Dropshipping Made Simple: Is it Really the Easiest Way to Start an Online Business?

You've probably heard about the next e-commerce option that'll help you start an online business with little capital and no inventories. Dropshipping is often heralded as one of the quickest ways to start an e-commerce business because you don’t have to own a single product before selling. However, there is a lot more that goes into building a successful dropshipping store.

You’ve probably heard about the next e-commerce option that'll help you start an online business with little capital and no inventories. Dropshipping is often heralded as one of the quickest ways to start an e-commerce business because you don’t have to own a single product before selling.

A lot of people think it’s the road to overnight success, but is it? Like other types of business, there is a lot more that goes into building a successful dropshipping store.

What is dropshipping?

First and foremost, dropshipping is a method used by entrepreneurs to sell products online. Dropshipping is where entrepreneurs sell products that they don’t have on hand.

Here’s how it happens. You have a manufacturer, a wholesale distributor, and a dropshipper.

Product manufacturers are often poor marketers. They don’t concern themselves with marketing their products to the public, and that’s where the wholesale distributor comes in. The wholesale distributor buys the products and stores them in their own warehouse. They can either look for resellers or sell the products to the end consumers themselves.

Sometimes, wholesale distributors don’t want to waste time looking for buyers, so they get dropshippers instead.

Here's where the magic happens. The task of dropshippers is to:

  1. Simply collect orders for products on behalf of the wholesale supplier.
  2. Then forward those orders to the wholesale supplier.

The supplier will then take care of the order fulfillment. So are we telling you that as dropshipper, you won’t have to buy any of the products? And that you don't need to worry yourself with tracking an inventory and fulfilling orders?

Yes! Just collect orders, forward to the wholesale supplier, and make a profit!

How can dropshippers get orders?

You just gotta be creative. The Internet offers tons of ways to market your products. You can set up your own e-commerce shop in Shopify or other platforms and promote that website using marketing tools such as Facebook ads, email marketing, YouTube videos, and others.

One of the best tools that successful dropshippers swear by is Facebook ads. Irwin Dominguez, a dropshipper from San Diego, has earned $1,000,000 over the past 8 months, and he says that one of the marketing tools he can’t live without is Facebook ads.

Once you get the hang of it and crack the code of how Facebook ads work, you’ll generate sales you never imagined.

What's the catch?

If you’re smart, you must be thinking that there is a big catch in all of these amazing benefits of dropshipping. Well, there are.

1. You won't be getting the lowest wholesale prices.

Let’s go back to the dropshipping business model. In this model, most of the work falls on the wholesale supplier’s lap.

This will be reflected in your wholesale price. There will often be a markup, and because of that, you won’t be able to offer competitive prices to your customers.

2. You'll have to deal with the customer care.

If anything goes wrong, like if the delivery is late or if the product is defective, you’ll have to answer their questions.

If you’re dealing with several wholesale suppliers, this can quickly turn into a nightmare. Each of the suppliers has their own shipping time and procedure, and if any of them gets problematic, your online store reputation is on the line.

3. You won't have real-time supply chain updates.

This means that you won’t automatically be updated when a product gets out-of-stock or available. This may lead to selling products that are out-of-stock or missed sales of products that are incorrectly marked as out-of-stock.

You’d have to be creative in dealing with these if you want to succeed as a dropshipper. Dropshipping is easier to start than a traditional e-commerce business, but that doesn’t mean that it’s easy to maintain and grow as well.

Is dropshipping for you?

If you're someone who wants a low-risk way to break through the e-commerce industry, you should definitely consider dropshipping. The low capital needed to start makes it one of the best options for a person looking to know how to start an online business the quickest way.

Every type of business comes with its own set of challenges, so whether you go for a traditional e-commerce store or a dropshipping store, you're going to have to deal with challenges all the same.

You just have to find the best ways to deal with the challenges that come with dropshipping, and with proper planning, execution, and mindset, you can succeed as a dropshipping company.

Have you tried dropshipping? What are the biggest challenges for you?

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