Recently a friend of mine asked about liability he would be exposed to if he sell medical instruments via his dropshipping eCommerce website.
he has products from a few manufacturers and buyers can be from anywhere in the world.
if anyone has some insight please share.
Nothing much, he will not be recognising revenue but keep it in inventory until the return period is over. For which he has to monitor and spend time on it making it a cost constraint if this is a middle to big enterprise.
He has to monitor the mark up or down his selling price due to foreign exchange differences. I guess there are no receivables as it is spot payment.
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
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