In today’s world, many ways to make money exist. You may choose to write an online review, take up a side gig, or become a freelancer and client. But, if you’re looking for a way to make money from a large audience, consider becoming a vendor or a dealer. Selling online with no inventory may be the perfect fit for you. Let’s take a quick look at how you can make money selling online with no inventory.
The Benefits Of Online Vendors
If you’ve been searching for a way to make money online, you may have come across a blog post or two talking about vendors. A vendor is someone who offers a service or product that can be ordered or downloaded directly from his website.
Vendors often get a bad rap because they don’t offer a physical good. However, there are several major benefits to doing business with vendors.
- No Inventory. Your customers can browse through your products and make an order at any time. No matter how many stock keeping units you have, you’ll never run out of inventory. This is especially useful if you get orders frequently and need to keep up with inventory. In the event that something happens and you can’t fulfill an order, you’re not losing any money as you still have the original price that the customer paid. You’ll simply have to ask for an extension.
- Flexibility. With vendors, you have complete flexibility regarding the time of day and day of week that you work. If you get a lot of orders, say, between midnight and 8 am, you could easily set up a second job just to manage your inventory during those hours.
- Protected Income. Because you have no inventory to worry about, you don’t have to worry about losing any money to theft or damage. Your profit margin is protected and increases as your sales grow.
- Continuous Growth. The more you sell, the more you make. Every time you sell something, you create a new customer and potentially increase your sales further. This is great if you’re looking for continual growth.
- Less Stress. Since you don’t have to worry about stocking or selling a physical product, you can take on more orders and be more relaxed while doing so. If you’re constantly stressed about whether you have enough inventory or whether an order will be placed, you’ll soon find yourself battling insomnia. Being fully committed to your business, you won’t have any stress, and therefore, you won’t have any regrets.
The Difference Between An Online Vendor And Merchant
Before you begin selling your inventory through a vendor, make sure you understand the difference between an online vendor and a merchant. A merchant is someone who sells a physical product and an online vendor is someone who only sells an online service or product.
If you get orders frequently and need to keep up with inventory, you may choose to go the route of an online vendor. However, if you’re looking to be more active on social media and want to have a physical product to show off, you may want to consider becoming a merchant.
Here’s a brief description of the differences between the two.
- Merchants sell a physical product. You’ll often find them selling books, purses, or clothing. They may even offer a small selection of groceries or home products for sale. Most merchants keep a small inventory and need to order more frequently. They usually don’t offer online vendors because they don’t want to risk their inventory getting stolen, lost, or damaged. Inventory is also expensive and it’s hard to track if it’s sold once or twice. In the event of a security breach, they’ll have to notify all of their customers and ask for an extension until they can get their inventory back in stock. This is not ideal if they want to keep their existing customers. For this reason, they rarely offer online ordering except for specific items they think will be high-demand. Otherwise, they’ll stick with their established business model of selling through a physical retail location.
- Online vendors don’t offer a physical product. They simply offer a service that requires an initial payment and then the customer receives a product or service they’ve ordered (e.g., web design, SEO, social media management, etc.). Once the initial payment is made, the customer doesn’t need to worry about seeing their product or having it delivered. They simply receive an email confirmation that their order has been placed and they’ll get a link to access their purchased product or service. This type of business model requires a lot of upfront work before you actually begin selling, but it has several advantages.
- The money you make is only based on the amount of time you spend working. You don’t have to worry about physical inventory, so your profit margin is higher. As a result, you can be more selective about the types of products you choose to sell. It’s also a great opportunity for people who want to work remotely.
- Since you’re not physically keeping the product, you don’t have to worry about damage or theft. This is especially beneficial if you have financial concerns (e.g., you’re a first-time entrepreneur or you have a low credit score).
- The customer service is great since you aren’t tied down to one location. If a customer has a question regarding their product or service, they can easily contact the company and get an answer. No need to worry about getting their merchandise returned or an extended warranty.
Choosing Your Niche
When you begin your journey as a vendor, you’ll quickly realize that there are a lot of different niches out there. Just because you’re not selling a physical product doesn’t mean that you have to limit yourself to just one type of product or service. There are dozens of different ways to make money online, and many of them don’t require you to sell your own merchandise. Consider the various benefits of each business model and choose the one that makes the most sense for you.