There are more and more businessmen in recent years, this is due to the fact that the market for goods and services is saturated with ways to earn money in the absence of investments or with the use of a small amount of their own money.
Today we will talk about such a popular destination as dropshipping. Let's see: dropshipping what is it in simple words and how to start your profitable business?
The contents:
- What is dropshipping?;
- Is it profitable for manufacturers;
- How does dropshipping work?;
- Pros and cons of dropshipping;
- Categories of Top products in dropshipping;
- Choosing a supplier manufacturer;
- How to start a business in this area;
- How much a dropshipper can earn.
What is dropshipping?
This is a business area that involves shipping goods in small batches from a direct manufacturer at the request of a drop shipper directly to the customer. A remote representative is responsible for providing the product, handling objections, and helping in conflict situations.
Some useful links:
In simple words, dropshipping is a direct delivery of goods to consumers. A dropshipper is an intermediary between these links.
Earning money on dropshipping for the seller consists of a mark-up on the product, which he himself determines and takes for himself. In fact, this representative helps both parties: the manufacturer – in selling goods, the consumer-in purchasing the necessary products.
To ensure smooth operation and minimize risks with the delivery of goods and its compliance with the presented characteristics and image, the dropshipper needs to find only high-quality products and cooperate with trusted manufacturers.
The greatest influx of potential buyers to the seller brings competent, unique advertising. Many experienced Dropshippers spend huge amounts of money on advertising campaigns for their products, while some focus on interesting, hand-made piece products.
We'll talk about how to get started and how much you can earn from it later, but for now, we'll figure out whether such a sale is necessary for suppliers.
Is it profitable for manufacturers?
Manufacturers, whether they are individuals selling hand-made goods or large companies selling lots of goods in small and large wholesale, will always benefit for a number of reasons:
- They themselves are not spent on advertising.
- The dropshipper itself works with objections and faces problems.
- With the involvement of a large number of Dropshippers and their client network, the supplier's product turnover increases.
Therefore, dropshipping around the world is only increasing the pace of development.
How does dropshipping work?
There are many models for dropshipping, but they all have the following stages::
- You choose one or several trusted suppliers – it will be useful to visit the forums, read reviews about the quality of their products, delivery times, and product compliance with the showcase.
- You sign a contract with them.
- You decide on the products that you will sell and set a mark-up for them.
- Then the buyer selects the product they like and makes a request to you – this can happen in social networks, through correspondence through Bulletin boards, or directly on the website of your online store.
- Then you send the request to the supplier company, which will collect the order and send it to you or directly to the consumer. There are two options for receiving payment from the customer – in the first case, you accept the money, pay for the goods yourself, and take the extra charge for yourself. In the second option, the manufacturer receives the cost of the product and pays you the Commission specified in the contract between you.
In fact, you, as a seller, do not need to worry about the storage and transportation of products, these tasks are solved by the supplier himself. You only need to attract customers and set up payment methods if you accept the payment yourself.
There are two ways to work in dropshipping:
- Buy in bulk and sell the product at a retail price with a mark-up;
- Redirect requests to the supplier.
In the first case, you will need a warehouse for storing goods: this can be a room in an apartment, in a house, in a utility room, or a rented area.
Important! We do not recommend renting a room at the initial stages of the development of such a business – the costs may not overlap!
Pros and cons of dropshipping
Undoubtedly, both manufacturers and entrepreneurs like such a sale, however, as in any field, dropshipping has its advantages and disadvantages.
Positive:
- You can work without investment or with small start-up capital.
- No need to search for staff, rent a storage room.
- No packaging or order collection skills are required.
- You are not involved in logistics (delivery).
- It is possible to conclude dropshipping agreements with several manufacturers if this does not contradict them.
- You can manage your business from anywhere in the world.
Disadvantages:
- All advertising and customer acquisition costs are entirely borne by you.
- You will deal with customers yourself if the delivery time of goods is disrupted, the advertising image does not correspond to reality, and so on.
- Revenue depends directly on the quantity of products sold.
In simple words, in dropshipping, the dropshipper is responsible for the entire marriage, timing, and quality. Revenue can only increase as sales increase.
Categories of Top products in dropshipping
It is better to start this business in a promoted segment – if the demand for this product is high, then the profit will be unambiguous. You should also focus on the season and economy, that is, track trends in the world and switch to a more" clickable " product on time.
We have compiled a list of sales hits in this area:
- Clothing and shoes. Regardless of the season, there is a great demand for jeans, tight underwear, home, and women's clothing. Men's clothing and shoes are in less demand due to the pragmatism of the stronger sex.
- Wristwatches and accessories for men. The peak of sales falls on a week or two before February 23.
- Gyrometer, bicycles, sporting goods – products for any age. Demand does not depend on the season, so you should look for a supplier that offers a not too low, but not too high price for them.
- Bed linen and curtains.
Suppliers from different countries offer a very large selection in this segment, where everything depends on the quality of products, delivery times, and prices. It is advisable to provide customers with a wide range of products. - Body care products, decorative cosmetics, Dietary Supplements, and everything related to health and beauty.
- Children's goods, clothing, and shoes. In this segment, there are large margins and high demand all year round, it is only necessary to offer an unusual colorful design, convenience, and high-quality products.
Larger purchases are made at a different level, so it is better not to enter the niches of the more expensive segment. Hand-made items are less in demand than their counterparts from well-known brands, but if you find a supplier of exclusive, relevant goods with a low price, why not?
Choosing a supplier manufacturer
The main condition for dropshipping is the availability of high-quality products in the manufacturer's warehouses. In order not to run into unscrupulous suppliers, we recommend that you pay attention to the following points::
- Choose companies, which in addition to payment for the goods without requiring any additional monthly fees or hidden charges – please be sure to review the sample contract.
- When you start working directly with the manufacturer – ask where the products come from, whether they make them themselves or are intermediaries, and why you need to pay twice as much.
- Agree with the supplier on issues related to placing orders – parcels should not contain information about the manufacturer's contacts, only your data.
- To check the speed of the supplier's technical support, try writing to them and see how quickly they will respond to you, and whether the conflict issue will be resolved. If a long time has passed since the application was submitted and there was no response or the issue was not resolved professionally, feel free to look for another manufacturer.
- In order for your customers to have a choice of services for receiving parcels, ask the supplier what delivery services they work with.
- Also specify how information about the latest updates, product inventory balances is reported, and whether there is such a feature at all.
Here are some dropshipping platforms where bona fide suppliers are selected:
- AliExpress;
- Amazon;
- eBay;
- Alibaba;
- Supplier of happiness;
- Optlist;
- <url> suppliers;
- Dropo;
- Rufavor;
- AliDropship;
- Worldwide Brands.
And many others. There is an incredible number of sites where you can find suppliers for dropshipping, and you can also ask in your region which company operates on this principle.
How to start a business in this area
Once you have decided on the products you want to sell and found suppliers that have the least negative reviews, you can start creating ads, posts on social networks, and creating a page on the Internet.
For dropshipping, we register in popular communication services, write a short catchy text with a preview of your product and contacts. On ad sites, we place an ad with an image of products for sale. A lot of traffic is focused on Avito and Yula, and that's where you should start.
If you want to receive a large number of applications from potential buyers, we recommend hiring managers by placing an ad about this vacancy on the same platforms. This is what it might look like:
There are a lot of videos on YouTube that describe in detail how to submit ads for dropshipping. You can get acquainted with them. To create your own online store, you will need your own page. There are many resources that offer to create websites with minimal investment.
There are also domains and hosting services that provide a certain period of time to use them for free to analyze how often site visitors come in, where they come from (this is done when setting up), and whether the products you advertise are in demand.
Important! We recommend that you use the Google Trends service to track seasonality and demand statistics for certain products.
On this site, you can use a query in the search bar to see competitors, how they advertise their products, and create a detailed report about their product.
To promote your page on the vast expanses of the Internet, where millions of your competitors work, you must meet the following conditions::
- Be sure to use SEO tools and features to attract your target audience. If you can't do it yourself, use the help of an experienced SEO specialist. Its task is to set up everything as you need to optimize the site, then you can use its services every six months to analyze the site's performance.
- Contextual and targeted advertising. The results of such a promotion can please you in a few weeks. But unlike the first point, this will require larger attachments.
- In order for as many people as possible to find out about you, actively communicate on forums, correspond with directory managers, bloggers, and offer cooperation with the placement of your ads.
- Promote your product through marketplaces and price aggregators.
How much can a dropshipper earn?
At the moment, worldwide dropshipping is based on business with China. Many suppliers offer a huge selection of products from all categories at low prices and expect a profit from 100% to 1000% margin. Your income depends on how well your advertising works and the number of deals per month.
At the initial stage in this area, you can set up the site without investment or with little SEO costs, place posts and ads, and make a profit of up to $ 100 in the first months.
After a few months of hard work, analyzing competitors, and "working on mistakes", you can reach an income of $ 300.
After overgrowing with regular customers, increasing working capital, you can start wholesale purchases. First, the supplier's retail price will be lower, and additional funds may not be charged for delivery from the price of goods.
Secondly, it will improve your status as a dropshipper and significantly increase your profit. Here, revenues can run into the tens of thousands of dollars.
In summary, let's repeat what dropshipping is in simple words. This is a business area where goods are sold online without the need to rent a warehouse or hire employees for packaging and delivery. Having a little knowledge in marketing, advertising, and writing advertising texts in a competent and interesting language, you can earn money without leaving your home.
