How dropshipping is becoming a scalable retailer growth strategy

John Lewis is using the model to offer a host of premium brands. For Freemans, it is a vital lever in its transformation from a catalogue business to a digital pureplay. And in the case of H&M, it’s a powerful catalyst for growth. 

Dropshipping is already an integral part of many retailers’ strategies, but the focus is now shifting towards making programmes more modern, scalable and agile. Not only can the model reduce cash flow pressure, warehousing costs and risks to margins, but it is also emerging as a vital tool for growth. In the face of increased demand for broader ranges, retailers are now looking to amplify these programmes, offering more SKUs without taking on additional inventory, while improving their visibility in an AI-driven shopping environment.

As mentioned, H&M illustrates what a modern, scalable dropship programme can deliver. The fashion retailer has expanded its dropship programme to reach more than 80,000 SKUs across 13 European markets – and has grown turnover by 9% in six months.  

The fashion retailer has boosted sales by offering products that weren’t previously viable, such as furniture. “For us, it’s all about the flexibility and being able to select product assortments we can’t house ourselves,” H&M former senior product manager, dropship, Jonas Blomgren told Mirakl in July.  

Dropshipping in numbers 

H&M isn’t the only retailer to have reaped rewards from dropshipping. Increasingly, businesses are using the model strategically to deliver growth. 

The potential results are shared in the latest Mirakl Marketplace & Dropship Index, which analysed the financials of 153 retailers using marketplace and dropship specialist Mirakl’s solutions globally.  

Together, those retailers – which includes B&Q, Nordstrom and Decathlon – generated an impressive $9.63bn (£7.12bn) in gross merchandise value in 2024. But arguably, the real story lies in the growth trajectory. The retailers in Mirakl’s analysis delivered growth of 34.3% year on year. That’s four times the rate of global ecommerce, which grew by 8-9% over the same period. 

As illustrated by H&M’s example, increased range is a key driver, but the ability to manage that range efficiently is just as important. For retailers, the opportunity lies not simply in adding more products, but in doing so without creating disproportionate operational complexity, cost or headcount requirements. Product assortment at H&M expanded by an average of 24.3% among the marketplace and dropship retailers in Mirakl’s analysis. That helped fuel orders, which grew 31.6% year on year. 

Increasing discoverability in the age of AI 

The benefits of a broad, well-structured assortment are becoming even more important as AI reshapes online shopping habits. Already, the impact is clear to see. 

Six out of 10 consumers now use AI to shop, according to Mirakl’s Agentic Commerce Readiness Gap Playbook, while traffic from AI sources rocketed 393% year on year to US retail sites in the first quarter of 2026. 

Meanwhile, organic search traffic declined by 10% in 2025. That trend is only set to accelerate.  

In the US for instance, over half (55%) of ecommerce spend is projected to become agent-assisted in the coming years, according to management advisory firm Boston Consulting Group. 

In this rapidly changing landscape, retailers are struggling to keep up. Mirakl’s Agentic Commerce Readiness Gap Playbook found the gap between what buyers expect and what brands can deliver is widening fast. The report found 63% of consumers want better product discovery experiences, while 74% of consumers want improved post-purchase experiences. 

Dropshipping is one way to harness the power of AI and improve discoverability. Rather than simply browsing, shopping agents look for the broadest, best-structured product range. That means a strong range is no longer just about customer experience – it’s increasingly crucial to discovery.  

Marketplace and dropship retailers using Mirakl solutions achieved a 94% mention rate in ChatGPT’s top five results in a product category – and a first-place ranking in 17% of cases. The inverse is true, too. Removing the expanded assortment from the model caused the mention rate to drop by 24%. 

What it takes to build a dropship programme

The business case for dropshipping is compelling. There are important factors to address when scaling or modernising a dropship programme, and a clear understanding of the operating model is vital. 

Modern dropshipping does not replace a retailer’s wholesaling operation. It complements and extends it, allowing retailers to offer broader online ranges while reserving owned inventory for the products and categories where it creates the most value.

End-to-end fulfilment of new product ranges is taken out of the retailers’ hands, into the suppliers. As programmes scale, this makes supplier selection, service-level agreements, product data quality, stock visibility, returns processes and delivery performance increasingly important. This makes it essential to select product ranges that match the quality of current lines, and work with trusted third-party providers, that retailers know will uphold the same level of excellent customer service their shoppers expect.  

It is important to establish clear ownership across the operating model. While brand partners ship directly to the customer, the retailer remains responsible for pricing, the customer relationship and the overall experience. Modern dropship programmes therefore require consistent governance, performance monitoring and accountability across the partner network.

In addition, AI is an increasingly important tool in eliminating the operational complexity that previously made dropship expensive to scale. This is where modern dropshipping differs from earlier, more manual approaches. AI and automation can reduce the operational complexity that previously made dropship difficult to scale. A modern, AI-native unified platform can manage vendor onboarding, catalogue management, product data, order routing, compliance and performance monitoring, helping retailers grow their programmes without growing headcount at the same rate.