Dropshipping is not an industry jargon, but I’ll still start my article by explaining what it actually is. Dropshipping is an order fulfillment method where the selling merchant doesn't stock or hoard inventory. Instead, they first take a product request. Then they purchase the item from a third party and have it shipped directly to the customer via the third party. This model requires less capital and has lower overhead. Also, a physical inventory warehouse is not required, as there is no concept of storing physical products.