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How To Start A Dropshipping Business – Get The Details Here

April 1, 2020 840 views

A Post to Help You Decide If A Dropshipping Business Is For You

It takes time, effort, and money to run a business. Make sure you’re in a business you’re interested in. If you’re passionate about what you do, you’ll dramatically increase your chances of success, as opposed to being in business just for the money and having no passion for the products and services you provide.

You could be running this business for the rest of your life. You may grow to love it; you may grow to hate it! When you have the option, choose something you’re passionate about.

Also, keep in mind that nothing is easy. A lot of people want to get into business because they want to be their own boss. Well, in business, you still have a boss, and it’s your customers. If you don’t get along with your customers, it’s the same as not getting along with your boss, and in business, it’s your customers that call the shots!

Now, let’s look at the dropshipping business.

What Is Dropshipping?

Dropshipping is a business model that allows you to sell products without the need to purchase and ship the product. You set your focus on making sales and building a customer base, letting your supplier take care of the rest.

The concept is simple:

  • You market the products you have chosen
  • You receive an order and accept payment
  • You pay the supplier for the order and forward the customer information to them
  • Your supplier will ship the product to the customer as if it was shipped from your store

The fine details of each step that your supplier takes are complex, which you don’t need to worry about. Just choose the right products and suppliers, and target the right customers.

The Pros and Cons of Dropshipping

Dropshipping Pros:

Low Startup Costs

A dropshipping business has extremely low startup costs. On average, you can be up and running for under a thousand dollars, depending on the software and website you choose. Since you don’t own the product or need to stock it, all you need is an office set up, an online presence, and a marketing budget; then, you’re good to start.

No Inventory Cost

With this business model, your inventory costs are zero. You don’t own the product. Therefore, you don’t pay for the product, and you don’t store the product. This concept opens up a lot of opportunities to sell thousands of items. You can focus on one main category or on hundreds of categories. It all depends on your target audience and marketing strategies.

Easy Fulfillment Process

You don’t have to deal with getting the product to the customer; if you did, you would need to find the product in the warehouse, label it, arrange for shipping, track the order, etc. That’s a lot of work. With a dropshipping business, a third party deals with product fulfillment. You can focus your efforts on sales and marketing.

Sell and Test More Products

You can test many products since you don’t pay for the inventory. You’re free to try products to determine your best sellers. The more products you try, the better your chances of finding those hidden gems; the more hidden gems you can offer, the better your chances of success.

Offer a Large Selection with Little Investment

When you don’t own the product, you can offer a large selection with no extra investment except for the cost of creating the webpages to list the products.

Dropshipping Cons:

Highly Competitive

With low startup costs for this business model, you can expect a lot of competition. Also, a lot of people believe it’s easy to succeed in this type of business, and that creates more competition.

Distinctiveness

It may be challenging to be unique because you are selling the same product everyone else is offering. If you come up with a way to be different, it can be easily copied by a competitor.

Being Highly Dependent on Other Businesses

You don’t own the products; therefore, your control is limited. You can’t make decisions without consulting the wholesaler. For example, if you want to create a sale on a product, you will need to verify the orders can be filled before creating the sale.

Another issue to be aware of is that if you depend on one wholesaler, and that wholesaler goes out of business, your business will be out of stock until you can find another supplier.

Regarding shipping, again, you are not in control of this. Your supplier may deliver in an acceptable time frame, or they may have horrible delivery times, which will affect your success.

Low-Profit Margins

With this business model, the profit is split between the manufacturer, the wholesaler, and the retailer. There is only so much profit available. Therefore, some dropshipping businesses focus on low profits with high sales volume to make the business profitable.

Limited Customer Service

You’re the middleman, so your customer service is limited. Your supplier controls the products, deliveries, and warranties if there are any. Keep in mind you are the one selling the product, and your reputation is at stake.

Dropshipping Considerations

What Type of Product Will You Sell?

The types of products you sell are a major factor in how much profit you earn and how successful you’ll be. It’s easier to market products in which you specialize in, than marketing to a broad audience.

Below are a few considerations and questions regarding product selection.

  • Product availability
  • The quality of the product
  • What is the price range for your target customers?
  • How easy is the product to ship?
  • Is there a demand for the product?
  • Is there a lot of competition for the product?
  • Is the market saturated with these products?
  • Can the product be shipped worldwide?
  • Are there any regulations regarding the product entering certain countries?
  • Etc.

How Will you Market Your Products

How you promote your products is one of the major keys to becoming successful. There are many ways you can do this. In my opinion, I would start with one, and when this process is optimized, then expand into another source to market.

For example, you can start with Facebook ads; once it’s tweaked, you can move on to Google ads and so on. Don’t try everything at once, as marketing takes time, effort, and constant optimization for the best results.

Average Profit

Your profits will depend on a variety of issues, including the profit margins of the products, your operating costs, and your marketing costs, which is a large part of your expenses.

The average for the industry is roughly 10% to 40%, which is an idea of what you can expect.

Suppliers

An important factor is finding the right suppliers. When you find the right one, your chances of success are greatly increased. If you find the wrong one, it can put you out of business a lot quicker than the time it took you to get started.

When choosing a supplier, you need to consider the following:

  • Does the supplier have a good reputation?
  • Where does your supplier ship? Is it worldwide or certain regions?
  • What type of warranties are offered?
  • What profit margin can you make?
  • How long does shipping take?
  • Etc.

A Collection of Resources Related To Dropshipping

In the resources below, you’ll find a large collection of articles that go into depth about starting and running your dropshipping business.

I would suggest you bookmark this page so you can return because you can’t go through all the information in one visit and you can return as needed.

Take the time needed to go through the articles; rushing through the material is ineffective. There is a lot of information, and you want to know as much as you can before you get started.

Considerations Before You Start

What You Must Consider Before Starting Your Business

How to Start a Dropshipping Business

How to Start a Dropshipping Business in 2020 – Oberlo

6 Steps to Building a Successful Online Drop Shipping Business

How to Start a Dropshipping Business in 5 Easy Steps | SaleHoo

How to Start Dropshipping: The Easiest Way to Sell Online — Dropshipping

How to Start a Drop Shipping Business in 5 Easy Steps

How to Start a Dropshipping Business Step-by-Step | Get Started Today

Dropshipping in 2020: Does It Actually Work? (Pros + Cons)

What Is Dropshipping & How To Start A Drop Shipping Business In 2020 – MyWifeQuitHerJob.com

Dropshipping VS Affiliate Marketing

Dropshipping vs Affiliate Marketing – Which is Profitable?

Dropshipping Vs Affiliate Marketing: Which Online Business Will Make You More Money? – MyWifeQuitHerJob.com

Drop Shipping vs Affiliate Marketing In 2020 [Which Is Better?]

Is Dropshipping A Good Business To Get Into?

Is Dropshipping Business Dead or Still Profitable in 2020?

2020 is a Good Year for Dropshipping Business – Magenticians

7 Reasons To Rethink Dropshipping | Merchant Maverick

Dropshipping Success Stories

From Zero to $1M in 8 Months | Awesome Dropshipping Success Stories

Oberlo Success Stories Archive – Every Journey Starts with a Single Step

Dropshipping Success Stories From Real Entrepreneurs

Dropshipping Reviews

The 17 Best Dropshipping Companies – 2020 Review

10 Best Dropshipping eCommerce Courses of 2020 (Unbiased) – Ippei Blog

Spocket vs Oberlo: Complete Shopify Dropship App Review

Forums

dropshipping – Warrior Forum – The #1 Digital Marketing Forum & Marketplace – Threads Tagged with dropshipping

AliExpress drop shipping forum – expert drop shipping community!

Dropship Forum – Dropshippers & Dropshipping Reviews and Discussions

Suppliers

Dropshipping Suppliers – How To Choose The Right One

Products

How to Choose the Right Dropshipping Products

Trends and Statistics

Key Statistics of Dropshipping Profitability

Dropshipping Market Size & Share | Industry Analysis Report, 2019-2025

Profitability and Revenue

How Much Money Can You REALLY Make Dropshipping? [in 2020]

How Much Do Dropshippers Make: 14 Real-Life Stories

How Much Do Dropshippers Make On Average? [What About Profit?]

Startup and Operating Costs

Dropshipping Startup Cost: How Much Money Does It Take to Get Started?

How Much It Costs To Start An Online Store And Should I Dropship Or Carry Inventory – MyWifeQuitHerJob.com

The Cost of Drop Shipping: 24 Top Questions Answered! | SaleHoo

Equipment and Tools

Top 14 Dropshipping Tools You Need to Boost Business Success | AutoDS

30+ Best Dropshipping Tools/Softwares 2020 (Free & Paid )100% Working

12+ Awesome Dropshipping Tools | Bring Your Store to the Next Level!

Licenses Needed to Start a Business

Do you need a business license to drop ship? – Quora

What Retail License Do I Need for Drop Shipping? | Bizfluent

Do I Need a Business License to Sell Online (2020 Ecommerce)

Business Insurance

Commercial Insurance for Ecommerce: What Types Do You Need?

The Insurance Guide for E-Commerce Companies | Layr

Drop Shipping and Quality Control

Employee Considerations

A List of Common Jobs Needed for Running a Business

How to Finance Your Business

How to Obtain Financing for a Dropshipping Business | LenderzHub

Drop Shipping Financing

Business Funding By Shopify Capital – Grow Your Business

Business Name Ideas

How to Choose a Catchy Business Name for Your Online Store

Free Name Generator: Generate Business Names Online for Free

How To Choose A Name For Dropshipping Store: 5 Tips

Business Plan

How to Write a Business Plan for your Online Business – Oberlo

Dropshipping Business Plan: How To Write It And Why?

Dropshipping Business Plan: How to Build A Successful Online Business

Business Cards

Latest Image Search Results Related to Dropshipping Business cards

See Our Resource for Creating Attractive Business Cards That Work

Business Logo

5 Best Business Logo Generators For Your Online Store

Free Logo Maker: Create a Logo Online for Free – Oberlo

Latest Image Search Results Related to Dropshipping Business Logos

See Our Resource for Tips to Create an Impressive Logo

Dropshipping Business Businesses for Sale

Buy Dropshipping Websites for Sale | Exchange by Shopify

Dropship Websites, Domains and Apps for Sale | Flippa

Latest Search Results Related to Dropshipping Business For Sale

Marketing Tips

Marketing for dropshipping: 7-step marketing guide for dropshipping

How To Successfully Market A Dropshipping Business Using Facebook Ads

10 Ways That You Can Advertise Your Dropshipping Store (No FB!)

Shopify Dropshipping Business: 10 Marketing Tips to Double Your Sales – Fulfillman

Expert Tips For Beginners: How To Promote A New Dropshipping Store

Drop Shipping Business: 8 Marketing Tips to double your sales

16 Dropshipping Tips to Increase Leads for New Entrepreneurs – Oberlo

4 Ways To Promote Your Drop Shipping Store ($2,177.04 in One Month)

Resources for Running a Business

Acey Gaspard’s Guide to Starting a Small Business — Made Simple

The Nine-Hour Business Tune-Up

Learning Center SBA.gov

Entrepreneurship Course Online | HBS Online

LinkedIn Learning: Online Courses for Business

Online Courses — Anytime, Anywhere | Udemy

Courses on Coursera.org Related to Business

Courses on Skillshare.com Related to Business

Publications

Oberlo Blog – Free Dropshipping Tips and Resources

Top 25 Dropshipping Blogs & Websites To Follow in 2020 | Dropship Blogs

Top 10 Dropshipping Websites and Blogs to Follow In 2019 – Fulfillman

Terminology

ecommerce Glossary | SaleHoo

The Complete Dropshipping Glossary | Liquid Web

Ecommerce Glossary – A – Z – Further Ecommerce Resources

Books

Books from Amazon Related to Starting A Dropshipping Business

Google Book Search Related to Starting A Dropshipping Business

The Latest about Starting A Dropshipping Business

Google Searches

Latest Search Results Related to Starting A Dropshipping Business

Latest Scholar Search Results Related to Starting A Dropshipping Business

Latest Image Search Results Related to Starting A Dropshipping Business

News

Latest News Related to Starting A Dropshipping Business

Twitter

Tweets Related to Starting A Dropshipping Business

YouTube

Videos Related to Starting A Dropshipping Business