Dropshipping vs. Print-to-order: What’s the difference?
As COVID continues to transform the way we work, many people are now exploring e-commerce to generate income. The opportunities are pretty endless as more people start to exclusively do their shopping online. The Canadian government has even partnered with Shopify to make it easier for Canadian entrepreneurs start an online business. You might have even seen ads on social media about working from the comfort of home and being your own boss with a dropshipping or print-on-demand store. Is it really that simple, and can anyone do it?
The answer is — yes and no.
Anyone can do it. The problem is that not everyone does it well. Much like any other business, the failure rate is high if you don’t take the time to do things carefully and with calculated risks. For every single aspiring e-commerce merchant out there, there are ten “authorities” that will tell you that they can guarantee you sales with a quick one-time payment. There’s no magic formula to online sales — everything I know I learned online — , but there is some truth to the statement that e-commerce is easier to get into than traditional retail, and here’s why.
Unlike traditional retail or e-commerce, you don’t need a lot of financing to get started. You don’t need a physical space or store, staff, or even inventory in some cases. That takes away a pretty major barrier to entry for folks who want to sell their products online. A brick and mortar location costs a lot more than a domain name and website. Many of the tools you need to do things like make sales and process payments are free, or take a cut from transactions so you don’t need to pay for them up-front. Oh, and with some exceptions, you can sell almost anything online.
Everything I’m sharing is based on personal experience, and forms that basis of the steps I took to hit and exceed my goal of 30 sales in the first 30 days of my online store.
Finding Stuff to Sell
Dropshipping and Print-to-Order are two e-commerce models that many people have found success with. They both differ greatly, and while I don’t claim to be an expert in either, I have enough experience to know why one worked better for me than the other.
The first thing to understand is that in this industry, there are three roles. You are either the customer (person who buys the item), the reseller (person who sells the item), and fulfilment partner (company who has the item and is responsible for shipping it).
Dropshipping and Print-to-Order (POD) have a few things in common:
- No minimum order quantities (MOQ). That means you can order one item at a time at reseller pricing instead of having to buy a bulk amount. A large retail chain like Wal-Mart has to buy thousands of a single SKU to sell an item.
- You don’t have to physically purchase any merchandise if you don’t want to, as it can be sent directly to your customer.
- All fulfillment, packaging, shipping and returns are typically handled by the fulfillment partner. No trips to the post office for you!
The key difference, however, is that dropshipping items have already been made, and are ready to send out. POD items have to be made after the customer orders them.
Dropshipping Summary
Dropshipping suppliers include AliExpress, Doba, Worldwide Brands, and Wholesale Central. These websites vary in the products they offer, where those products come from, and where you’re able to sell their products. Subscriptions can range from free to monthly and annual fees depending on the supplier marketplace.
Pros of Dropshipping
- From dog toys to hosiery, dropshipping suppliers usually have a massive range of productions and options.
- Most dropshipping suppliers are able to offer fairly low prices to resellers because the cost of labour in their countries (e.g. China, Vietnam, Bangladesh) is significantly lower than in Europe and North America.
- Dropshippers don’t require you to buy any merchandise in advance
- Dropshipping suppliers will mail your product directly to the customer without telling them how much it cost the reseller, and some will even white-label the products (e.g. use your logo and branding on them).
- Dropshipping suppliers typically provide product descriptions, details, photos, reviews, and other information you would need to set up a sales listing online
- Easy to get started; e-commerce platforms like Shopify runs dropshipping apps like Oberlo that make it very easy to start researching and adding products to your online store
Cons of Dropshipping
- Very long shipping times, which are exacerbated by COVID-19
- Variations in quality; because you never see the item, you won’t know what your customer is getting necessarily. Sometimes products do not meet safety hazard or chemical standards of the country they’re being shipped to.
- High level of competition in the space. For every person that claims to make a significant amount of money on a dropshipping platform, there are ten people who have given up after putting in many, many hours and dollars into launching.
- Limited customization of products, if available.
- If your customer doesn’t like the product or it never shows up, they’ll often hold you at fault, and you may be expected to provide a refund or risk a negative review (which can break an online business in the early days).
Print-to-Order (POD) Fulfillment
Popular print-to-order fulfillment partners include Printful, Printify, Art of Where, Subliminator, ArtsAdd, Society6, and Spoonflower.
Pros of Print-to-Order Fulfillment
- The easiest way to get your own art and ideas onto apparel. This is a great option for creative types.
- Decent selection of products — you can create your own clothing, socks, coasters, jewelry, blankets, wallpaper… the list is endless.
- If you don’t have artistic skills, there are plenty of ways to legally and ethically purchase art for commercial use online that you can put on apparel and products to sell. I’ll cover this in another article sometime.
- You don’t have to pre-order anything; your customers order from you and you transfer the order to the fulfillment partner. You pay your reseller rate when you submit the order, and keep the profit.
- You get to choose what to charge for the product, and you can receive discounted pricing on samples for yourself
- The ability to add your own labels, packaging and tags to your products
- Most POD companies offer a mock-up generator on their website that lets you see what the product would look like printed fairly accurately, which helps manage everyone’s expectations
- Integrates nicely with lots of online shopping platforms like WooCommerce and Shopify
Cons of Print-to-Order Fulfillment
- You need to have some artistic and technical skill to translate designs into clothing and other merchandise. It helps to understand the basics of seamless pattern design, vector vs. bitmap art, and digital resolution. I plan on releasing another article eventually about getting started with vector pattern design in Illustrator that should explain exactly how to do this.
- Shipping and fulfillment times aren’t always guaranteed, there are frequent delays depending on how busy your fulfillment partner is.
- Limited options for fabric types for apparel; many affordable fabric printing uses a technique called sublimation that can’t be done on 100% natural fabrics like cotton or wool. Embroidery is another option, but typically comes with its own technical requirements.
- Technical errors can happen, and sometimes you have to create duplicate orders depending on how well the fulfillment partner’s app integrates with your e-commerce platform, which can make managing sales and inventory a little bit tricky!
Summary
There are pros and cons to dropshipping and print-to-order as online e-commerce models. While both are easy and relatively cheap to get started with, it’s important to know where your strengths lie. Realistically, every new brand has to do a significant amount of marketing and customer acquisition online leading up to your first sale. That means having to put in a significant amount of time and eventually money towards promoting your brand and products using online marketing tools. You could have a brilliant product, but no one will buy it if they can’t find it.
While many people seem to think that e-commerce is one of those ‘set it and forget it’ business models, there’s a lot of work that goes into creating a successful e-commerce business. Whether you go the Dropshipping or Print-to-Order route, I advise that you put in the work, do the research, and be wary of anyone offering an instant formula or unrealistic return. Learn from your early customers, don’t be afraid to make a few mistakes, and adjust your products and marketing to match your vision and customer needs. If you have any questions, drop me a note!
