If you want to start an online business that sells things, a dropshipping store sounds like a fun and profitable idea. As the number of people who shop online grows, so does the number of e-stores. This means that more new retail businesses are using the dropshipping model.
Dropshipping is becoming more and more popular around the world, but many people still don’t fully understand what it means. This is why we’re here: to help you learn more about this type of business and to show you the steps you need to take to open a dropshipping store.
What Dropshipping Means
Dropshipping is a way for online stores to do business. Retailers don’t have to spend money on stocking up on products or store them in a warehouse. When they fill their online store with information about the products that their supplier partners sell, they will have “virtual stock.” At first, the supplier shipped the products directly to the customer who bought the item from the reseller’s store. The customer pays the retailer for the product, and then the retailer pays the supplier for the product.
Even online stores that use the dropshipping model need to put money into the business to make it work and get it started. You can’t start a dropshipping store and keep it running without having any money. When you work with wholesale suppliers, you don’t have to spend as much money as when you run an online business. Small business owners can save a lot of money, time, and work on logistics.
The difference between the wholesale/dropshipping price and the retail price in the store is what the retailer will make.
What are the pros and cons of dropshipping?
There are both pros and cons to opening a dropshipping store. Businesspeople have to decide if the terms of this model work for them. You can read more about these in general below. As a retailer, if you want to be successful, you need to work with real suppliers and sell products that your target market isn’t already getting too much of. Sell things that the people you want to reach need.
Advantages
- Small Capital Investment: you don’t have to spend money on inventory because there isn’t any. Just pay for your website, online store, etc. to work. You don’t have to worry about logistics and you don’t have to rent a warehouse because there are no physical products to store.
- Lower Risk: especially for people who are just starting out. You don’t have to pay for products before you sell them, so you don’t have to worry that you won’t be able to. A wider range of products that are easy to change. Since you don’t have a real inventory, you can change the products in your store whenever you want, for any reason.
- More Chances: When you start a dropshipping store, you can choose from a very large number of products. Every day, there are more and more dropshipping suppliers on the market. Don’t forget to choose partners whose warehouses are close to where you are so you can give your customers good shipping conditions.
- Less Commitment: it works for more things. First of all, you don’t have to worry about logistics or pay for this. Second, it doesn’t matter where your supplier’s warehouse is or where your coworkers work. It doesn’t have to be in your town or country. Online, you can do a lot of things.
- Easy To Start: All you have to do to start a dropshipping store is decide what you want to sell and from which supplier you want to buy it. You have to build your online store. If you need help, you can ask a professional. You need to think about marketing. You don’t have to worry about things like stock and shipping. Less money will be enough to get the business off the ground.
- Automated Processes: All processes, like uploading and updating product data and syncing orders, can be automated if you choose the right solution.
Disadvantages
Products Come In One At A Time: Even though products come from the supplier one at a time and not in large quantities, if you have more partners, it’s easy for a customer to order more products from you that come from different suppliers. But if that happens, the customer will get more packages on different days, and if the first package only has one product, the customer is likely to send you a message complaining. Solution: You have to ask for the products to come to your place first, and then you can let them wait for each other. Then you can send all of the items in one box. When you work with local suppliers, you can keep the delivery time short.
Suppliers Often Give Dropshipping Retailers: less of a discount than they would for a bulk order. Also, when you add your markup to the price of the product to get your store price, you have to be careful not to add a price margin that is way too high, or retailers will get the product from somewhere else. Solution: Work with real suppliers instead of companies that just resell products and set their own prices. Real suppliers will give you fair prices for their goods.
Less Control: You don’t see or touch the products, and you don’t meet the people who make them. Because of this, you can’t be sure that the product and package that your customer gets really represents you. Solution: Ask for the products to be sent to your house first so you can check their quality and add a small gift. Also, make sure that the manual for the product is written in the language that your customers speak.
Long Shipping: Time because many dropshipping retailers choose suppliers from overseas or from another continent. Solution: When you’re ready to start a dropshipping store, choose a partner whose warehouse is near or in the same place as your target audience (or you).
There is a lot of competition between online stores: More and more online stores use dropshipping, which means that more e-shops are selling the same items to customers, making the competition even tougher. Solution: When starting a dropshipping store, choose products that are unique and meet the needs of your target audience. Check to see what that market is missing, and don’t do everything that other companies do. Listen to both your head (what you should sell) and your heart (what you would like to sell).
How to Start a Dropshipping Store: 7 Steps
There are a few steps you need to take to start a dropshipping store. You also need to make sure you do everything right and learn from more sources. We have written before about what you need to do to start an online store, which you might find interesting.
Choose what you want to sell
The first thing you need to do before opening a dropshipping store is decide what you want to sell. You may already have an idea of what you want to sell, which is why you want to open an online store. In this case, you need to see if that product will sell well on your market and if it will make money for your business to sell it.
What can you do to make sure your business has the best niche, winning, and trendy product? You should think about what you couldn’t find in the local stores or if any of your friends tried to buy something there but couldn’t. Do you have any hobbies that could be turned into great products? On the market, what do other people sell? What do you see on YouTube and social media? What is something close to your heart that you could be passionate about as a business? Find out about the market, make surveys, and share them in Facebook groups. Go to Google Trends to see how well-known your product is. Your choice of products should make you stand out from the crowd.
Choose a provider
Before opening a dropshipping store, if you already know what you want to sell, the next step is to find a reliable supplier. What should you be sure of? First, you need to make sure that the supplier offers dropshipping. Then, it’s important to choose a supplier whose warehouse is near or in the same city as your target audience. This will cut down on the time it takes to ship the goods. Talk to your future partner about all the details of how you will work together before you start selling their products. You can avoid getting confused like this again.
Also, when you start a dropshipping store, don’t choose a lot of supplier partners. Instead, choose just one or two. Why? Because if a customer orders 5 products from you and they come from 5 different suppliers, they will get 5 different packages on 5 different days. After the first package arrives, the customer will send you a message saying that 4 other items are missing. If you want to work with more than one supplier, what can you do to avoid this? Ask for the products to come to your place first so you can let them wait for each other and put them all in one box. Choose suppliers who can get things to you quickly.
Where can you find suppliers you can trust? Check out dropship-empire Marketplace, where you can find millions of products from sellers around the world and in your area.
Define Your Strategies
You need to work on your plans before opening a dropshipping store. You will have more than one. You have to decide what kinds of things you want to sell. You also need to figure out who your target audience is and how you plan to reach them. You need to make plans for how you will run your online store, and if more than one person works there, you need to decide who will be in charge of each task. You will also need a clear plan for marketing. Also, make sure that the logistics will go well.
Have goals. You need to know what your business is called, what your message is, why you’re opening a dropshipping store, why you’re selling those products, and what your overall goal is with the business. You also need to set goals for how much money you want to make each month, and you need to come up with a plan for how to get one-time and ongoing income and how much of each you want. It’s important to work on strategies to make sure your business runs smoothly and so you always know what you’re doing, how, and why.
Pick an online store platform to work on
At first, you could start a dropshipping store or build a website in one of two ways. You can start working with developers who will build you an online store or site from scratch. You can also sign up for an ecommerce platform, which will make setting up an online store easier. Find out what each platform can offer and what its benefits are. You can find out more about them by using their free trials.
Shopify, Wix, BigCommerce, Ecwid by Lightspeed, Jumpseller, and Shoprenter are all examples of ecommerce platforms. Also, when starting a dropshipping store, it’s helpful to choose ecommerce applications that will make your work easier.
Set up an online store.
When we were setting up a dropshipping store, we got to the point where we could start building it. Choose a good name for your business, register your domain, sign up for your chosen ecommerce platform, install the necessary apps, such as a product sourcing dropshipping app, and decide on the design (on the colors, fonts, visual components, and the design of the website, etc). Read articles, watch videos, and check the online Help Center for the service to learn how to do everything the best way. You can also choose a team of experts to build your online store.
Take care of official and legal things
When starting a dropshipping store, it’s important to take care of all the official and legal things that need to be done. Talk to someone who knows a lot about online business and can help you. Choose an accountant and, if you need to, a lawyer. Make sure the partners you choose know about online shopping and dropshipping. You will have to register your business with the government. Don’t believe everything you read in groups and forums on social media. Your accountant will help you a lot as you go through the steps. You can also find easy-to-use accounting solutions and software for your ecommerce business online.
Get started with your marketing plans
Marketing helps you get more visitors and turn them into buyers, which will lead to more orders. Set up your marketing plans for opening a drop-shipping store. Be active on Facebook, Instagram, and other important social media sites, and post often. Have a certain look that you carry with you everywhere.
Emails, newsletters, and posts on social media are all part of marketing. You can send emails about registrations, sales, special offers, tips, and tricks. Also, there is Search Engine Optimization (SEO), which is a long-term way to get people to visit your site. It doesn’t cost you money, just time. Paid ads are the next part of marketing that we’ll talk about. You can also use Google Ads, Facebook Ads, Instagram Ads, and other ways to advertise with Google like videos, emails, and Google Shopping. Another piece of advice is to include a small gift and a greeting card with the products you send to customers. It is good to have sales and special deals often.