Many people have heard of dropshipping but do you know what is drop servicing? In this article, we will help you understand this concept and give tips on how you can start your own drop servicing business.
In this article
Drop servicing is a business model in which you offer services to the clients without actually providing the services yourself, instead getting them done through a freelancer. This is done by attracting a client in lieu of helping them with services like copywriting, programming, graphic designing etc. and then outsourcing those services to the freelancers. In this model, the person offering drop servicing acts as the middleman between the client and the freelancer without usually disclosing their association.
Drop servicing vs dropshipping
Drop servicing is similar to dropshipping. The only difference is that in the case of dropshipping, physical products are sold on your website at marked-up prices without having to keep the inventory. However, in the case of drop servicing, the physical products are replaced by digital services while everything else remains the same.
How does drop servicing work?
Starting a drop service business is a straightforward process. You must first create a professional-looking website marketing the service you plan to offer. Once that is done, you need to look for one or more freelancers who can accomplish those tasks on your behalf. The hiring of freelancers can also be done on an ad-hoc basis, depending on the project at hand and the manpower required. Drop service business works in the following steps:
- The client finds your business and places an order for a specific service with you
- You forward the service to the freelancer and pay them for task
- The freelancer completes the task, sends it to you, and you send it to the client.
- You keep the difference between what your client pays you and what you pay to the freelancer.
For example, you are approached by a customer who wants your help with video editing and promises to pay you £100. You will then reach out to the freelancer and pay him £70 to finish the same task. Once the task is finished by the freelancer, you send it to the customer yourself without mentioning that it was done not by you, but by a freelancer. The difference of £30 is what you make in the entire process.
All the services that can be performed by a freelancer can be converted into a drop servicing business. The main distinction is that you're delegating the task to your team as a drop service business rather than performing it yourself. Some examples of the services which can be offered are SEO optimisation, video creation, blog writing, website creation, social media management,lead generation, graphic designing etc.
How to start a drop servicing business in the UK?
Are you looking to kickstart your own drop servicing business but not sure where to start? In this section, we break down the process of setting up your business along with some tips you may want to keep in mind at the nascent stages.
1. Find a niche
Which market would be ideal for a drop servicing business? You may begin by picking a niche that is simple to comprehend by people around you so that it is easier for them to contact you for the same. You may also want to keep your business easy to sell and operate in order to avoid any potential complications. And lastly, you may want to pick a niche which is profitable in nature. Spend some time understanding the market and see which industry is booming and which service is in demand.
Tips for businesses
At the time of picking your niche, it is important to keep in mind that the services which are in demand also have higher competition. While you may want to tap into a profitable area, it may be a good idea to explore newer in-demand skills in the industry where you can have the chance to take a headstart.
2. Create your brand and website
Now that you know exactly what you want to offer, it is time to bring it into action. A good place to start is by building your website. Make sure your website is user-friendly and responsive on all types of devices. The purpose of building a website is to establish and showcase your expertise in the market you plan to tap into. Your website serves as your online store, giving you a reliable online presence. You can also manage the back-end functions using a service dispatch software which can better manage your business by automating various tasks for you.
Tips for businesses
While creating your brand, it may be a good idea to name your brand wisely. In a market full of people trying to sell their business, you would want to stand out and at the same time, remain relevant. Keep the name of your business and website something that quickly conveys what you do.
3. Build a team
Effective businesses need a team to operate. Once you have the website in place, you would need a team of freelancers who can do the work on your behalf, and that too at a reasonable price. There are various online platforms which can help you find a freelance in the domain you require.
Tips for businesses
When onboarding freelancers, it may be helpful to employ a limited number at the starting stage of your business since you can’t be sure of the workforce required when just starting out. As and when your business expands, you can always get more freelancers on board and expand your team.
4. Attract customers
This is the time to generate leads and get more and more people to convert as customers/clients. You can target customers either organically through your website or by running paid advertisements on the internet, depending on your budget. You can also look to attract customers by sending them emails or contacting them through platforms like LinkedIn with a personalised message.
Tips for businesses
While a website is a great way to attract customers, it may be a great idea to also reach out to your existing network and build offline contacts. People who already know you can recommend your business to their connections. Not only can word-of-mouth bring a human element to your business, but it is also a cost-effective way to market.
What are the benefits of a drop servicing business?
It has several benefits as a business model, including minimal entry barriers, the need for just rudimentary expertise in the services you wish to provide, and a scope to offer a variety of services. There is also a lesser risk involved in drop servicing compared to the traditional business model as all services are handled by other parties, and the brand solely deals with marketing and lead conversion. For customers, drop servicing can be a simple and practical solution, and for freelancers, it can potentially be a consistent source of money.
