In Case You Missed It: What Is Drop Shipping Business?

In the era of e-commerce, it’s hard to imagine that someone does not know what drop shipping is.

Most likely, you’ve heard about it before, but what if you have no idea how it works?

Let’s figure out what’s it all about.

What are the main obstacles for opening a traditional online store?

First, the absence of startup capital.

Second, lack of business knowledge.

Drop shipping is free from both these shortcomings.

You can start your business with zero budget.

And what about some special magic knowledge? This article is just about that.

Drop Shipping. As Easy as a Mouse Click

In a nutshell, you post some products on an online platform (your own website or online store, in a social network etc.). You don’t need to buy goods before posting! You just use the supplier’s pictures and descriptions.

Then you promote your webstore to attract customers. When a customer places an order and pays for it, you contact the supplier who stocks this item. You place the same order which should be delivered to the address of your customer. The customer receives the order, the deal is done.

The main advantage of this scheme for a dropshipper is zero cost of the products’ purchase. You don’t have to spend money on the supply of goods: you pay for the product with the customer’s money. The price in your webstore is higher than the supplier’s price. You put margin – the difference between the initial and final prices – in your pocket.

There are hundreds of resources delivering goods from China and other countries to online stores around the world. Drop shipping offers an unlimited range of products: clothes, shoes, accessories, toys, household appliances, digital devices and what not. Let’s see in detail how to find your place in this business and make a successful webstore.

Making Profit in 4 Steps

  • Step 1. Study the market and choose the niche

Begin with analyzing the market. Study the latest statistics. Use Google Trends to estimate chances in different spheres. Another useful tool is Google Adwords and its Keyword Planner. You will see how popular various niches are.

Don’t plunge into the sphere where the maximum competition already exists. If you cannot disrupt the popular niche with some revolutionary improvement, you will only waste your time and energy.

A promising niche for drop shipping should differ from what the most prosperous online stores do. Seems like all the places are occupied, but there are always vacant business niches – just think a little.

Make a list of your own interests and skills to narrow down the scope of possible niches. Are you good at swimming? Keen on anime? Crazy about makeup? Convert your knowledge into profit!

  • Step 2. Find suppliers

A dropshipper needs reliable suppliers. Before working with any supplier, study the seller’s information and customers’ feedback. Trustworthy suppliers guarantee parcel delivery and provide payments protection.

It is very convenient to work with AliExpress. This Chinese retail platform has an unlimited choice of products at the lowest prices from large and small manufacturers. It’s easy to choose suppliers because there are both a sellers rating and a product range. Positive feedback will help you to find a good seller.

  • Step 3. Create an online store

If you have your own website, blog or account in a social network, you can sell products there. But it’s much more comfortable to make a specialized webstore. It looks cool and attracts more users.

Create your website with the help of online store building software. It’s not so difficult as it seems if you use WordPress and some plugins for e-commerce retailers. Post pictures of the products from your supplier on your website. Don’t forget to add a shopping cart, all necessary buttons, About and Contact pages etc.

Complexity of this work depends on your skills and availability of free time. If you want to save time, you can order a ready-made store from professionals for a reasonable price.

  • Step 4. Start online promotion

A profitable webstore is impossible without Internet promotion.

There are different ways of online promotion:

  • search engine optimisation (you can go to professional SEO specialists);
  • contextual advertising (e.g. Google Adwords, Facebook ads);
  • promotion in popular forums and on other Internet sites;
  • advertising in social networks (Social Media Marketing);
  • promotion through online services for the search and purchase of goods, etc.

All means of promotion involve certain investments – if not finance, then time. But these expenses are usually justified manifold, especially if you can organize the advertising campaign properly.

What comes next?

Track the users’ activity and use the knowledge. If you see good demand, keep it on.

If there are no sales, make some adjustments. Don’t step back immediately. Try to change your working practice, webstore design, marketing tools. Testing is vital, so monitor the effect of all the changes. Stay relevant and never give up.

What are the benefits for dropshippers?

  • No significant initial investment;
  • No need to organize warehouses;
  • No risk of excessive stock or shortage of goods;
  • No need to deal with packing and shipping of goods;
  • No limits to the increase the range of offered products;
  • You can promote your own brand;
  • You can quickly test and evaluate ideas and products;
  • You can do drop shipping alongside with the main work;
  • You can work from anywhere – the only thing you need is Internet.

What are the benefits for customers?

  • They save their time and effort;
  • They have quick assistance if necessary;
  • They find necessary products more easily;
  • They make purchasing with greater comfort;
  • They solve the problem of overstocked market;
  • They have easier and user-friendly webstore navigation.

What are the benefits for suppliers?

  • They get enormous sales volume without ad spending. That will do ☺

As you can see, drop shipping makes profit for all parts. A successful dropshipper can get a lifetime income by owning a popular webstore.

Certainly there’s a lot of information about it around the web and studying it is a preliminary phase. But if you have already decided to dive into this venture – we’ve found how to start and run your drop shipping business smoothly.