UPSC CSE Prelims
Question 79
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 :
View correct answer and explanation
Correct answer: A
Correct Option: A
Explanation: Dropshipping lets a retailer sell at its chosen price without maintaining its own physical inventory; fulfilment is handled by a supplier.
Option-wise Analysis:
A: Correct - Dropshipping fits the model: orders go to a third-party supplier, which ships directly to the consumer.
B: Incorrect - Affiliate marketing pays commissions for referrals; an affiliate usually does not set the seller’s retail price.
C: Incorrect - A transaction-fee model earns fees from facilitating transactions, not necessarily through outsourced order fulfilment.
D: Incorrect - An agency model represents principals and may earn commission; it is not defined by third-party inventory fulfilment.