How to Start a Drop Shipping Business?

Aug 14, 2019 - Chetan Menaria

How to Start a Drop Shipping Business?

What is Drop Shipping Business?

A drop shipping business is a model for sales where sellers will accept the orders through different websites and other sales channel.

But they don’t need to carry the ship products and inventory themselves. Drop Ship sellers use suppliers which ship products directly to the customers on their behalf.

Drop shippers don’t require any storage, inventory or warehousing costs.

Why Starting a Drop Shipping Business is a Good Idea?

Starting a drop shipping business is a great way of taking the first step to enter into the entrepreneurship. One of the low-risk business models is a dropshipping business.

The business owners are able to sell products to the customers, set their own product prices and can able to market their brand. The e-commerce platform is a great way of starting to drop shipping for beginners.

It will connect you to the dropship suppliers. This will make easy of every step, starting from the addition of products with one click to automating shipping so that you can focus on increasing your business sales.

The process of planning and launching the drop shipping e-commerce business is almost the same as that of starting any other varieties of sales enterprise.

What you need to start your own business is that of the proper concept of market, different sales channels, source of goods with proper market plan and tactics.

But you don’t need to worry about a lot of cash to invest in staff for packaging and shipping, inventory and facilities that may be required for other business start-ups. You can start to dropshipping business during your weekends.

However, it would require daily work when it comes to processing orders each day. The business opportunities are endless, what you need is just to enter into the first step.

So, here are a few reasons why the drop shipping business is great for beginners:

1. Creative Channel

starting any new business is always exciting. You will get lots of new ideas, can able to do new experiments and maximize your creativity. Getting out of the regular bored 9 to 6 duty and starting a new business could be the creative channel.

No Extra Shipping Cost: Dropshipping business lets products get shipped directly to the customers on your behalf because manufacturers will ship for you. So, you don’t need any extra costs for packaging.

2. Make Money

A business with proper planning always gives you profit and more money. With drop shipping, you can set your own prices and can control how much you make. The more you market your business, the more you will make money with dropshipping business.

3. No Warehouse Fees

Dropshippers need not carry inventory. The manufacturer will take care of this. So, you do not require any warehouse or storage to hold package boxes for the products. It will save lots of your money.

What to Check While Choosing to Buy a Dropshipping Business Store

If you are planning to buy any store, you should consider few things like the design with picture quality, age of the website, the cost, how much money it has already make, penalizations and popularity of niche.

1. Design & Picture Quality

Check if the store is looking like it has been designed by any professionals or it is just designed a new entrepreneur just to make a quick sale?

Most of the time, it has been seen that designers or website owners skip the quality of the pictures. However, to convince any customer, it is very much important to present the product image in an attractive manner on the website.

Editing a product image is the whole and individual solution. It is one of the important parts of any e-commerce or drops shipping business websites.

Check that the image quality of the website has been created by experienced and topmost professional companies like Pixelphant with clean and optimized background photos.

2. Cost

Fix your budget first. What price you are willing to pay for your business.

It is necessary to invest money in the dropshipping business for its growth and expansion. So, you have to work out on your budget.

3. Age of the Website

An older website always has a better chance of ranking good online than any new site. So, choose according to the age of the website.

How much money it has made?  You need to find out some much maximum money it has make and how much it is making currently.

It will help you to understand the current business scenario, whether the dropshipping business growing up or dying.

4. Penalizations

Another important part to check before starting a dropshipping business. You have to double-check that the website which you are going to buy should not be penalized by Google.

There are several online tools to check whether the website has even been penalized by Google or not. If a business store has been penalized before by Google then it would be harder for you to get it rank in Google.

5. Popularity of Niche

Any store with broad topics and trending products can perform better than the stores with any specific type of product. So, choose such website which has huge products options.

How to Start a Drop Shipping Business

With all the above-mentioned tips, the process of planning and launching a drop shipping e-commerce business is almost the same as starting any other type of sales enterprise.

1. Choosing a Dropshipping Business Niche

The business niche you select needs to be laser found and it must be something in which you are genuinely interested. The truth is, what you sell matters.

Thus, you should take your time to find out the best dropshipping business ideas. It is not only about your passion, but it is also the combination of profit and passion which will lead you towards the profit.

So, when you are actually interested to make money with the drop shipping business, it is the reality to look into the profit and passion both.

Few more tips while selecting business niche:

  • Look for attractive profits: When you are running a drop shipping business model, your focus must be on marketing and customer acquisition. Select a niche with higher price products.
  • Google Trends: Google trend is a great way to know whether your selected niche is an upward trend or downward trend.
  • However, it can’t be the ultimate one to decide your business niche as some trend may going upward but do not have enough search volume to gain its popularity.
  • Search for some brands on social media: Browse social media ads from Facebook pages for top brands and do some research about their followers, how do they market their brand, how much engagement they are getting and how could be stand separate from them?
  • Low shipping cost: However, your supplier or manufacturer will handle the shipping but if the cost is too high, it may act as customers repulsive. So, find out some business ideas which are inexpensive to ship as it will provide you with the option of free shipping to your customers.
  • Sell something that is not easily available locally: Picking some business ideas which your customer would not find down the street. This is a great way to become more attractive to your potential customers.

2. Make Sure Your Products Appeal to the Buyers

While you are focusing on driving traffic on your website, you would definitely look into the highest conversion rate as most of the people visit either don't buy or never return.

So, the products you are selling must need to be attractive to the buyers. You must have to use photo editing and high-end retouching service for e-commerce products from a professional company.

There are so many professional companies which deliver product image editing service to each individual and organization who are selling products through online platforms.

3. Competitors Research

You just need to remember that drop shipping for beginners required lots of competitor's research as you are competing with the top brands and retail giants like Aliexpress, Amazon, Walmart and many more in this market.

So, doing the competitor analysis with the demand for particular products, its shipping costs, supplier and manufacturing process with profit margins is very much essential to stay in the dropshipping market.

This is where a lot of drop shippers go wrong. Look for such products which have competition as it is the sign of high demands of those products.

4. Leading Drop Shippers Shortlisted by Experts

Partnering with the wrong supplier may destroy your business. So, don't be hurry in this case. Start dropshipping business with verified manufacturers and suppliers.

Most of the suppliers are located overseas, so you need proper communication both in case of response speed and ability to know and understand each other. If you are not happy with the communication, then go ahead to search for another one.

Here are some of the leading dropshippers:

4.1 Oberlo by Shopify: Oberlo is uniquely designed user-friendly app by Shopify. It is free for use when participated through Shopify and is easy to operate saving time though.

After the provision for free sign up the cost may vary up to $79.9 for the pro plan. If you trust Shopify you can trust Oberlo.

4.2 AliExpress: AliExpress is the wholesale and dropshipping company with the widest variety of products options for drop shippers with free sign up. They can drop their products for over almost every niche and sell their products to customers.

Low prices help the dropping companies to sell at higher prices and earn a profit despite the free shipping charges globally. But the delivery might take more than the time specified in case of inconsistencies. After signing up the products are available for free view with price tags.

4.3 Wholesale B2: Wholesale B2 is a supplier integration system that will allow you to build your e-commerce store tempted with a huge product line. Besides, you can add tools to sell through eBay, Amazon, Google and your website. It has running applications integrated with Bigcommerce, Shopify & ECWID.

Although the sign up is free, the return policy includes a personal percentage of commission. This is up to 20% of the return amount as a restocking fee. Their pricing plans differ for channels like eBay, Amazon, website and data feed.

4.4 Spocket: Spocket is majorly ideal for US dropshipping suppliers offering fastest delivery because the majority of the suppliers are US-based. The variety and quantity of products is not huge, but the products have branded invoices.

4.5 Salehoo: This is a wholesale supplier list integrating the dropshipping suppliers with companies, to help sell. It is not a free one, but charges $67 per year ( 5.58 per month ) for sign up, against 60 days money back plan. Try SaleHoo directory for small costs.

The pricing for Spocket differs from $8 per month for the basic plan to $69 per month for the empire plan.

Read more: 18 Best Dropshipping Companies Shortlisted by Experts

5. Building and Marketing Your Dropshipping Business

To build your dropshipping e-commerce business, you have to choose the domain name first. Make sure it should sound like you have a broad range of products.

Once you select a domain name, then build your e-commerce website by proper designing, development, and addition of images. Create proper content through the product description, product reviews, blog posts, about the company and more to let the customers know about your store well.

Even you can launch a website which supports a drop shipping business model by using Shopify.

After this, it is the time to market your dropshipping business with the proper plan. You can choose several marketing tactics like Facebook ads, Email marketing, Retargeting ads, Some media coverage, influencer marketing to get a highly targeted audience and to increase your conversion rate.

Such marketing plan will give you the chance of making more money through your business.