If you’ve always wanted to start an e-commerce business but have no idea where or how to start, dropshipping is an excellent idea. Dropshipping business is a fulfillment model that allows you to purchase products/goods individually from a wholesaler/s and ship them directly to your customers.
The only difference between dropshipping and the standard retail model is that you as the merchant never see or handle the product. In other words, you do not stock or own inventory- you purchase inventory as needed from a third party to fulfill orders.
Dropshipping isn’t new actually. E-commerce giants like Amazon and Sears use it too and from what you can see from these two businesses, dropshipping is a highly profitable business, but only if the correct strategies are used.
How Does Dropshipping Business Work?
As explained earlier, you as the merchant purchases products individually from a wholesaler and ship them directly to your customers. In detail, you list the supplier’s products on your eCommerce store for customers to buy. When a customer purchases any item from your store, you order the same item that the customer has ordered and paid for from your supplier.
Your drop shipping supplier then ships the item directly to your customer. You receive the money you sold the item for and the supplier charges you the wholesale price. Thereby, your profit is the difference between the retail price you sold the item for and the wholesale price you pay to your supplier.
How to Start a Profitable Dropshipping Store?
Dropshipping enables you to sell products that you don’t stock or own, so you can focus on the marketing, customer support, and the daily functions of your eCommerce store. If you’re ready to start a dropshipping business, here are useful tips on how to start a profitable dropshipping store.
1. Select a niche
First things first, you need to select a niche, a niche that is not only laser-focused but also something that you are passionate about. If you choose a niche that you aren’t passionate about, sooner or later, you will get bored and discouraged.
When selecting a niche, consider things like the amount of profit you will get where higher-priced products are more suitable than low priced ones. You should also consider shipping costs where obviously, low shipping costs are more suitable. Also, the products must appeal to impulse buyers with disposable income.
To ensure the success of your business, you also need to make sure that people are actively searching for your product. In this case, you can use tools like Google Keyword Planner and Google Trends to search for keywords related to your specific niche.
2. Carry out competition research
Since you will be competing with giant brands like Amazon, Sears, Walmart…e.t.c, you need to perform your competition research properly. You need to know what products they sell, their price, how popular these products are with buyers, their shipping costs, and other important things.
Don’t be afraid to choose products that have high price tags on them. If e-commerce stores like Amazon are making sales from them, you can too.
So once you perform thorough competition research, it will be easier to create a profitable and successful dropshipping business.
3. Find dropshipping suppliers with high-quality products
The success of your dropshipping business partly relies on your suppliers. If your suppliers provide low-quality products or they fail to deliver ordered items on time, then your business is bound to fail. Therefore, you need to choose your suppliers wisely.
4. Set up your eCommerce website
Customers will purchase the products you’re offering through your website, so you need to build one. If you don’t have any tech skills, you can easily hire a web designer to create a customized E-commerce website for you.
5. Create a customer acquisition plan
You have the right supplier and a website to sell your products. The next step is devising strategies to attract potential customers. Although there are numerous ways to attract potential customers, starting a Facebook ad campaign happens to be the most effective.
Facebook allows you to promote your products to a highly targeted audience. This way, you can compete with giant dropshipping brands and retailers. Using this method will also allow you to generate more sales and revenue.
6. Analyze and optimize
To grow your dropshipping business, you need to track every single data and metric available. You can use Google Analytics and Facebook conversion pixel data to analyze traffic, target audience, conversions, and other important data.
Using this information, you can tweak your website in a way that attracts more traffic and potential customers.
How to Pick The Right Products to Sell?
To pick the right products to sell in your dropshipping business, here are some important things to consider:
- Choose products that aren’t readily available locally.
- Choose products with low shipping costs.
- Choose products that people are actively searching for.
- Choose products that are appealing to buyers.
10 Best Dropshipping Niche Ideas
1. Wearable devices
According to recent data released by Zion Market Research, “Wearable sensor market will grow up to approximately $1,387 million by 2022. It couldn’t be more true. From fitness trackers, smartwatches to heart rate monitors- the wearable devices niche has an incredible potential in the near future.
Starting a dropshipping business in the wearable devices niche would be profitable and a huge success- if done right.
2. Pet supplies and accessories
Animal lovers would do just anything to keep their furry friends happy and comfortable. Thanks to the wide range of pet supplies and accessories available, keeping a pet has never been more fun. From cat/dog LED flashing collars, leashes, play toys, to chew toys, you can never go wrong with this niche.
3. Animal themed products
People generally love animals. So why not help appreciate them more by selling the cute animal-themed products. It could be t-shirts with cute puppies printed or bear-themed sleepwear for kids.
4. Dog-themed gifts and decorations
Many dog lovers would appreciate dog-themed gifts and decorations. A look at Google Trend on dog-themed gifts and decorations over time shows that interest has been growing steadily over the years.
So why not take a bite of this lucrative market for your dropshipping business?
5. Art materials
Gone are the days when all that many people wanted was to sit down on the couch and watch the TV. Most of them are often looking to do something that provides them with a great time during their free time. They are ready to invest in nice art and crafts supplies and accessories.
There are even those who create art and art products as a side hustle to make some extra cash. So if you think you can satisfy the market, then you should consider art materials as a profitable dropshipping niche idea.
6. Low-cost sportswear
As part of achieving their fitness goals and to lose weight, people are always engaging in different forms of workouts. Some are even working out right in the homes. What this means is that the demand for sportswear is rising. But it’s not just any sportswear- it’s also about buying sportswear that fits within their low budgets.
By building a dropshipping business that sells low-cost sportswear that everyone can afford, you can expect huge returns.
7. Antistress toys
Everyone at some point gets stressed up. It could be about money issues, relationships, work, school, or some other reason. To calm their minds and forget about their worries a little bit, most people use anti-stress toys like squeeze balls, fidget cube puzzles, hand spinner fidgets, among others.
So if you’re looking for a potentially lucrative dropshipping niche idea, then anti-stress toys niche idea is a great choice.
8. Automotive accessories
Niche ideas for dropshipping include selling automotive parts accessories like LED strips, new classic headlights, custom sticks, and others can be a huge success. The demand for automotive accessories is not going down anytime soon, so you better be prepared to satisfy the market demand.
9. Sports tools and equipment
Sports tools and equipment often cost a lot of money to purchase. This leaves out low-income earners with the option to visit the gym, where membership can be a little bit expensive. How about creating a dropshipping store offering low priced sports tools and equipment that people can even use right in the comfort of their homes?
10. Smartwatch accessories
As the demand for smartwatch rises, so does the demand for smartwatch accessories. With smartwatch sales expected to rise in the next couple of years, it’s quite evident that starting a dropshipping business in the smartwatch accessories niche could be highly profitable.
Best DropShipping Companies
Finding the right dropshipping company for your eCommerce business can be difficult especially if you don’t know what to look for. To make the search easier and hustle-free, here are some of the best dropshipping companies.
Pros and Cons of DropShipping
- Escape the burden of inventory.
- Freedom and flexibility.
- Potential to make great profits.
- Minimal starting capital.
- Low-risk business.
- Packaging and shipping are taken care of.
- Save time and money.
- Low overhead.
- Ability to sell a wide range of products.
- Lack of control over packaging and shipping.
- Thinner profit margins.
- Reliance on the stock.
- Less competitive pricing.
- Competition is stiff.
There are numerous dropshipping stories from successful entrepreneurs that will inspire you to get started. Furthermore, the ability to set your prices and not having to worry about being price competitive should further ease your worries about how to start a successful dropshipping business.
Dropshipping is a great business model for new entrepreneurs considering its low risk, less costly to start, easy to start, and highly automated. So go ahead and build your dropshipping business and get a share of this lucrative industry.