By Stuart Lisonbee
Most retailers agree that drop shipping, when implemented effectively, significantly reduces time and labor. But does it translate to monetary savings? The common saying “time is money” begs the question: what is the actual value of drop shipping?
This article aims to address this question methodically, using logical reasoning to determine drop shipping’s true worth for your business.
The value of time is subjective. For someone like Bill Gates, an hour is exceptionally valuable. Conversely, interns often work without immediate financial compensation, valuing their time in terms of experience gained, which increases their future marketability. They see their time as an investment with future returns.
Consider investing in the stock market. Extensive research is typically required before investing, followed by a potentially long wait before realizing profits. This represents an investment of time for a future payoff. If one values their time at $50 per hour, the goal would be to achieve a return of $50 for each hour spent on research.
When using drop shipping, you save time by outsourcing inventory management, order fulfillment, and shipping logistics. This frees up valuable time that can be spent on other aspects of your business.
Part 2 of this article will delve into the concrete monetary value of the time saved through drop shipping.