Nowadays, almost everyone dreams of running an online store, but choosing the right business model can be tricky. Each model has its pros and cons, so it’s essential to understand each model closely to find the right fit for your needs and sales goals.
Two business models stand out, in particular, for aspiring online business owners who don’t want to manage inventory: print on demand vs drop shipping.
Are you thinking about a print on demand business or a dropshipping business? You’re not alone!
I’ve been asked this question often, and it’s difficult for me to say if one is better than the other for your ecommerce business. Instead, I’ll take you inside these two online business models to help you pick what’s right for your ecommerce business.
Whether it’s your first time selling products online or you want to expand your online stores, look no further than this dropshipping vs print on demand guide. You will find everything you need to help to choose a business model.
Key Takeaways
- A dropshipping business model involves finding dropshipping suppliers who will provide you with products you must list in your store and earn profit from.
- Dropshipping offers many advantages, such as being low-risk, easy to set up, and offering a wide product selection to attract more buyers. However, it has some downsides, like longer shipping times, difficulty building your brand, and being highly saturated.
- The print on demand business model lets you start selling customized products featuring your designs. You must partner with a printing company; the supplier ships products directly to customers.
- Print on demand businesses offer many benefits, such as limitless customization options, low startup costs, and the opportunity to cross-sell or upsell. However, they do have some downsides, like higher production costs and risks of supply chain disruptions that cause delays.
- Choosing the right business model depends on your target market, business goals, and the types of products you want to sell online.
What You Need to Know Before Starting a Dropshipping Business
The dropshipping business model is something that many entrepreneurs are familiar with. It’s a straightforward process of being a middleman to your dropshipping suppliers, who will provide the products you sell in your online stores.
Therefore, there are no upfront costs involved, and you won’t be managing your own inventory. A drop shipping business is a special solution for business owners without capital investment.
You must find dropshipping suppliers to sell products with a business model. The dropshipping suppliers can either be the manufacturer or a wholesaler.
The suppliers will be responsible for inventory management, so you don’t need to. Your dropshipping suppliers will fulfil the orders and deliver them to your customers.
With a dropshipping business, you must maintain your online storefront and promote your products online. You won’t have access to the products that are being sold.
The only thing you must do is to pay your dropshipping suppliers when an order is confirmed from your customers’ end.
The main factor that sets dropshipping businesses apart from traditional retail stores is that you won’t have to buy the products you want to sell online. This business model is risk-free and requires low upfront costs.
A dropshipping model sounds too good to be true. You can sell products even if you don’t buy them from your suppliers, yet you can make a decent profit, especially if you can find winning products.
But to help you choose between print on demand vs dropshipping, I will discuss the pros and cons of dropshipping products.
Dropshipping Business Pros
Is a dropshipping business the right choice? Let’s examine the benefits of this business model.
Easy to Setup
With a dropshipping business, you can get started almost immediately. It is especially true if you have an existing business website since you can start by adding dropshipping products to your store.
The most challenging aspect is finding high-demand dropshipping products to ensure high profit margins and more sales volume.
But once you have chosen the best products for your dropshipping store, all you must think about is optimizing your listings to increase traffic to your product pages and store.
You don’t need to conceptualize your custom designs or make your custom products.
The setup process is far less complicated because the products are already in your dropshipping suppliers’ inventory, and they can immediately ship the items when your customer orders from your dropshipping store.
Vast Product Selection
Another advantage of dropshipping businesses is the vast selection of products you can add to your ecommerce store. You can pick any niche you want!
You can even add trending products to your dropshipping store to capitalize on their demand. If you’ve optimized your product listings and have done extensive market research, you can rest assured that you can make money online by dropshipping products.
Identify Best-Selling Products
In addition to having a wide range of products to choose from, the dropshipping business model is also advantageous because of your ability to generate data insights about your sales.
You can use real metrics on sales and traffic to analyze which dropshipping products are making money for your business. This data informs your future product selection, ensuring you don’t have to guess which products to add to your online stores.
Lower Risk
Due to the low upfront costs and the fact that you won’t stock physical products, dropshipping is a low-risk business model. You will only send orders to your dropshipping suppliers if a customer has ordered and paid for an item from your ecommerce business.
It protects you from financial loss when you stock physical products without knowing if customers will ever order them!
For this reason, dropshipping is a popular business model, allowing store owners to minimize their losses.
Dropshipping Business Cons
While there are benefits to dropshipping businesses, there are also drawbacks that you must be aware of.
Lack of Quality Control
Product quality issues continue to plague dropshipping businesses. A lack of product quality control can hurt your business reputation and impact your ability to make more sales in the future.
Since dropshipping businesses allow suppliers to fulfill and ship the orders, sellers cannot check the product quality before it is shipped to customers.
The best way to avoid this issue with dropshipping business models is to only work with reliable and reputable suppliers.
Research the top suppliers in the dropshipping industry so you can ensure product quality and good customer service. A dropshipping supplier holds so much power in your business, so you must choose them wisely.
Ideally, you must ask your suppliers for a product sample before you choose them for your business. This savvy approach allows you to evaluate the product quality, giving you more confidence before selling their products in your store.
Longer Shipping Times
Most dropshipping suppliers are located overseas, such as in China. It could be an issue when you want to ship orders fast to your customers as the distance would mean longer wait times before they can receive their orders.
The good news is that more suppliers are based in the US and Canada. Therefore, if your target audience is based in the US, you must choose them.
This approach will significantly reduce shipping times, boosting the customer shopping experience.
If you cannot find suppliers outside of China, since they offer competitive prices that help you earn a huge profit margin, it’s important to be transparent with your customers.
Tell them that products will be shipped from China and provide them with a concrete shipping estimate. That way, your customers can make an informed decision when buying if they want to wait that long before they order.
Setting realistic expectations is a good business practice that you must adopt, whether using the print-on-demand or dropshipping model.
Highly Saturated Market
The dropshipping industry is a highly saturated market. This means that there will be more competition in this industry, making it more difficult to stand out from the competition and meet your sales target.
If you want to outdo the competition, you have to invest in product research to identify high-demand products. You also need to optimize your product listings and deliver excellent customer service to ensure repeat buyers.
Difficult to Build Your Brand
Branding is one way to stand out in a highly competitive industry, such as dropshipping. However, it is difficult to build your own brand for a dropshipping store because you do not create the products or own the designs.
Without a brand, it can be difficult to establish a solid customer base or win over your target audience because there is little to build trust on.
In most cases, you end up setting the prices based on what you think is most competitive instead of the actual market rate. That said, dropshipping store owners feel they get a lower profit margin per product with this business model.
Want to learn more about Shopify Dropshipping? Check out our comprehensive beginner’s guide.
What You Need to Know Before Starting a Print on Demand Business
If you’re searching for online business ideas or models that require no inventory, chances are you’ve stumbled upon print on demand.
The print on demand business model is another method of fulfillment for orders with a third-party supplier. However, that is where most of the similarities with a dropshipping business end.
A print on demand business involves selling your own custom designs. Thus, it is a great choice for ecommerce business owners who want to promote their brand through their custom products themselves.
Starting a print on demand business requires you to find print on demand services that will print your designs for you. These print on demand services are responsible for printing the custom designs and products and shipping them to your customers.
Here is how it works: you will create your custom designs and then provide a mockup of the products where you allow custom printing. These products include t-shirts, hoodies, jackets, tote bags, books, and mugs.
When customers see the products in your online store, they can choose the design and the product for printing. You will then forward the order details from your customer to the print on demand companies you have partnered with.
They are responsible for fulfilling your orders and sending them to your customers.
Thus, print on demand businesses are an excellent business model if you want a low-risk business.
They eliminate the need for you to acquire your printing tools and equipment; instead, you will find print-on-demand services that can do the printing for you. You will have to adjust your desired profit margins according to the costs of the products and printing service.
It is also preferred by some online entrepreneurs because, unlike dropshipping, where your role is to sell products only, you are involved with creating the products using your designs. Many print on demand companies help you create white-label products to allow you to showcase your brand.
But like any other business model, there are distinct benefits and drawbacks to choosing a print-on-demand business. It’s crucial that you weigh them out so you can determine if this business is right for you.
Print on Demand Business Pros
Print on demand businesses have distinct advantages over dropshipping companies. If you are deciding between print on demand and dropshipping, here are some reasons to consider a print on demand model.
Selling Custom Products
Whether you’re the creative type or not, there is a strong sense of fulfillment that you get when people buy your own designs or own custom products. And this is why many sellers choose print on demand vs other business models, including dropshipping.
Creating your designs is an opportunity to build a strong brand. When you have a brand, fostering customer trust and loyalty is easier. This is especially true if you are a graphic designer or creative; this process is fun and rewarding.
With print on demand businesses, you can scale your business by finding manufacturers that can produce the items using your designs. But for starters, print on demand sells potentially profitable products.
Opportunity for Cross-Selling or Upselling
Selling print-on-demand products offers opportunities to cross-sell or upsell your other products from your own brand. For example, you can offer discounts when people buy two or more T-shirts.
Another option is to bundle your print-on-demand products, especially for items that people typically buy together. For example, you can give your customers a discount when they buy a T-shirt and hoodie together.
Be creative with cross-selling and upselling since you can attract more potential buyers for your print on demand online stores.
Lower Startup Cost
A print on demand online business offers potentially huge profit margins if you partner with a reliable and trusted printing company. You can launch your online store immediately since you no longer have to invest money in procuring your printing equipment and technology.
The cost-effectiveness of this business model makes it attractive to more sellers, allowing them to get started and make money online when the idea strikes them (or when they have designs).
Customization Options
The high level of customization offered by print-on-demand businesses compared to dropshipping businesses makes it easier to stand out from the competition. You can offer your custom designs, but also allow your customers to personalize them with their own design ideas.
This flexibility allows you to appeal to your target audience where a dropshipping store lacks that opportunity. The customization available with print on demand vs dropshipping also refers to testing new designs.
Again, offering multiple design options can attract potential buyers and make your products suitable for corporate gifts, gift ideas, and more.
In addition to the products, the packaging is another aspect where you can offer customization. It aligns with the entire print-on-demand concept, which makes it more attractive as a business opportunity.
Print on Demand Business Cons
Given the benefits of print on demand services, it’s time to explore the potential drawbacks of this business model.
Longer shipping times
One thing you must be aware of when choosing the print on demand vs dropshipping business model is the longer shipping time. Since products are custom-made, your print on demand supplier must make the products from scratch upon receiving the customer order.
The good news is that most customers know the waiting times for selling customized products. However, issues with the supply chain could easily cause delays in the production and shipping of your customer orders.
Many factors beyond your control could negatively affect the customer experience.
Higher production costs
Print on demand vs dropshipping entails a higher production cost since you must cover the cost of the product and printing of the custom designs. Unlike dropshipping businesses, wherein most products are mass-produced, each item is custom-made for the customer’s order.
For this reason, selling online with print on demand companies can significantly reduce your profit margin.
It’s a good opportunity to remind you to calculate your pricing carefully to ensure the profitability and sustainability of your business. Otherwise, you not only lower your profit margin but could even end up losing money.
Given the high competition in print on demand businesses, you must keep your prices competitive, which further limits your profit margin.
Summary: Choosing Between Print on Demand and Dropshipping
Print on demand and dropshipping businesses have as many similarities as they do differences. Hopefully, you can use the information here to weigh your options and make an informed decision about the right business model for your goals.
To sum up, dropshipping businesses are best for sellers who do not want the hassle of inventory management. You can find the most in-demand products that would attract your target market using product research tools like ZIK Analytics.
This tool provides data insights about trending niches and the top-selling products from online marketplaces, which helps determine the best products to sell in your dropshipping stores.
On the other hand, starting a print-on-demand store is ideal for creative types or those who want to design their own products. There is great potential for building your brand and attracting customers who want unique products.
While it is important to find reliable print-on-demand suppliers, the entire process is seamless if you can find the right partner.
Knowing the best practices for running an online store is critical regardless of which model you choose, print on demand vs dropshipping.
It allows you to stand out from the competition and generate traffic to your business website, which will attract your target market, who might be looking for products you offer.
Find Winning Products for Your Business
Choosing between print on demand and dropshipping? Let data guide your decision. With ZIK’s Product Research Tool, you can uncover trending products, analyze competition levels, and spot untapped opportunities in any niche. Whether you want to sell custom t-shirts or source high-demand items from suppliers, ZIK shows you what’s actually selling online. Skip the guesswork and start your store with confidence.
FAQs
Is dropshipping better than print-on-demand?
Print-on-demand businesses are more viable for long-term success, especially since dropshipping is more competitive. However, dropshipping is easier to start since you don’t have to create your own products or designs; you can choose a dropshipping supplier and start selling online.
Which ecommerce platform is best for print on demand?
Shopify is among the most popular ecommerce platform for print on demand stores, but you can also consider Wix, BigCommerce, and WooCommerce.
Is Printify good for dropshipping?
Yes. Printify is among the top print on demand companies for dropshipping. They have a solid reputation and have been in the industry for many years.
Is print on demand more profitable?
The print on demand model is potentially more profitable if you partner with the right print-on-demand suppliers.
Other factors that impact your profitability include the quality of your designs and your advertising skills, which allow more potential customers to see your products online. Having a solid pricing strategy is also critical to your success and profitability.
Which print on demand products sell the most?
The best products to sell with a print-on-demand are unisex t-shirts, baby clothing, mugs, hoodies, yoga pants, and jewelry.
Is print on demand dead in 2024?
No, print on demand is growing and becoming more profitable. By 2031, this market is estimated to be valued at over $46 billion globally.