What is Dropshipping?
Dropshipping is selling products without holding inventory. This means that the products you are selling are not your. You are just a middleman. You are just connecting the products owner with the customer. Through that process you make your cut. That’s simply how dropshipping works. Ofcourse in order for you to make some money you need to make sure that the price you sell the products is higher than the product owner’s price. Hence, the source of your products needs to be cheap. Otherwise you will not be able to make anything. Read through as in this article we are going to discuss How to Make Money with Dropshipping.
Step-by-Step guide on How to Make Money with Dropshipping.
Step 1. Choose a Profitable Niche.
The very first step of dropshipping is choosing a profitable niche. You do not want to be stuck selling products that don’t sell. You know trying to sell products that no one wants to buy. In addition to that, you do not want to be selling products that do not have profits. You know selling products that are so cheap that there is no room for profit. Similarly, you do not want to sell products that are super competitive when it comes to pricing such that you cannot be able to markup your profit. You want products with wiggle room.
Step 2. Find Reliable Suppliers.
The next step is finding a reliable supplier of your products. This is one of the most important steps. That is because if you find a supplier with low prices and good products, you will be able to make profits. On the other hand, if the supplier you find has very high prices and/or low quality products then you will not succeed with your dropshipping career.
We will list for you some of the best dropshipping suppliers/sources you can use.
- Alibaba. Alibaba is the absolute best source of dropshipping products. They deal with B2B which means their prices are tailored for resellers.
- AliExpress. It is closely related to Alibaba but it is also an excellent source of dropshipping products. This is best if you do not have your shipping and fulfillment. So what you do is when people buy from your website, you go and buy from AliExpress. Then AliExpress ships the products to your customer. The reason why this works with AliExpress and not with other eCommerce sites like amazon is because AliExpress prices are really good. Also, AliExpress products are not abundantly available on sites like amazon.
- CJdropshipping.
- Spocket.
- SaleHoo.
- AliDropship.
Step 3. Set Up an Online Store.
Now that you know what you want to sell and from where you are getting it, its time to know where to sell it. Every business needs a home. You know a place where customers can find you. A place where they can always go at any point in time and and find you. One of the most common business fronts is a website. These days it is very easy to create a website. For example, you can create a wordpress website very easily without any programing. In addition to that, there are many other platforms like shopify where you can create a website without programming.
Actually, these days the need for a website has decreased as all you need is an online outlet such your social media profile. If you have large following on your social media profile, that’s all you need. All you need to do is list some products on your social media and encourage the people to buy.
Step 4. Optimize Pricing for Profit.
Now that you have your products and your platform, its time to decide how much you want to sell the products for. Remember that dropshipping is all about markup. What this means is that you take the product from your supplier, then add your profit cut on top of the sellers price. For example, if the seller is selling the product for $39, you can sell that product at $49. Bigger price products have bigger room for price markup. For example, if the product is priced at $329 by the seller then you can sell the same product at $399.
On the other hand, as you seek to make more profits by marking up the prices of the dropshipping products, remember that you need to make sales. Therefore, if you make the markup very big you will not be able to sell since there are other competitors. Remember you are not the only one selling such products. Therefore you need to compete. Do not sell at very high prices such that you are beaten by competition. Similarly, do not sell at a very low price such that you end up making loses.
Step 5. Promote and Market Your Store/products.
One of the most important steps of dropshipping is the marketing phase. Anyone can purport to do dropshipping but not everyone who can sell. The one thing that sets the two apart is the fact that one can market and get his/her products to the customers and the other one cannot. The more people you can reach and put your products infront of them, the more you are likely to sell. You can look at it as a game of probabilities. Use all avenues at your disposal such as social media to bring people to your store or your products so that they can buy them.
Step 6. Manage Customer Service Efficiently, Analyze and Scale.
The last step of your dropshipping journey after you start making sales is to serve your customers properly. Make sure that you communicate with them when they contact you. Make sure that if there is an issue with the order, you are there to solve the problem. In addition to that, make sure that the response is immediate.
Finally the biggest aim of every business is to grow. Thus, when you make your money through dropshipping do not spend all of it. Save some so that you can return it into your business for growth. You can invest in marketing to reach more customers and make more sales. The secret for all businesses is growth. So keep growing.
