What is drop servicing ? Is Drop shipping and drop servicing are same ?
Answer is yes and no both.
Though the concept for both are same. In drop shipping you would book physical product from somebody else and sell it to customers with all the logistics involved.
whereas in drop servicing it is selling a service to a customer for a certain price (say $50). Then hiring someone else to provide the service for the client at a lower price ($20), and this way You can make profits.
Drop servicing is also known as “service arbitrage.” You can arbitrage the price difference client and the the person you are getting the work done.
How Drop Servicing works ?
It is very much simple process. Just take an example.
Say you got a client who wants to get video editing done from you and he is willing to pay you $100 which you quoted him. Now you will find a freelancer or any video editor who can do this job in less than $100, keeping your margins in mind. Now if you got a freelancer who does this editing done in $50, you will make profit of $50.
No rocket science, Isn’t it ?
What you can drop service ?
No Restrictions. You can drop service anything which is in demand and solve the need of the customer. But question is that is it good idea that you drop service everything ?
The answer is ‘NO’ at least in initial stage
It is not necessary that you need a in-depth knowledge of the service because you are not doing at your own but It is always best to drop service which you have some knowledge or interest. So that if something goes wrong or any dispute comes you should be able to understand the problem.
There are some good niches you can start drop service
- Blog writing
- Web Designing
- E-commerce website
- Video Editing
- Graphic designing
- Photo editing
- Voice over
And the list goes on..
Best way to identify the customer behaviour and his need and of course your interest in solving that need.
Where to outsource Drop Service ?
There are many websites where you can contact freelancers who can get the work done for you. Just to name few –
Check the best gig, ratings, delivery time, and other important source of information which you can easily get from these places.
You need to choose carefully in finalizing the freelancers because for your customer you are the point of contact and known face. If they don’t like the service, it will be a spoiler for your image.
Pros and Cons
- Very low start up cost
- High sales volume
- Recurring income
- No special skill set needed
- Can be done from anywhere from you laptop
- Freelancers can delay because of many orders.
- No full control on the service as you yourself are not doing the work.
How much it Cost to start Drop shipping business ?
Well, it depends on how do you want to start ? But as a start for a beginner it can be started in very minimal cost . What you need is
Website or Domain – Free to $12 a year
Hosting – $36-$60 a year
Theme, Plugins etc – $30 – $60 a year ( Free themes plugins also available )
This is a basic cost. You can spend as per your pocket to make it more professional.
That’s All, you can start your Drop Service business in only $10 a month.
Sounds Great Isn’t it ? I mean what you expect minimum than this.
To Conclude –
Because of the high demand of online work, Drop Servicing Business can be an incredible source of income. Do your research, find the niche you know about and you are confident.
If you can deliver high quality, on time and high-value to your potential customers then drop servicing business is for you.
Wishing Best !!