To give some clarification, we are not a MLM. We deal directly with the manufacturer (although the manufacturer may outsource some of the actual production [but not the concept and design specs] to China).
Yes there is middleman out there that pray on novice e-tailers, and I believe these con artists, are what are giving drop shipping a bad name among e-tailers. I don't believe consumers are aware of this however.
Our business model is also very environmentally friendly, as it dramitically reduces distance traveled for the product's.
The drop shipping aspect is something that will come out of our green e-tailing business; but maybe we should refer to it as green logistics rather than drop shipping; when we show those diagrams reducing the road travel that their product travels.
As far as the competition finding out; well in our business everybody is drop shipping anyways; If they haven't, they have already gone out of business.
I actually see three phases in the developement of ecommerce.
Stage 1) Ecomerce storefront with traditional backend, where product is shipped to the store and then to the customer. These are the dinasours
Stage 2) Ecomerce storefront whith dropshipping of the product from the manufacturer/primary distributor. This is already standard in many industries.
Stage 3) Eccomerce storefront with drop shipping, and integrated order fullfillment with the manufacturer/primary distributor. Features include real time stock, and automatic transmission of tracking to the customer. This is the golden age of e-tailing. Actually, many sites that are selling electronics are already doing this, since their razor thin profits, mandate the minimizing of customer service inquires.