You’ve probably heard of the term dropshipping before, but you might not know exactly what it means or how it works.
However, dropshipping is a business model that many entrepreneurs are choosing to go with, because of its flexibility and low cost-basis.
If you want to know exactly how dropshipping works, this guide will tell you all about it! You’ll learn about how dropshipping companies work, why you should use dropshipping to start your business, and even where to find the best dropshipping suppliers on the internet.
What is Dropshipping?
Dropshipping is a process in which a retailer does not keep the products they are selling in stock. Instead, when a store owner receives an order from a customer, they purchase the product from their supplier and have it shipped directly to the customer’s door. This eliminates the need to carry inventory, freeing up time and money that can be used elsewhere.
What makes this so beneficial? Let’s say you have an idea for a new t-shirt line but don’t want to invest any of your savings into the start-up costs of getting the business off the ground. You can open up a dropshipping account with one of many different suppliers who provide everything you need to start your own clothing line!
They’ll offer wholesale pricing on apparel, bulk discounts on shipping, and more. All you have to do is set up your online storefront (we recommend using Shopify) then send them all the details about what items you want to sell – from colors and sizes all the way down to images – once approved, they will take care of the rest by sending them directly to your customers.
The Benefits of Dropshipping
Dropshipping is a business model where ecommerce entrepreneurs essentially act as middlemen, promoting products from other companies and then shipping them to customers.
It has many benefits that make it perfect for entrepreneurs, including low start-up costs and the ability to use almost any product as long as you are able to find a manufacturer that will work with you.
The most significant benefits of dropshipping include little risk since you're only ever responsible for the cost of your initial order and the time spent running your store; a substantial reduction in storage fees; quick turnaround times on orders; minimal advertising expenses; increased revenue potential from margins due to not having overhead costs such as utility bills, employee salaries, etc.; no need for an inventory; and finally, easy returns.
The Downsides of Dropshipping
Dropshipping is a good way to start up, but there are some downsides. The biggest downside of dropshipping is that it doesn't allow you to be your own boss.
You'll have the supplier tell you what to do and when to do it. This can be a problem if the supplier is being unfair or unfair in their demands.
If you're looking for independence from your work and want more control over your time, then dropshipping may not be the way for you.
How to Start a Dropshipping Business
Dropshipping is a form of retail fulfillment that has become increasingly popular in recent years. It's a way to sell products without keeping inventory on hand, and it can be a great alternative to starting a traditional brick and mortar store.
Dropshipping with Oberlo is easy to get started with, but it's also important to understand the ins and outs of this business model before diving in head first.
Here are five (5) steps you should take when considering dropshipping with Oberlo!
1. Make sure your niche has enough volume: The beauty of dropshipping is that there's no need to keep large quantities of inventory on hand; instead, you simply purchase items at wholesale prices from sites like Alibaba or Oberlo, and then send them directly to your customers.
However, you need to make sure your niche has enough demand (and a low level of competition) so that your storefront won't sit idle while you wait for orders to come in.
2. Pick a high-margin product: Many people choose to dropship clothing because they're relatively cheap to order and ship. However, some merchants have been able to find success by focusing on higher-priced items with much higher margins - especially those in the electronics category.
Just remember that whatever you choose will require some upfront investment before any profits start rolling in.
3. Consider how quickly you want to grow: Many entrepreneurs decide to use dropshipping as an introductory strategy for their businesses, as it's one of the quickest ways to get up and running without having too many initial costs.
In fact, successful entrepreneurs often reinvest all profits into building up their store until they're ready to move onto other strategies. If you've got an aggressive timeline or want more control over what kind of products end up on your website, drop shipping may not be the best option for you.
4. Determine whether you'll be handling logistics yourself or using Oberlo's fulfillment service: Using Oberlo requires less time and effort than handling logistics yourself - though if you're just getting started with dropshipping, it might be worth investing some time in learning about different warehouses and parcel carriers.
5. Start with a small amount of inventory: You don't necessarily need thousands of dollars' worth of stock to make money as a dropshipper; in fact, you can actually get started with just $150.
So long as you know where to source quality goods at affordable prices and know how to promote them effectively, it's entirely possible to succeed even if your initial investment is small. With these five tips in mind, anyone who wants to start a dropshipping business can do so successfully.
Finding Suppliers and Products
Dropshipping is a way of running a business without ever having to carry inventory. It's not as easy as clicking sell, but it can be an attractive option if you're willing to do some legwork up front.
First, find suppliers that stock the products you want to sell and take note of the wholesale price they offer them at.
Next, create an online store with Shopify and link it to your chosen supplier.
