Question:
There is this business model called dropshipping where you create a store and sell products without having any sort of possession of the products, would this be permissible to sell products without having possession of them?
Answer:
Dropshipping is a business model where you create an online store, list products for sale, and when someone buys something, you don’t actually ship it yourself. Instead, it goes directly from the supplier to the customer — and you never physically own or handle the product. So the big question is: Is it halal (permissible) or haram (not allowed) to sell something without actually owning it?
The answer is:
Dropshipping is haram if you don’t have physical or contractual ownership of the product.
But dropshipping can be halal if certain conditions are met.
Example of Halal Dropshipping
Let’s say I have a website where I sell iPhones. I don’t actually own the iPhones or keep them in stock. But here’s how I do it the halal way:
I list the iPhones on my website with full, accurate descriptions and real pictures.
There must also be a formal agreement with the supplier or factory, making you an authorized seller of the product.
When someone places an order and pays me, I go and buy that exact iPhone myself (either from Apple or an authorized supplier).
I then make sure it’s shipped to the customer.
If anything goes wrong — whether it gets lost during shipping or the customer wants to return it within the return window — I take full responsibility.
Not Apple.
Not the customer.
Me.
After that, I can go back to Apple and try to get a refund or a replacement if needed. But no matter what happens with them, I owe the customer their full rights.
This is because, in Islamic law, you are only allowed to earn profit when you are also bearing the full risk. You can’t separate risk from reward.
The Islamic Legal Maxim (قاعدة فقهية):
الخراج بالضمان
“Profit is justified only when liability is borne.”
This means if you’re making money from a sale, then you also have to take responsibility if something goes wrong.
Example of Haram Dropshipping
Now let’s look at a common setup that is not allowed:
I have a popular website with a lot of traffic.
I find a factory in China that sells backpacks.
I list the backpacks on my website.
When someone places an order, the factory in China ships the backpack directly to the customer.
I don’t see the product, I don’t check the quality, and I take zero responsibility.
If the customer wants to return the item or if there’s a problem, it goes back to the factory — not me.
In this case, I’m making money without owning the product, without bearing any risk, and without guaranteeing the customer’s rights. That’s not allowed in Islam.
Halal dropshipping means you take ownership (even temporarily) and full responsibility for the product and transaction.
Haram dropshipping means you sell something you don’t own and pass all the responsibility to someone else while still making a profit.
So if you’re thinking of starting a dropshipping business, make sure you’re doing it in a way that aligns with Islamic principles. Always remember:
الخراج بالضمان
“Profit comes with liability.”
That’s what makes the difference between halal and haram in this case.