Introduction
In today's fast-paced ecommerce landscape, businesses must constantly adapt to remain competitive and meet growing customer expectations. With the increasing costs of real estate, managing warehouse labor, and fluctuating interest rates, many ecommerce businesses are finding it harder to maintain a traditional warehousing model. Moreover, customer demands are constantly evolving, making it easy to get stuck with unsold inventory. At the same time, the sheer number of suppliers in the market makes it nearly impossible to stock everything customers might want. With the "Amazon effect" driving high expectations for product variety, availability, and fast shipping, more businesses are considering a move to dropshipping as a smarter, more flexible solution.
Challenges of traditional eCommerce fulfillment
Traditional ecommerce businesses are forced to make significant commitments through lease obligations and warehouse payroll. Additionally, the capital liabilities required to store inventory, combined with a fast changing market make holding inventory a significant risk to any retailers balance sheet.
Benefits of migrating to dropship
By migrating to a dropshipping model, you can avoid the pitfalls of rising real estate costs and the complexities of warehouse management. You also free up capital that would otherwise be tied up in inventory, especially with high interest rates. Additionally, you gain the ability to offer a wider range of products without worrying about stock constraints, allowing you to better meet the dynamic needs of today’s customers.
In most cases, your suppliers are already selling online. This means they already have a process for order fulfillment in place, and you can cut down on costs by piggybacking on their fulfillment operations.
How to migrate from held inventory to a dropship strategy
Migrating an online store to use dropship fulfillment can be a challenge. Once you have an established store with an existing product database, different suppliers with various platforms, it can be difficult to wrangle all of the components together. Crowdship simplifies the migration process for any online retailer, with a suite of tools designs to make the transition as smooth as possible.
Migrating can be done in steps, ensuring each component is in place before you begin winding down your own warehouse operations.
1. Connect Your Online Store to Crowdship
The first step in the transition is to connect your ecommerce store—whether on Shopify, WooCommerce, Magento, or another platform—to Crowdship. Unlike other dropshipping networks that only connect with AliExpress and major retailers, Crowdship allows you to empower all of your existing suppliers to dropship directly for your store without interrupting their existing workflows.
The Crowdship platform helps you automate product listings, manage inventory in real time, and streamline order fulfillment—all without needing to hold physical stock.
To begin, install the Crowdship app from your ecommerce platform’s app store and follow the setup instructions to sync your store. Upon install, Crowdship will automatically import your entire product catalog, so that you can match each SKU up to the appropriate supplier product.
2. Invite Your Suppliers
Once your store is connected to Crowdship, invite your current suppliers to join the platform. They'll receive an email notification with a link to the Crowdship supplier platform. There, they can create an account, connect their own online store, import products, set prices, and approve you as an authorized retailer.
The Crowdship supplier dashboard is an all-in-one platform that supports order fulfillment, invoicing, inventory management and more.
3. Sell through your held inventory.
Now that your suppliers have set up their catalog, you're ready to connect your products -- but first, you'll probably want to sell through the stock you're already holding. As you sell out, rather than re-ordering from your supplier, you'll need to connect products to your suppliers in Crowdship
You'll collect cash for those sales, but unlike before, you won't have to reinvest it to buy more stock. By not replenishing your inventory, you gradually shift your business model away from warehousing and toward a dropshipping approach. Eventually, you'll be all out of inventory, and will need to decide what to do with all the money you're saving by closing or downsizing warehouse.
4. Connect each SKU to a supplier
Crowdship's "Sync by SKU" tool makes finding matches easy. It'll automatically detect SKU matches between your catalog and your suppliers, letting connect matches individually or in bulk.
This connection ensures that all new orders for connected inventory are fulfilled directly by the suppliers without requiring you to maintain physical stock. Crowdship will sync inventory levels, price changes, and keep your product listing attributes updated.
Orders for connected SKUs are automatically processed into purchase orders and synced directly to each supplier.
That's it! Suppliers will fulfill each order as it comes in, and Crowdship will pay them for each order shipped.
Conclusion
Migrating from warehousing to dropshipping can significantly enhance your ecommerce operations, making them more cost-effective, flexible, and responsive to customer demands. Some of the benefits you'll gain are:
- No Tied-Up Capital: Freed from the burden of buying inventory upfront, you can redirect capital to other growth initiatives like marketing or expanding your product line.
- Access to Millions of Products: With dropshipping, you can offer an extensive range of products without holding stock, meeting diverse customer demands quickly.
- Unlimited Product Selection: You are not limited by storage space or upfront purchasing costs, allowing you to offer more variants, colors, and sizes to customers.
- Reduced Overhead Costs: Dropshipping eliminates warehousing costs such as rent, utilities, and labor, reducing your overall expenses.
- Scalability: Your business can scale more easily and adapt to changes in customer demand without the limitations of physical inventory management.
By leveraging a platform like Crowdship, you'll enable your existing suppliers to dropship for your store, ensuring a smooth transition with minimal disruption. Follow these steps, and you’ll be well on your way to a more agile and scalable ecommerce business.
