery rates, and locations. Update these details on your website for customers to view.
||Manage interactions with multiple suppliers, and coordinate inventory and order data to ensure your ecommerce store doesn’t run out of stock.
|Customer service management
||Manage relationships with customers and address their issues, such as delayed delivery or product replacements. Customers can submit their queries, and you can then reach out to your suppliers to solve the problems.
What type of buyer are you?
Before you start evaluating dropshipping software options, you'll want to know which buyer category you belong to. Most buyers belong to one of the below categories.
- Small and midsize ecommerce business (up to 500 employees): These buyers usually don’t have a warehouse or delivery team of their own. Compared to large ecommerce companies, they work with fewer suppliers and thus have fewer customer orders. They’re on the lookout for a dropshipping tool that can help manage orders and track shipment details. A dropshipping platform with features such as order management, shipping tracker, and sourcing management would be suitable for such buyers.
- Large ecommerce stores (over 500 employees): These buyers may have a warehouse or delivery team along with distribution centers to collect items from different supplier locations. They have a large number of suppliers enrolled in their books and deal with multiple customer orders on a daily basis. Due to large order volumes, they also have to manage customer queries and service requests. These buyers should opt for a full-featured dropshipping tool for streamlined supplier management, order fulfillment, and customer service management processes.
Benefits of dropshipping software
While some benefits of dropshipping software may be clear from our discussion above, we've listed the most notable ones in this section.
- Conduct business from any location: Dropshipping software allows you to manage your online business from anywhere as long as you can find a supplier to deliver products to your customers’ location. The software doesn’t require you to be physically present near a customer or supplier location to conduct business. You only need to add supplier details into the system, and you’re ready to start taking orders.
- Sell multiple products: Most retail or online stores deal in a single category of products (e.g., apparel, skincare, footwear). But with dropshipping software, you can sell products from multiple categories—computers, mobiles, kitchen appliances, stationery, books, and more—without incurring huge upfront inventory costs. You can also add or delete product categories based on the availability of suppliers.
- Offer more seller options to customers: With dropshipping software, you can have multiple seller options for your customers. When a customer orders a product, the software routes the order to the most suitable supplier based on factors such as delivery speed or your profit margin. In case the supplier is out of stock, the software automatically reroutes the order to the next suitable dropshipping supplier on the list.
Key considerations when selecting dropshipping software
Below are two considerations you should keep in mind while buying dropshipping software.
- Mobile app availability: Check if the dropshipping software you're planning to buy offers mobile apps for iOS and Android devices, such as smartphones and tablets. With a mobile app, you'll be able to add or remove product offerings, edit or update product descriptions, track the delivery status, and receive payments even when you're on the move.
- Customer support: When shortlisting a tool, check if customer support is available via your preferred channels, such as email, phone, or live chat. While email support is typically free, phone support may incur additional charges. Likewise, training users on the software might cost extra. Also, ask vendors if their support channels are available 24/7, 24/5, or only during business hours.
Market trend to understand
Here's a recent trend in the dropshipping business market that you should be aware of:
- Increasing use of artificial intelligence (AI) in dropshipping businesses: AI is helping dropshipping businesses in various aspects, such as communicating with customers via AI chatbots, creating engaging marketing campaigns using predictive analytics, making personalized product recommendations for customers, and analyzing data to track visitors' website activities, browsing behaviors, etc.
Note: The application selected in this article is an example to show a feature in context and isn't intended as an endorsement or a recommendation. It has been obtained from sources believed to be reliable at the time of publication.