Dropshipping can be a great way to make money online, but is it legal? The short answer is yes, dropshipping is a legal business model in the Netherlands and Belgium. It is a recognized way of company formation by the Chamber of Commerce. They have even written several articles about dropshipping.
What is drop shipping?
Dropshipping is an innovative supply chain management method in which the webshop owner does not hold or own any stock. Instead, they partner with manufacturers to sell products directly from the warehouse through their online store (or Bol,Amazon,Etsy). Dropshipping is ideal for entrepreneurs who want to sell products online without all the risks that come with purchasing products.
The benefits of dropshipping
Dropshipping has many advantages. Below are a few examples:
- No inventory: You don't have to buy, store and ship all the products you sell. All you have to do is focus on selling the products. Think of advertising on Facebook , Google AdWords, Pinterest, TikTok or building an email list.
- No storage costs: You don't need a storage space to store your products. You can ship products directly from the supplier to the customers' addresses.
- Low start-up capital: Dropshipping has a low barrier to entry because you don't have to buy products or risk being stuck with unsold inventory.
- Save time and money: Because you don't have to pack and deliver the products yourself.
What should you take into account as a dropshipper?
As a dropshipper in the Netherlands you are obliged to follow a number of rules and regulations. These include:
- Paying taxes: You have to pay VAT on all products sold.
- Agreements are met: Delivering products on the agreed date.
- Product safety: It is important that the products are safe for use. If your products do not have a CE mark or other certification, they cannot be sold in the European Union.
When is dropshipping illegal?
Unfortunately, dropshipping has a bad reputation due to the actions of some dishonest sellers. Unfortunately, scams can be found in every industry, including dropshipping. Below what you absolutely should NOT do as a dropshipper:
- Pay no VAT
- Not delivering products
- Sell fake products
- Advertising with false promises
Dropshipping this way is illegal . If the government investigates your company, there can be several consequences. Think of high fines, closure of your company and claims for damages.
Dropshipping with Dutch suppliers
Drop shipping with Dutch suppliers is a good option, because it is not only legal, but it also ensures fair business formation. Dutch suppliers are known for their high quality products, which means that you can deliver excellent products resulting in high customer satisfaction!
We at GOGETTERS have been working on improving dropshipping in the Netherlands since 2018. We have developed a simple app that links Dutch suppliers to your webshop in a few minutes. With our app you get the tools you need to successfully do business with Dutch suppliers - at a fraction of the cost and effort of hiring a developer. We take care of everything: think of automatic order processing, importing products, updating stocks and much more. So you can focus on growing your business!
Conclusion
Some people are hesitant to try dropshipping, thinking it is a scam. But if you play by the rules, sell good quality, and deliver on time, then dropshipping is perfectly legal and just like running a regular online store (only without all the headaches that come with keeping stock)!