Dropshipping Fundamentals 5

Question 1

Why must US dropshippers be aware of sales tax obligations?

Accepted Answer

They may owe tax based on nexus in certain states

Answer

US dropshippers may have to collect and remit sales tax where they have nexus.

Question 2

What is 'nexus' in US e-commerce taxation?

Accepted Answer

A connection to a state that creates a tax obligation

Answer

Nexus is a sufficient business connection to a state requiring sales tax collection.

Question 3

Why is selling trademarked or branded products risky in dropshipping?

Accepted Answer

It can lead to legal action and account bans

Answer

Selling unauthorized branded goods can trigger lawsuits and platform suspensions.

Question 4

What is a key benefit of providing excellent customer service in dropshipping?

Accepted Answer

It reduces chargebacks and builds repeat business

Answer

Good customer service lowers disputes and encourages customers to return.

Question 5

Why should a dropshipper order product samples from a supplier?

Accepted Answer

To verify quality and shipping experience firsthand

Answer

Ordering samples lets you confirm product quality and delivery before selling.

Dropshipping Practice Test