Why Dropshipping Can Be More Profitable Than Network Marketing

December 6, 2010  

A lot of people who are looking to make some extra money, or even start their own business, will often consider network marketing, rather than dropshipping, as a way to achieve their aims. Network marketing, or multi-level marketing as it’s sometimes called, is where an individual gets paid for the sales they generate for a company, as well as the sales of other network marketers they recruit. The more sales you, and your recruits (called your downline) make, the more money you make – but is it as profitable as dropshipping, and could you make more money with your own dropship business?

Dropshipping is cheaper to start

For many dropshippers, one of the most appealing things about starting their own dropshipping business, was that it didn’t cost anything to set up. They could, if they wanted to, spend a bit of money on their website, but for there are plenty of options for starting your dropship business for free. Network marketing on the other hand, usually involves some kind of start up fee – whether it’s for products you’ll sell, resources, or whatever else you’ll need to get going. So straight away, you could be out of pocket with a network marketing business, whereas dropshipping doesn’t need to cost you a penny to get up and running.

You can make more profit with dropshipping

One thing that dropshipping and network marketing have in common, is that you only make money when you sell something. However, dropshippers get to decide how much margin they want to make on each sale, based on what you can buy and sell your dropship products for. With network marketing, margins (or commissions) are fixed by the company that provides the opportunity, and these can be as low as a few percent, depending on what you are selling.

Dropshippers can make more sales

Anyone who knows about selling, knows that those who sell what’s in demand, will make more sales than those who just try to sell whatever they have. While many network marketing schemes are built around products that people do buy, dropshippers get to choose what they want to sell, based on what dropship products buyers want to spend their money on. Network marketers can only sell the products their scheme offers, so if they are not in demand, it’s a lot harder to make any sales. A yyyyy Dropshipping Business is therefore always in a position to take advantage of customers’ changing demand to keep sales high, and network marketers have to put up with poor sales when demand is low.

You can scale up your dropship business

Dropshippers are able to quickly scale up their business once sales start coming in. Using the internet, their websites, and software that’s available, they can start to automate a lot of their dropshipping business, making many more sales for the same amount of effort. Network marketers are limited to the number of cold calls they can make, or sales pitches they can give; so increasing the number of sales for the same amount of effort is harder. Of course, they could recruit more repeat customers, or a bigger downline who will sell for them, but that means more effort on top of their sales activity, and they are then reliant on other people for their income. Dropshippers can grow their sales, and profits, and still be in control of their business.

There are some people who make a living from network, or multi-level marketing, but they have had to work very hard to achieve it. Plus, it’s not a business that’s suited to everyone. With no investment, no cold-calling, and the chance to make more profit, more quickly, it’s easy to see why more people consider dropshipping to be a better business opportunity.


  business Business Model Drop Shipping dropship dropshippers dropshipping Niche Market Niche Marketing Strategy online business Small Business Owner

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