E-Commerce Apr 18, 2022

Dropshipping vs. E-commerce: What to Choose?

Kseniia Hrechyshkyna

Kseniia Hrechyshkyna



Oksana Shesternina

Oksana Shesternina

Business Analyst


Dropshipping vs. E-commerce: What to Choose?

Time to read: 12 minutes


  1. Understanding E-commerce Fulfillment
  2. Traditional E-commerce Fulfillment vs. Dropshipping: Full Comparison
  3. E-commerce vs. Dropshipping: Choose the Right Option for You

Modern merchants can market their products and services in multiple ways as well as to conduct their order fulfillment—either opt for an in-house fulfillment or delegate these tasks to the third-party providers. But there is also the other order fulfillment model—dropshipping—that is widely used due to its affordability.

In this article, we focus on dropshipping and compare it to conventional e-commerce order fulfillment, highlight the advantages and disadvantages of both models, and answer the main question—which option is right for you.

Understanding E-commerce Fulfillment

Before we dive deeper into the specifics of e-commerce vs dropshipping, let’s understand the basic concept of online order fulfillment, since well-built supply chain management processes can give your business a competitive edge.

Fulfillment is an imperative e-commerce business process that involves warehousing (inventory storage), packing and shipping orders, and, when necessary, processing returns. The ultimate goal of any e-commerce fulfillment is the timely and careful delivery of a product or service to its consumers.

In this article, we described in detail the essential stages of supply chain fulfillment and the factors that influence its costs.

E-commerce Fulfillment

Types of e-commerce fulfillment models

Your e-commerce fulfillment strategy may depend on many aspects, such as the type of product you sell, whether you keep a warehouse, how many orders you deliver per month, etc. However, to come up with your own fulfillment plan, it’s important to find out about all choices available to you.

Generally, there are four methods on how you can organize your order fulfillment operations, and dropshipping is one of them:

  1. In-house. This is when the entire order fulfillment lifecycle rests on the shoulders of a given business. In this case, the company conducts all processes through its own facilities. It receives, stores, and manages inventory, processes packing, and ships products.

  2. Third-party logistics (3PL). Within this model, e-commerce merchants outsource their supply chain management to third parties—so-called 3PL companies. This is an inevitable step in any e-commerce business development when fulfillment operations become too complex to manage without external assistance.

  3. Dropshipping. Merchants that stick to this fulfillment model neither manufacture nor store the products themselves. Their main activity within dropshipping is to promote these products, receive orders, and either automatically or manually redirect them to the manufacturer or distributor. Hence, dropshippers are minimally involved in order fulfillment itself, acting as intermediaries.

  4. Hybrid. This model entails a combination of the above-listed approaches to order fulfillment. For instance, a large corporation can combine in-house and 3PL fulfillment.

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Traditional E-commerce Fulfillment vs. Dropshipping: Full Comparison

As we have already determined, the workflows of how the order will be processed and delivered to the end customer differ. So, what’s the difference between e-commerce and dropshipping?

As a rule, traditional e-commerce fulfillment consists of the following steps:

  1. You order from a manufacturer.

  2. Products are shipped to your warehouse.

  3. Products are received and processed.

  4. You renew your product assortment with new arrivals.

  5. Customers place an order on your website.

  6. Money for the order is credited to your bank account.

  7. The order is picked and packed in your warehouse.

  8. The delivery service provider transports the parcel to its destination.

  9. The order arrives at the door of your happy customer.

Thus, with traditional e-commerce fulfillment, business owners either produce or source products and store them in warehouses. However, depending on whether they fulfill their orders in-house or using 3PL, there can be fewer or more steps mentioned above.

Traditional E-commerce Fulfillment

Dropshipping operates in a similar way to traditional e-commerce fulfillment, but the main peculiarity of this fulfillment model is that merchants are not responsible for product storage and delivery. Below, you can find a typical workflow common to the dropshipping model:

  1. The customer places an order with your business.

  2. You alert your dropshipping partner—either a manufacturer or distributor—who packs the item and ships it to the customer.

  3. The dropshipping partner charges you for the services provided, and you, in turn, charge the customer.


Pros and cons of traditional e-commerce fulfillment

As an e-commerce consultancy company, we have been saying persistently that each business is unique, whether it’s a small company with a garage as a fulfillment center or a large international enterprise. Speaking about one or another fulfillment method, here, we would also like to draw your attention either to its benefits or drawbacks.

Pros of traditional e-commerce fulfillment

Most retailers and manufacturers managed to derive much benefit from this fulfillment model. So why is traditional e-commerce fulfillment so attractive to them?

Cons of traditional e-commerce fulfillment

Despite many merchants using this method, there are also considerable risks associated with traditional e-commerce fulfillment:

To eliminate all these risks, it’s crucial to rely on the assistance of professional e-commerce business developers, like Dinarys. We possess first-hand experience in different e-commerce fields, which helps us organize fulfillment processes competently with the use of the latest technological advances.

Pros and cons of dropshipping

Many dropshipping advantages revolve around how easy it is to start such a business in terms of cost efficiency and quick profit. SImultaneously, dropshipping brings limitations to ambitious merchants who don’t like to be content with little.

Pros of dropshipping

Let’s take a closer look at the benefits of dropshipping.

You might be interested in: “How to Build a Dropshipping Website in 2022

Cons of dropshipping

Consider the disadvantages of dropshipping below to decide to figure out if it’s your final destination or if it’s better to proceed with a traditional e-commerce fulfillment.

Have a project in mind?

Lets talk about it

Request a quote

E-commerce vs. Dropshipping: Choose the Right Option for You

Now you know the answer to the question what’s the difference between dropshipping and e-commerce. The points below may guide you to the final decision.

You should choose traditional e-commerce fulfillment if

A dropshipping model might be a suitable option if

Whatever model you pick for your further business development, there are more chances to succeed if you have a reliable tutor like Dinarys. Apart from our core development services, as e-commerce consultants, we conduct preliminary market research to ascertain that your e-commerce solution will be 100% viable to achieve desirable business metrics.

Contact us to receive a consultation or an estimation of your online store costs.

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