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Over 3300 stores are closing in the first half of 2020 only. And it’s going to be worse as the retail apocalypse drags on!
Nowadays, entrepreneurs are flocking towards online businesses to reap the rewards of being their own boss!
So, are you looking forward to starting a dropshipping business? Here’s the exact process that you need to follow in order to hopefully become a full-time drop shipper someday!
The 7 Step Process For Starting A Dropshipping Business:
|1. Select a niche|
|2. Choose the right platform|
|3. Build your online storefront|
|4. Find reliable suppliers|
|5. List and sell|
|6. Market your business|
|7. Keep learning as you go along|
What is dropshipping
Dropshipping is a business model that has been more popular day after day since 2004!
It’s basically a retail fulfillment method and a business partnership but without contracts between parties!
Dropshipping is the act of reselling others’ products without the need for having any stocks or inventory.
This is the thing that makes dropshipping a great business for beginners, especially that it doesn’t require as much as the brick and mortar business!
Dropshipping process simplified for beginners
With dropshipping, 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.
The merchant doesn’t have to order inventory or fulfill the orders in any way. Instead, the third-party supplier takes care of the product itself.
For the store, this is a mostly hands-off process.
But, how does the dropshipping business model actually work?
Below are the exact process of the dropshipping business model:
🔰 You (the seller) set up an online storefront.
🔰 Then you select a product niche that you’d like to list and sell.
🔰 You then need to find reliable suppliers who have the products that you desire to sell and let them ship directly to your customers.
🔰 Someone will place an order while surfing your products and site.
🔰 You’ll receive money and order that actually contains: address, name, phone number and everything.
🔰 Forward the order to the supplier, with a pay cut for the item’s cost.
🔰 The supplier will handle packaging, shipping, and delivering the item directly to the buyer.
That’s really it! For the store, this is a mostly hands-off process and the third-party supplier takes care of the product itself.
The merchant doesn’t have to order inventory or fulfill the orders in any way. The third-party supplier takes care of the product itself.
Benefits of the dropshipping business model
There are many factors that make the dropshipping business model so flexible comparing to the traditional retail business. Below are some of them:
✅ It’s easy to start: It’s a lot easier than it was to build an online business 20 years ago. Shopify, for example, allows you to start an online store in a matter of minutes!
✅ Easy to grow: The dropshipping business model is so scalable, without skyrocketing your costs!
✅ Doesn’t demand a lot of capital: Unlike the brick and mortar business, you don’t need land or rent a place. Instead, you replace them with a domain name and a storefront!
Also, you don’t need to stock any inventory. You’ll be selling a third-party’s product that they will ship directly to your customers.
✅ Dropshipping is flexbile: You can put in as much work as you want, you can be your own boss and set your own rules and schedule.
You can literally work from any place you want, and gives you the ability to take decisions that work for you!
You won’t have to bend over backward to get things done. Instead, you set your own pace.
✅ It’s is easy to manage: Unless you want to assemble a small team at some point, you can do almost everything all by yourself.
you can handle everything on your own, and hire a VA (virtual assistant) as your business grows!
How to start a dropshipping business in 7 simple steps
The process of starting an online dropshipping business is way seamless that it once was!
Below are the exact steps that you need to follow in order to hopefully someday become a full-time dropshipper:
1️⃣ Select your niche.
You’ve heard much about dropshipping and now you’re convinced in this awesome dropshipping business model.
How to get started?
The very first step would be identifying your market and category because this will determine what you’ll be selling later on.
There are basically two types of stores, niche and general stores.
General stores include multiple categories with a variety of products, the thing that makes it hard for beginners to scale their businesses and promote their products!
Another advantage of the niche store over a general one is that you’ll be able to identify your dream customers that have the same problem or interest in common!
I know, picking a niche can be intimidating for beginners, but it’s okay to take your time and choose a niche that has a huge potential and you personally are interested in.
So, how can you pick a promising niche?
There are 3 key questions that you need to consider answering when you are picking a niche for your dropshipping business:
🔘 How to implement market research and use stereotypes to brainstorm niche ideas?
🔘 Do you know enough about that niche and are you passionate about it? (So you can create content for it)
🔘 Can you actually find good products and trustworthy suppliers in that niche?
Taking all of theme into consideation can really help you nail down the perfect niche store, so let me go through all of them into details!
There practices and activities can help you choose a niche that actually works for you.
🔶 Good research can help you find what’s already trending and what have people been searching for recently.
It’s all about supply and demand, and you don’t want to get stuck in a market where there’s no demand for the products you sell, right?
A great free tool that’s offered by Google is called “Google Trends” can help you identify the trendiest terms, queries, topics, and even products!
Google Trends also allows you to see people’s exact questions and queries in a specific period of time!
For example, due to the COVID-19 and the lockdown in early 2020, people have increasingly been searching for how to lose weight, best home exercises, and best movies to kill their time!
Additionally, by using stereotypes, you can identify a specific group of people that have particular interests and characteristics in common.
🔶 Also, you can search on Google and see what’s actually trending on the first page of the search results.
This can be inspirational and give you an idea of what should you be involved in.
🔶 Another great approach that I personally like is through suppliers marketplaces.
Spocket for example is a great supplier marketplace where you can find high-quality products from the US and EU.
Spocket or any other supplier directory can give you some interesting data for what’s been selling and what’s not.
They also sort products by popularity and have the best selling section which can be a good indicator of what other dropshippers actually selling.
Related: What Is Spocket? Best Way To Find Quality Suppliers From The USA & EU (Open in a new tab)
2️⃣ Choose the right platform for your dropshipping business.
While big companies like eBay and Amazon allow you to start selling on their platforms, having a self-hosted eCommerce website is definitely more worth it and scalable!
Starting a dropshipping store has become easier nowadays, thanks to companies like Shopify.
Shopify is the leader company in the eCommerce industry which is now home for over 1m business owners around the world!
It will act as your hosted eCommerce solution, allowing you to start an online storefront, list, and sell with ease.
I’ve recently published an article about eBay dropshipping vs Shopify dropshipping, it’s definitely worth checking out. (Open in a new tab)
Before we dive into the exact process on how to start a dropshipping store on Shopify, let me first project some advantages and disadvantages for having a self-hosted online store and selling on websites like eBay and Amazon.
Advantages for selling on companies like eBay and Amazon
✔️ High returning ratio.
✔️ Solid back-end support
✔️ High level of trust, reputation and creditability.
✔️ Conversion are high because people come by searching for a particular product.
✔️ No marketing envolved from your side.
Disadvantages for selling on companies like eBay and Amazon
❌ High competition.
❌ Low profit margins.
❌ Customers are not yours.
❌ No control over things.
❌ You can’t market your products
❌ Low scalability
Advantages for having a self hosted store on Shopify
✔️ They are supportive for dropshipping and encourage dropshippers.
✔️ They are smart enough to realize that your success on their platform means their success too. Therefore, they provide a variety of tools and free valuable resources.
✔️ They track, process and manage all your payments while you focus on building your brand.
✔️ Customers are all yours! You can build your own newsletter and upsell them at ease.
✔️ Shopify will act as your hosted eCommerce solution, and their innovative drag and drop builder allows you to build an outstanding and inviting storefront and create your own atmosphere.
✔️ Shopify is a very affordable solution for beginners. You can start your dropshipping store from as low as $29/month and upgrade as your business grows.
✔️ Shopify has an awesome reporting system that will allow you to measure your store’s performance.
✔️ You can place your own domain and create a unique name for your brand. Unlike eBay, Amazon, and other big companies.
✔️ Higher flexibility and more profits. On eBay and Amazon, you should stay in a particular pricing range because the competition is high.
This is not the case with Shopify! You can set your own markups after taking into consideration the processing and Shopify fees.
Related: 27 brand name generators to help you find the perfect name for your business (Open in a new tab)
Disadvantages for having a self hosted store on Shopify
⚠️ You’re building a brand for your own, therefore, you should develop trust with your customers and work hard to build your business’s reputation.
⚠️ Promote your business yourself (Or hire an expert to do this for you)
⚠️ You need to keep monitoring your store and fulfill your orders by yourself.
⚠️ You should handle the customer support for your own business.
Frankly, those are not exactly the disadvantages of having a self-hosted store on Shopify. There’s nothing better than building a reputation for your own brand name.
Above all, you’ll be running and managing an independent and unique store, while having control over your customers.
3️⃣ Build your online storefront
And this is where things start getting exciting and interesting…
It’s a lot easier than it was to build an online business 20 years ago.
In this illustrated tutorial, I will show you exactly how easy it is to set up an online store on Shopify.
Let’s dive in!
First of all, you’ll go to Shopify.com (click here to go) and grab your 14-day trial!
Note: Shopify free trial is enough period to set up your store, populate it with products, run test orders, and familiarizing yourself with the platform. However, in order to receive actual orders and get paid, you should subscribe to a monthly or yearly payment plan. Learn more about their packages
First of all, you’ll be asked to provide an email address that you like to register your store with.
After doing so, a new similar screen will pop up.
At this point, you’re 5 mins away from having your online store live! Keep going with me.
You’ll be asked to provide some information about the business that you’re planning to start.
Things like your current revenue if you’re already selling offline and your industry.
Finally, you’d need to add an address so you can get paid.
Once you’ve done that, you will simply just hit the “Enter My Store” button to go to your back-end office, where you have control over everything there.
And, congratulation!🎉 You’ve just created your online storefront, which needs customization and editing now to become appealing and inviting for customers.
This is your back-end office, the Shopify admin. This is where all the awesome things are being created and customized.
In your Shopify admin panel, there are multiple clickable tabs that you should be familiar with.
Orders: This is where your first order will show up! In this section, you monitor and fulfill your orders at ease!
Products: In this section, you can manage, add, remove, and customize your products.
Customers: Everything that’s related to customers is in this tab. You get access to all of their information along with awesome metrics like their sales volume and number of orders.
Anlaytics: This is where you can measure your site’s perfomance and analyize all the numbers. Things like live visitors, conversion rate, click through rate, number of orders and sales.
Marketing: The cool thing about Shopify is that they are capable to handle your marketing.
Discounts: This is where you can create awesome discount and coupon codes for your customers.
Apps: This tab gives you access to Shopify app store, where you can find outstanding tools (free and paid) that can improve your store and add more functionalities to it.
Think about it like a brick and mortar store. You would need it to look inviting, well-looking, and filled up with items and products.
One of the things that make an online business way better than a traditional retail business is that it doesn’t require as much as the latter.
Unlike brick and mortar where you pay thousands of dollars on interior design and decor, in online business, you simply buy a unique, presentable, and functional theme to be the storefront of your online business!
Picking a theme for your business is a matter preferences.
Luckily, Shopify has variety of free themes, as well as paid, that you can choose from.
It’s advisable to purchase a premium theme because it simply has more control, features, functionalities and most importantly, it looks more professional.
Start by surfing and navigating Shopify theme store, if you want more options, there are some verified themes and online assets marketplaces like:
◼️ Theme Forest – Envato Market (Open in a new tab)
◼️ My Theme Shop (Open in a new tab)
◼️ Creative Market (Open in a new tab)
Related: A step by step illustrated guide on how to install a theme on your Shopify store (Open in a new tab)
Now, before adding any products, you need to have the needed pages and policies on your site.
Some of the pages that are a must-have:
- 📄 Terms & Conditions
- ↩️ Returns & Refunds
- ✈️ Shipping Policy
Make sure to make it easy for your customers to navigate your pages.
This is your own zone, set your own rules, and just don’t promise your customers things you cant commit to!
If the order takes 2 weeks to be delivered just say it clearly it takes two weeks to receive your order.
Meeting customers’ expectations is key here. Therefore, you should be very picky with your suppliers.
And that what takes us to step number 4, finding reliable suppliers to list their products on your store and let them handle packaging, shipping and delivering the items to your customers!
4️⃣ Find reliable suppliers
This is where it gets critical, because a bad supplier can drastically ruin your business, but don’t just panic, I’m writing you this to help you avoid any troubles.
Most troubles in dropshipping happen because of a supplier.
Dropshipping is basically a partnership agreement, and you would be having your own policies and rules.
Your customers don’t know your suppliers, and they may even don’t know the distribution channels involved in the process.
They only know you and will blame you if anything wrong happens…
So, if the order takes long to get delivered, some may cancel the order and ask you to return their money.
Therefore, an unreliable supplier can painfully cost you tons of money.
It’s always advisable to stick to suppliers with a good rating, feedback, and amount of orders, which can be a good indicator of their creditability.
That said, there are multiple approaches to finding quality and trustworthy suppliers for your dropshipping business, here are the most 2 popular ones:
👉 Aliexpress Dropshipping – Oberlo App
Aliexpress is a great company that is supportive of dropshipping and encourages dropshippers, and you can find tens of thousands of suppliers on their platform.
This is the option where most beginners start with.
And here’s the exact step-by-step process you need to go through in order to drop ship from China, Alibaba Aliexpress:
Oberlo is a fulfillment app that helps you import products from Aliexpress website directly to your store with only a click by installing the product importer extension to your chrome. They have a variety of suppliers that you can list their products too and let them handle all the work for you!
First of all, you need to go to your Shopify back-end office, and head to the “Apps” tab.
After clicking the “Visit the app store” button, you’ll go to Shopify app store where you can add useful apps to boost your site’s conversion, features and functionalities.
At the bottom of the page, you’ll find an “install” button, by hitting it you will have it installed and ready to use.
Oberlo is a great app, and at the beginning it’s totally free you don’t need to even worry about it.
You’ll start paying a fee after starting receiving over 50 orders, but at that point you’ll be making good money, so no worries!
They have helpful resources, tips, tutorials, and videos, and you won’t be left in the dark.
It’s definitely worth your time and consideration.
However, there are a few disadvantages for Aliexpress dropshipping, or dropshipping from China particularly.
Long shipping times: We are living in an era where every second matter! Dropshipping from China to the US usually takes around 3 weeks, or even longer!
And since you’re more likely to sell to the US and European countries, you’ll get in trouble because it takes an ETERNITY to people receive their packages and items!
Unreliable suppliers: Most issues in dropshipping are caused because of a bad supplier. I’ve previously mentioned that a bad supplier has the power to ruin your whole business.
Unfortunately, Aliexpress is a big marketplace whereas you can find reliable and trustworthy suppliers, you could find unreliable ones too. And they are a huge percentage.
You need to build a healthy relationship with the a trusted and verified supplier, see what he promises you and promise it back to your customers.
In that way, you’ll always meet your customers’ expectations, the thing that will develop trust and loyalty!
On Aliexpress, you can find suppliers who don’t adhere to what they promise with, therefore, you will see a delay in fulfillment and in delivering the order!
Put yourself in the customer’s shoes, what do you think will happen?
Yup! You’ve guessed it! They will simply request a refund and cancel their order…
And this will lead to a loss and most importantly, a lost customer!
Low-quality products: I’m not generalizing… You can still find outstanding products with awesome quality, but the quality is something that you need to 100% be sure of because it will be sold under your brand name.
If you want to start with Aliexpress dropshipping, it’s recommended to order the item yourself and if you’re satisfied with the experience and the product, your customers would probably be so too!
Bonus: Why is dropshipping becoming popular day after day? (Open in a new tab)
👉 Suppliers Directories & Marketplaces
So, you now know that dealing with the wrong supplier is a recipe of failure, and you’re likely to be seeking an alternative.
A supplier directory can connect you with trustworthy and very verified suppliers from the US and EU.
So, no unreliable suppliers, no long shipping times, and a lot of competitive advantages.
5️⃣ List and sell
Now it’s time to populate your store with useful products and make it appearling for your customers.
Adding and listing products to your Shopify store is a very seamless process.
After you’ve imported a product using the Oberlo app or any of the previously provided supplier marketplaces, you’ll have the products in the “products” section.
The products are not live until you give permission for that. You can go through each product, edit name, description, and price.
You can also add tags to products that act as labels to easily categorize products and set them in certain collections.
How to price products on Shopify
Having a pricing strategy is crucial because the price is a key element for any business success.
Shopify shares 10 ways to find the perfect price for your products. So, after assessing the competition, you’ll have an idea on what’s the range of price that you’re competitors are into.
There is the price: The actual price that you want your customers to see. And these are some good and bad pricing tactics:
|Good Pricing||Bad Pricing|
And there are the compare price: If you’re planning to set your product on a sale or discount, you can set a compare price. It will cross your old price by drawing a line through it.
Price your products wisely and don’t get greedy. Know your costs and fees to better understand your potential of earnings.
6️⃣ Market your business
Now your online store is up, live and accessable to the entire world! But remember that money comes from people, and you won’t make a dime without people visiting your site.
You should be strategic with your steps and approaches and know exactly what you’re doing.
The best thing about online business is that there are no limitations to the amount of information that you can learn.
The best is that you can actually leverage others’ knowledge! You don’t need to be an expert in marketing to market and promote your business.
However, it’s something doable and learnable. No one was born with knowledge.
Having that in mind will allow you to think outside the box. It’s a one whole big investment.
It’s not just about throwing some bucks and expecting to make thousands of dollars and retire from your sucky job!
With that being said, if you’re looking forward to raising a healthy business with sustainable growth, you need a marketing mix strategy.
The truth is that email marketing should be a part of any, literally any marketing strategy you set.
Professional marketers usually collect leads, and start engaging with visitors to warm them up and convert them into customers.
You should definitely be building a mailing list for your business, and this article explains the reasons for that!
Finally, social media tends to be the best solution for beginners or people who are just starting out and it’s super scalable as well.
However, you should know how things actually work!
Hooray hooray, for EcomDimes readers, I’ve searched the internet for the best Facebook ads training course to put you on the right track.
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Imagine having similar results? How would that affect your business and life if you have an ROI (return on investment) over 3X, 4X, or even 8X?
This premium course goes through everything step-by-step to help you build awesome campaigns that generate real money!
The course is super affordable in comparison with what it provides and offers.
Grab your discount below or click here 🙂
7️⃣ Keep learning as you go along
Practice it to master it! This is a quote by me that I’ve just created haha!
I kid you not, dropshipping is a great and flexible business model, but you just can’t wait until you learn it all!
It keeps evolving, expanding, and updating so if you’re aggressively looking forward to becoming a part of this world, you just need to start and learn as you go along!
Making mistakes in the beginning is healthy so you can avoid them when you scale your business up and grow.
There are a lot of helpful resources that you can even start with or consider using in the near future.
You can check out his course from here and see what his clients are already saying about it (Open in a new tab)
For me personally, I’ve created you a totally FREE dropshipping course to help you put your feet into this and test its water.
This -video training series explores the strategic steps you need to follow in order to hopefully someday become a full-time dropshipper and build a 6 or even 7-figure online business.
Why should you start a dropshipping business
The world is changing and people are not shopping like they used to.
Shopping is becoming more transactional. They would rather choose to shop online while they’re in their pajamas than going to a mall.
The truth is that eCommerce is killing the retail industry and showing huge potential.
A recent study by Yahoo Finance says that a $1,000 worth of Shopify IPO stock in 2015 would be worth about $45,764 today!
According to Statista, eCommerce global sales are projected to go over $6.5B by 2023!
So, with all that the digital world is offering today, do you still need to start a business offline?
Dropshipping is among the best ways of making money online, and it’s still showing massive potential while retail is dying!
This article has gone through the exact 7 step process for starting a dropshipping business and hopefully someday become a full-time dropshipper.
eCommerce worldwide sales are projected to hit $6.5B by 2023, so it’s never too late to be a part of this world and have a share of this big pie.
If you truly care for your financial freedom, you’ve got to take action now and start exploring opportunities that meet your skills, interests and capabilities.
Fortunately, the dropshipping and affiliate marketing business models can give the power to start in your online journey with ease.
If you’re not sure what business model fits you best, I’ve already written another article that puts affiliate marketing vs. dropshipping.
I highly recommend you check it out (Open in a new tab)
What about you, what’s your biggest challenge for starting a dropshipping business for your very own? 🙂
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