How Do I Start A Dropshipping Business?

Dropshipping is an exceptionally popular business model for new businesses, mainly because you do not need to stock or handle the things you sell, you can start a dropshipping business on a shoestring budget. 

A dropshipping e-commerce website buys the things it sells from a third-party supplier or manufacturer, who subsequently fulfills the order. This not only reduces operational costs but also frees up your time to focus solely on customer acquisition.

How do I start a dropshipping business

Here’s how to get started:

1. Choose your niche

The niche you choose should be precise and something you actually care about. A non-focused product line will be challenging to promote.

If you are not passionate about the area you choose, you will be more likely to become frustrated, because successfully scaling a drop shipping business requires a lot of labor. Here are some things to think about while deciding on a niche.

  • Seek out profitable opportunities. Because the focus of a dropshipping business model is on marketing and client acquisition, the amount of work required to sell a $10 item is essentially the same as the amount of work required to sell a $2000 item. Choose a market with higher-priced products.
  • Low delivery costs are essential. Even if your supplier or manufacturer handles shipping, if the cost is outrageously expensive, it will deter customers from your shop.  Find something that is cheap to ship, as this provides you the option of offering free shipping to your buyers and deducting the cost as a business expense to entice more sales.
  • Appeal to the right people. When it comes to increasing traffic to your website, you want to have the maximum conversion rate possible because the majority of visitors will never return. The things you sell should elicit impulse purchases and appeal to those who have the financial means to make a purchase right now.
  • Be sure your product is in demand. Check out Google’s Keyword Planner and Trends to see what prevalent search terms are associated with your potential niche. If no one is looking for what you want to sell, you’re out of luck before you even start.
  • Develop a brand. Your drop shipping business will be more valuable if you can rebrand whatever you’re selling. Look for a product or line that you can white label and sell under your own brand, complete with personalized packaging and branding.

2. Market Research

It’s important to remember that you will be competing with other drop shipping companies as well as retail megacorporations like Walmart and Amazon. Many would-be drop shippers make the mistake of looking for a product with little to no competition. That is an indication that there is no demand for that particular product.

There are numerous reasons why a product may not have much competition, such as high transportation costs, supplier and manufacturing challenges, or low-profit margins. Look for products with plenty of competition because it indicates that there is a high demand and that the business strategy is viable.

3. Find a supplier

Partnering with the wrong supplier can be disastrous for your brand, so don’t rush into this stage. Do your research first. Because the majority of dropshipping suppliers are based overseas, communication is critical, both in terms of reaction time and mutual understanding.

If you are not completely sure about a potential supplier’s communication ability, look for a new one.

In the event that your company expands rapidly, make sure to ask a lot of questions and learn about their manufacturing capabilities. You want to be certain that they can grow with you.

Try to learn from other entrepreneurs that have previously taken this journey.

3. Build a website

Using a simple e-commerce platform like Shopify is the quickest method to establish a website that supports a drop shipping business model. You don’t need technical knowledge to get started, and there are lots of tools to assist you to raise sales.

Even if you have a large enough budget to pay a web design and development team to develop a custom solution, it is a far better decision to choose one of the plug-and-play choices, especially in the beginning. Once you’ve established yourself and your revenue is flowing in, you can look into more website personalization.

4. Attracting your customer

You can have a wonderful product and a terrific website, but without people looking to buy, you don’t have a business. There are various methods for attracting new clients, but the most effective is to launch a Facebook marketing campaign. This helps you to create sales and money straight away, which can help you scale quickly.

Facebook lets you directly display your offer in front of a highly focused audience. This allows you to compete with the biggest brands on the market right now. You must also consider the long term, thus search engine optimization and email marketing should be prioritized.

Collect emails from the beginning and build up automated email sequences with discounts and special offers. It’s a simple method to capitalize on your existing client base and make real cash without spending money on further advertising and marketing.

5. Optimize

To expand your company, you must track all accessible data and stats. When you can track every single conversion – knowing where the consumer came from and what path they followed on your website that eventually led to a sale – you can increase what works and eliminate the tactics that don’t work.

Is it hard to start dropshipping?

Nope! Dropshipping is pretty easy and simple when you’re just getting started. However, it’s very difficult to succeed at it. In fact- 97% of all dropshipping businesses fail on the first attempt.

During your learning phase, you will probably waste a large portion of your advertising cash making small mistakes. This is where the majority of people give up.

If you keep going, you’ll come across a few winners. This is where things begin to get interesting. You’ll be able to launch an ad campaign for $100 and make $200 once you’ve gotten your feet wet.

When a marketer reaches this position, they can aggressively scale-up, paying $2000 to make $4000, or $20,0000 to make $40,000. However, at first glance, it appears hopeless because you would be paying money and get nothing in return. Be sure to stick at it and give it your best shot before giving up!

Even business graduates have found it difficult to run a successful dropshipping business. Some people grow frustrated because they believe they know everything about the business, but when it comes to dropshipping issues that are “small” or “simple to deal with,” they suddenly become a significant deal.

The most common difficulties associated with dropshipping are:

  • Making your online store appealing enough to attract customers
  • Creating product listings with images and descriptions
  • Marketing your store to make it stand out from the crowd
  • Finding the best and most dependable suppliers
  • Identifying high-quality, profitable items
  • Finding the best tools to help you automate your dropshipping business.
  • Getting to know the features of your dropshipping app, if you have one.
  • Paying for your monthly expenses (online store platforms and other programs you use), especially if your store is not yet profitable.
  • Handling returns and refunds
  • Handling potential client complaints or issues
  • Dealing with shipment time delays

How many products do I need to start dropshipping?

There is no such thing as an ideal number of products. With just one product, you may create a highly successful store. Or perhaps just a few items. Or even hundreds.

It truly depends on the store you’re putting up, how you promote your products, who you’re targeting, how relevant the products are, whether you’re focusing on a certain niche or putting together a more generalist store, and so on. 

If you’re making a niche store, we recommend starting small, with only a handful of products. This can be anywhere from 1 to around 10.

However, with a general store, you must ensure that you have enough products to give your shop an authentic vibe. You can and should add additional products in the future, but 30 to 50 is a reasonable starting point. It’s enough to give your shop legitimacy, but not so many that it takes too long to set up.

But don’t feel obligated to start your store with thousands of products.  Strategic and slow growth will enable you to study, comprehend, and eventually give yourself a better chance of success.

Remember that the most important thing to keep in mind when launching a new dropshipping store is to have it up and running quickly so that you can begin marketing and earning income.

You won’t need to take out a second mortgage, but you will have to put money into your dropshipping company before it will put money in your pocket.