Tapiture, a Pinterest competitor, doesn't just show you stuff you might like. In many cases, it lets you buy that stuff as well.

Aside from some branded merchandise though, Tapiture doesn't keep any inventory on hand at its Venice, California, headquarters. Instead, it functions as a virtual storefront.

Amazon and eBay have been doing the same thing for years, of course, but startups like Tapiture are also taking advantage of this no-investory arrangement, which is made possible through dropshipping.

"We're big believers in the dropshipping model," says John Ellis, CEO of Tapiture. "We think it's the way of the future."

In a traditional brick-and-mortar retail model, a storefront can only sell what it stocks on its shelves. The Internet has allowed websites to offer nearly limitless inventory, but most — including Amazon — still use physical warehouses to stock their goods. Even eBay merchants often find themselves filling their basements, garages and — eventually — warehouse or storage space with their inventory.

Dropshipping, however, turns online retailers into mostly marketers. If you can create an audience, you can put products in front of them and make margins of up to 20% on the stuff you sell without having to spend a lot up front or risk getting stuck with unsold inventory.

That, at least, is the promise.

Michael Main, who runs the website Main Performance PC, says he tried to build a business around dropshipping by working with warehouse companies that offer a range of products to resell.

He found that approach too competitive. "They really only sell products that are found all over the web, anyway," he says. "They're all just competing with one another."

These days, Main mostly sells gaming PCs and "cockpits" (chairs designed for gaming) that his company manufactures, though he dropships a small percentage of items from other vendors.

Andrew Youderian started a business in 2008 that sold radio equipment for vehicles. Despite having no prior interest in the category, Youderian saw a niche in the market and created a business based on dropshipping the items. He later co-authored The Ultimate Guide to Dropshipping.

Youderian says dropshipping isn't for everyone. "It's harder than retailing your own product," he says. "By definition you're selling something that someone else created. You've got to add value somewhere."

Usually, that means becoming an expert in a field and providing content that will draw people to your site.

In 2010, for instance, Jesse Craven began selling garden equipment on HydroGalaxy.com. Like Youderain, he wasn't hugely interested in the segment, but saw a marketing opportunity and built a site, spent lots of money on advertising and hired a blogger full-time to pump out content.

"I saw an emerging marketplace where the companies that were presently involved were not [web savvy]," he says. "We wanted to take proven business concepts and apply them."

When Craven started HydroGalaxy, it was 100% based on dropshipping. By 2011, though, he started phasing that out. Now, with millions in revenues, only 35% of HyrdoGalaxy's sales come from goods shipped directly from its 13,000 square-foot warehouse in Burbank, California.

Craven says the main reason dropshipping doesn't really work for him now is that the charges of $5 per item eat into his margins. Still, he would recommend dropshipping to someone who was starting a similar business.

"I would try it first, because your financial exposure is limited," he says.

There are a couple of ways to get started with dropshipping. If you know the industry well enough, you can arrange to do business with suppliers. "A number of suppliers will dropship for you if you call and ask," Youderian says. For such vendors, it's more attractive to sell things in bulk — say 1,000 units per order — than one at time.

For their troubles, the suppliers charge per order. The $5 fee that Craven cited is about average, though the fee varies greatly. "If you're selling pool tables, it's going to be more," Youderian says.

An alternative is to use dropshipping middle-men like Doba, which charges businesses a monthly fee of $69 and up to resell items ranging from perfumes to electronics to knives. If you're able to make a business out of it, Youderian says there's a big upside: It pretty much runs itself.

"I was able to take four to five months off at a time and the business ran fine without me," he says. "The suppliers do all the work."

On the other hand, the margins can be brutal, especially if you pour money into advertising. You also face endless competition. In Youderian's illustration, if you make your own mountain bikes, then no one can undercut you because you have a unique product. If you dropship mountain bikes, though, you're trying to vie with lots of other people who have access to the same inventory.

That's why the guy who wrote the book on dropshipping appears to be tapping out. Says Youderian: "My next business will probably not be a dropshipping business."