Doubling down on growth: How Cheney Brothers transformed dropship into a profit engine
Most B2B wholesale leaders today are asking the wrong question.
Instead of "How do we cut costs in this competitive landscape?" The strategic question is: "How do we transform operational constraints into growth opportunities?"
The market is providing a clear answer.
Recent data shows retailers with marketplace and dropship models are achieving 4X faster growth than traditional eCommerce — a signal that points to a fundamental shift in how successful commerce operates.
But here's what's often overlooked about dropship strategy. While many view it primarily as inventory risk mitigation, the real value lies in operational agility.
The "sell first, buy later" model doesn't just improve cash flow, but transforms your ability to respond to market demand without the traditional constraints of warehouse capacity or upfront investment.
Forward-thinking companies are recognizing this opportunity.
Consider Cheney Brothers, a century-old food distributor that doubled their dropship volume by leveraging dropship to fulfill customer requests in product categories they didn't sell, transforming unmet demand into a competitive advantage.
Rather than viewing these requests as operational challenges, they built a dropship model that expanded their offering while maintaining customer relationships.
The evidence suggests we aren’t witnessing just another tactical shift, but a fundamental evolution in how value is created in commerce. The organizations that recognize this transition early are positioning themselves to capture disproportionate growth in an increasingly dynamic market.
When traditional distribution meets dropship innovation
At a recent Mirakl Summit, Cheney Brother’s Senior VP of Sales Transformation and Strategy Russell Scott shared how his company turned a fundamental business challenge into a dropship-powered growth engine.
Like many distributors, Cheney Brothers faced a persistent problem: customers constantly requested products the company didn't stock in its six warehouses. The traditional solution was cumbersome — order from vendors, wait weeks for delivery to warehouses, then ship to customers, frustrating customers and limiting growth potential.
"We may stock 10,000 to 12,000 different items that a restaurant would buy, but there's tens of thousands of additional items that those same vendors make, that our customers may need, that we don't stock," Scott explained during the panel discussion.
The breakthrough came when Cheney Brothers implemented a dropship strategy, allowing vendors to ship directly to customers while maintaining control over special pricing and customer relationships — the core advantage of dropship over the traditional retail model.
The dropship economics advantage
Bain Partner and Global eCommerce/Marketplaces Sector Leader Aaron Cheris, who has spent 29 years working with retailers and platforms, provided crucial context during the discussion. He noted that retail profitability has been declining for decades, making alternative revenue streams essential.
"Retail is less profitable today than it was 10 years ago, which was less profitable than it was 10 years before that," Cherris observed.
This is where dropship creates a competitive advantage.
In Cheney Brothers' dropship model, they buy products from vendors, control markup decisions and maintain pricing authority. This control enables better margin management while eliminating inventory risk.
For Cheney Brothers, the dropship economics were immediately compelling. Because they don't inventory-manage the products, don't handle delivery and don't tie up cash— creating a powerful incentive for dropship adoption.
Watch the fireside chat on demand to see how Cheney Brothers leveraged dropship innovation to drive profitable growth.
Overcoming organizational resistance to dropship
Perhaps the most valuable insight from Cheney Brothers' dropship experience involves managing the human element of transformation. Sales teams initially struggled with the shift from traditional inventory control to dropship fulfillment models.
The solution required both incentive alignment and peer influence. By offering higher commissions on dropship sales and showcasing early adopters' success, Cheney Brothers created internal momentum for their 700-person sales team around their dropship program.
"Sales people look at other sales people that are successful and they want to understand that more," Scott noted. "Once you see some of your top sellers having success, the other ones just kind of seem to come along."
Since the beginning of the year, Cheney Brothers' dropship volume has doubled — demonstrating the power of properly executed organizational change management.
The dropship integration imperative
One critical lesson emerged around dropship customer experience integration. Cheney Brothers initially launched with separate platforms — one for traditional inventory, another for dropship products. This created friction that limited dropship adoption.
"It's about making yourself easy to do business with," Scott emphasized. "Customers want easy."
The company is now working to integrate both experiences, allowing customers to seamlessly combine traditional orders with dropship products in a single transaction — a unified approach that maximizes the dropship value proposition.
Strategic implications for dropship implementation
The Cheney Brothers dropship story illuminates several key principles for executives considering dropship strategies:
Start with customer needs, not technology. The most successful dropship implementations address genuine customer pain points rather than pursuing dropship for its own sake.
Align organizational incentives early. Without proper sales team motivation around dropship, even the best technology will struggle to gain adoption.
Plan for dropship integration from day one. Separate customer experiences create unnecessary friction that limits dropship growth potential.
Focus on supply chain agility. As Cherris noted, alternative business models provide "business model agility" that enables rapid adaptation to market changes, including challenges like tariff fluctuations.
The dropship path forward
For enterprise leaders watching competitors pull ahead, the window for action is narrowing.
The companies that will thrive view dropship as a fundamental evolution in their business model, transforming operational challenges into competitive advantages, while maintaining customer relationships that drive long-term success.
Success in this new landscape requires more than just adopting dropship technology. It demands rethinking how value is created, delivered and captured through dropship strategies in an increasingly complex commercial ecosystem.
For organizations ready to make this transition, Mirakl's Dropship Platform provides the foundation to transform distribution challenges into profit engines, just as Cheney Brothers discovered.
To get a closer look at the Cheney Brother’s story, download the full fireside chat here.
