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Many may have tried dropshipping and have not succeeded, or many who are not interested in this business model at all, a lot of people claim that this is a dead business model.
People are usually afraid to try or even discuss new opportunities. They would rather choose a physical business or job that generates a stable amount of money each month, that’s why they claim that.
So, is dropshipping really dead in 2020? This is a very critical question especially for people who are considering to enter the digital world and create an online business because for sure, no one wants to waste money on a dead business.
Although you don’t need to pay for an upfront inventory, dropshipping is not a free business. You still need to pay for maintaining a website and advertising it as well.
In this post, we will answer some good questions about dropshipping, and by the time you finish reading it, you will see the huge power in this business model, and once you understand it and how does it work then you will see if it’s going to be dead in the future or not.
What Is Dropshipping?
So, you don’t need to sell your own product, you are basically selling someone’s product, which makes the process less costly.
The process is simple, and I’ve covered it previously in another article:
Let’s keep it simple, you search for a good supplier and product, list their product on your site, and when you receive an order, you just pass the order to the supplier so they can process, fulfill and ship the product directly to the customer.
So, you don’t have to store or deliver anything physical at all. You simply make sales and the rest of the process (mainly fulfillment and distribution) is handled by a supplier.
Dropshipping is a great business model, and it is one of my favorite methods to not just to make money online, but to build a profitable business with sustainable growth.
To be honest, I’m a dropshipper, and I’ve fairly been in this industry for a long time and I know that it’s killing the retail store industry.
In this smartphone era, we have endless opportunities at our fingertips, because traditional retail is dying.
This is even getting worse day by day and Netflix can be a great example, they make billions a year as a streaming platform, which caused the end of the journey for a lot of video stores.
With all that the digital world is offering today, do you still need to build a store offline?
Before we get into that, I want to tell you why you should consider starting an online business in 2020.
How Did Dropshipping Start?
The dropshipping concept is not new at all, it has been around even before the internet.
Dropshipping has been around the 1950s and it was called Mail Order at that time. People used to constantly receive products’ catalogs in their mailboxes at home.
The person behind printing those catalogs was just responsible for capturing orders to the supplier, he did not manufacture the products listed there. They were manufactured and distributed by someone else.
Let’s assume a homeowner decides to place an order, he’d need to do that by phone or mail, along with his payment.
The person/company that printed the catalog will order that from the supplier, and then the supplier will ship it to the customer’s house directly.
Have you ever met a salesman on your door trying to sell you something? Yes, in some cases, the salesman will do door to door sales. He will attempt to sell you a particular product, for a company that he’s not an employee for.
Now you may be asking what’s the seller’s profit, right?
They sell the items at a higher price, then when someone orders, it’s the supplier that ships to the consumer directly. The price difference between the capital cost of the product and the salesman’s selling price is the seller’s profit.
Related: Everything you need to know to start selling online, anywhere (Open in a new tab).
Will Dropshipping Work In 2020 And Beyond?
As we advance in the smartphone era, endless opportunities right under our fingerprints. The internet has made it easier for people to drop-ship to the globe.
Related: How to find quality suppliers for your dropshipping business 2020? (Open in a new tab)
Over the years, many companies have appeared and offered their services as solutions for dropshippers.
Then another problem has risen, how to create a store and make this business work? There’s where many e-commerce companies have come in, like Alibaba, Aliexpress, WooCommerce, Magento, and Shopify!
These companies have made selling online easier and reduced time and cost.
Who does not know Amazon? Amazon was the first company to dropship. That’s what’s made it the world’s largest online business retailer.
It acted as a connector between suppliers and customers. It let suppliers list their products on their platform, and when a customer orders an item, the supplier gets notified and ships the product directly to the customer.
How Did Dropshipping Become Popular?
Amazon has been constantly growing, and it has achieved huge success, which has made many other companies copy the same business model. That’s why we now have dropshipping as we know today.
One of those companies that works exactly the same as Amazon operates in China, it’s called Aliexpress, yes you may have heard about it.
It has adopted the same business model and allowed suppliers to list their products on the platform, and suppliers are responsible for shipping to customers globally.
Although there were companies that’s made it easier, still, it was a very time-consuming process.
Imagine you want to dropship from Aliexpress, you would need to copy images from the suppliers, save them on your computer, and then re-upload them to your website.
And when you receive an order, you go back to Aliexpress and place an order. On top of that, you need to apply for a payment provider to be able to capture online payments and get paid!
All of that is time-consuming and costly!
That’s until the world has been introduced to Shopify! Thanks to platforms like Shopify!
Related: Learn how to create an online store and start selling online in 7 simple steps (Open in a new tab)
Shopify is the biggest e-commerce platform in the world, so when it comes to dropshipping, they are the leaders in this industry.
One of the main reasons I recommend Shopify is that they are supportive of dropshipping, they provide a variety of integrations to make the process easier and smoother.
It’s very easy to set up a store through a drag and drop builder, you don’t need to do any coding, they do the hard work for you, you simply edit the storefront, adding products, editing the navigations, buttons, pages and you are good to go.
In addition, Shopify has the capabilities to handle your sales, marketing, and payments.
Related: What Is Shopify? Now Home to 1,000,000 Business Owners! (Open in a new tab)
With Shopify, you can:
✔️ Create a unique website with a simple drag and drop builder.
✔️ Have a backend office where you control all your orders, stock, categories and more.
✔️ List as many products as you want, no limitations in quantities.
✔️ Update the prices, descriptions, and everything on your own.
✔️ Receive and capture payments smoothly.
✔️ Process, pass and fulfill orders automatically.
✔️ Track everything from one panel.
✔️ See people who land on your website live.
Related: How to setup a Shopify store in 7 simple steps in 2020? (Open in a new tab)
It’s fair to mention that Shopify is not a free service, FOR SURE! But it has very affordable plans, and the monthly payment is totally worth it! Please refer to Shopify’s pricing guide to have more info about their packages.
Related: Shopify Pricing: What Are The Shopify Payment Plans? (Open in a new tab)
Dropshipping Is Never Going To Be Dead!
And it can’t die. Follow along with me and let me explain why!
You may have heard about the retail apocalypse. For those who have not, it’s the closing of numerous North American brick and mortar retail stores, especially those of large chains, starting in 2010 and continuing onward.
Thousands of retails have shut down in 2018-2019. According to Busines Insider and Fortune Radar, these numbers are rising year after year.
It’s going to be worse in 2020! Netflix can be a great example for all times as well, they make billions a year as a streaming platform, which caused the end of the journey for a lot of video stores.
As I’ve pointed earlier that dropshipping is killing the retail industry. What does that mean?
Yes, we agree that shopping in physical stores is still more popular than purchasing products online, the difference here is that online sales are increasing while traditional retail purchases are on a rapid decline.
People aren’t shopping the same way they used to. Rather than spending whole afternoons walking around the mall, many people prefer to shop in their pajamas at home. Shopping is getting more transactional.
For sure, there should be reasons that entrepreneurs are flocking towards online business, rather than creating a brick and mortar store.
Companies like Shopify were aggressively growing, and they’re (and still) willing to pay people commissions for referring other people to their platform. This is what’s actually called affiliate marketing.
Related: The ultimate guide for affiliate marketing. Step by step guide for beginners (Open in a new tab)!
Now Shopify is home for more than 1 million business owners around the globe, and they have sold over $135 billion on the platform.
This has helped to spread the dropshipping concept over the years.
As you can see, the trend is still going up and has never declined at all. The estimated net sales for 2021 is around $4.9 trillion! Imagine how many other retails will close as well.
Big brands are shutting down their doors. The bankruptcy of fast-fashion retailer Forever 21 was the 35th major bankruptcy for 2019, with over two-thirds of them in retail. And it likely won’t be the last.
Is Dropshipping Really Dead In 2020?
Many people who may have tried dropshipping for few weeks or months and failed, or who are not convinced in the business model may say that dropshipping is a dead business.
But is it really dead?
If just 1 million businesses are powered by Shopify, imagine how many dropshipping stores are over the internet.
My short answer is No, it’s not dead! Dropshipping is still showing huge potential, and a lot of money is in this industry!
$4.9 trillion! Create an online store, and who knows? You may be able to get a share of that big pie! The best part of Shopify is that you don’t need to master it all before getting into it, you can learn as you go along.
Related: Shopify Free Trial: Does Shopify Provide A Free Trial? (Open in a new tab)
One more proof to show you the Dropshipping and Shopify trends are still going up:
Related: Why is dropshipping popular in 2020? (Open in a new tab)
Watch out negative people, and stay away from them! Don’t believe people who have failed in dropshipping and say that it’s a dead business. A huge potential is still in this industry.
Like anything else in life, before you master it you need to learn it first. Invest in yourself and get opened to new opportunities.
The cool part about Shopify is that they provide a 14-day free trial, where you get the chance to experience selling online. In this free trial period, you are not required to provide any credit card details, but you can’t receive actual payments until you become a paid subscriber.
Finally, I want to wrap up my words and tell you that dropshipping is a serious business and can be a very lucrative opportunity to make money in 2020!
For sure it’s not easy, it requires passion, time and effort, but it can be very rewarding and fruitful!
Have you ever tried dropshipping? What do you like most about this business model? Share your thoughts in the comment box, and I promise to reply back 😉
Because you, our readers are precious to us, we’ve come up with this amazing course, that can teach how to launch your own Shopify store without paying big bucks to some guru! Do not forget to grab your seat, It’s FOR FREE!