There is a topic that people are always debating. Is Dropshipping dead? Or Is Dropshipping worth it? The truth is eCommerce business has been growing very fast in the past few years. Not only that, people are moving their life to online more than ever now.
Dropshipping itself has been around for a long time, and will still be around. The debates normally start with people that are still following the old advice on getting the supplier from Aliexpress or another China dropshipping marketplace, marking up the price and then selling it.
This method is no longer valid. People are looking for fast shipping and quality products. And the competition is fierce as many people are joining the eCommerce business now. Getting a common product from a marketplace and reselling simply won’t win in the game. There is no unique selling proposition for you to win in the business.
Dropshipping is considered to be one of the easiest and low-risk online retail business models. The word dropshipping become popular with the eCommerce store builder, Shopify. You can see how many people are still searching for Shopify Dropshipping nowadays.
In the dropshipping business model, you don’t keep any inventory. Everything is handled by your supplier. Your focus will be getting the sales and handling customer service-related issues. And all the order processing, packaging, and shipping are handled by your dropshipping supplier.
In other words, dropshipping means you become the middleman between the supplier and the customers. You don’t hold any stock, but merely bridge them and earn in the price difference. You sell the products in your online store, and when a customer places an order, your supplier receives the order and ships it out to the customer.
This is a good business to start out with low investment. If you are going to manage everything yourself, your investment is huge, and you are going to risk losing your investment if the products bought do not sell.
But with dropshipping, you don’t face the risk at all. You are only in charge of selling the products. The stock keeping, packing and shipping are all done by your dropshipping supplier to your customers.
Dropshipping had been a popular business model for the past 10 years. But is getting a boost for the past few years during the pandemic. People cannot go out to buy things and do business. And hence, everyone turned to doing business online. While many who are looking for this option are those who lost their job and are trying to get some replacements, they usually looking for a low-investment and low-risk business to start.
Not only that, as most were from the corporate world, they might have limited knowledge about starting and running a business. This is why running a dropshipping business is very suitable for them. They only need to focus on selecting the product to sell, deciding where to sell and getting traffic to sell the product. The rest of the order processing and fulfilment can be outsourced easily.
For example, suppliers like Printful or Printify are focused on print-on-demand business. Print-on-demand(POD) is also similar to a dropshipping business. Just for print-on-demand business, you will be in charge of the product design. And the POD supplier will print the final product and fulfil it for you.
Some benefits of dropshipping include:
While dropshipping has many benefits, there are also several challenges associated with this business model:
Choosing the right product is crucial for the success of any dropshipping business. Here are some steps to help you choose good products for your dropshipping store:
By following these steps, you can identify good products to sell in your dropshipping store that have high demand, moderate competition, good profit margins, and align with your brand identity and values.
Basically, there is no limit on how much you can make from dropshipping. It depends on how big is your business and what niche you are in. On average, dropshipping businesses make around 20%-30% on each sale.
So, to make $10,000 per month, you need to get $300 in profit per day. Which is $1,000-$1,500 in sales per day. But it all depends on how is your marketing strategy and how much is the money in your niche.
One of the big determining factors for your profit will be the number of customer complaints and refunds that you are going to handle. If you are having a huge refund rate and shipping delays, it will definitely affect your earnings and sales.
Now, dropshipping business is still very good and profitable if you are doing it right. You may hit the jackpot on the first hit, but most of the time, that’s not the case. You will first need to train and know how to build a successful business, and then, work hard on it and stay consistent to be successful. Don’t assume that it’s something to get rich quickly.
Here’s how you can start your dropshipping
The first step in starting a dropshipping business is to choose a niche. A niche is a specific market or product category that you want to focus on. It’s important to choose a niche that you are passionate about and that has a high demand for products but relatively low competition. Research different niches to find one that fits these criteria.
You can spy on your competitor’s store, ads, and social media and see what’s trending or selling well.
Once you have chosen a niche, the next step is to find reliable and trustworthy suppliers. Someone who offers quality products at competitive prices. You can search for suppliers on platforms like AliExpress, Oberlo, or SaleHoo. Look for suppliers who have positive reviews, offer good customer service, and have a fast shipping time.
Be sure that you communicate with the suppliers before picking them. By communicating with them, both of you will get to know each other and at the same time build a long-term partnership. So they will take care of your product quality and give your the best price.
The next step is to create an online store where you can showcase your products and sell them to customers. There are many platforms out there. You can use platforms like Shopify, WooCommerce, or BigCommerce to create your store. Or selling at the marketplace like Amazon, eBay or Etsy.
Choose a theme and design that suits your niche and create a logo and branding that reflects your business. You don’t need a complicated design store. Keep it simple, stupid. A clean and simple website will work well.
Your aim is to get them to buy, not to confuse them.
Once you have set up your online store, the next step is to select the products you want to sell and add them to your store. Choose products that are in demand and fit your niche. Ensure that the product descriptions and images are accurate and attractive to potential customers.
You will need to integrate payment and shipping options into your store. Use services like PayPal, Stripe, or Square for payments and services like USPS, FedEx, or DHL for shipping. Choose options that are convenient for your customers and make the checkout process as easy as possible.
This is the crucial step to bring traffic or potential customers into your online store.
You may use social media, email marketing, SEO, and paid advertising to market your store. Do simple research to know where your target customers hang out the most. And focus on the marketing channels that are most effective for your niche and target audience.
Data analysis is the key to online business success. This is also the advantage you can have for selling online. Differing from traditional business or marketing, you get to read and analyze the data of how your online store or marketing campaigns perform.
Then, you can use the data to optimize your store and improve customer experience. Monitor your profit margins and adjust prices and products as needed to ensure that your business is profitable.
Now you should have all the basics required to start a dropshipping business. The next important thing would be implementing the marketing strategy to bring traffic to your online store.
Social media platforms like Facebook, Instagram, and Twitter are good ways to promote your products and connect with potential customers. You need to have a content strategy and share high-quality images and engaging content that showcases your products and encourages people to visit your online store.
The key to social media marketing success is to stay consistent in your posting and interact with your audiences.
Collaborate with influencers who have a large following and influence in your niche. They can help promote your products to their followers, which can increase your brand awareness and drive traffic to your store.
These people already did great work congregating your target customers together. All you need is to pay to tap into the traffic they own to promote your products to their followers.
Email marketing is one of the highest ROI marketing strategies. Build an email list of interested customers and use email marketing to promote your products and special offers. You can build relationships with your potential customers via personalized emails and by providing value in your emails to them.
This is a good way to build trust and loyalty with your customers.
Optimize your online store for search engines by using relevant keywords. You should optimise your product descriptions and images, and build high-quality backlinks.
This can help your store rank higher in search engine results, which can increase your visibility and drive more traffic to your store. This is essential for long-term organic traffic for your store.
Using platforms like Google Ads, Facebook Ads, and Instagram Ads to target potential customers with ads, you can run targeted ads to show your products to potential customers.
And the beauty of paid advertising is you get almost instant traffic once you run the ad campaign. Not only that, you can use paid advertising to run A/B testing to optimize your online store and sales copy to maximize your sales.
Create high-quality content such as blog posts, videos, and infographics that educate and entertain your target audience. This can help build your brand and drive traffic to your store.
By using these marketing strategies, you can promote your dropshipping business and attract more customers to your online store. It’s important to be strategic in your approach and track your results to optimize your marketing efforts for maximum ROI.
Dropshipping is definitely a legit and very profitable business to start with. The dropshipping business model has reduced the risk of high investment and high inventory costs. The only difference is many people painted a very nice picture of the dropshipping business model. This made many beginners not willing to do work and expecting to get huge results.
If you decide to start, go ahead and start now. Don’t wait.
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