Before you start a dropshipping business with AliExpress or turn your existing online business into a dropshipping model, you need to know: Is dropshipping still worth it in 2023?
In this age of technology, you need to look further than most people. The growth of online business has been sped up by digital and e-commerce technology. As technology keeps getting better, dropshipping won’t just “die” out of nowhere, unless it’s against the law or not legal. But it is legal to dropship.
Dropshipping is easy to do. All you have to do is put items for sale on your website. A third party makes and holds the product itself. When a customer places an order, the third party sends the item straight to the customer.
It seems like a dream to be able to add stock without having to deal with production, shipping, or renting warehouse space.
But is it worth it to drop ship? Let’s find out more so you can make the best business decision.
Is dropshipping finished?
No, is the short answer. Some statistics you can find on the Internet suggest that the dropshipping market may be full and competitive, but that doesn’t mean that dropshipping is dead. In fact, it has never been more alive. From 2020 to 2028, the dropshipping market is expected to grow at a compound annual growth rate (CAGR) of 28.8%. So, let’s clear up the confusion about the question “Is dropshipping dead?”
Competition That’s Tough
People often think that the dropshipping market is too old for new businesses because it has been around since 2006. People thought that affiliate marketing had filled all the possible sales niches.
Competition can be tough, but that’s not the end of the story. You can always find better suppliers and new brands to work with and sell the best and newest products.
The tastes of people change all the time. Some things can be popular for three months, but then no one remembers them at all. As long as you know what’s going on, you can stay ahead.
Even if a business has been around for a long time, that doesn’t mean it won’t fail soon. Look at Apple Inc., do they seem like they’re giving up? Of course not. To stay in business and grow in the market, you need to come up with new ideas, keep looking, and not be afraid to add more products.
Getting ads to cost more
Since you can’t stop it, you might as well learn how to handle it. People who come up with good marketing campaigns will stand out in a market with millions of competitors.
Regular dropshippers hear stories about how this amazing way of selling can make anyone a millionaire in just 90 days, and they want to make money fast. Well, e-commerce isn’t a calm blue ocean, so you should be ready for problems.
One way to lessen the “pain” of failure is to not sell low-quality products with low-quality marketing. A business that does well always pays more attention to its suppliers and chooses better products that add value to its marketing plans.
You can start your dropshipping business today with the help of a number of online tools. E-commerce platforms like Shopify give you a lot of tools for marketing that are made to help you convert or get new customers.
Effective marketing strategies can put you far ahead of the competition if you’re selling the same product as someone else. This is because you’re well-prepared and use tools to take advantage of one’s sales.
When the market is this full, dropshippers will be competing for customers and suppliers, so you must keep a good brand image to stand out and show them the value you can offer. Don’t cry and say, “Dropshipping is dead.” The answer is not clear.
Even though it isn’t, the people who live in this market will try to beat each other up. Things are crazy at work. You can’t stop because of competition, because competition is a part of life and you can’t just stop.
Does dropshipping still make money?
Yes, dropshipping will still be a profitable business model in 2023 and beyond. A lot of people are getting into dropshipping these days, but if you keep in mind that you’re building a real business and not a “quick-money store,” then you’re off to a good start! Dropshipping is a low-risk way to run a business because it lets sellers sell products to customers without the huge costs of running a wholesaler.
There are different ways to figure out how well dropshipping is doing. Google Trends is a very useful tool that is often used to find niches, products, or brands that make money.
Google Trends shows how much people search for something on a scale from 0 to 100. The number on the right is not the original time of the search, but the number of searches for a certain term. So, if the score was 50 in 2010 and 100 in 2023, that means there were twice as many searches in 2023.
In addition to the hint that Google Trends shows people’s interest in dropshipping over the past 5 years, there are real statistics that are more convincing. By 2025, the global dropshipping industry is expected to be worth $557.9 billion and grow by about 7% each year. When you dropship instead of keeping your own inventory, you can also make about 50% more money.
The Good and Bad of Dropshipping
Dropshipping has both good and bad things about it. Let’s look at some of the most important things you should know before you start.
PROS:
Many people know that dropshipping is a great business model, but why is it so great?
Don’t Worry About Stock
In a regular retail e-commerce business, it’s clear that they need to keep a lot of products in stock because they have to make or prepare a lot of products and fill orders themselves. Dropshipping has just taken care of this problem.
In dropshipping, there is no such thing as “inventory.” When you see the words “dropshipping” and “inventory” in the same sentence, you might think that “dropshipping” doesn’t need any inventory. You don’t have to buy things in large quantities or worry about them getting broken over time.
You don’t have to keep track of inventory, which can take a lot of time and effort. All of those are given to the vendors. You can focus on growing your business instead of taking care of products that you don’t have any buyers for right now.
Low Business Budget
Entrepreneurs need to have huge budgets for most businesses, especially e-commerce, so they can make and prepare the product, package it, keep records, and ship it to customers.
But dropshipping cuts the cost of all of this by a lot. The seller doesn’t have to put any money into anything until there’s an order, which is paid for by the customer in the end. So the risks are now much more stable.
Even starting a business doesn’t cost anything. This small amount is only needed to market the business and pay taxes.
A Huge Number of Items
All successful e-commerce sites have one thing in common: they offer a wide range of products. People are most interested in dropshipping when they want to look at a wide range of products online and want to find something that fits their tastes.
With no limits on keeping stock and low start-up costs, the seller can also offer a lot of different kinds of products instead of just one. On e-commerce sites, it’s also easy to add a lot of other items without thinking about how much they cost.
So there are a lot of different products and options. This is a huge chance for any creative person who wants to start their own business.
Lower Risks
Inventory in normal retail online stores tends to put pressure on sellers to move it often, or else the product will lose its value quickly. If this happens, the seller will be very surprised because all of the money will disappear as soon as the inventory is sold.
In dropshipping, the seller doesn’t buy the inventory and only pays for a product when an online store orders it. It’s a safe and secure system, and the seller won’t put it at risk in any way.
If the online seller can’t sell the product and doesn’t get any orders, he doesn’t have to pay anything except for the bad marketing he did. So, in a way, it’s on the safer side.
Location Free
A great dream for entrepreneurs today is to be able to work anywhere, at any time. This is a benefit of dropshipping because one of its best parts is that it doesn’t matter where the seller is, as long as the seller doesn’t have a bad Internet connection.
The seller can take his laptop with him and set up and grow his dropshipping e-commerce store. Make sure that communication with customers and suppliers doesn’t break down. This will make it easy for the business to grow.
CONS:
Now that you know all the great things about dropshipping, let’s talk about the bad things.
Not being in charge
In the dropshipping business, all of the work is done by third-party suppliers, not the seller. This can make it a risky business if you end up working with suppliers you can’t trust. Once you’ve found the suppliers, you can only trust them. You can’t control what they do.
Customers will not complain to the supplier if something goes wrong with their order. Instead, they will complain to you. When a customer places an order on your website, you will be responsible for everything.
Hard Stock-Tracking
Since dropshipping sellers don’t keep any inventory on hand, they could lose money if their suppliers don’t have enough items. It will make the orders hard to predict. If demand for a product goes up all of a sudden, the seller won’t know if there aren’t enough supplies or if it will take longer to process the orders.
Expert Tip: Use dropship-empire to Make Your Dropshipping Business Better
But, as we said above, there are a lot of tools that can help with marketing the business. There are also tools and apps that can help with finding reliable suppliers and keeping track of stock. With more than 4,000 5-star reviews, dropship-empire is the best dropshipping tool in Shopify’s App Store.
dropship-empire is here to make sure you stay in charge of any conditions in your order. Is this order going through? Has it been delivered yet? Is AliExpress giving the store any trouble?
With the dropshipping technology from dropship-empire, shop owners can automatically keep track of all orders and their status. When a new order comes in, it will show up right away and move to a different tab based on its current status.
In the paid plan, dropship-empire will automatically update the inventory information of the application’s suppliers and your online e-commerce store’s product inventory information.
So, the data in the back-end will be similar to what your AliExpress vendors give you about their stock. If a product is out of stock on AliExpress, dropship-empire users can also make it so that it is no longer available in the store automatically.
Last Word
Now you know that dropshipping is a legitimate way to run a business that will continue to grow in the years to come. Is it worth it to drop ship? Yes, that’s the answer. Online shopping is becoming more popular all over the world, so anyone who wants to do it can make a lot of money at it.