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I am learning magento. I want to create a Multi-vendor application using Magento where vendors will add their products to sell. But when I google about multivendor extensions in magento, i get dropshipper modules also in search results. I want to know the difference between Multi-vendor and Dropshipper. Can anyone explain about it ?

Thanks in advance.

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This is not really Magento related, more of a discussion of terms or semantics. However, to most people the distinction is that in multi-vendor you see that the website offers products actually sold by other parties. With dropshipping, the customer thinks he's buying directly from your store, but actually you're only handling the order on-site and the rest is done in the background by a third party.

To elaborate:

  1. In a dropshipping setup, you sell products on your store that are actually handled by third parties. You handle the order-process on your website, after which you forward the order to the third party. They are the ones actually sending the order. In most cases, the client ordering doesn't know about this. The third party sends the package under the name of your website, with your logo, etc.

  2. In a multi-vendor setup, customers can choose from several vendors that are selling on your website. Good example are Etsy and eBay, which offers a multitude of tiny shops run by several individuals.

Technically, the most important point is that a dropshopping site is maintained by one person or company. You aggregate products from other vendor(s) and 'sell' these on your site. For a multi-vendor site you need to handle a store for every vendor, provide them with logins to handle their personal store, etc.

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    I will just add that the reason you see them together is that a multi-vendor can also be a dropshipping hub. Look at any cafepress or custom product type of site. A business can manufacture custom widgets, and store & drop ship them for their customers. Their customers can then create their own webstore on the dropship companies platform. – willboudle Oct 9 '13 at 14:24
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Multi-vendor application using Magento - that means seller or vendor can register in to your magento store and they can upload the product , manage the inventory , manage the orders and can manage the shipping . there are various kind of multi vendor marketplace example seller will be able to add a new product or old product or seller can choose the existing product from global catalog .

even in advance concepts - marketplace vendor can also ship their product using dropshipping i.e admin can assign particular vendor to a dropshipper and order and delivery management will take place from dropshipper

Dropshipping using Magento - in this case you dont need to create a marketplace , what will happen lets say you create your own store and you dont want to have a warehouse of product in this case dropshipping is super useful . that means when ever a order will come in to you site , shipment and order will be managed by dropshipper .

admin need to add dropshipper and admin can add what shipping methods dropshipper provides and during checkout buyer can choose the shipping methods . so in this case all the delivery will be managed by dropshipper your store will be kind of a front end where you will get % of payment in every sale (its depends on your business modal how do you manage it ) .

PS - we are creating marketplaces for magento , this is not an advtisement but you can check more feature what a multi vendor product should have at this link https://store.webkul.com/Magento-Marketplace.html

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