Dropshipping has revolutionized the way retailers manage their operations by eliminating the need to maintain inventory. Instead of purchasing and storing products upfront, retailers only buy items from suppliers when a customer places an order. This business model not only reduces overhead costs but also allows retailers to offer a broader range of products without the risk of unsold inventory.
Odoo, an open-source ERP software, offers a powerful and seamless dropshipping feature that allows businesses to manage this model with ease. By automating processes such as order fulfillment, vendor management, and shipment tracking, Odoo simplifies the complexities of dropshipping. In this blog, we’ll dive into how Odoo's dropshipping functionality works, how you can set it up, and the key benefits it offers for businesses looking to scale efficiently. Whether you're new to dropshipping or aiming to optimize your existing setup, Odoo provides the tools to make dropshipping a smooth and successful experience.
Advantages of dropshipping
Dropshipping provides numerous benefits, making it an appealing business model for many entrepreneurs. A key advantage is the minimal initial investment required, as there's no need to buy inventory in advance, which helps reduce financial risks. Additionally, dropshipping offers excellent scalability—businesses can expand their product range without the need for additional storage space or the complexities of managing more stock. This flexibility allows retailers to grow quickly without the traditional limitations of inventory management. With dropshipping, you can operate from virtually anywhere, offering location independence. Additionally, overhead costs are minimal since you don't need a warehouse or fulfillment center, as products are shipped directly from suppliers. Finally, dropshipping allows access to a wide variety of products, enabling you to offer a broad selection to customers without significant investment.
Now let's see how Odoo manages dropshipping.
Dropshipping can be easily set up by the user in the Logistics section under the settings of the Odoo 18 Purchase module.
You can also access the Routes menu by navigating to the Configuration in the Inventory module, where you can configure or create a new Dropship route.
For the particular product for which you want to perform dropshipping, you can configure its operating route accordingly. We can change the route of the product from the inventory tab of the product form to dropshipping so that any future order can be fulfilled using this specified route.
Additionally, it is mandatory to add a seller under the product form's purchasing tab.
This will be the vendor whenever a purchase is created for this product.
Now create a sale order for the product for which the route is set as dropship, so that the product will be shipped directly from the vendor to the buyer, bypassing your warehouse.
Thus a purchase order will be triggered automatically to make dropshipping for that particular customer and the delivery address actually belongs to him.
The vendor listed on the Purchasing tab of a product form is automatically selected when you create a purchase order. This streamlines the procurement process, ensuring that the correct vendor is associated with the order from the start. Additionally, the product and quantity are automatically updated according to the conditions defined in the corresponding sale order. Once the sale order is validated, a Dropship smart button appears, allowing you to easily manage dropshipping processes.
The dropshipping process needs validation to mark the reception of the product to the customer.
The bill can be prepared for the transaction after the validation process.
Now you can prepare the invoice for the item and send it to the customer.
In conclusion, dropshipping in Odoo 18 offers a robust and efficient solution for businesses looking to streamline their e-commerce operations. With Odoo's integrated platform, entrepreneurs can easily manage product sourcing, sales, and order fulfillment in a seamless manner. The system allows for automatic order processing, supplier management, and inventory updates, helping reduce manual work and minimize errors. Odoo 18’s powerful features, such as real-time tracking, multi-channel support, and customizable workflows, make it an ideal choice for businesses that want to scale their dropshipping operations with ease. While challenges such as supplier management and shipping logistics remain, Odoo 18 provides the tools needed to manage these issues effectively, making it a valuable asset for any dropshipping business.
To read more about How to Manage Dropshipping in Odoo 17 Purchase Module, refer to our blog How to Manage Dropshipping in Odoo 17 Purchase Module.