You are in the UK, you want to start selling online in the next few weeks, and you are stuck between dropshipping, print on demand and buying wholesale stock. This page compares all three on who holds the money and the risk, cost to start in pounds, margin after UK fees and VAT, delivery time and returns exposure. Every fee and rule links to a primary source, stamped 15 September 2026, except the print on demand base costs, verified 7 August 2026.
Disclosure: we build Orbit Commerce, an ecommerce platform, so we have a stake in you opening a shop. That is why every number links to gov.uk, Companies House or a marketplace’s own fee page. There is a fourth option these comparisons skip too: marketplace only, no website.
What is the difference in who holds the money and the risk?
It comes down to who pays for the goods before your customer does. In dropshipping and print on demand nobody buys the item until you have been paid, so your capital stays put. In wholesale you buy a batch up front: money gone before a sale, in exchange for a lower unit cost and control of dispatch.
What does not differ is legal responsibility. In all three you are the retailer: UK consumer law puts descriptions, delivery, cancellation, refunds and faulty goods on the business the customer bought from, not on whoever packed the box (gov.uk, checked 15 September 2026). Our guide to dropshipping in the UK works through those duties.
| Question | Dropshipping | Print on demand | Wholesale (you hold stock) |
|---|---|---|---|
| Who holds the money and the risk | Supplier holds stock and capital. You hold the customer and the legal duties | Printer holds the kit. Nothing is made until you have been paid | You hold both. Cash leaves weeks before it returns |
| Cost to start | Under £100 plus store software | £50 to £150, mostly samples | £300 upwards for a first order, plus storage |
| Margin after UK fees and VAT | £15.24 on the £24.99 example, £12.57 if VAT registered | £11.88, or £9.77 if VAT registered | £13.54, or £10.62 if VAT registered, if the batch sells |
| Delivery to a UK customer | 1 to 3 days from a UK warehouse, 1 to 3 weeks from overseas | 3 to 7 working days door to door from a UK printer | Same or next day: the box is in your hallway |
| Returns exposure | Highest. Full refund owed, supplier rarely reimburses you | Lower on genuinely personalised items, exempt from the 14-day right | Medium. You get the item back and can resell it |
| Who it suits | A niche audience and no product | Designs and no audience yet | Capital and a product you believe in |
What does each cost to start, in pounds?
Print on demand is cheapest at roughly £50 to £150, dropshipping sits just above it once you have sampled properly, and wholesale starts in the hundreds because the first purchase order is the entry fee. The shared costs are identical:
- Sole trader registration: free. Register for Self Assessment once you earn more than £1,000 from self-employment in a tax year (gov.uk, checked 15 September 2026).
- Limited company: £100 online, plus £50 a year for the confirmation statement (Companies House fees, updated 2 July 2026, checked 15 September 2026). Plenty of pages still quote the old £50.
- Store software: Orbit’s Solo plan is £25 a month (£19 billed yearly), after a 14-day free trial with no card required.
- Samples: £10 to £15 per product, whichever model.
- Stock, wholesale only: 50 units at £7.50 is £375 in a cupboard.
Full breakdown: what it actually costs to start dropshipping in the UK.
What margin does each leave after UK fees and VAT?
Ignore the “10 to 30 percent versus 50 percent” comparison that circulates here; we found no traceable source for it. Arithmetic instead, assumptions stated. One price: £24.99 including delivery, paid by UK card on Orbit’s Solo rate of 2% + 25p, which is 75p.
| Line | Dropshipping | Print on demand | Wholesale |
|---|---|---|---|
| Customer pays | £24.99 | £24.99 | £24.99 |
| Goods, delivered to the customer | −£9.00 (assumption: UK-warehoused supplier) | −£12.36 (Inkthreadable tee £9.48 plus Royal Mail 48 £2.88, checked 7 August 2026) | −£10.70 (assumption: £7.50 trade unit on a 50-unit buy, plus £3.20 postage) |
| Card fee, Orbit Solo | −£0.75 | −£0.75 | −£0.75 |
| Gross, not VAT registered | £15.24 | £11.88 | £13.54 |
| Gross, VAT registered | £12.57 | £9.77 | £10.62 |
The VAT row works like this. Once registered, £4.17 of that £24.99 is output VAT, leaving £20.82, and you reclaim VAT on what you bought, so a £9.00 supplier invoice costs £7.50 net. Card fees are VAT exempt; Royal Mail account services such as Royal Mail 48 carry VAT, which a registered seller reclaims. Registration is compulsory past £90,000 of taxable turnover in a rolling 12 months (gov.uk, checked 15 September 2026); it costs £2.11 to £2.92 an order and favours none of the three. Read our guide to UK VAT for online sellers if goods ship from overseas, because the £135 consignment rule can force registration on day one.
Two things the table hides. Dropshipping looks best per order and is often worst in practice, because a £10 advertising cost per order eats most of that £15.24. Wholesale looks middling and often wins, though £13.54 assumes the batch sells: if only 40 of 50 units go, the 10 left cost £75, another £1.88 off every order you did sell, so £11.66. The uncomfortable version is in is dropshipping worth it in the UK.
What does each do to your delivery time to a UK customer?
Wholesale is fastest, print on demand is predictable, and dropshipping is whatever your supplier decides. A UK printer takes 1 to 5 working days to produce plus 1 to 3 in the post, so 3 to 7 days door to door (checked 7 August 2026). A UK-warehoused dropship supplier is similar; an overseas one takes one to three weeks and can hand your customer a customs bill. You must also deliver within 30 days unless the customer agreed otherwise (gov.uk, checked 15 September 2026). Hence our shortlist of UK dropshipping suppliers with UK warehouses.
Are personalised print on demand items exempt from the 14-day cancellation right?
Yes, and it is the one genuine structural advantage print on demand has over the other two. Gov.uk’s guidance on accepting returns and giving refunds lists goods customers have no automatic right to cancel, and the first entry is “personalised or custom-made items, for example curtains” (gov.uk, checked 15 September 2026). Perishables, newspapers, unwrapped CDs and sealed hygiene items are on the same list.
Read the wording before planning around it. The exemption covers items made to that customer’s specification: a mug with their dog’s name on it, a print with their wedding date. It does not cover a stock design that happens to be printed after the order lands, and it never touches faulty goods, which always get a full refund. Check gov.uk before relying on this.
The effect is real money. A 10% return rate costs a dropshipper £2.50 on that £24.99 order: full refund, usually nothing back from the supplier. On personalised print on demand, the only returns you owe are faults. Supplier costs are in our print on demand UK guide, the rules in UK returns law for online shops.
The fourth option: selling on a marketplace with no website
Every comparison assumes you need a website on day one. You do not. Listing on Amazon or eBay with no site tests whether anyone wants the thing, swapping an ad budget for a fee percentage. The trade is that the marketplace owns the customer. Fees, checked 15 September 2026 on each marketplace’s UK pricing page:
- Amazon: £25 a month excluding VAT on Professional, or 75p per item sold on Individual, plus a referral fee of 8% to 15% in most categories. Clothing is tiered: 5% up to £15, 10% to £20, 15% above.
- eBay business sellers: 11.9% final value fee in Clothing, Shoes and Accessories, plus 30p per order up to £10 or 40p above, plus a 0.35% regulatory operating fee. Shops cost £27, £77 or £437 a month.
- eBay private sellers: no final value fees in the UK. If you trade as a business, that is not you.
Run the £24.99 sale through it. On eBay as a business seller in clothing you pay £2.97 plus 40p plus 9p, so £3.46. On your own shop, the 75p card fee. The gap is £2.71 an order, so a £25 a month subscription covers itself at about ten orders. Which is why most sellers do both: see eBay versus your own website.
Which suits you if you have designs, an audience, or capital?
If you have designs
Print on demand. You own the asset that is hard to copy, and the model turns it into product with no stock risk. Price upwards from cost: a tee costing £12.36 delivered, sold at £15.99, leaves nothing to find the next customer with. Aim at 40% and above, and personalise some designs, for the price and the exemption above.
If you have a niche audience
Dropshipping, from UK-warehoused suppliers. An audience is the expensive part and you have it, so the model’s worst weakness, paid acquisition cost, does not apply to you. Sample everything, get defect and returns terms in writing, and assume some orders come back with nothing from the supplier.
If you have capital
Buy stock. Trade pricing beats both other models per unit, you control dispatch, and returns come back as resaleable inventory. Negotiate below the minimum order quantity if you can: the risk is not the money, it is buying 300 of something nobody wanted. If it works, selling to other shops as well as the public is the next step: see selling wholesale alongside retail.
Can you run more than one model in the same shop?
Yes, and you should expect to. Most UK shops that last end up mixed: a stocked core range, dropshipped lines to widen the catalogue, print on demand for people who already like you. Avoid a platform that forces a rebuild when the mix changes.
In Orbit that is three things in one dashboard. The supplier directory lets you browse UK suppliers publishing wholesale catalogues, request a connection, import their catalogue, keep prices and stock synced, and have orders routed to them to fulfil, with no separate subscription. Alongside it you keep ordinary stocked products with your own inventory counts, so one order can hold a line you posted and one the supplier posted. Print on demand items sit in the same catalogue as normal products. And the free Amazon and eBay plugins run off that same stock count. To be listed as a supplier instead, see Orbit for suppliers.
Questions people ask about dropshipping, print on demand and wholesale
Which is better for a UK beginner, dropshipping or print on demand?
Print on demand, for most people. It costs about the same to start, delivery from a UK printer is faster and more predictable than a typical dropship supply chain, and genuinely personalised items are exempt from the 14-day cancellation right (gov.uk, checked 15 September 2026). Dropshipping wins only if you already have an audience you can sell to without paid ads.
How much capital do you need to buy wholesale stock in the UK?
Plan for £300 to £1,000 for a first order plus your store costs. Fifty units at a £7.50 trade price is £375 gone before any sale. The risk is not the money as such, it is holding stock nobody wanted, so buy the smallest quantity a supplier will accept and treat the first batch as paid research.
Do you pay VAT differently on dropshipping, print on demand and wholesale?
No. Once you are VAT registered the treatment is the same across all three: output VAT on the sale, input VAT reclaimed on what you bought. Registration is compulsory past £90,000 of taxable turnover in a rolling 12 months (gov.uk, checked 15 September 2026). The exception is overseas dropshipping, where consignments of £135 or less force registration whatever your turnover.
Can you sell on Amazon or eBay without your own website?
Yes. Amazon charges £25 a month excluding VAT on the Professional plan, or 75p per item on Individual, plus 8% to 15% referral fees in most categories. eBay business sellers pay around 11.9% in clothing plus 30p to 40p per order and a 0.35% regulatory fee (both checked 15 September 2026). You give up the customer relationship in exchange.
Can one shop run dropshipping, print on demand and stocked products together?
Yes. They are all products with different fulfilment routes behind them. In Orbit you can import a supplier’s catalogue from the built-in supplier directory, hold your own stock on other lines, sell print on demand items as ordinary products, and list the lot on Amazon and eBay through free plugins running off one stock count.
Pick the model that matches what you already have, not the best margin on paper, then build the shop once so switching later costs nothing. Orbit puts the supplier directory, your stocked inventory and the free marketplace plugins in one dashboard, on a 14-day free trial with no card required, so you can run your own £24.99 sum against a real checkout: start free.