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Over 8500 retail stores had closed in 2019, which is 47% more than last year, and over 5500 are closing in 2023 as the retail apocalypse drags on!
With all that the digital world is offering today, eCommerce and dropshipping are painfully killing the retail industry. People are not shopping the same way they used to; shopping is getting more transactional. While retail is dying, entrepreneurs are flocking towards starting an online business to sell to the world, anywhere!
Pin this image or bookmark this page to easily refer back to it anytime you want to!
As we advance in the smartphone era, we have endless opportunities right at our fingerprints.
Therefore, banks are becoming virtual and entrepreneurs are flocking towards online businesses instead of traditional businesses.
In this article, I will be taking you through real statistics and facts about eCommerce generally, and dropshipping particularly.
Retail Is Dying
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.
The image below shows some of the retail stores that have shut down in 2019. Pin it or bookmark this page to easily refer back to it anytime you want to!
Why Is This Happening?
Ecommerce and dropshipping are killing the retail store industry. For instance, over 8500 retail stores have closed in 2019, 47% more than last year.
The bankruptcy of fast-fashion retailer Forever 21, for instance, was the 35th major bankruptcy this year, with over two-thirds of them in retail. In conclusion, it likely won’t be the last.
It’s going to be worse in 2023! 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.
Before I go any further, let me get the chance to thank you for being here, on this blog, because that means that you adopt the mentality of creating your own business. So if you are planning to create a business for your own, you basically have two options, traditional or online store.
I have talked about the brick & mortar business model in detail in a previous article, it’s a good resource if you are considering to open a physical store.
In this article, I will be focusing more on the dropshipping model, pointing to all the advantages, benefits and the huge potential in it.
What Is Dropshipping?
Dropshipping is basically a business partnership, but there are no contracts between parties. In this business, the seller doesn’t need to meet up with the supplier, you just look for a supplier for a product.
Related: Get access to more than 8000 trustworthy suppliers for your business. (Open in a new tab)
Dropshipping is a great business model for entrepreneurs because it doesn’t demand as much as the traditional retail model. You don’t have to open a brick-and-mortar store, pay overhead, and stock products.
Instead, you open an online storefront, find suppliers, list their products, set your profit margins and optimize your store to make it look inviting.
Dropshipping Process Simplified For Beginners
- You the seller will set up an online storefront.
- You select a product niche to dropship and sell.
- The seller will find a reliable supplier to ship products from his warehouse directly to customers.
- The seller places the images of the chosen products on his store, showing the exact features through the product’s description.
- Someone will find an item they like while surfing your store and place an order.
- You the seller will receive the order, containing their information (address, name, phone number, etc…)
- You forward the order to the supplier, with a pay cut for the item.
- The supplier will handle packaging, shipping and delivering the item directly to the buyer.
So basically, after you have chosen a name for your business, all that you need a domain, host and trusted supplier/s to sell their products.
Luckily, there are tons of resources that are offering their digital solutions, which makes starting a dropshipping business incredibly simple.
Thanks to platforms like Shopify, they will act as your hosted e-commerce solution. This will allow you to easily create a professional-looking store, display your products and take payments from your customers.
Dropshipping is a great business model, and for entrepreneurs with limited resources and capital.
You may have come through an article or a video about someone who’s making huge money from dropshipping, well that’s possible and true. A lot of people are killing it with dropshipping, and you can become successful at it too.
This is a serious business opportunity, and yes it’s not hard but it’s not easy as well. It requires effort, time and work. The trouble is, not many people understand how it works, they may get involved in it without even learning about its basics, so they fail and claim that this is a scam!
However, it’s a real and LEGAL business model, and you can achieve more than you even expect.
Dropshipping Advantages Over The Traditional Retail Store
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.
1. It’s an easy business to manage
This business model is flexible, you can work whenever you want, and as much as you want from anywhere as long as you are on the planet.
You can run your dropshipping business as a side-hustle, but what you don’t know is that you can become a full-time dropshipper if you know how to master this game.
Running a Dropshipping Shopify business can be totally automated because there are many tools and integrations that were created to simplify the process.
For example, you don’t need to capture every payment, and process every order manually, this can be done automatically. The same when the supplier changes the prices, you don’t need to change them manually, you set rules on your website and let Shopify and suppliers do the rest.
In other words, you don’t even have to monitor your own inventory or sales, that what makes it a powerful business opportunity.
2. No inventory needed
When creating a brick-and-mortar store, it has to be populated with products, now this is not the case with the Dropshipping business model.
For the store, this is a mostly hands-off process. The merchant (Which is you) doesn’t have to order inventory or fulfill the orders in any way. Instead, the third-party supplier takes care of the product itself.
Instead of paying overhead and stocking products, you open an online storefront, find a supplier, and list their products on your store.
When someone orders from you, you buy the item from the supplier from the customer’s own money, leaving yourself a profit margin.
The supplier will take care of packaging, shipping, and delivering the order to the end consumer.
In other words, 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.
3. Small capital needed
Shopify will act as your hosted e-commerce solution. This will allow you to easily create a professional-looking store, display your products and take payments from your customers.
You can start your Dropshipping business for as low as $30 since you don’t need to buy inventory.
The only capital you need is the payment for a website host. Shopify has 4 payment packages, they are helpful and affordable for anyone.
You can start with the free theme that Shopify offers, or you can get yourself a professional theme to make your store look inviting to people.
You can also create a unique and professional logo for up to $10, or you can use the free tools that Shopify offers.
It all depends on how much you want your store to look professional.
Summing up, as you are getting started, it’s important to frankly say that you need no more than the basic package, it’s for $29 a month, and this can give you access to the tools directory.
This is the coolest part! You can upgrade your store’s plan on your will once your business starts to grow!
4. No physical store, no real state needed
You do not need to rent a warehouse to keep your stock because you will not maintain an inventory. You do not need a large office, too.
You can work from your living room or kitchen, or in a coffee shop if you want to. You can also hire freelancers to help you, and they will work from their homes.
5. Logistics hands off
For the store, this is a mostly hands-off process. The merchant (You) doesn’t have to order inventory or fulfill the orders in any way.
You simply make sales and the rest of the process (mainly fulfillment and distribution) is handled by the supplier.
6. It’s a huge market
You can find suppliers from all over the world, China, Australia, Canada, United Kingdom, United States and more. You can also sell globally. The world is in your pocket, it’s your marketplace.
7. Endless options and products to choose from
There are millions of products and thousands of suppliers to choose from.
Find a niche that you are passionate about, across dozens of categories. You can find hot-selling products across niches such as clothing and accessories, antiques and collectibles, electronics, health and beauty, home and garden, and many more.
Pro Tip: It’s important to be confident that the supplier is legitimate, and will fulfill orders on time. Learn more about SaleHoo platform.
8. Suppliers are willing
Not just merchants, but suppliers love this business model too!
If the supplier has 50 people selling his product, firstly, he would be willing to reduce the price, because there’s no marketing cost.
Secondly, they will focus on manufacturing instead of focusing their efforts on selling.
9. It’s a learnable business and easy to setup
You don’t need to fully master this model, it’s good to start right away, and learn as you go along.
There are plenty of tutorials and people who are offering their services and courses to help you quickly start your Dropshipping business, it’s good to start investing in yourself.
Our mission in EcomDimes is to educate our readers and open for them the doors to new opportunities.
10. And most importantly, people are not shopping the way they used to.
The consumer behavior is changing, and as we advance in the smartphone era, people prefer to shop while they are in their pajamas, from the comfort of their homes or from their beds.
Nowadays, people are too busy to shop at a mall.
Wait don’t get me wrong! 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.
Some stats about dropshipping to motivate you and get you more excited
- Dropshippers can earn more than 50% profit than those who keep their own stock inventory.
- Dropshipping is the fulfillment model of nearly 33% of online stores.
- With eCommerce growing by about 17% every year, it’s projected that the popularity of dropshipping as a fulfillment model will continue to increase alongside the industry.
- 23% of online sales last year were fulfilled via dropshipping, which amounts to about $85.1 billion
- 34% of Amazon sales in 2011 were fulfilled using a dropshipper, and that number has only grown since then.
If this doesn’t motivate you, what would? If you can figure starting a dropshipping business, you can really make good money.
What Platform Should You Use For Dropshipping?
There are truly tens of thousands of companies and resources that offer their digital solutions to help you succeed with dropshipping.
I’m not here to just recommend a particular company or side, I will be sharing my own experience and tell you why I had much success with Shopify.
When I first began selling items on eBay, I discovered it was a quick and easy way to make money online. It wasn’t complicated – buying items for cheap and selling them on eBay for more money made sense! But then I got greedy and started to get burned by scammy suppliers.
Which led me to decide to open my own e-commerce store, because at the end of the day, no matter how much you’ve made, you are actually working for someone else.
Selling on eBay and Amazon is surely an extraordinary experience, and there are still people killing it day after day. My point is that, even if you have made sales, they will get the benefit too. You help to build their email lists, and their online exposure.
This means that a customer who comes to buy your product is not actually your customer, he’s Amazon’s or eBay’s customer.
Another disadvantage as well, the competition. I know and we all know that competition is great, I love competition, but on those platforms, you will find too many people who are selling the same product as yours.
I have mentioned the dark side of selling on them, now what are the pros of selling let’s say Amazon?
Amazon is here to stay, it has proven itself in the market since 1994. Been rapidly growing, and they were able to gain a good market share. When it comes to eCommerce, shopping is transactional and related to that, Amazon has accounted for 37.7% of US online sales.
Some stats about Amazon
I know this information will blow up your mind, Amazon has the highest conversion rate on the internet, 74% for prime users, and 13% for non-Prime users. Noting that the average conversion rate for online retailers is 3.32%!
If anything, these rates illustrate strong loyalty to Amazon.
What Is Shopify?
Maybe you came across a video on Youtube for someone who became a millionaire selling on Shopify. Or maybe your friend keeps talking about Shopify (Like I do with my friends).
The good news is those stories could be real, and there are millions and millions are made year after year. The trouble is, not many people understand how it works.
Shopify is an eCommerce platform, that has everything you need to sell online, anywhere. You can use this drag and drop platform to build an online store and start selling to all customers around the globe.
While bloggers use WordPress, to host their domains, articles, and work, Shopify is used for selling online, as it will act as your hosted e-commerce solution. This will allow you to easily create a professional-looking store, display your products and take payments from your customers.
While other e-commerce platforms limit you with how many products you can list on your online store, Shopify does not!
The reason they do so because the more products and images you upload, the more server bandwidth your store is eating, which may slow down the web host’s services.
Shopify allows you to upload unlimited products, items, and images, even with their least package.
Imagine you have a brick and mortar store, and you are selling apparel, it has a capacity, at some level there would be a limitation in the number of products you have. Well, that’s not the case when it comes to selling on Shopify, you can list thousands of products, with different variants (Colors, sizes, etc…).
Besides that, here are the reasons why we use Shopify for dropshipping:
1. They are supportive of dropshipping, they provide a variety of integrations to make the process easier and smoother. They have an app store, some apps are free some are paid, but they will surely raise up the functionality of your store.
2. 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.
3. Shopify has the capabilities to handle your sales, marketing, and payments.
4. It tracks, processes, and manages all your payments and orders, allowing you to focus on building a brand.
5. You are allowed to add your own domain.
6. In the admin panel, you can find a whole range of reports and features that help you know more about your Shopify store performance.
7. Free features and tools are available for you to use.
From a list of free themes to choose from to everything you need to sell and grow your retail business.
8. Shopify wants you to succeed on its platform. That’s why they have their own blog where e-commerce experts share their best tactics.
That’s why they created Shopify Academy, free e-commerce courses where you can learn at your own pace.
9. Anyone who has tried or worked with a server before knows very well that servers crash at the wrong times.
They usually crash on big events like Black Friday. Unlike Woocommerce and other eCommerce platforms, Shopify is a cloud network, which allows you to run your business with ease, without your website being down at any time.
10. Shopify plans are very affordable and helpful.
If you are starting out, you need no more than the basic package, and you can upgrade upon your will, as your business grows.
11. Low Barrier to Entry. I’m not telling that it’s easy, but it’s a lot easier than it was to build an online business 20 years ago.
How To Start In Dropshipping As A Beginner?
For now, you are at least familiar with the dropshipping business model and know how it does work. To start you just need to pick a niche, of what you’ll be selling.
General stores have usually a high competition level, and as a beginner, I always recommend picking up a niche market, which will narrow down your competition and your audience.
It usually works better if you choose something that you are passionate about, something you have experience in or have tried yourself.
When picking up your niche, make sure that it has enough demand in the market, and make sure to deal with trustworthy suppliers, because if not, they can ruin your business so easily.
How To Start A Shopify Store?
With what Shopify is providing nowadays, selling online has never been easier.
In a matter of days or even hours, you can be having a very nice looking store, that’s filled with products and populated with pages and policies.
If you are starting out, you need no more than the basic package, and you can upgrade upon your will, as your business grows.
Do not wait till you learn everything, get inside of the thing, and learn as you go along.
Just not to make this article long and boring for you, and since that I’ve written a complete article around how to start a Shopify store, I will just mention the steps of building a successful business on Shopify.
Please refer to that article to learn more about how to start a Shopify store (open in a new tab)
- Sign up to Shopify (open in a new tab to grab the 14-day free trial)
- Pick a monthly plan to be able to start selling online.
- Pick a name and domain for your business.
- Adjust your free theme, or get yourself a professional one.
- Pick a niche market, and find trustworthy suppliers in that niche.
- List their products on your store, and adjust descriptions and prices.
- Populate your store with the needed pages and polices that will educate your customers more about your store.
- Setup your payment methods and gateways in order to be able to receive money from customers.
- Share it with the world. I highly recommend starting with social media influencers since it’s the most beginner-friendly method. (Get your brand in front of an audience of 600M+ Follower & Subscriber)
In conclusion, dropshipping is a very cool business model, and you can make good money with it.
While traditional retail purchases are on a rapid decline, and online sales are increasing, there should be a presence for you online if you are willing to make money and change your lifestyle.
It’s crucial to get the advantage of what Shopify is providing nowadays, they are making e-commerce and selling online a lot easier.
After all, if you are starting out, you need no more than the basic package, and you can upgrade upon your will, as your business grows.
Do not wait till you learn everything, get inside of the thing, and learn as you go along.
I suggest you sign up for free and test its waters, surf the admin panel and see whether this is for you or not.
Luckily, you don’t need to provide any credit card information in the free-trial period, but in order to experience selling online, you need to pick up a plan.
Summing up, with something around $30, you would be able to reach the stars since the whole world is your marketplace.
What do you think about the dropshipping business model? Share your thoughts in the comment box, and I will reply back as soon as possible.
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!
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