First, let’s explain what an affiliate program is. Let’s say you have a blog online where you talk about coffee and a couple times a month, you post about how much you love coffee and you even mention your favorite brands and flavors. Those brands probably have an affiliate program for you to sign up for. Most major companies & retailers do! You would sign up for that affiliate program, and put your special link on the words in your blog posts to send people to that place to buy or you place “ads” on the page for people to check out what you like and maybe buy it to try it out.
When a person clicks that ad or link, they will go to the brand or retailers website, and you will earn a set commission amount for every sale that is made. Commission amounts vary across the board for every company, so you can either shop around for the best commission or only promote your favorite places to buy from.
So with an affiliate program, you aren’t the one processing the orders and charging customers. The company you are referring people to will.
A Wholesale Affiliate Program is the exact same thing. You are promoting products, but not necessarily selling them.
So how does that differ from dropshipping?
With drop shipping, you are the one that is offering the products for sale on your website or chosen selling platform. You have a merchant account and will charge the customers the retail price + shipping/handling costs. Once you collect the funds from the customer, you then place the order with the wholesaler that dropships and pay the wholesaler the wholesale cost + shipping/handling. The Dropshipping Supplier will then ship the product to your customers location for you.
So with drop shipping, the wholesaler is your fulfillment center. With an affiliate program, the retailer handles everything and will pay you every month for sales that you generated.
Which is better?
It depends. If you only want to blog about your favorite things, then an affiliate program is better. If you want to control the retail prices, directly communicate with the customers, and actually have a store online, then you need to setup accounts with wholesalers that drop ship to fulfill orders for you.
Which earns more?
Again, it depends. If you get fantastic wholesale prices, you can actually earn more by having an online store than referring people to other websites. So shop around and figure out what’s best for you and what level of involvement you want.