Dropship Orders
Imagine a business model where all you have to do is create an eCommerce brand and focus on selling stuff while a third party handles the inventory, shipping, and fulfillment.
What’s more?
You don’t pay for the product until the customer places an order for it.
Dropshipping is an online business model with probably the least barriers to entry which attracts Invoices and professionals alike to select a niche, create a brand, market, and make money.
What is Dropshipping?
Dropshipping is an e-commerce retail model that allows stores to sell products without keeping any physical inventory. The products are shipped directly to the consumer.
There is a partnership between an online retailer and a supplier. The retailer passes the orders to the supplier, which will package and ship the items directly to the end customer, but in the retailer’s name.
Dropshipping Business Model
Dropshipping works in Just FOUR Steps:
Step One: Your Customer places an Order from your Store.
Step Two: Your Store automatically sends the Order to your dropshipping supplier.
Step Three: Your dropshipping supplier prepares your customer’s order.
Step Four: Your dropshipping supplier ships the order directly to your customer.
Benefits of dropshipping business model
The biggest advantage of Dropshipping is that there is no more upfront Inventory Cost or Shipping Logistics. With Dropshipping, products are sent directly from your wholesaler to your customer.
Other advantages that come with dropshipping:
Smaller investment
Easy to start
Flexibility
A wide selection of products
Easy to scale
We have introduced the “Dropship Process” for the Sales & Purchase workflow. This is an automated process that streamlines the Shipping/Fulfillment of a Sales Order directly from the Purchase Order. The SO can be linked to a Dropship PO, and it can be shipped directly from the linked Dropship PO.
Let’s understand the working of the dropship model in detail.
Dropship Business Model in Xoro
What’s New?
1. Added “Is Dropship?” checkbox in the Item module (also in the Item Centre) under the other attributes tab.
Added Dropship Vendors option in the Item module under other attributes tab.
When the “Is Dropship” option is true then the default Vendor option is required.
In the Dropship Vendors option, users can select multiple Vendors.
If the user does not select dropship Vendors then the default Vendor will automatically be added in the Dropship Vendors option (On saving the Item).
2. Added 2 new App configs under the General tab:
Dropship PO notification for Vendor: Dropship PO notification emails will be sent to the Vendors
Dropship PO notification – Additional emails: Send Dropship PO notifications to internal users when the Dropship PO is created, here you can add comma-separated emails like a@yopmail.com,b@yopmail.com
3. Added the “Create Dropship PO” option in the Sales Order module.
Dropship Workflow in Xoro
So, it goes like this:
How does it work?
Create a Sales Order containing one or more Dropship Items.
There are four Dropship-related columns available at the Sales Order line level:
Dropship Qty
Is Dropship Item?
Dropship PO Number
Dropshipped Qty
In Dropship Qty, users can view the quantity linked to the Dropship Purchase Order. The quantity can be modified, and the same change is automatically reflected in the linked Dropship Purchase Order.
To create a Dropship Purchase Order, click Options → Create / Copy → Create Dropship PO.
The Create Dropship PO window displays all eligible Dropship order lines. Only vendors configured as Dropship Vendors for the selected item are available for selection.
Users can create a Dropship Purchase Order only for the quantity calculated as: Qty − Qty Allocated − Qty Shipped
The Dropship Qty can be modified before creating the Purchase Order.
Vendors can be changed from the available vendor list if required.
The Create Dropship PO window now includes an Is Dropship? column that indicates whether an order line is already linked to a Dropship Purchase Order.
Order lines that are already linked to a Dropship Purchase Order display Is Dropship? as selected, and their selection checkbox is disabled to prevent duplicate Dropship PO creation.
Order lines that are not yet linked remain available for selection, allowing users to create additional Dropship Purchase Orders from the same Sales Order.
Select one or more eligible order lines and click Create PO.
The system creates a separate Dropship Purchase Order for the selected line(s) and displays the generated Dropship PO Number.
After the Dropship Purchase Order is created, the Sales Order status is updated to Dropship. The purchase orders created for dropship items can be viewed from the Linked Orders tab of the sales order.
Sales Order line can be linked to only one Dropship Purchase Order. Once a Dropship PO has been created for a line, that line cannot be selected again.
The Dropship PO has only options to Add to Email Queue or Void.
Enter the required details like Receipt Date, Packing Slip, and now the Order can be dropshipped.
The Dropship Qty can be changed here if required.
The Dropship option is also available in the PO Centre, both on the right-click and in the options dropdown.
Dropshipping will create an Invoice for the linked Item in the SO.
The Item Receipt and the Bill for the dropship PO will be automatically generated.
The status of the linked dropship SO will change to Shipped/Partially Shipped.
The Dropship PO Number and Dropshipped Qty will appear on the line level of the SO.
The linked dropship PO can be viewed in the Linked Orders tab of the SO.
Notification Emails:
You can enable sending the dropship PO notification emails directly to the vendors and/or internal users when the dropship PO is created or updated. This setting can be turned on from the app config as mentioned above.
The email body for this notification can be customized from the “Email Templates Configuration” module
When dropship PO notification for Vendor is turned on, any change in qty of the SO will send a notification email to Vendor.
Upload Dropship Receipt Module
Users can process the dropship PO directly using the CSV file upload.
Further Information
If there are no dropship items available in the SO, and the “Create Dropship” option is selected, the system will show an info error that”‘No dropship item(s) available”.
Users can link only 1 dropship PO with an SO line.
To update a Dropship PO line:
If the Dropship Qty needs to be reduced on the created Dropship PO:
Go to the respective Sales Order and, at the line level, reduce the Sales Order Qty. The Dropship Qty is automatically reduced accordingly.
Re-open the Dropship PO. The quantity in the Purchase Order Details section is updated to reflect the reduced quantity.
If the Dropship Qty needs to be increased on the created Dropship PO:
Go to the respective Sales Order and, at the line level, increase both the Sales Order Qty and the Dropship Qty.
Re-open the Dropship PO. The quantity in the Purchase Order Details section is updated to reflect the increased quantity.
In the PO module, we added an ability to dropship PO based on the qty entered by the user.
From the purchase order Centre, only the full qty of dropship PO can be shipped.
In the sales order Centre, we added the following columns:
Is dropship (Header level): It will only be true if there is any dropship PO linked with SO.
Dropship PO#,
Dropship Qty (Line level).
In the purchase order Centre, we added the following columns:
Is Dropship (Header level),
Dropship SO#, Dropship Qty(Line level).
Linked Dropship PO will be canceled if the Items are removed from the SO.
In order to void a dropship SO, the User has to first delete the Dropship PO linking.
Merge Line: The dropship SO line cannot be merged with Other lines.
Editing/voiding the Invoice created from a Dropship SO will trigger the same change in linked drop-shipped IR/Bill.
The user cannot update qty directly in IR/ Bill.
If the user void an Invoice then the linked dropship Bill/ IR will also be deleted.
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