In the digital age, opportunities for entrepreneurial ventures have expanded exponentially, and one avenue that has gained significant traction is dropshipping. This business model allows individuals to sell online without the need for upfront inventory investment. Instead, products are sourced directly from suppliers and shipped to customers, making it an attractive and low-risk option for budding online entrepreneurs.
Understanding Dropshipping:
Dropshipping involves selling products to customers without holding any inventory. When a customer makes a purchase, the dropshipper (you) purchases the item from a third-party supplier such as retail store, who then ships it directly to the customer. This eliminates the need for warehousing, packaging, and shipping logistics on the part of the dropshipper, making it a streamlined and cost-effective business model.
Example
You find a retailer selling a pop up plug socket (or any other item you want to sell) for £35.99 and you decide to sell it for £65.99. Making a sale would earn you £30 minus any expenses incurred in the sale.
Do I Need A Website To Dropship?
The good news is that you do not need your own website although you certainly can do this. Let’s explore some of the best platforms to dropship from and the merits of each:
Facebook Marketplace: This is probably the simplest place to get started. You simply list the product and start getting offers. The problem is the reach wont be huge and you will mainly get offers from people who are relatively local to you (or you can arrange delivery).
Ebay: This is one of the most popular and cost effective places to start dropshipping. The positive is that Ebay has a huge amount of traffic on the platform and also often gains external traffic from Google. Your Ebay products will often be able to rank highly on Google Search results which result in additional sales. You also get to gather seller reviews and move up from bronze to silver then gold seller ect and as you gain trust over time your sales should become easier to achieve.
You can turn on Ebay Ads to gain additional sales. An additional feature is opting in to Ebay’s Global Shipping Program which allows you to easily send domestically sourced products to millions of people all over the world in 100+ countries – greatly increasing your chance of making sales.
Amazon: You can list products on Amazon that are easily found in other stores. Once upon a time i used to sell a toy from Smyth’s Stores that cost £12 and would sell on Amazon for £25 and would sell around 8-12 each day. One of the problems selling on Amazon is the Amazon listing (ASIN) does not belong to you and any other Amazon seller can come along and start selling on your listing and win the ‘buy box’ by offering it cheaper than you or having better historical selling record. It is still an option however.
Social Media: You can potentially use TikTok or Instagram Reels to drum up sales for your product however the headache of staying on top of those sales and processing them at each store would become overwhelming. Social Media is better suited for ‘affiliate marketing’ which is what a lot of influencers do – i.e sending the customer directly to the supplier but receiving a cut of each sale eg 10%. I would not recommend social media for pure dropshipping.
Shopify: Shopify is the best ecommerce platform for those who want their own website. The pros is that you have full control unlike selling on Ebay or Amazon, where you have to follow their rules to a T and maintain good shipping times, response rates, customer satisfaction. Shopify allows you to build a legitimate brand and is more expensive and customisable. It does not come with it’s own traffic so unless you know how to get traffic to a website and convert them into sales do not expect to achieve any sales after building your store (unlike ebay and amazon). I would only recommend Shopify for seasoned professionals who have graduated from Ebay or Amazon Dropshipping or already have knowledge of online marketing and are confident they can generate traffic profitably.
Those people who chose to do high ticket dropshipping – selling products which cost between £100 -£1000 as advocated by certain gurus such as Anton Kraly from Drop Ship Lifestyle would also do best by selecting Shopify as their main platform. The higher revenues earnt from high ticket items allow you to spend money on advertising. Again high ticket dropshipping and Shopify in general is higher risk and higher reward so potentially saved until you are more seasoned. A good example of well put together Shopify dropshipping store selling high ticket items is Pedal & Chain.
What are some of the Pro’s of Dropshipping?
Low Barrier To Entry
It is super easy to get started. All you need is to start is find a product that you can sell for a higher price and then promote it to get a sale. There are plenty of places where you can market this product for free. For instance you could list the product for free or close to free on places such as Facebook Marketplace or Ebay.
Cash Flow
With dropshipping you get paid up front, which is great for cash flow. This does mean that you need to make sure you are on top of your profit calculations and leave enough cash to pay for any expenses such as shipping or taxes which you incur.
Variety
There are lots of companies and products available in the world, as long as you can spot value for money and also trending products / demand you should be able to offer a wide variety of products which people would want to purchase.
What are some of the Cons of Dropshipping?
Delivery Times
A common mistake made in the UK is attempting to dropship with Chinese made problems from places such as ali express / alibaba. Yes, you can get fabulously cheap products from China but the waiting time is often way longer than stated eg 10 days shipping turns into 40 days and you will have a nightmare trying to deal with the customer complaints.
Returns & Refunds
As you are the middleman, if a customer is unhappy with a product and wishes to return / replace it you will need to know the return / replacement policy of the store and negotiate with the store on their behalf. If you are unable to make the customer happy you risk a poor review on whatever platform you are selling.
Out of Stock
If you have hundreds of products for sale on your website or ebay / amazon, how do you keep up with which products go out of stock or adjust their prices? Luckily this problem can be solved with software such as Hustle Got Real which monitors all your suppliers and will auto adjust your pricing for you to maintain your margin or take down your listing if out of stock.
Workload
If you choose to do everything manually, the workload involved in staying organised can stack up! However, there is a plethora of software’s which can make managing a dropshipping store a breeze and there are also a number of ‘virtual assistants’ based in the Phillipines and India which can be hired for cheap and know how to manage these stores for you.
Most Important Factors For Success
Research: Picking the correct products is crucial to your success. Being able to find products which are in high demand and are profitable to sell are two key factors. You can use tools such as AutoDS or Chili Hunter to identify these products.
Traffic: Getting traffic in the form of impressions, clicks and ultimately sales is the name of the game. Knowing basic SEO and how to optimise your titles and descriptions for keywords and ranking them up if going to play an important factor.
Ratings: Getting positive reviews and maintaining a positive reputation as legitimate seller will be crucial in the long run to succeeding online.
Knowledge: Becoming knowledgeable about dropshipping almost always leads to improved results. There is a lot of content around dropshipping that you can learn for free via youtube, trial and error or you may wish to pay for a more structured course.
Dropshipping has been around for a long time and many people are still making good money from it. It allows you the flexibility of working from anywhere in the world and at your own pace. It allows you to work in a fast paced, adaptive space. So is dropshipping something you would consider? If you fancy a more straightforward way in which you could win money online, you can opt to enter your email into our daily prize draw and hopefully win some cash that way!