E-Commerce Supply Chain Models
Question
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:
Options
Dropshipping Model
Affiliate Revenue Model
Transaction Fee Revenue Model
Agency Revenue Model
Explanation
The correct answer is (a). The dropshipping configuration is a popular e-commerce retail fulfillment model where an online storefront processes orders without maintaining physical inventory or warehouse stocks. Upon receiving a customer purchase, the retailer purchases the item directly from a third-party manufacturer or wholesaler, who handles the logistics and ships the product directly to the end consumer. This allows the merchant to manage pricing and front-end transactions independently.
Question details
Year
2026
Paper
GS Paper 1
Question
Q52
Subject
Economy
Sub-topic
Digital Economy & Fintech
Type
Factual single
Difficulty
Easy
Nature
Static
Source hint
Standard Business Studies & Digital Commerce Frameworks
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