What is Dropshipping business?
In Dropshipping model, you are a seller.
You sell the supplier’s products at arbitrary prices and market the product. When a customer makes a purchase, you pay the supplier’s list price to the seller. The supplier records your customer information and passes it on to the customer.
You need to track your order and get COD.
How does Dropshipping work?
The process of the Dropshipping model will include the following:
- Selecting business items
- Marketing about products to reach potential customers
- Closing orders
- Contact supplier
- Discuss pricing and shipping with suppliers
- Order and track orders
- Continue marketing the products you want to sell
Advantages of Dropshipping
The dropshipping model has distinct advantages as follows:
Easy organization:
The operation of the dropship model only encapsulates 3 steps, including Finding suppliers, building a sales channel, and starting related work to sell goods.
Low cost of the sales organization:
In traditional business models, the majority of business costs arise from setting up and running retail operations, including the fees of holding and managing inventory. Dropship eliminates this cost problem. You don’t need to store inventory, handle goods, package, and ship. Accordingly, the main costs are website building and marketing for the store.
Low investment cost:
As mentioned above, you do not need to invest too much capital in an online business. The main cost is to complete the sales and advertising channels to attract consumers.
Low risk:
You won’t lose inventory control costs if your store doesn’t sell products. If you want to stop selling the product, you won’t suffer a capital loss due to the overstock of the product.
Advantages of Dropshipping
Cross-border sales:
You can sell anywhere, anytime, because your online store doesn’t need an office, warehouse, staff, etc.
Sell any product you want:
You can research and sell any item you like. Even on your sales website, you can sell various products in the same category so that consumers have various choices and cover their needs.
Scale your business easily:
In the traditional business model, scaling means an increased investment of time and money in the store. With the dropshipping model, the supplier will handle all activities related to goods and fulfillment of orders. Therefore, you have more time to expand your business by increasing multi-channel sales, building an optimized website for sales, and searching for potential products to develop the product list.
How to Start a DropShipping Business?
You can start your dropshipping business in 7 steps only:
1- Market research
This is one of those things you need to take seriously if you want to scale your business. You will need to do some market research and statistics on market requirements, status, and trends. Besides, you also need to research your competitors to know what they do, how they do it, how good and bad they are, etc.
2- Identify the types of products to sell
You need to define this step early from the start of your Drop Shipping business. You can choose from convenience items, food, fashion, home appliances, pharmaceuticals, cosmetics, etc… You can go for a specific item or semi-aggregate to increase your opportunities.
3- Contact suppliers
Now that you have an idea of the types of products you want to sell, it’s time to go a step further by contacting the vendors of these products. Set up agreement terms if you’re going to work professionally and maximize profits.
4- Create a professional sales website
A website will be the foundation for all your business activities. Unless you are a web designer who knows how to work best, you need to invest in a qualified web design service to have the most effective online store. You may also want to consider a similar model to your competitors or come up with something completely new, giving it a personal touch.
5- Run your business from anywhere
As I said above, the website is the most important platform. In addition, you need to expand the scope of your activities and promote your brand and website to potential customers. Don’t forget that you have many sales channels, such as social networks (Facebook, Instagram, Twitter, etc.) and forums in your niche.
6- Set a good price
The goal is to make a lot of profit, and the supplier can sell many goods. So, negotiate for the best price to easily create a profitable brand. Be careful not to let the cost be too high as customers will visit once and look at a product without daring to come back next time.
7- Marketing for an e-commerce store
One of the ways to have a successful, profitable Drop Shipping business is to market it properly. You can consider some of the following methods to advertise: Run Facebook ads, Zalo ads, SEO (search engine optimization), special banner ads on newspapers, information pages… Don’t forget to mention the types of products you sell and include phone numbers and addresses for people to get more information and contact buyers.
✅See also: How to Promote your ecommerce store and Affiliate Offers
What do sellers and dropshippers get when doing dropshipping business?
Optimizing the cost of goods sources:
When dropshipping is popular through a comprehensive support platform, sellers can directly access goods from China, domestic sources, and Affiliate sources without intermediaries, reducing the cost of goods. Then, you as a dropshipper business sells products to buyers and enjoy the difference between the dropshipping cost and the actual selling price without having to import the goods.
Low-risk omnichannel selling:
Dropshipping sales model even though you don’t own the goods, you can still sell effectively omnichannel. Inventory data will be available on the supplier’s sales channel. You only need to use this data to set up and update product inventory on the dropshipping channel.