Want to start a business but only have a limited space? Dropshipping might be the solution.
Find out how this business model works below ⬇️
Profit and Loss Statement: Intro, Example, and How to CreateWhat is Dropshipping?
Dropshipping is an online selling method where the seller doesn’t need to keep any stock.
When a customer places an order, the seller simply forwards the order to a supplier, and the supplier ships the product directly to the customer.
With this method, anyone can start an online business without spending a lot of money on inventory or renting a warehouse.
How Does Dropshipping Work?
The dropshipping process involves several key steps:
1
Product Listing
Retailers list products on their online store or marketplace
2
Customer Orders
A customer places an order and pays the retail price set by the store.
3
Order Fulfillment
The retailer forwards the order details to the supplier and pays the wholesale price.
4
Shipping
The supplier ships the product directly to the customer, often without any branding that identifies the supplier.
All-in-One Dropshipping
Management with Odoo
Odoo is an open-source business suite with tools for sales, inventory, e-commerce, and more—ideal for dropshipping.
Setting Up Dropshipping in Odoo
To configure dropshipping in Odoo:
1. Enable Dropshipping
In the Inventory module, activate the 'Dropship' route. This setting allows products to be shipped directly from the supplier to the customer.
2. Configure Products
For each product you wish to dropship, enable the 'Dropship' route in the product's Inventory tab
Then, assign a vendor in the Purchase tab. You can add more than one vendor here.
3. Process Orders
Each incoming order is recorded as a Sales Order. With this setup, Odoo will automatically generate a Purchase Order to the supplier when the item “Furniture” is included in the Sales Order.
Once the purchase order is confirmed, the system automatically creates a dropship receipt linked to the order. After the supplier confirms, the product is shipped directly to the customer.
With Odoo’s integration to marketplaces like Shopee and your website, dropshipping becomes more efficient, easier to manage, and easier to track.
Cost of Goods Sold (COGS) Formula: The Easy Way to Calculate ItAdvantages of Using Odoo for Dropshipping
Automation
Odoo automates the order-to-delivery process, reducing manual intervention and errors.
Inventory Management
Even without holding stock, Odoo's inventory module helps track product availability and supplier performance.
Scalability
As your business grows, Odoo's modular structure allows you to add functionalities like accounting, marketing, and customer service.
Customization
Odoo's open-source nature means it can be tailored to fit specific business needs, providing flexibility in operations.
Multi-vendor Management
If you have multiple suppliers in different locations with various offers, you can compare them and set priorities for incoming orders.
ERP: What It Is, Why It Matters, and How Businesses Use It
Dropshipping is one of the easiest ways to start a business in the e-commerce world because it requires relatively low initial capital.
With the help of platforms like Odoo, businesses can manage operations more efficiently—from order processing to supplier coordination.
However, to succeed in dropshipping, you still need to choose reliable suppliers, conduct market research, and provide good customer service to build trust and gain recognition.