Business

Logic
TOPIC 4
Dropshipping

Dropshipping is a type of retail

fulfillment business that outsources
production, warehousing and shipping to a
third-party supplier. If you dropship some
or all of your products, you don’t stock or
fulfill those items yourself. Instead, when This arrangement can be a win-win for everyone
you receive customer orders, you route involved. Sellers get to focus on curating and promoting
them directly to manufacturers or items as opposed to managing inventory and warehouses;
wholesalers for direct shipment to
suppliers get to focus on making and delivering goods
customers. You don’t pay for the items
without needing a retail operation; and shoppers gain
until they are purchased by your
customers.
access to products they can’t necessarily find at their local
stores.
Sample companies
WHAT IS CROWDSOURCING?

Obtaining work, information, or opinions

from a large group of people via the
internet
HOW DOES IT WORK?
Companies collect information from customers and
use it to their advantage. Companies or brands gather
opinions, ask for help, receive feedback to improve
their product or services.
EXAMPLES:
 WHAT ARE THE MAIN TYPES OF
CROWDSOURCING?
Crowdsourcing involves obtaining information or resources from a wide swath of people. In general, we can
break this up into four main categories:

Wisdom - Wisdom of crowds is the idea that large groups of people are collectively smarter than individual
experts when it comes to problem-solving or identifying values (like the weight of a cow or number of
jellybeans in a jar).

Creation - Crowd creation is a collaborative effort to design or build something. Wikipedia and other wikis are
examples of this. Open-source software is another good example.

Voting - Crowd voting uses the democratic principle to choose a particular policy or course of action by "polling
the audience.“

Funding - Crowdfunding involved raising money for various purposes by soliciting relatively small amounts
from a large number of funders.
PROS
Crowdsourcing brings together communities around a
common project or cause
Efficient way of solving time-intensive problems
Deeper engagement by communities, who resonate and
build loyalty to the product or solution
CONS
Results can be easily skewed based on the crowd being
sourced
Lack of confidentiality or ownership of an idea
Potential to miss the best ideas, talent, or direction and fall
short of the goal or purpose
 How Network Marketing Works

Network marketing is known by a variety of names,

including multilevel marketing (MLM), cellular marketing,
Network affiliate marketing, consumer-direct marketing, referral
marketing, or home-based business franchising.
Marketing Companies that follow the network marketing model often
Network marketing is a business model that create tiers of salespeople—that is, salespeople are
depends on person-to-person sales by encouraged to recruit their own networks of salespeople. The
independent representatives, often working
from home. A network marketing business may
creators of a new tier (or "upline") earn commission on their
require you to build a network of business own sales and on sales made by the people in the tier they
partners or salespeople to assist with created (the "downline"). In time, a new tier can sprout yet
lead generation and closing sales.
another tier, which contributes more commission to the
There are many reputable network marketing person in the top tier as well as the middle tier.
operations, but some have been denounced as
pyramid schemes. The latter may focus less on
Thus, the earnings of salespeople depend on recruitment as
sales to consumers than on recruitment of
salespeople who may be required to pay well as product sales. Those who got in early and are in a top
upfront for expensive starter kits. tier make the most.
MULTILEVEL MARKETING
Multilevel Marketing (MLM), also known as network marketing or pyramid selling, is a
marketing strategy where revenue is generated through a non-salaried workforce selling a
company's products or services and earning a commission based on their sales and the sales of
their downline (recruited individuals). MLM is structured in a hierarchical fashion, with multiple
levels of distributors or participants, each earning income from their sales and the sales of those
they recruit.

One example of a multilevel marketing (MLM) company operating in the Philippines is Frontrow
International. Frontrow is a Philippine-based MLM company that focuses on health and beauty
products. It was founded in 2010 by Sam Verzosa and has gained popularity in the country.
CELLULAR MARKETING
Mobile marketing is a multi-channel, digital marketing strategy aimed at reaching a target
audience on their smartphones, tablets, and/or other mobile devices, via websites, email, SMS,
social media, apps, and more. Given the widespread use of mobile devices, businesses and
marketers have increasingly adopted mobile marketing strategies to connect with users on the go.
AFFLIATE MARKETING
Affiliate marketing is a performance-based marketing strategy where a business rewards one or more
affiliates for each visitor or customer brought by the affiliate's marketing efforts. It is a form of online
marketing in which businesses (merchants or advertisers) collaborate with individuals or other
companies (affiliates or publishers) to promote their products or services.

An example of affiliate marketing in the Philippines involves various online platforms and influencers
promoting products or services through affiliate links. One such platform that facilitates affiliate
marketing is Lazada, a popular e-commerce website in the Philippines.
CONSUMER-DIRECT
MARKETING
"Consumer-direct marketing" typically refers to a business model or marketing strategy where
companies sell their products or services directly to consumers without involving intermediaries
like retailers or wholesalers. This approach allows businesses to establish a direct connection
with their customers, gather valuable data, and have more control over the entire customer
experience. Here are some key features and examples of consumer-direct marketing:
REFERAL MARKETING
Referral marketing is a strategy in which businesses encourage and leverage existing customers,
clients, or contacts to promote their products or services to new potential customers. This
marketing approach relies on word-of-mouth recommendations and personal endorsements to
generate leads and acquire new customers. The goal is to turn satisfied customers into advocates
who actively refer others to the business.

In the Philippines, referral marketing is commonly used by various businesses, including e-

commerce platforms, service providers, and direct selling companies. One example is the referral
program implemented by the popular ride-hailing service, Grab.
HOME-BASED BUSINESS
FRANCHISING
Home-based business franchising refers to a business model where individuals can operate a franchise
from the comfort of their own homes. Franchising is a business arrangement in which the owner
(franchisor) of a proven business concept grants the rights to another person (franchisee) to operate a
similar business under the established brand, systems, and support. Home-based franchising allows
individuals to run their franchise operations without the need for a separate physical storefront or
office space.

One example of a home-based business franchising opportunity in the Philippines is The Generics
Pharmacy (TGP) Express Franchise. TGP is a well-known pharmacy chain in the Philippines, and the
TGP Express Franchise is designed to allow individuals to operate a TGP store from their homes or
other suitable locations. This home-based franchise model aims to make pharmaceutical products more
accessible to local communities.
 Blockchain technology has the following main features:

Decentralization

Block Chain Decentralization in blockchain refers to transferring control and decision

making from a centralized entity (individual, organization, or group) to a
distributed network. Decentralized blockchain networks use transparency to
reduce the need for trust among participants. These networks also deter
Blockchain technology is an advanced participants from exerting authority or control over one another in ways that
database mechanism that allows transparent degrade the functionality of the network.
information sharing within a business network.
A blockchain database stores data in blocks Immutability
that are linked together in a chain. The data is
Immutability means something cannot be changed or altered. No participant
chronologically consistent because you cannot
can tamper with a transaction once someone has recorded it to the shared
delete or modify the chain without consensus
from the network. As a result, you can use ledger. If a transaction record includes an error, you must add a new
blockchain technology to create an unalterable transaction to reverse the mistake, and both transactions are visible to the
or immutable ledger for tracking orders, network.
payments, accounts, and other transactions.
Consensus
The system has built-in mechanisms that
prevent unauthorized transaction entries and A blockchain system establishes rules about participant consent for recording
create consistency in the shared view of these transactions. You can record new transactions only when the majority of
transactions. participants in the network give their consent.
How does Blockchain work?
Sample Companies
 Drop servicing differs from a drop shipping business because it’s mainly service-oriented.
With drop servicing, you don’t need a retail or online store to process physical products.

Let’s look at how the drop service business model typically works:

1.Identify a digital service. You first identify the digital service you’re willing to provide. From

Drop Touch/
content production to software development, the list of drop service ideas you can start is
vast.

Drop Servicing
2.Find freelancers to work with you. Once you’ve identified your target service, start looking
for freelancers who will collaborate with you to provide the service. Among the top places you
can find freelancers are Upwork and Fiverr.

3.Find customers. The next step is to market your digital service and find customers. You can
Drop servicing is a business model where you sell
use a variety of promotional tactics, including social media marketing.
digital services to clients and outsource the work to
freelancers, agencies, or contractors rather than 4.Set prices and receive payment. Remember to set prices for your services. You don’t want to
doing it yourself. Starting a drop service business put a high price tag that will scare away clients or go too low where you make no profit. Most
means dealing with services rather than physical drop-service businesses receive payment upfront, allowing them to hire freelancers and get
products. started with the work.

As a drop service business owner, you’ll profit from 5.Collaborate with the service provider or contractor. At this stage, you’ll communicate the
client’s requirements to the service provider doing the project. Once the service provider
what remains after paying the service provider. Let’s
completes the work, you’ll review it and ensure it’s high quality before delivering it to the
say you start a website development drop service.
customer. You’ll also pay the contractor for the service rendered.
You’ll meet with the customer to identify their
needs and hire developers to build the website. 6.Engage in customer service. After sending the final work to the client, get overall sentiment
from them and provide feedback to the service provider. If the customer asks for revisions,
When the developers complete the project, you’ll work with the service provider to address the client’s concerns. Make sure your service
make sure it meets the customer’s requirements, pay provider contract lists the number of changes covered to avoid misunderstandings.
the contractors as agreed, and deliver the final
product to the client.In other words, you act as the
intermediary between clients and service providers.
Sample Companies/Agencies

• Fire Art
• DigitalHaus
• Highland Europe
• Eventsoft
• Marketing Fix
Your best quote that reflects your
approach… “It’s one small step for
man, one giant leap for mankind.”

- NEIL ARMSTRONG