The online sales business is developing every day, providing opportunities for millions of people to increase their income and sell their products on the international market using the Internet. One of the most underestimated online sales models is dropshipping when all goods are sent to the Buyer directly from the Manufacturer or the Wholesale Retailers without an Intermediate Retailer Warehouse.
The business income is coming from the difference between wholesalers and retailers’ prices. This model helps to decrease retailers’ risks in buying lots of goods and storing them which might not be sold later and appreciated by Buyers. The most famous dropshipping company is AliExpress or Amazon.
How dropshipping business is working
Dropshipping business is mainly software. To start this business, you need to make a website with the possibility for Buyers to surf through the whole Internet in one place and choose different goods and buy them. The Buyer pays for the goods to the dropshipping website.
The website owner sends the money to the Manufacturer or Wholesale Retailers minus his commission; the Manufacturer or Wholesale Retailers will execute the delivery. The website should be user-friendly, and its content should be actual for your numerous Buyers to buy the goods in it and come back again.
Despite the simplicity from the description, the dropshipping business has some minuses, as:
- As the website owner is not producing the sales goods, it is difficult to predict all problems, but all complaints will be to the website.
- A website should constantly be updated and contain only precise information regarding availability and prices.
- It isn’t easy to organize compatible prices for delivering the goods from different Manufacturers or Wholesale Retailers.
- It isn’t easy to make a unique buying process; the only instrument to attract Buyers you have is the price.
- The advertisement of the website can cost a fortune; otherwise, you will have no Buyers.
Five tools to start your dropshipping business
Starting a new business is complicated anyway, but below are some tools to make it easier and less painful if you decided to start a dropshipping website.
- Find products you want to sell. Nowadays there is a special dropshipping software as easync provides an opportunity to find the best proposals on the market. Such programs create a list of the hottest items with the most competitive price easily inserted on your website. Software is available for Amazon, Walmart, AliExpress and many more. Another helpful program is Shopify with its app Oberlo. With the proper software, the whole process of website creation will be automatic. Afterward, the software provides analytics of the sales. The most accessible categories of goods to start a dropshipping website are electronics, cosmetics, goods for kids, clothes.
- Find your target audience and check its needs. You should find a proper way of advertisement for your audience. There is a big rivalry for most of the goods. You may check the methods for attraction and target audience from your competitors and may even buy from them to check the productivity of their whole sales chain. Many platforms can propose a trial time to check the website and how the auditory reacts to it.
- Find the Manufacturer or Wholesale Retailers. It is not an easy task, as it is a risk for such Suppliers. The best option is if your Suppliers provide you with access to the leftovers in the storage and the right to check the delivery of goods to the Buyer. Unfortunately, it is impossible to control the goods produced by the Manufacturer and the quality of the packing. The only solution is to have several Manufacturers for the same product and change them from time to time. Do not forget to sign the contract with the Manufacturer or Wholesale Retailer to ensure that the terms of supply will be followed. With special software for the dropshipping website, you can automatically find Manufacturers on eBay, Amazon, AliExpress, etc.
- Make the website. Another option is to make a group or a page on social networks. It should be accessible in navigation and attractive. Technical support should be available at least during regular working hours. It would help if you also bought a domain for placing your website and activating payment systems (Visa, MasterCard, PayPal, etc.).
- Start an advertisement program. It should be everywhere that fits your budget. Maybe it is better to invite professional marketing specialists for a more effective campaign. A better campaign will lead to more Buyers on your website. Always check Google Analytics to check how your advertisement is working.
For all described activities, you do not need to create a team or find an office; you may execute all activities by yourself from the start. Moreover, the income depends only on the margin from the Manufacturer price and your price on the website (commission). Therefore, the amount of your capital to start this business is minimum.
Do not forget about returns – the goods that the Buyers did not accept; in some cases, these expenses may lay on dropshipping website Owner. However, if you choose goods that cannot be spoiled because of inadequate storage conditions, you can resell them, and such expenses will be minimal.
If you have not got your production, dropshipping is a good start for a business. You will be a middle part of Buyers and Manufacturer providing the only website with a wide variety of proposals. The only part of expenses for such business is an advertisement. For example, Facebook can be used in the USA, as people there get used to buying online. If you want to work in the international market, you need proper translation of the website and corresponding payment systems. Do not only look for Manufactures from China but also many proposals from Eastern Europe, former USSR countries, and others with better quality. Do not forget about the manager or technical support ready to answer questions regarding price/composition/delivery times and many others. As this business does not require significant initial capital, you may always drop one idea and try to find something more profitable.