What You Need To Know Before Starting Dropshipping In 2020

A photo of a packed box ready to ship
Photo by jesse ramirez on Unsplash
Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on email
Email

You’ve heard about dropshipping and you think you have what it takes to build a business and run it from an Island in Thailand, but you are full of doubts: You’ve never run a Facebook ad, and you don’t know how to spend money on ads, you don’t know how much money it will take, and you can’t tell if this is too good to be true, in fact, you’ve never started a business before. You’ve never even bought a good domain before, and you’re not sure why anyone would come to your domain name and not Amazon’s. If you’ve had thoughts like these in the past, then this article is for you.

In this article, we’re going to cover every fear, worry, question, and insecurity that you have about getting started with dropshipping, and we’re taking them straight from the emails that you’ve sent to us at SaleSource.

Before we get started, we want to warn you. Some of you just want a comfortable excuse not to start your business online. After all, the possibility of failure is really frightening. It’s more convenient to write off drop shipping as a scam or claim that it’s saturated and to go back to your nine-to-five job. Nobody in your fluorescent-lit agency will blame you after all agony loves the company.

But, if you are the black sheep in the flock and before getting started, you want to get some explanations, then let’s get cracking.

The first fear is that ‘dropshipping is a scam.’ Dropshipping is just an eCommerce business model and a fast recap of that for you: So, in this business model you need to create a store, then import goods from suppliers, invest your money in promoting those goods, and then you sell them to the buyers only when you get bookings. In other words, you go to the supplier one at a time and place the orders that the buyers have already placed with you – the supplier then dispatches those products directly to your buyers.

Now, this is a business model that a lot of other retailers use even, big-box retailers like Walmart use this business model to make sure that they’re only buying as much supply as they need to meet buyers’ demand for products. The contrast between you and Walmart is, well, you’re a person, and you’re getting your products from Aliexpress, which is an e-commerce site that other people can shop on.

That’s what commences some people to think that dropshipping is a scam, one of our customers asked: “what stops people from using to Aliexpress and purchasing products themselves by going straight to Aliexpress best sellers list.” That client even raised the issue that family and friends might think that they’re being scammed.

Well, drop shippers add value to the customer experience that they don’t get when they go directly to Aliexpress. Remember, Aliexpress is not easy to navigate, especially when it comes to high ticket drop shipping – there are lots of suppliers selling the same products, and their descriptions are in English. Also, there are infinite shipping options which can feel really alien to people shopping on Aliexpress.

But even if you don’t take the customer experience into account, dropshipping still isn’t a scam, and that’s because entrepreneurs are not obligated to sell products to customers at the lowest possible price, they’re only forced to sell the products they say they’re selling so if you sell dog costumes for a three times markup. Somebody buys that costume from your store – you didn’t scam them you proposed them a product, and the shopper concluded that it was worth twenty-five dollars to buy that dog costume from a trustworthy store right then and there—the customer-validated your trustworthiness with their wallets.

The other thing we hear a lot about dropshipping is that it’s a get-rich-quick scheme. If you’ve gotten this guess from our articles that we write on our blog, please let me know because we’ve tried to describe dropshipping as something anyone can succeed in as long as they work hard and persevere in the face of setbacks.

In fact, we only work with associates who do the same – our affiliate contract affirms the following:

“one of the most important parts of the partner program agreement is that as a Shopify affiliate, you aren’t permitted to make deceptive or misleading claims, guarantee earnings or promise prospective merchants success.”

So if you see someone promising that you’ll make seven figures in a week after you take their course know this – they are not our affiliates. We don’t believe it’s true that you can make a certain amount of money in a set amount of time, and we don’t want you to think that’s true either. When we do talk to drop shippers about making six figures in a year, we’re not talking about their first store; we’re usually talking about their fifth or even 50th store.

The thing is, once these drop shippers fail and learn, they develop the courage and the know-how to do things right, and scaling a successful store can happen fast after you’ve had all of those learnings. Some things are easy about drop shipping; for example, importing products is easy, but getting customers to actually buy those products is hard, and it takes practice.

A good analogy here is watching people play soccer or football anyone – can kick around a ball, but to be a professional, you really need to practice and hone your skills. On the topic of dropshipping YouTubers, I also want to address this question:

If dropshipping works, why do so many people sell courses?

You might think dropshipping actually doesn’t work because of all the dropshipping YouTubers selling courses, but many of these drop shippers sell courses because dropshipping is hard and they know that they can make money on the side by teaching others how to be as successful as they’ve been.

The other thing you have to memorize is that these drop shippers are enthusiasts, they enjoy finding new revenue streams; some of them are fine running various dropshipping stores, but others favor to run a single dropshipping store and then market their expertise. We’ve talked plenty of gurus, and I can tell you from experience they are doing just fine with their drop shipping stores (whether they use Oberlo or oberlo alternatives).

Here’s something I hear a lot: It’s 2020 – drop shipping is saturated. Oh boy, I have been excited to address this claim, I don’t want to get all nerdy and explain market saturation, but you leave me no choice.

Market saturation arises when the volume of a product in a given market place has been maximized at that point of saturation. An entrepreneur can only grow their business with new products, by taking market share from competitors or from a rise in customer demand.

Dropshipping is not saturated; it can’t be because it’s neither a product nor a market; it’s just an eCommerce business model. Remember, back in the 70s, the founder of Nike was buying sneakers individually from Japan and selling them as he got orders in the US. Dropshipping has been around four decades, but it’s taken shape in different mediums as the times and technology has progressed, so that covers weather dropshipping is saturated – it can’t be it’s impossible, but I know what you’re thinking – there are still so many products out there to dropship, and those products are all saturated.

Here’s the thing – a product can only be saturated in a given market, so these scrubbing gloves, for example:

an example FDA photo

They cannot in themselves be saturated; they can only be saturated in, for example, the US or Florida and only then if they’ve been marketed and sold to everyone who could possibly want these gloves, so before you leave a comment telling me that a product is saturated, make sure you tell me where it’s saturated is it saturated in Canada, the UK, Spain, Denmark.

What about in the US? And if a product got 10,000 orders on Aliexpress and there are 230 million online shoppers in the US, there are probably a few buyers left to sell to in the United States; in fact, there are probably thousands and one more thing – people are lazy. I say that because every time we publish a new product recommendation post, we get comments about how the products that we’ve now recommended must be saturated. No guys! I wish, but we can track this stuff – most people read our articles and do nothing, they don’t start their stores, they don’t start marketing, they don’t start making mistakes and learning. The few who do, are delighted to find that no – these products aren’t saturated, at least not in the 35 ePacket countries that they can sell to. There are new products and new markets and new trends to be sold to every day. Ecommerce is booming, and now is still the perfect time to jump in.

Hopefully, now I’ve addressed some doubts about the fact that dropshipping can work, but I know there are still some big concerns before you get started, and one of them is that you’re going to need a huge budget. People will give you different advice as to how to budget for your first drop shipping business. Some people will say you need only $200 and other people will say you need at least $2,000.

If you want our advice on what budget to get started with, check out our article. Other than the basic costs – the biggest variable in your budget will be marketing.

Marketing is what can change your initial budget from $200 to $2,000, but that depends on the marketing channel you choose to try. For example, Instagram influencers will be cheaper than Facebook Ads when you’re just getting started.

Another variable in your budget are apps, this might include apps that create urgency, like countdown timers or apps that help you change the language or currency of your store the cost of these apps vary and you can operate a store without any apps at all, or you can load your store up on apps if you think they are worth it.

By the way, you can definitely build a business without spending a lot on advertising, but you’ll need to pay with time, you can start a store with no marketing budget if you take the time to grow an Instagram community or a Facebook group beforehand, it’s not easy, and it’s not fast, but it does work.

Realistically you’ll need somewhere between $300 and $1,000 to start drop-shipping but do not spend the last five hundred dollars in your bank account to get started with this business if this is your first business you’re going to make mistakes, and you’re probably not going to see an immediate return on that investment save up for this venture, cut back on your daily lattes or lunches to save at least $5 a day that you can put towards your Facebook ads in the new year.

Another big fear among new drop shippers is that shipping products from China take months – this isn’t true this is an outdated rumor, and it’s really solved by e packet shipping, which takes about two to three weeks and comes with free tracking but best of all it’s really cheap if shipping from China really did take months other drop shippers would not be able to have sustainable businesses, some suppliers on Aliexpress even have US or European warehouses that let them ship to local customers within five to seven days.

I also want to address something a little more sensitive than shipping times. US-china relations have been all over the TV and news, and you may start seeing headlines or have seen headlines that make you worried that you won’t be able to start your own business based on the state of those relations (i.e., US and China) there are no definitive answers for this, as to what is happening yet, so our advice now is not to let these headlines get in your head and scare you away from starting your own business when any major changes occur we will be the first ones to let you know, stay updated on our website.

Another huge fear that we must talk about is this: customers will just buy from Amazon instead – this is one of the biggest fears new drop shippers have in their minds before starting a new dropshipping business. Yes, Amazon has this advantage of one to two-day prime shipping available however that doesn’t mean that you can’t run a successful business because the most of our sales are impulse buys, your customers aren’t looking for those items yet, and therefore they’re not going to Amazon or any other platform to look for them.

When customers see something extraordinary and unique they’re willing to wait for that unique product whereas they’re a lot less likely to wait for say paper towels, customers go to Amazon when they already know what they’re looking for, but your goal is to grab the attention of those customers before they know what they want and show them what they want – hint it’s your products.

Even if some customers do go to Amazon that’s okay; multi-million dollar businesses are built on the back of a 2% conversion rate meaning 98% of people who visit these successful businesses bounce – that’s okay that is still enough for you to grow your business so don’t worry too much about the competition and focus on maximizing the good numbers of your business.

And a big roadblock for beginners is the belief that they need to be Facebook Ads geniuses to succeed with dropshipping – nobody is born an expert in anything, and that includes Facebook Ads. Driving traffic to your store isn’t easy, it takes time, and it takes money, and it takes failure to really learn how Facebook marketing works, keep this in mind when you’re spending money on Facebook ads especially in the beginning you’re spending money on your e-commerce education, it’s by spending money that you learn what works and what doesn’t and it’s by spending money that your Facebook pixel learns what customers like and what customers don’t.

The more you invest in Facebook advertising, the closer you’ll get to finding your ideal customer, by the way, if you’re looking for a complete step-by-step hand-holding guide to Facebook ads from start to sale check out our guide. If you’re still scared about Facebook ads, no problem you can advertise all over the internet Facebook ads are just the most popular advertising method because they’re very easy to scale once you get it right if you don’t have the budget for Facebook ads consider hiring influencers on Instagram or on other social media platforms such as Snapchat or Tik-Tok, you can also build a social media following for free and then advertise to that following.

If you can’t find traffic with money, you’ll need to pay for it with time, but that is completely within your skillset.

Author Information
Editorial Staff
Editorial Staff
Editorial Staff at WPArena is a team of WordPress experts led by Jazib Zaman. Page maintained by Jazib Zaman.

Leave a Reply

Your email address will not be published. Required fields are marked *

Sponsor

Table of Contents