Drop Shipping introduction.

In our modern world Drop-Shipping has been on the rise for many years, making a wide variety of people to be aware of the term’s existence. Despite Drop Shipping’s recognizability, most people have no clue what this fuss is all about. In this article, we will give you a presentation of this not-so-new trend.

What is Drop-Shipping?

Basically, Drop-Shipping is a procedure that allows you to function as an E-Commerce business without the need for a brick-and-mortar store. Besides, you don’t need to maintain products in stock. In contrast with physical businesses and typical E-Commerce shops, the Drop-Shipper entrepreneur has nothing to do with the product and its shipment procedure. When someone makes an order to a Drop-Shipping store, the order goes directly to the manufacturer and he ships the goods to the designated location. On this occasion, the retailer is only responsible for the marketing and selling of the product.

How does that work?

First of all the entrepreneur chooses a supplier (AliExpress, Amazon, Spocket, etc) and after that, he sets up an E-Commerce store in a dropshipping platform such as Shopify or WooCommerce. Of course, he buys the products at a decided price and after that, he tries to sell them in a higher one to make a profit. With some automation tools (Oberlo etc) the whole procedure becomes automated and the order arrives directly to the supplier, who then ships them to the proper destination. It has to be mentioned that the client is not aware that he bought a product through drop shipping.

What about scams?

Like any entrepreneurial branch, Drop-Shipping could not resist scams. There were many occasions where people were approached by people calling themselves “life coaches” or “e-commerce experts”. These hustlers, offer people a “lifetime opportunity” and try to sell them lists of businesses from which Drop Shipping orders can be placed. Of course, these lists actually contain the names of other middlemen, with no product of their own to sell. These middlemen change the prices at their will, leaving the victims with very little or no profit margin at all.

Amazon FBA

Fulfillment by Amazon (FBA) is actually a drop-shipping service provided by Amazon itself. The company takes a great burden off the drop shippers, as it offers them storage, packaging, and shipping assistance. This is ideal for the sellers because not only they do not have to worry about product-related responsibilities, they also link their product to a huge enterprise, known all over the world. Also, it is liberating to know that you have a company like Amazon on your side. Of course, costly fees and a high percentage of returns balance the scale of the Amazon FBA benefits.

How to build a successful Drop-Shipping business?

Primarily, you have to select a niche and you have to be very careful about it. Think of things that you are interested in, things that you are passionate about, then make market research to find out which products are “hot”, and after considering these two factors, you decide your niche and therefore, the product(s) that you will sell. Of course, competition research must be preceded before so you can be certain about what you are getting yourself into.

Secondly, be very careful when you are picking your supplier. The manufacturer that will supply you will be the origin of your business’s life, the alpha, and omega. For that reason, it is essential to choose someone with whom you can communicate properly. In general, communication is the key to a business’s triumph or death sentence, thus, be precise when it comes to the people that you will work with.

Moreover, create a customer acquisition plan. Orchestrate how you will manage to bring customers to your shop before you try to build yourself one. Yes, there are drop-shippers that earn more than 100,000$/year but that is not usually the case. Most drop shippers fail to bring real customers to their sites and manage to achieve sales. Thinking about that, one can easily understand that a plan is needed from before.

Conclusion

Taking everything into consideration it wise to understand that Drop-Shipping has tremendous capabilities, but things are not so simple as they seem. Although most people are unaware of this kind of commerce, paradoxically, most of them believe that if they start a drop shipping initiative, success will come overnight. That is undoubtedly false. Most sellers claim that they did not manage a single sale over the course of the first 6 months. So, if you are willing to start exploring this commercial landscape, be sure that you have the dedication and discipline needed.

In Mindspace, we believe that people, with their ideas and their vision, can and will change the world. For that reason, we want each one of you to try and reach his full potential, this is the only way we can make this world a better place.