Attempt this previous-year question. The correct option stays hidden until you choose.
An e-commerce revenue model where the seller has control over pricing but doesn't keep products in stock and instead transfers customer orders and shipment details to a third-party supplier, who then ships the goods directly to the customer, is called :
Pick an option to check yourself.
Approach: *Analyze the supply chain and inventory management role of the seller to distinguish between various e-commerce business models.*
- **Correct Answer:** (a) Dropshipping Model
- **Dropshipping:** In this model, the retailer acts as a storefront. The retailer sets the retail price and manages customer relations, but the physical inventory is held and shipped by a third-party supplier (wholesaler or manufacturer). The retailer only purchases the item from the supplier once a sale is made, eliminating inventory risk.
- **Why other options are incorrect:**
- **Affiliate Revenue Model:** The seller earns a commission by referring customers to another merchant's website. The seller does not set the price or handle the transaction/shipping.
- **Transaction Fee Revenue Model:** The platform earns revenue by charging a fee for facilitating a transaction between two parties (e.g., payment gateways or marketplaces like eBay), rather than acting as the primary seller.
- **Agency Revenue Model:** The seller acts as an agent for the supplier, often earning a commission on sales, but typically does not have the same level of independent price-setting authority or the 'buy-sell' structure characteristic of dropshipping.
Attempt Prelims MCQs or open Mains questions by paper — then continue the same bank inside the app with visual decks.
GyanGram