Most of us don't know what drop shipping is although we regularly partake in it.

This type of shipping is generally an effective way if you are planning to start an ecommerce business.

It is an effective and easy way to reduce the stock that is on hand as it decreases the cost of shipping. It also reduces the delivery time, and customers get their orders quickly.

With this kind of shipping, business owners can send either single or small quantity of unit orders that is ordered via their websites.

These warehouses or goods manufactures then ship the items to customers. The one who brings the goods from the manufacturer to the customer's doorstep is the dropship company.

There are two important components to dropshipping; firstly it's the shipping address and the billing address.

Most of us think that billing address and shipping address is the same. However there is a slight difference between them and it is important that businesses should know the difference between the two terms.

What Is Shipping Address?

When you buy certain items from an online store, you often notice a page that asks you to enter in the shipping address. The shipping address is nothing but the address that you want the items to be delivered to.

The dropshipping company delivers these items to the shipping address.

If you are locally located, the manufacturer employs international shipping methods so that their clients get their items.

Your shipping address (where the item will be delivered) can be your home, office, or even hostel. This also determines the cost; addresses that are locally located do not have to incur shipping charges. However those that need to be shipped internationally have certain charges that apply to it.

What Is A Billing Address?

Billing address is the second most important component in dropshipping.

It is the address to where the bill statement is sent out to, and payment received from.

Once the item is paid for the transaction is complete. Most people who shop or buy items online pay though credit cards.

Most online businesses ask customers for their billing address which is generally the address on your credit card.

Once you complete the buying process, the billing address is matched with the address on your credit.

This is generally a verification kind of process, so that they know if the credit card details are entered correctly.

The bill and its information are sent out to the credit card company and the credit card is charged, after which the item is sent out to the shipping address.

It is important for a dropshipping company to know the difference between the billing address and shipping address.

• Business that make use of dropshipping services operate online and need to have dropshipping friendly shopping carts as well as card processing facilities. This ensures that the transaction process is completed.

• Shopping carts information also means that they need to capture the billing address and shipping address of the customer.

• There are times when the billing address is different from the shipping address. Especially if customer wants to send out the item as a gift to your friend or loved ones. In this case there is an obvious difference between the shipping and billing address.

• It is necessary for businesses to allow their customers to supply billing address so that they can compare it with their credit card companies and charge them for the item.

• Only once the customer is charged can the item be sent out to the customer.