How dropshipping business works?
A dropshipping business sells products through an e-commerce website or mobile application, which it purchases from a supplier or manufacturer who ships it directly to the customer. In short, a dropshipping business displays the products of a supplier and sells it through an online platform without keeping stock or doing shipping.
How to do a dropshipping business?
First choose the products to sell, find reliable suppliers for those products and choose a suitable selling platform (own website or e-commerce platform) to display and sell the products. Learn digital marketing and open social media accounts for promoting your business. Take GST registration and start selling the products.
How to select dropshipping products?
When you are selecting a product to dropship, in-depth analysis of the following factors should be done: product trend and popularity, product quality, price, profit margin, competition, product availability, ease of shipping, delivery time, supplier reliability and after sales support. If your analysis reveals positive outcome, you can select that product to drop ship.
How to find a dropshipping supplier?
You can find lot of resources online regarding reliable and unreliable dropshipping suppliers. Do thorough research and list a few in your niche. Communicate with them regarding each and every aspect of the business and select a few. You can find a lot of suppliers through e-commerce platforms like Alibaba, Amazon, Flipkart, Ebay, etc. You can also search in supplier directories like Worldwide Brands, SaleHoo, Doba, and Wholesale Central to find legitimate suppliers.
How to attract customers to your dropshipping business?
Select great products and create a stunning website to display the products. Start a Facebook Ad campaign and do search engine optimization, digital marketing and e-mail marketing to create a strong online presence. Make videos explaining your products and publish them on your YouTube channel and social media pages. Post customer reviews, ratings, and testimonials in your website to build trust and attract potential customers. Find suppliers who deliver good quality products within a short period of time to serve your customers better.
Advantages of dropshipping business
• Can start with small capital as no upfront investment required
• Sell unlimited number of products from different suppliers
• No need to keep stock or ship products, which saves lot of money, time and effort
• Save on operational costs of maintaining a retail shop
• Experiment with various products without the risk of losing money
• Online selling platform, so no retail location or staff needed
• Flexibility of running the business anywhere and anytime
Disadvantages of dropshipping business
• Low profit margins and high order fulfillment costs
• Higher customer service headache due to less control over the entire order fulfillment process
• Problems can arise with stock shortages, product quality, shipping and delivery, turnaround time, miscommunication and product returns.
• Not many manufacturers or distributors agree to drop ship.
• High competition and difficult to build a personalized brand