I was looking into dropshipping like 5 years ago at it seemed like the perfect business model to me at first... Until I realized margins are close to nonexistent, the hundreds of issues that may arise when dropshippers screw up an order (especially if you sell on Amazon and Ebay, one mistake on their side and you're done).
My company drop ships 10-15% of our orders each week, we're in a fairly small and protected industry... but GOSH there is margin pressure all over the place.
I would be very careful about just jumping in thinking it is free money. If you have west coast suppliers who are GMT -8 and you are +1, that adds some complexity to getting orders out the door and processing any problems that come up.
Drop ship companies run out of stock... don't tell you, your customer is mad, you are asleep....
We do drop shipping (and we do a bit of private labeling, although 300% markup, yeah, doesn't happen with us), but mostly as a way to fill our own inventory gaps, not as a primary way to sell.
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Also, brief note, as it is my pet peeve:
Markup is the % above your cost that you price an item.
Margin is the % of the retail price that is your profit.
Margin can never be over 100% (and is only 100% if your cost on the the item is $0.00).
A normal retail markup is 100%, resulting in a margin typically around 40-50%.
Anyone who gets those confused should be treated with a bit of suspicion (no disrespect intended BK Money)