A few years ago, a young man by the name of Marc Chapon had a goal of starting a successful online business. His background was in hospitality and he had limited business experience other than a few mandatory courses that his program offered around marketing.
Fast forward a few months and his online store started producing over $60K a month!
His success was no accident. He was smart, methodical and figured out the trick to successfully dropshipping through a lot of trial an error. Eventually he fine tuned his methodology and launched Spocket.co. His detailed case study is well worth reading.
What is Dropshipping
Dropshipping is the process of selling products online through your own e-eCommerce store front while having the manufacturer or wholesaler send the order directly to your customer. This means never having to take posession of the product, never dealing with packing the goods for delivery and not having to manage the shipping aspect of the process.
Many entrepreneurs are attracted to this model because it reduces some of the heaviest cost tied to the eCommerce process. This allows you to focus on driving targeted traffic to your site, making the sale and some very basic customer service.
With the explosive growth of online shopping, more and more global internet usage and the wild success of platforms like Shopify and Amazon, there is no better time than now to corner your own piece of the space. Dropshipping can get you up and running in a matter of days.
Benefits of Dropshipping
There are a number of benefits to dropshipping.
It’s really easy to get started.
You really just need an internet connection. With that you can build a store front, conduct product research, negotiate with dropshippers and start marketing. One of the benefits (and drawbacks) of dropshipping is the very low barrier to entry that allows someone to get start with minimal capital and time.
The upfront cost is minimal.
Since you are not taking ownership of any product you don’t need to make large risky orders to get the best price. Typical e-commerce requires you to purchase inventory in bulk at wholesale prices in order to get a large discount and then sell it at retail. The markup you make (margin) allows you to run your site and drive traffic through various forms of marketing.
In dropshipping, you never take ownership of the product and rarely need to make any commitment of volumes. Your margins are typically less but your cost and risks are drastically reduced.
You don’t need to create a corporation.
You can run your enterprise as a sole proprietor and not have to create a full corporation. This reduces your accounting and legal costs drastically. It is important to note that when dropshipping internationally or in some jurisdictions, there may be tax implication that a tax professional should assist you with.
You don’t need large storage facility or packing services
By far the best part of dropshipping is the reduced overhead that your business will benefit from by not needing a large storage facility for product and not requiring labor to pick the products, pack them up and send them out. This can be a major expense in comparison to profit for small operations just getting started.
You don’t need to manage returns
This may depend on the dropshipper you’re working with but often the dropshipper will manage all returns and take responsibility for failed deliveries or damaged products. This is another head ache that is best left to the manufacturer.
Thousands of manufacturers around the world want to partner with you
In order to distribute their products, manufacturers are looking for wholesalers, retailers and dropshippers to represent their business worlside and sell their wares. As a dropshipper, you are their lifeline. After a brief few months of proving yourself and the potential business you can bring to their business, you can often strike discounts and deals that can increase your margins and do more marketing on their behalf
It’s a win/win for both parties as it can drive a lot more volume to your store and a lot more profit to your pocket
Can I really make that kind of money with Dropshipping?
I’m usually skeptical of big claims, especially with the large number of scams on the internet these days. However Spocket.co is not a get rich quick scheme. It’s a legitimate service that offers all aspects of dropshipping so that their customers can get going quickly and have the highest change of success.
Product and niche selection, marketing avenues, budget, customer support, and other factors come into play when determining how profitable your store can become.If you find good quality products, with high margins, delivered quickly, at fair prices, you stand an excellent change of being successful. But it takes work and commitment to launch a site properly.
You can drastically improve your chances of success through Spocket Academy.
How to get started with Dropshipping
Any pursuit worth embarking on does take time. Although dropshipping drastically recuces the risks and cost of starting a business online, it still takes sweat equity and a strong plan to succeed. Here are the major steps in that are required and recommendation on what tools/platforms to use:
1. Create a Storefront to sell your products
Your customers need to see your products and have a place to make a purchase. Having a storefront is the first step. I would suggest working with the most popular platforms out there like Shopify and WordPress using Woocommerce.
Shopify is an outstanding options, great customer service and many add-ons that allow for integration with all types of dropshippers so you can manage your store on autopilot.
Note, there are some people out there that do dropshipping without owning a site or storefront through email marketing. Unless you have an immense email list with a high conversion rate, I would recommend having a store front regardless.
2. Find products
Picking the right niche and product will make or break your store. Often individuals looking to dropship will just surf the web and find a product they like. The reality is that to find the best deals you need to find manufacturers that are not advertising themselves very well. Going to trade shows, industry meetings, social media and networking are key ways to find these products and manufactures that can give you something unique to sell.
This can take months and be quite risky. Services like Spocket.co however make finding products simple and secure. Their app integrates directly into your shopify store and you can find thousands of high quality products and immediately integrate them into your storefront.
3. Integrate Payment Gateway
Through the shopify platform you can immediately integrate the payment portal to accept paypal and credit cards and other options. The same can be leveraged for woo-commerce and all major platforms. Some are easier to integrate than others. My recommendation, keep it simple and stick with shopify
4. Market you site and drive traffic
This is your real job once everything is set up. Driving traffic can take many forms. Pay per click ads (Google, Facebook, Instagram, etc), social media posts, influencer marketing, Search Engine Optimization, email marketing, joint ventures and many other systems are commonly leveraged to drive buyers. Once the buyers are on your site, they will purchase your products.
5. Clickthrough Rate Optimization and Upsells
Your next role is to maximize the “share of wallet” of each visitor. This is done through testing. Testing ways to optimize your site so more users purchase your products (click through rate optimization). Testing user experience, product titles, tags, and desciptions are all ways to improve the change of closing your your prospects.
Once you have their attention, there are other tricks like upselling (providing recommendation or discounts for purchasing higher volumes of products), coupons, and other approaches.
Dropshipping is a great way to create income without outlaying a large amount of capital and effort and minimizing risk. If you’re looking to make money online, dropshipping is a great first choice to get started and learn.
If you are looking to purchase a dropshipping site, look into a buyer broker like MadX Capital so they can strike a great deal for you and you can have a successful business immediately.