Dropshipping: What Is It, How To Start & Common Questions

“Dropshipping is the future.” Yes, if you want to start a new online retail store then there is nothing better than starting an eCommerce dropshipping store. This is an easy way to make extra money from your home and you can continue your job or other business without any problem.

What is Dropshipping?

Dropshipping is a supply chain management model in which you can fulfill your orders without keeping the products in your stock. In this model, you have to partner as a retailer with the wholesaler and once you get an order, your wholesaler partner will fulfill your order and the customer will get the product directly from the wholesaler. You will keep your commission and you don’t have to do anything. No need to keep the stock, no need to spend time on packing the product, and no need to get worried about the shipping.

 

In a dropshipping business, you need to create your online eCommerce store and list the products from different wholesalers. Your only work would be to promote your online store to the targeted audience and when someone places an order on your store, you will fulfill the order with just a few clicks. The wholesaler will deal with the inventory, packaging, and shipping. Even in some cases, the wholesaler will deal with the returns as well.

How to Start Dropshipping?

The first thing, you need an eCommerce platform. WooCommerce, Shopify, BigCommerce are good platforms that you can use to create your eCommerce store. You need to find the best wholesaler which you believe have good quality products.

AliExpress, Amazon, eBay and Alibaba are some good option to select as your wholesaler. You have to find the products on these websites which are available to ship worldwide at low cast.

Once you have selected your products, you need to list those products on your own eCommerce site with same details and images. You have to change the price a bit to get your commission.

If you do it manually, then it will be very difficult to keep your store up to date as there will be 100s of products and these products will keep changing every day as these might get out of stock, price change, or unavailability of a variation of the product.

There are many solutions available for this like you can use Oberlo if you are using Shopify. You can list your favorite products from AliExpress to your Shopify store with just a few clicks and Oberlo will take care of everything else.

 

Like when a product is out of stock, or there is a price change, the changes will be made on your own store as well automatically by oberlo. If you are using WoCommerce or BigCommerce, there are many other tools available for the same purpose. Most of these tools are paid and you have to pay some extra amount to synchronize the products on your store with the AliExpress or Amazon.

What are the Advantages of Dropshipping?

  • Almost Free to Start: You can start your dropshipping business with almost zero cost. The only expense is to get your dropshipping store ready. It is about 100 USD to 300 USD, which is not a big deal.
  • Low Risk: When you start your own eCommerce store, you have to buy inventory, packaging material, staff to help you out and a place to set up your office where you keep your inventory and other material. If you don’t get orders as per your expectations your initial investment would be lost and it will become a dead investment after some time. But in Dropshipping you don’t have to buy the inventory so there is nothing at risk and even no office is required as you can start the business from your home.
  • More time for Marketing: When you don’t have to maintain your stock and no need to worry about the packaging, you can spend more time on the marketing of your online store so to increase your sales and the commission.
  • Test New Products: If you have your own products and you are planning to buy new products for your eCommerce store, you can use dropshipping models to test if the product will get a good response from the customers? If you find that sales are good for that product, you can stock that item to get high profit.

What are the Disadvantages of Dropshipping?

  • High Competition: In online market, you have competitors from all around the world so it is difficult to make your own place. You will face a healthy competition and your success is based on your promotion and your online support for customers.
  • You can’t Control Product Quality: Since you don’t have the inventory and you did not test the product so you can’t control the quality of the product. If the wholesaler ships a low quality product, you will lose your customer.
  • Low Profit: Since you are not going to buy the products in bulk, so you will have to pay the regular price to the wholesaler and your profit margin will be low as compared to that which you can earn if you order the product in bulk and get it at a lower price.

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