This business model involves selling products on a major e-commerce platform without maintaining an inventory. The seller acts as a middleman, listing items and processing orders, while a third-party supplier fulfills the shipments directly to the customer. An example is an individual who lists a variety of goods on their marketplace storefront, only purchasing those goods from a separate wholesale distributor once a customer places an order.
The significance of this approach lies in its low barrier to entry and minimal upfront investment. The elimination of warehousing expenses and inventory management responsibilities allows entrepreneurs to launch businesses quickly and efficiently. Historically, this method has provided opportunities for small businesses and individuals to compete in the online retail landscape without the substantial capital required for traditional retail operations.
