Mail order is the term used whenever customers order goods via means of communication such as the Internet, fax or telephone. It is the counterpart to retail trade, where there is personal contact between buyer and seller. In the case of mail order, there is no direct exchange between the customer and the seller, but rather via the medium used, for example the online store or the print catalog. It is also referred to as “distance selling” because the commercial transaction is conducted over a longer distance.
How mail order works
In the case of mail order, the customer obtains information about the retailer’s product range independently. To do this, they either use a printed catalog, which most mail order companies send to them free of charge, or an online store. With the online store, all articles can be viewed on the Internet and, if interested, also ordered. When purchasing by catalog, the customer notes the item numbers of the desired goods and finally places his order by telephone, by fax, by order form in the mail, by e-mail or via the associated online store of the retailer. In the case of mail order via an online store, the buyer places the desired products in the shopping cart and finally submits his order electronically. The goods are shipped to the customer either after payment or, in the case of payment on account, also beforehand using shipping service providers such as DHL or Hermes.
Types of mail order
There are basically two types of mail order business. A universal mail order business does not specialize, but covers a wide range of products. A typical example is the combination of clothing, electronic goods, home textiles, furniture and toys. This contrasts with specialty mail order, which covers only a specific product line. A typical example of this is a mail order business with a DIY product range or an online store with a range of products for babies and children.
Advantages of mail order
Mail order has the advantage for consumers that they can shop completely independently of time and place. In the meantime, mobile shopping applications even enable shopping on the go via smartphone. What’s more, customers can look at the entire product range at their leisure without overlooking important aspects in the crowds in a store. Purchase decisions can be made in a much more informed manner. Sellers reach a much larger target group through mail order than in retail. In addition, they can save costs by requiring fewer staff and by not having to operate a retail store.
Better opportunities through dropshipping
Mail order is additionally revolutionized by the possibility of “dropshipping”. Online retailers no longer have to keep the goods they offer in stock. They cooperate with wholesalers who ship the goods directly to the buyer in the event of a customer order. This eliminates the need for the retailer’s delivery station, reducing not only storage costs but also delivery costs. This also reduces the naturally high storage risk associated with mail order. Today, it is possible to start an online store without a large capital base.
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