Without stock: How to Succeed in Dropshipping?

By all indications, this current global shopping month is going to be a steaming one. It seems that anyone who has some inventory somewhere is taking advantage of the fact that the credit cards are already out to offer an attractive deal. Actually, even keeping stock is passé. The digital age has provided fast, direct and reliable sales methods, without having to keep a single product in stock. One method is Dropshipping, a business model that allows anyone to trade in products of another supplier, without bearing any costs of production, storage and distribution.

At first glance it seems that Dropshippers live comfy lives. They sell and transfer orders to the manufacturer, who is responsible for delivering the product to the clients, in predetermined conditions. A win-win, no? The biggest sales websites, such as Amazon and Ali Express, have whole divisions whose entire function is to operate dedicated stores for the energetic dealers from anywhere around the globe. The advantages are obvious: low operating costs (all you need is a website and a clearing house). No need for inventory management, storage, or fancy offices, and you can sell from anywhere.

On the other hand, the Dropshipping model is not without its drawbacks: choosing a reliable and high-quality manufacturer or supplier is not without risks, the entry barriers are low, and anyone can sell at any price, competition is ever intensifying, there’s no control over the inventory and the delivery system, the profit margins are low, the customer service and the handling of returns are the responsibility of the seller – who has no control. And yet, more and more entrepreneurs prefer the Dropshipping model. If you to wish to join this model which conquered large parts of the ecommerce world, this article is for you.

Everything you need to know about Dropshipping

1. Opening a store? First find your niche

All marketing people know that targeting is the way to success, and that if you chase two rabbits you will catch none. This logic also works when dealing in Dropshipping. The narrower and niche your store is – the greater the chance of finding a competitive advantage to set you apart from your competition. A quick look at the over-bursting supermarkets of the ecommerce websites will teach one that you should buy shoes in a shoe store, and not in a store that also offers fishing equipment.

2. Some products are not for sale

The Dropshipping model frees sellers from storing and managing inventory, but that doesn’t mean they can sell whatever they want. The sale of original or counterfeit products that are protected under copyright agreements, such as, art, music, international super brands etc. – may result in legal action and financial damages. Products for which distribution process is complex, such as fragile, mechanical, heavy or sensitive objects are prone to malfunctions, and may lead to financial loss and damage to the seller’s reputation.

No need for inventory management, storage, or fancy offices (UNFLASH)

3. Catch the right trend

Remember the fidget spinner? The Livestrong bracelet? And other temporary trends that sold in the millions in a short time? Those are just what you need. Trends come and go, and if you hop on the train in time – you might just cash-in big. How do you predict the next trend? Follow Google Trends or simply create it yourself.

4. Follow your gut

Choosing the right manufacturer or supplier is imperative for the model to succeed. This decision can be compared to choosing a business partner from dozens of candidates, with just one difference: you have no idea who they really are. Therefore, it’s recommended to research, following statistics, reviews and ratings given by other Dropshippers. Don’t spread out and never choose several suppliers that market the same product.

5. Invest in marketing

You don’t need to allocate a huge budget, but you should work to correctly market your website to your chosen target audience. Start with a catchy and relevant domain name, promote registration forms on the website, create newsletters and branded landing pages, and build automated clients’ journeys to save on marketing costs. We also recommend to create marketed pages on social networks, and to create winning SEO content to promote marketing messages and present your brand story.

6. Keep your online reputation clean and inviting

Seems simple, right? Think again, especially since you have no control over the quality of the product or its distribution to the customer. You might be able to deal with one negative review, but several negative reviews can hurt or even ruin your reputation. On the other hand, positive reviews (and don’t hesitate to ask customers to compliment you!) must be displayed in a prominent spot. And don’t forget to respond to every review. Silence will lead to corrosion.

7. Patience everyone

A common scenario for every beginner Dropshipper is cash flowing in from day one. But it’s not always the case, and you need to be patience. If you went by the book it should work. And if sales are still faltering, you need to recalculate and check what went wrong.