Answer
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
In this fatwa:
Selling products through dropshipping is allowed if the supplier has a system to reject orders when they know they will not be able to fulfill them. This is usually the case.
Answering your question, Sheikh Mustafa Umar, President of California Islamic University, states:
There are many different forms of dropshipping and much of the difference has to do with who is taking the risk on.
The Prophet (peace be upon him) prohibited selling something you don’t own because you are selling something that is not in your possession and it is not within your power to guarantee it and hand it over to the purchaser.
Therefore, it is an ambiguous transaction and one that is effectively like gambling.
Dealing in such transactions may lead to disputes and conflict, because you may be faced with a sudden rise in price, so that the item may cost more than the price for which you sold it. Similarly, the item may become unavailable.
So if your contract with the wholesaler prevents this and you bear all of the liability in case something happens, then it would be allowed. It falls under the category of dropshipping and as long as they reject orders if they don’t have the product in stock, then it is fine.
It was narrated that Hakim ibn Hizam said: “I came to the Messenger of Allah (peace be upon him) and said: A man may come to me wanting to buy something that I do not possess; should I buy it for him from the marketplace then sell it to him?” He said: “Do not sell what you do not possess.” [At-Tirmidhi, an-Nasa’I, Abu Dawud, Ibn Majah, Ahmad, graded authentic by Al-Albani in Irwa’ Al-Ghalil, 1292]
Almighty Allah knows best.
Source: Ask the Scholars