How I made 14K+ Net Income from Dropshipping
Dropshipping is selling products without having an inventory. The business model is known as “low-profit margins.” And, I think so too. It requires a lot of work with small profits.
I started this dropshipping business back in 2017. The dropshipping business was in the red first year because of the shipping costs. The profit was very small, but it became in the black second year. Since then, my dropshipping business grew little by little.
In this post, I’ll share how I start dropshipping business and grow my net income.
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Step-by-Step Guide to Start Dropshipping Business
Step 1. Select a niche
You will be faced with an overwhelming amount of competition because dropshipping is a low barrier to entry. Many of your competitors will sell the same products and will be trying the lowest-price-possible approach to selling.
My best advice is “research every day.”
Dropshipping is all about finding high-demand trending products faster than competitors and sell them before competitors notice that demand. Instagram is a very good social media to find trending products.
Google’s Keyword Planner and Trends are also great tools to find potential niches.
Step 2. Competition research
Little to no competition means maybe there isn’t a demand for that particular product. Analyze competitor’s listing, shipping costs as well as the cost of products. I check Walmart and Amazon constantly for competition research.
Step 3. Find supplier
Partnering with the wrong supplier can ruin your business, so ask a lot of questions before you select a supplier. How long shipping will take, how much will be the transaction fees, etc. Spend a lot of time on it.
I actually ordered products myself and see the product’s quality and how the supplier packed and shipped it to the customer.
Most dropshipping suppliers are located overseas. Make sure how do the suppliers communicate with you. (as well as the speed of response.) Suppliers will be your business partner. Communication is extremely important.
Here is a list of dropshipping suppliers.
Step 4. Build your eCommerce website
The fastest way to launch a website that supports dropshipping is to use an eCommerce platform. eCommerce platform makes website building easy for anyone but a little bit pricey.
Here is a list of eCommerce platforms/online stores.
If you have a background in web development, try eCommerce hosting by web hosting providers. This option will be much cheaper than an eCommerce platform but required knowledge of WordPress. There will be tons of templates so you don’t have to design the site. I would recommend WP Engine or Bluehost for beginners.
Related Post: Best eCommerce Hosting Providers 2021 (how to choose the best eCommerce hosting)
Step 5. Promote it
Promote, promote, promote! After you’ve created a website, you need to sell them. Building a website and listing a product won’t make you sell.
Marketing through social media is one of the most cost-effective strategies that small businesses can use to reach their target audience. Facebook is good for drive site traffic, brand awareness, word-of-mouth marketing. 95% of Instagram users are younger than 35 and they love shopping. If you dropship fashion or beauty products, Instagram is a very good social media channel. If you want to dropship food, drink, technology, or art supplies then Pinterest could be a great option.
Here is a tip to find the best social media channels for your business:
- How to Use Social Media for Your Small Business
- Which Social Media Platforms Are Right for Your Business?
If you have the budget, try an ad campaign on social media or Google. I’ve never tried an ad campaign on social media or Google. But I purchase multiple products through Instagram ads like jewelry and home decor products. I think Instagram ads are very genius. They know what I want to buy. Lol
Step 6. Analyze and optimize
You need to constantly test new products and consumer behavior. You need to track all of your sales and the data available to grow your business. This includes Google Analytics traffic and conversion rate. If you choose eCommerce hosting to build your website, I highly recommend MonsterInsights.
MonsterInsights Ecommerce Tracking gives you all the data you need on your online store. Data like conversion rate, transactions, revenue, and average order value can help you to understand your audience more and enhance engagement with your audience. It is super easy to navigate and install.
Here is a step-by-step guide to adding google analytics to WooCommerce by MonsterInsights.
How I Grew My Net Income
1. Deal with shipping problem
If the products are lost or damaged, customers will complain to me, not a supplier. I normally reply to complaint emails within 24 hours. Customer service is all about speed. Competitors sell the same products with a similar price range or maybe cheaper. Take good care of shipping problems differentiate my positioning in the market.
2. Lower shipping costs
Even though the supplier handles the packing and shipping, I still need to pay for shipping fees. So, I selected lightweight products to sell. Shipping cost is calculated by weight in the US. Cut shipping cost increase my profits.
3. Sell something that is not readily available locally
Finding products that are not easily getting on local boosts your sale! According to Shopify (1), these are popular dropshipping products:
- Kids face masks
- Electric toothbrushes
- Bamboo toothbrushes
- Interdental toothbrushes
- Sleep eye masks
- Massage gun
- Jade rollers
- Vitamin C serum (prevent wrinkles)
- Acne patches
- Squat-proof leggings
- Mom jeans (high-waisted women’s jeans, legs look longer)
- Tracksuit (very difficult to find a good one locally)
- Portable blenders (it was very popular on Instagram a years ago)
- Creative doormats
- Gaming mouse pads
- Gaming headsets
4. Switched to B2B
I manage multiple dropshipping businesses. One of them is B2B e-commerce, short for business-to-business.
B2B eCommerce is much scalable and sustainable than C2C eCommerce. (Consumer to consumer) B2B customers will usually make a large number of orders which will cut shipping costs. However, they are bargain hunters with tight deadlines. They will ask you for crazy discounts and unrealistic shipping duration.
My best advice for this is “get used to it!”
5. Focus on recurring revenue
I think most people struggling to find how to make their dropshipping store more sustainable. Me too. I did a lot of trial and error. Really A LOT.
This is just my experience: Disposable and/or need to be reordered frequently products are great choices to build a sustainable dropshipping business.
6. Chase the trend
I do product research 5 days a week for 3 hours. I’m listing more than 1000 products and adding new products daily. In this digital age, trend changes super quickly. Popular products today don’t mean popular in a month later. Research, research, research. Trial and error. That is the only way to succeed in dropshipping business.
My dropshipping business is still small, but I hope these guides help you to start your dropshipping business!
Dropshipping requires a huge commitment even though it has a low barrier to entry and low margin. It’s not easy money. However, you can expect a decent number of profits if your niche perfectly fits in trend and demand.
Thank you for reading it! Happy side hustling (:
- Ferreira, C. (2021, January 7). The Best Dropshipping Products to Sell in 2021 (And Ideas to Market Them). Shopify. https://www.shopify.com/blog/best-dropshipping-products