How To Start an Online Store Without Inventory (2025)

Starting your own business doesn’t have to mean filling your garage with inventory or investing thousands upfront. In today’s online retail ecosystem, you can start an online store without inventory and still build a profitable ecommerce business—and there’s more than one way to do it.

Whether you’re launching a side hustle or scaling an existing brand, an online store without inventory can be a low-risk, high-reward path for online entrepreneurs. With the right strategy, you can focus on what matters most—building your brand, serving customers, and growing your business—while third party partners handle logistics.

To explore these strategies, Shopify community manager Jacqui McLellan shares her insight into picking the best strategy for your goals, budget, and skill set.

Advantages of selling without inventory

Choosing to start an online store without inventory can help reduce financial risk and startup costs. Here are the benefits of this model:

• Lower startup costs. When you don’t buy stock, you eliminate warehouse costs and inventory management expenses, reducing your financial risk. This is ideal for bootstrapping, letting you launch and grow your own store with minimal upfront costs while maintaining full ownership and control.

• Ideal for solopreneurs. The inventory-free approach makes running a one-person operation much more manageable. Ecommerce automation tools can handle jobs like order processing, inventory syncing, and notifying customers about shipping updates. Platforms like Shopify simplify storefront management, while third-party suppliers take care of storage, packing, and shipping. This frees up your time to focus on what drives real growth: marketing, customer service, and building your brand.

• Scalability and flexibility. Because you’re not limited by how much physical inventory you can store, you can easily list and experiment with a range of products. This approach makes it easier to test different product offerings, pivot your dropshipping niche based on what’s selling, or quickly expand your catalog to meet demand or capitalize on trends.

• Global reach. When you forgo physical inventory altogether by selling digital products (like online courses or ebooks), you get the advantages of instant delivery, no shipping costs, and infinite scalability—all while maintaining full control over product quality.

Disadvantages of selling without inventory

Like any ecommerce business model, selling without inventory comes with potential challenges you should consider:

• Less control over product quality. With many inventory-free models, you’re trusting third-party providers to meet customer expectations. If your supplier fails to deliver quality products, your brand reputation may suffer.

• Fierce competition. In crowded markets where many stores offer similar products, standing out becomes challenging when selling selling generic items without a particular niche, target audience, or unique branding.

• Returns and customer service complexity. Handling returns and refunds becomes more complex when you don’t oversee inventory and fulfillment. Coordinating the process involves back-and-forth with the supplier, often leaving you stuck in the middle. “Most suppliers are not going to take it back directly,” Jacqui says. “They might not refund you at all, depending on what the issue is, so you might end up losing money.”

• Lower profit margins. Not buying in bulk often means paying more per item. Combined with platform fees, your profit margins could be tight—especially when you’re starting out.

• Slower or inconsistent order fulfillment. Shipping processes depend on your supplier. Delays can lower customer satisfaction and increase support requests, which is why conducting through supplier research is essential.

6 ways to start an online store without inventory

1. Dropshipping
2. Print on demand
3. Fulfillment by Amazon (FBA)
4. Affiliate sales
5. Third-party logistics (3PL)
6. Digital product sales

Several proven models let you sell online without managing physical inventory. Here are the top strategies online entrepreneurs use to generate sales while keeping overhead low:

1. Dropshipping

With a dropshipping model, a customer purchases from your store and your supplier handles order fulfillment, shipping the product directly to the customer. Many dropshipping apps sync your store with your supplier’s inventory, automating what would otherwise be a tedious process. You act as the intermediary, earning profit on each sale. “You don’t have to keep anything on you ever,” Jacqui says. But to keep expenses low, she adds, “Start by doing as much as you can yourself. Use any apps that are free or that have free plans. Try to stick with those—especially when you’re first starting out—because if you’ve got no sales, there’s no point in paying more money for more apps.”

Platforms: Shopify (with DSers or Sprocket app), WooCommerce, BigCommerce

Pros:

• No upfront inventory costs. You can implement this strategy with little to no budget.

• Wide range of product offerings. You can expand your product offerings as your business grows.

• Works for almost any niche. Dropshipping product options are almost limitless.

Cons:

• Supplier reliability. Research and vet reliable suppliers to ensure quality products and enhance customer satisfaction—and don’t forget to order product samples.

• Intense competition. Dropshipping is a hot business strategy; defining a niche can give you an edge over the competition.

• Shipping costs. Keep a close eye on your supplier’s shipping rates because they can change without much notice, and you may have to absorb those costs.

2. Print on demand

Print-on-demand (POD) services let you apply custom designs to items like t-shirts, mugs, or tote bags. When a customer orders something from your store, the item is printed and shipped by the POD provider, meaning you never have to manage inventory.

“Print on demand can be really great if you’ve already got a brand, like, say you’re an influencer and you want to have merch, but you don’t want to have to have a whole bunch of merch sitting around your house all the time,” Jacqui says, adding. However, “Do a lot of research into the product before you commit to it, because every moment that you have to spend reconsidering products is lost money.”

Combine print-on-demand with digital marketing and search engine optimization (SEO) to attract organic traffic. You can quickly adapt to market trends by tracking Google Keywords or TikTok for popular phrases, then turning them into compelling designs people want to buy.

Platforms: Printful, Printify, Gelato (all of which you can integrate with your Shopify store)

Pros:

• No inventory management. Your product is stored digitally and produced on demand.

• Easy to launch. You can integrate POD services with platforms like Shopify or Etsy and start selling within days.

Cons:

• Slimmer profit margins. Because each product is produced and fulfilled on demand by a third-party provider, production costs are higher compared to buying in bulk.

• Success depends on design quality. Your POD business’s success hinges on the quality and appeal of your designs. Bad designs won’t sell.

3. Fulfillment by Amazon (FBA)

With this business model, you technically hold inventory in Amazon warehouses, but you don’t manage it yourself. You send products in bulk to Amazon’s fulfillment centers, and Amazon handles everything else—from storage to customer service. This ecommerce model works well for those who want the benefits of inventory ownership without handling the heavy lifting of processing orders.

Pros:

• Prime shipping. Amazon’s shipping has name-brand credibility and customer trust.

• Payment processing. Amazon manages all payments and transfers your earnings directly to you.

• Customer service. Amazon also handles customer questions, returns, and refunds.

Cons:

• Higher barrier of entry. FBA requires upfront investment and storage fees because you’re buying the product ahead of time.

• Requires inventory forecasting. You must keep a close eye on inventory and know when to schedule new orders.

4. Affiliate sales

When you join a brand as an affiliate or start your own affiliate store, you feature items from other brands and earn a commission when someone buys through your link. Affiliate marketing programs work best for content creators or bloggers who get high volumes of traffic from search engines or social media marketing. This strategy centers on your marketing skills and ability to convince your audience to buy the products you recommend.

Platforms: Amazon Associates, ShareASale, Shopify Affiliate Program

Pros:

• No product handling. The supplier handles the transaction from sale to delivery.

• Low financial risk. You don’t need significant monetary investment to launch an affiliate store—unless you want to do paid marketing.

• Passive income potential. Once you set up your store and content (like product reviews, blogs, or gift guides), it can generate sales and commissions passively over time—especially if you’re ranking in search engines or driving organic traffic.

Cons:

• Lower earnings potential. Depending on the program, your commissions on affiliate sales can be relatively low or infrequent. “You’re not going to make as much money, but there’s less risk, and as with anything, the less risk, the less reward,” Jacqui says.

• Requires strong marketing skills or social media presence. You build and retain customers based on the strength of your brand, so if you’re not earning their trust in your taste and driving them to your page, you’ll struggle to make sales.

5. Third-party logistics (3PL)

A 3PL company stores your inventory and manages order fulfillment for you. This model differs from the others because you can partner with a 3PL company if you run a regular ecommerce store and have your own stock, but don’t want to handle the logistics. This hybrid approach is ideal for store owners who want to offer their own products without managing storage or shipping.

Platforms: ShipBob, Red Stag Fulfillment, Flexport

Pros:

• Scalable. You can scale your business quickly because you don’t have physical infrastructure to expand or manage. Whether you’re shipping 10 orders a day or 1,000, most 3PL providers already have the capacity to handle your growth.

• Efficient. Outsourcing fulfillment frees you up to focus on product development, marketing, and branding instead of managing inventory or shipping logistics.

• Return support. Many 3PLs offer return and reverse logistics services, making it easier to manage refunds, exchanges, and restocking without touching the products yourself.

Con:

• Upfront costs and fees. Some 3PLs charge set up, monthly storage, and pick-and-pack fees, plus minimum order requirements. These upfront costs can quickly add up, especially for small or new businesses.

6. Digital product sales

You can create or acquire high-quality digital products—like ebooks, online courses, design templates, or software—and market them to customers who trust your voice and expertise. This approach works great as a side hustle for teachers, coaches, or other subject matter experts with an established audience and solid knowledge base.

Platforms: Gumroad, Payhip, Shopify (with digital product apps)

Pros: 

• High margins and unlimited inventory. Digital products can be created once and sold repeatedly without additional production or shipping costs. Plus, you never run out of stock.

• Instant delivery. Customers receive their purchase automatically and instantly via email or a download link.

• Minimal customer service issues. This model eliminates returns or refunds based on damages, lost packages, incorrect sizes, or shipping delays.

Con:

What to consider before starting an online store

Not sure which approach to take? Here are some factors to consider as you evaluate your options:

Startup budget and upfront costs

If you’re starting with a small budget, dropshipping, affiliate marketing, or selling digital products offer the lowest startup costs and financial risk. Fulfillment by Amazon and 3PL require more capital due to inventory purchases and storage fees.

Creative control

If creativity is your strength, print on demand and selling digital products give you full control over branding and design. Dropshipping and affiliate stores suit entrepreneurs focused on marketing strategy and search engine optimization (SEO).

Business goals and scalability

Want passive income? Choose digital products or affiliate marketing. Want to build a long-term brand? Consider dropshipping with reliable suppliers or 3PL providers that scale with demand.

Time commitment

Affiliate stores and digital products often require less day-to-day involvement than dropshipping or 3PL models. In contrast, managing a successful online store through Fulfillment by Amazon or dropshipping may demand ongoing customer service, product updates, and market research.