What is difference between Cargo shipping & Drop Shipping?


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Abi Ainscough answered
Cargo shipping is the general term used to describe the act of transporting goods. Drop shipping is a specific type of cargo shipping in which the manufacturer delivers directly to the retailer's customers.

  • What is cargo shipping?

Cargo shipping can occur on an international basis and methods of delivery can include cargo ships, freight trains, aircrafts, trucks or vans. It has been found to be highly cost effective as huge bulks of produce can be transported, saving on both financial and environmental costs.

  • What is bulk shipping?

Put simply, bulk shipping means the manufacturer will produce the goods. Then, another retail business at the tertiary stage will deal directly with customers physically, by telephone or online. After this, the manufacturer will deliver the goods to the customer. This is a business method not often found within large corporations but tends to be isolated towards the smaller and more entrepreneurial businesses.

  • What are the advantages and disadvantages of bulk shipping?

The risks to the retailer are greatly reduced as they do not have to actually purchase the product from suppliers until a sale has been made. Therefore, there is no accumulation of stock which could possibly go to waste if demand for the product drops due to a change in trends, economy or a business' reputation.

The business also benefits financially as they can purchase goods at cheaper wholesale prices but increase the retail selling price in order to cover the delivery costs that the manufacturer will charge, enabling a profit to still be made.

Moreover, customers may be more satisfied with drop shipping as delivery from the manufacturer may actually be quicker and more efficient if their location is geographically closer than the retailer.

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