What is drop servicing business? This is one of the popular questions among marketers. Is it similar to dropshipping or they are interchangeable? How can you start DropServicing? Today, I will explain how drop servicing is a business model that makes money online for almost everyone even knowing no skills.
Actually, drop servicing is a profitable business model even for beginners. It is also called service arbitrage or white labeling. In such business, you sell services to your customers, then hire a freelancer or agency to do the service for a less price.
What is drop servicing business?
Not to be confused with dropshipping (because it sounds very similar), drop servicing is a business model where you sell services – but instead of being the person performing the services, you hire a freelancer to do the work for you.
You are the marketer of these services and make money selling services to people who need them. In other words, you are the middleman between the service owner/provider and the customer.
Drop Servicing Vs Drop shipping
With drop shipping business model, you sell products, while with drop servicing business model you are selling services. In both, you are reselling something not yours.
Simply, drop servicing is a business model based on services not products, while drop shipping sells physical products.
How does drop servicing work?
With drop servicing, you create and market a service (or services) through your website and social media, the same way you would with dropshipping. The difference is that when it comes time for a customer to pay to get what they ordered (be it web design, SEO, or a PPC campaign), someone you outsource does the work. You then present the completed work to the client. After the client pays, you pay the freelancer, and the job is done.
What products can you drop service?
Drop servicing is a business model that works with any service. Actually, it is popular for online marketing, and commonly available services include:
- Design like Logos, T-shirt designs, Social media posts, Flyer designs, etc.
- Programming like App development, Website development, etc.
- Digital Marketing like SEO, SEM, PPC, content marketing, Social media marketing, Adwords, Backlinking, etc.
- Writing like Content writing, Ghostwriting, Resume writing, Proofreading, etc.
- Audio Video Design And Editing like Video Editing, Sound design, Motion graphics, Animation, etc.
- 3D Printing like Building models, Printing designs, etc.
Why is drop servicing useful? Advantages of drop servicing
Drop servicing business model is great if you know how to manage and market your business. In a way, you are like an agent, providing a variety of services or specializing in one service to those who need it. If you have the skills to build relationships with clients and suppliers, you can do well in hiring freelancers to do your work.
Drop servicing can also be a money-saving business model if you depend on freelancers to deliver your work (as opposed to creating an entire website to market your services).
What are the disadvantages of drop servicing?
Honestly, drop servicing is a business model with only one disadvantage which is having to work hard on finding talented freelancers to do the work (and there is no guarantee that they will).
Basically, you have to recruit talent – whereas, with dropshipping, suppliers are usually willing to accept orders at any time because they already have inventory in the production process. Also, it is not always possible to guarantee an exact turnaround time for your service, depending on how busy a freelancer is. Also, you will have to build a website from scratch to market your services.
✅See also: How to make money online from affiliate Marketing as a Beginner
What is drop servicing business requirements?
In general, drop servicing require very low entry requirements. Actually, you can start with zero initial capital. It will requires more effort, but it is possible.
Moreover, you don’t have to be expert in the service you are promoting. Having a basic knowledge is enough. However, you should deal with professional freelancer that fulfill the service with less costs.
How to Start a Successful drop Servicing Business?
Getting started is similar to any online business – you have to define what you want to offer and who your customers will be. Once you’ve figured that out, it’s time to get down to business, and there are two ways to do this:
Choose the service you want to drop service
Choose a service which is in demand and fits your niche and audience. If you don’t have an audience yet, you can choose whatever you want.
Build your own website
Using a platform like WordPress or Wix, you can create a website to market your business and its services. Make sure to have a well-designed website with clear info, privacy and policy page, about us page, terms and conditions page, your accepted payment methods, etc.
Find someone to deliver the services for a lower price
You should find some one to do the service at a cheaper price. Then, you display it on your website with higher price. The differences between both prices is your profit.
Advertise the website
Promote your website on social media and other platforms, run paid ads, etc.
What is drop servicing business providers?
I’ve noted some great sources above, but some other popular ones include:
- Hubstaff Talent
- Hire Coder
- 99 Designs
Is drop servicing legal?
Yes, the drop servicing business model is a legal business model. If you are honest in dealing with your customers and the freelancer providing the service, everything will be okay.
Provide services with high quality to get your audience trust and build a reputation for your company/brand.
Is drop servicing profitable?
Today, Drop servicing is one of the most profitable business models. It requires little requirements and can get high profits depending on the niche, type of work, marketing strategy and deadline. Actually, drop servicing businesses provide high profits every single day if they promote trending services.
What are the best drop servicing niches?
The best drop servicing niches are:
- Writing: Sell pieces of writing
- Video creation: Sell videos
- Graphic design: Sell designs
- Social media management: Sell the social management service
- Website development: Sell the website development service
- Search engine optimization (SEO): Sell the SEO service
- Programming: Sell the programming service
Can you start drop servicing with no budget?
Yes, you can start drop servicing with no budget.
Create your website on Wix, blogger or other free platform on internet and advertise it with free promotional methods to sell your service. It will be the simplest, successful project that cost nothing.
What skills do you need for drop servicing?
To start drop servicing, you need basic marketing and sales skills as well as basic knowledge with the services you are drop servicing. That’s it!
What services are the best for drop servicing?
Honestly, you can drop service any service you want. However, some services are just easier than others like:
- Video creation
- Graphic design
- Social media management
- Website development
- Search engine optimization (SEO)
Conclusion about What is Drop Servicing Business
Now, you know what is drop servicing business. Drop servicing is definitely a different business model concept than drop shipping, but it’s a great business idea for those who know how to manage client/freelancer relationships. If you know how to find talent and organize work, you can sell on-demand copywriting, programming or marketing services.
✅See also: What is DropShipping Business and How Does It Work?