Table of Contents
This blog targets anyone involved in or curious about ecommerce, brand growth, and marketplace innovations:
You started with Dropshipping, listed a few products, set up the backend, and made some early sales. The entire process was quick, low-risk, and effective in getting things moving. However, you now want more control over your brand, better customer experiences, and stronger partnerships.
That’s what collaborative commerce or brand partnerships make possible.
You may still rely on third-party suppliers but it will enable you to co-create products, build joint marketing campaigns, and grow alongside like-minded brands.
In this article, we will decode why brands are making the switch from dropshipping to collaborative commerce. We will also discuss how it works and where you can begin.
The traditional Dropshipping model is quite straightforward.
You list products on your online store; a customer places an order, and the product ships directly from a third-party supplier to the customer. You don’t even have to hold the inventory or manage fulfilment. You’re the middle layer connecting the buyer and supplier.
This approach offers advantages like:
It's what made dropshipping so attractive, especially for new entrepreneurs entering the e-commerce market.
But this simplicity came with drawbacks such as:
Over time, these issues can erode customer trust and hamper online market growth.
For example:
You’re running an online store and selling home office accessories. You’ve built your catalog by sourcing items from various suppliers like desk organizers, ergonomic chairs, and tech accessories. The moment a customer places an order, your supplier ships it out.
Now, imagine one supplier running out of stock and another shipping late, delivering your customer's package two weeks late with no tracking updates. You’re left dealing with the customer complaint despite never touching the product. Multiply that by dozens of orders a week, and control becomes a challenge.
This is why and where many brands fail and start exploring more sustainable and scalable models like collaborative commerce.
DoDropshipping reports that just 1.5% of dropshipping businesses ever reach over $50,000 in monthly recurring revenue. Adding to that, Shopify experts note that only 10% of dropshipping businesses actually become profitable.
So, while the model may be easy to start, sustaining and scaling it is a different story altogether.
In collaborative commerce, brands work with other businesses, creators, and suppliers to co-create, market, and deliver products. Unlike traditional dropshipping, where products come from distant suppliers with little involvement, collaborative commerce focuses on building mutually beneficial partnerships.
Instead of working in isolation, businesses team up to share resources, align on values, and grow together. This often includes co-developing products, running shared marketing efforts, and collaborating on fulfillment and logistics. This model emphasizes long-term value for everyone involved, including the customer.
Example: You run an online store that sells wellness products. In a typical dropshipping setup, you would usually list mass-produced yoga mats from a supplier. You don’t control how it's made, packaged, or priced. You simply market it and hope everything goes smoothly.
But in a collaborative commerce setup, you will reach out to a local eco-brand that makes yoga accessories. You might even decide to create an exclusive line of mats made from recycled materials. Thus, you co-design the product, your partner manufactures it, and you both promote it through your channels.
The customer receives a high-quality, thoughtfully packaged item with a strong brand story behind it. Your partner gains access to a new customer base. You offer something unique, and everyone grows together.
Since the pandemic began, consumer behavior has drastically shifted, with more people turning to online shopping for convenience. Brands have been racing to personalize the shopping experience using AI-based voice search and chatbots.
With rising competition and customer expectations, brands are realizing they need more control and authenticity to stand out. That’s why many are pivoting toward collaborative commerce. In this section, we’ll understand what’s fueling this shift and why more businesses are making the switch:
1. Increased competition and the need for differentiation
Today, anyone can open a Shopify store and start dropshipping products—that low barrier to entry has created intense competition. And when everyone’s selling the same trending items from the same suppliers, how do you stand out? That’s the challenge.
That’s where collaborative commerce gives brands a way to differentiate by curating exclusive products, building unique experiences, and aligning with like-minded partners. You gain access to exclusive products that your competitors can’t easily copy.
2. Robust brand authenticity and unique product offerings
Today’s consumers care deeply about where products come from, who makes them, and what a brand stands for. They need products that can’t be found in every marketplace. Dropshipping makes it hard to build that kind of trust, especially when you have little control over product quality, packaging, or customer experience.
However, collaborative commerce allows you to partner or co-create with brands that align with your purpose and values. It results in unique offerings that strengthen your brand footing in the market.
3. Building sustainable, long-term business partnerships
Dropshipping often feels transactional. You source a product, fulfill an order, and move on. There’s little incentive or ability to build a real partnership with your suppliers. But in collaborative commerce, you don’t only source but also strategize with your partners together. That means co-marketing, co-developing products, more innovation, and sustained business growth in tandem.
4. Improved customer loyalty and repeat purchases
Customer loyalty is tough to build when your product quality varies, and delivery timelines are unpredictable, which is common with dropshipping. So, customers may buy once, but they’re unlikely to come back.
Collaborative commerce offers a far more reliable and curated experience. You’re working with partners who meet your standards and care about customer satisfaction just as much as you do. It leads to better service, faster delivery timelines, enhanced product quality, and higher retention rates eventually.
Today’s customers don’t just want products, they're seeking purpose, trust, and a strong brand connection.
Collaborative Commerce enables brands to deliver on that while gaining more control over quality, brand consistency, and long-term growth.
The global market size for enterprise collaboration accounted for $53.93 billion last year. It’s now expected to increase from $59.67 billion in 2025 to $132.64 billion by 2023. That’s a steady CAGR of 121%, showing how quickly businesses are leaning towards partnership-driven models.
While both models enable you to sell products without holding inventory, their operational methods and value delivered differ. Here’s a comparative breakdown:
Nordstrom online marketplace is a great example of collaborative commerce done right.
Traditionally known for curated, high-end retail, Nordstrom expanded its digital footprint by inviting independent designers and niche brands to sell on its platform. Instead of buying or holding stock, Nordstrom offers these brands access to its massive customer base, logistics capabilities, and marketing reach.
This collaboration means:
This strategy has helped Nordstrom stay competitive against online giants by combining exclusivity with variety and convenience.
As dropshipping continues to face challenges like thin margins, limited control, and poor customer experiences, collaborative commerce is emerging significantly. So, let’s break down its features and how they’re paying off to the brands and customers as well:
Customer experience can make or break your brand. In dropshipping, marketplace owners mainly rely on third-party suppliers for product quality, shipping times, and even packaging. That can lead to delays, damaged goods, or mismatched branding.
With collaborative commerce, you work directly with partners who are invested in your success, online and offline. It results in faster delivery, branded packaging, and more consistent service.
Example: You’re running a home decor store. Instead of dropshipping a generic lamp from overseas, you partner with a local artisan brand. Now, your customer gets a beautifully packaged, handcrafted item delivered within days and not weeks.
Dropshipping can sound easy until you start dealing with unreliable suppliers, tracking lost shipments, or managing returns. You're often just the middleman with very little control.
In collaborative commerce, you and your partners align on systems, tools, and responsibilities. It leads to smoother workflows, clearer communication, and faster problem-solving.
Example: If a customer’s candle arrives broken, your collaborative partner already has a process in place with you to replace it fast. Hence, no finger-pointing or endless emails for replacement.
When you dropship, you carry all the burden of marketing, customer service, and brand building. On the other hand, the suppliers only have to fulfill the order. This entire scenario is flipped in collaborative commerce. Partners share resources, handle logistics, co-fund ad campaigns, and even contribute to packaging and design. When responsibilities are shared, there’s more accountability and less burden on just one person.
Example: You team up with a boutique skincare brand. They handle fulfillment and send samples while you manage digital ads. The costs are shared, and both brands benefit.
Dropshipping offers limited control over what you sell and how products connect. But when you're collaborating, you can intentionally bundle or pair products from different partners to increase value.
Example: Let’s consider that you’re selling yoga mats through a partner brand. You can even bundle it with eco-friendly water bottles from another partner. The target audience is the same, but the cart value is higher with a more curated customer experience.
With dropshipping, you’re often selling one-off, low-ticket items. It’s not ideal for margins. However, collaborative partnerships allow you to offer complementary, premium, or bundled products that raise the average order value.
Example: A customer buys a premium leather wallet from your store. But you’ve collaborated with a luxury pen brand as well. And they offered a discounted add-on product at checkout. It will increase the average order value, as a perception of discount is created in the mind of the buyer.
In dropshipping, the product variety is quite extensive. But it often comes at the cost of quality control. However, collaborative Commerce gives you both. You get access to your partners’ product lines with the ability to check quality, ensure consistency, and align branding.
Example: You’re running a lifestyle store. To ensure top quality, you can offer a handpicked range of wellness teas, skincare, and journals from trusted collaborators who uphold your brand standards.
In dropshipping, you don’t build much of a relationship with suppliers as they’re just order processors. However, collaborative partnerships are built on mutual goals and long-term growth.
Example: You have a fitness gear brand. Now, you collaborate with a small gym wear label. Together, you co-launch a limited-edition product line and promote it on both platforms. You grow your audience, and so do they.
As a dropshipper, you often rely on mass-produced, widely available items. But collaborative commerce lets you tap into niche and independent brands that your audience truly connects with.
Example: If your store focuses on pet lovers, you might team up with a small brand that makes handmade dog accessories. It's specific, unique, and speaks directly to your customers' lifestyle. This is something a mass dropshipping product just can’t do.
1000+
We believe in the uniqueness of every marketplace. That’s why more than 1,000 founders around the world have trusted us to help build the marketplace they envisioned.
Shipturtle is best positioned to address the shifting eCommerce landscape by facilitating both legacy dropshipping and the emerging tide of collaborative commerce — all through one platform.
Legacy Dropshipping:
Shipturtle makes traditional dropshipping easy by enabling retailers to add and resell products from multiple third-party suppliers without holding inventory. These features include:
Collaborative Commerce:
Shipturtle differentiates itself with a robust infrastructure for brand-to-brand collaborations, in which two or more brands work together to co-distribute or co-sell one another's products. This model taps into:
This enables expanding DTC brands to construct curated marketplaces or broaden their product line through trusted partners — no middlemen, no commissions.
While dropshipping was able to bootstrap many brands with little capital, its drawbacks—such as poor product quality, slow shipping, and inability to differentiate themselves—have made it unsuitable for long-term expansion. Only 1.5% of dropshipping stores make $50K/month, and only 10% become profitable. Meanwhile, collaborative commerce provides better margins, improved customer experiences, and greater product and fulfillment control.
Collaborative commerce is a system in which brands collaborate with other companies to co-produce offerings, pool logistics, and collectively market products. In contrast to dropshipping, in which offerings come from anonymous third-party vendors, collaborative commerce allows for shared ownership, authentic storytelling, and more consistent quality—all factors that foster customer loyalty and trust.
Benefits include better margins, shared marketing efforts, enhanced customer trust, faster fulfillment, improved product quality control, and a more sustainable, scalable business model.
Start by identifying aligned brand partners, use tools like Shipturtle for vendor collaboration, and shift to shared inventory and fulfillment workflows while maintaining your storefront as the customer-facing layer. You can also enhance your dropshipping experience with Shipturtle's powerful Shopify app.
Shipturtle lets you connect vendor websites, and automate listings, orders, shipping, payouts & much more. You can scale unlimited with open APIs for custom development.
Want to learn more about how Shipturtle can benefit your business? Book a personalized demo with our sales team.
Experience the power of Shipturtle for free. Start your trial today and discover how it can transform your Shopify multivendor store!
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Manav Gupta is a Content Consultant at Shipturtle, where he focuses on simplifying marketplace concepts and creating actionable content for e-commerce founders, operators, and product teams. Outside of Shipturtle, Manav is also involved in building AI-led business tools.
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