The Fail-Proof Guide to Dropshipping
Not many people are familiar with the term ‘dropshipping’.
If you are and you want to learn more, this is the right place for you.
If you fall under the ‘uh-uh, never heard of it’ geng, then this is also the right place for you.
First things first, what exactly is dropshipping?
What is Dropshipping?
Dropshipping is a sales business that allows you to sell products to customers even when you don’t have the effects.
Okay, let me explain better.
You know how retail works, right?
A retailer is a middle man.
He buys products from the wholesaler/producer and then sells them to the consumer.
A retailer needs to have a store to keep the products he has purchased from the manufacturers.
A typical example is Indomie vendors.
The company manufactures Indomie and then sells to wholesalers who then sell to retailers, and the retailers sell to consumers.
The retail price is not the same as the wholesale price.
The business model is Manufacturer – Wholesaler – Retailer – Consumer.
Dropshipping is almost like this business model.
You also serve as a retailer.
The only difference is you don’t have a store or warehouse. And it is carried out online.
So here’s how it works:
On your website or your online shop, you display products that ‘you sell.
However, you don’t have those products. So whenever someone pays for an effect on your website, you will buy from the manufacturer, then deliver to the customer.
For example, I have a friend who is a baker.
I can post pictures of her baked goodies as mine (with her permission) and tell my followers to order from me.
In reality, however, I can’t even bake.
If there is a N4,000 cake, I can set my price at N5000.
So when someone orders a cake, they pay N5000 to me.
And then I went to my baker friend to buy the cake with the money I had already gotten.
My profit is N1000.
Do you now understand how it works?
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Advantages of Dropshipping Business
There are a lot of benefits to dropshipping.
The most obvious are:
1. You Can’t Experience Much Loss:
Many retailers and wholesalers experience losses.
This happens especially when the goods are perishable or can quickly go out of style.
However, a drop shipper doesn’t understand loss because the goods or inventory are not with him.
They are with the manufacturer.
2. It’s Still Your Business:
You’re not with the products doesn’t mean that you don’t have a business.
The truth is that every other thing apart from the manufacture of said goods is yours.
What does this mean?
It means that you can decide how to market ‘your product.
You can decide the prices to fix for ‘your’ goods and services.
Besides, you’re also bringing customers for the manufacturers.
So it’s a win-win, right?
3. Less Capital:
Since it’s not your business, you don’t need much to start.
You don’t need to pay for manufacturing or packaging, etc.
4. Flexible Location:
Anything done online is super flexible.
You can relocate, and it won’t make any difference.
You can also do this from home.
This option is perfect for stay-at-home moms who want to make an extra income.
5. Different Products To Sell:
You can sell any and every product.
Also, you can do any and everything if you’re a manufacturer.
You will most likely stick to one kind of product.
However, as a drop shipper, you can have effects from every niche in your store.
Disadvantages of Dropshipping
1. Low Margin:
The only way to make a lot of profit is by cutting off extra people.
That is, it is better to buy directly from the wholesaler.
Even with cutting off people, due to the number of drop shippers, the competition is so high that you will find yourself lowering the price to sell a product.
2. Shipping Complexities:
At this point, you already know that you’re not in charge of the shipping process.
This process is for the manufacturer.
However, your customers don’t know that, and if there’s a delay or damage, you will be responsible.
How Can I Start My Dropshipping Business?
Starting can be pretty daunting.
However, it is a straightforward process.
Here are the steps to follow:
1. Get a Website/E-commerce Platform:
A website is essential.
When you get a website, you can then have a ‘shop’ on your website.
Secondly, you can write blog posts about the product, which will help your shop get more traffic.
If you don’t have a website, though, you can use an e-commerce platform like Shopify.
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2. Get A Good Supplier:
Your supplier can either make or break your drop-shipping business.
First of all, not all manufacturers allow dropshipping.
Find a supply (manufacturer) who allows it and also won’t be problematic.
Make sure that there is open communication.
Alibaba has made this process relatively more straightforward.
Alibaba allows you to connect with a lot of suppliers and manufactures worldwide.
3. Stock Your Shop:
Now, wait a minute.
This process is not as easy as it sounds. A lot of plan and work has to go into the type of products that you stock up.
Here are some points to note when thinking of products to sell:
Some products sell more than others.
Research on trending products.
An excellent way to do this is to check on eBay or Amazon.
Look for the top-selling items on each platform and have an idea of what you want to see.
Even though you can sell a host of different products as a drop shipper, it is advisable to have a niche if you’re starting.
Some products in a niche can sell better than products in another niche.
It is better to sell products at a higher price.
For example, it is better to sell a product of $1000 than a product of $20.
This is because a higher-priced product will get you more profit than a lower-priced product.
Secondly, the amount of work put into marketing a $20 product is still the same work needed for a $1000 product.
Even though you don’t own the business, you can brand the products you sell to distinguish you from other competitors.
Of course, you don’t have much of a say in the packaging of the product.
However, you have a say in how you want to be branded online.
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5. Market Your Product:
This is another vital area.
You cant make money as a drop shipper if you don’t have customers to buy what you’re selling.
You can use any social media platform of your choice to market your product and attract people to your website or shop.
6. Build a Trust-worthy Business:
You need to make customers comfortable.
Try as much as possible to avoid anything that will give you a bad reputation amongst customers.
Remember that word-of-mouth is still the most effective form of marketing.
Your supplier is essential for building trust because if he messes up the delivery or wastes a lot of time, it’s you who will feel the consequences.
As lucrative as dropshipping is, it is a very competitive area.
Try as much as possible to stand out.
Remember also to seek guidance from others who have walked this business before you.
As a stay-at-home mama, this business is perfect for you because you don’t do much work, yet you get your money.
So dear readers, what do you want to do with this information I just gave you?
Start your drop-shipping business today!
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