If you are an e-commerce startup, you should consider e-commerce dropshipping. In this post, learn the first steps you can take, factors to consider, in beginning e-commerce dropshipping.
What is E-commerce Dropshipping?
E-commerce dropshipping is a method of running an online retail business without having to buy or store inventory.
Dropshippers will typically purchase products from a wholesale distributor and then markup the price of those products. Then, sell them directly to their customers without ever holding stock of those items.
Products available for dropshipping include but are not limited to:
- fashion apparel
- sporting goods
- health & beauty products etc.
Before the internet era, anyone who wanted to start a retail business had two options: open a brick-and-mortar store or source products through wholesalers or drop shippers – both were very expensive options.
Dropshipping is a relatively new business model that makes it possible for anyone to start an internet-based retail business at a very low cost.
E-commerce Dropshipping: The Drawbacks
While dropshipping has many advantages, there are also some drawbacks to dropshipping.
What are the drawbacks of e-commerce dropshipping?
Consider the following:
- Time and effort it takes to set up your e-commerce dropshipping store.
- Money takes to build an online store.
- Inventory storage and management costs.
- Risk of low sales and high returns.
E-commerce Dropshipping: The Advantages
There are also many advantages you can take advantage of when starting an e-commerce drop-ship business. Consider the following advantages:
- No risk of product returns because your customer will never see or touch your product before they buy it.
- Ability to sell products at a higher price than they sell them for because you do not have to pay for inventory storage or handling costs. This is the main reason why so many people want to start this kind of e-business, especially in this economy when they can’t find any other kind of job or source of income.
- No need for storage space for products because you will never receive any inventory until after you have sold it to your customer online.
- No need for marketing or advertising because most products will be sent to you through affiliate marketing programs.
E-commerce Dropshipping: Factors to Consider
To get started, you will need to consider the following factors:
1. Who will be your customer?
2. What products are you going to sell?
3. What is your profit margin?
4. How much do you want to make from the dropshipping business?
5. How much time do you have to invest to build a successful business online?
6. How much capital can you afford to invest in this business?
7. What is your timeline for achieving success with e-commerce dropshipping?
8. What is your e-commerce experience like?
9. Do you have any prior experience in the e-commerce business? If yes, what was that experience, and what did you learn from it? If not, can you take the time to learn from the experts and read about drop shipping first before getting started with it?
Is E-commerce Dropshipping Right for You?
The most important rule of thumb when considering if e-commerce dropshipping is right for you is whether or not you are willing to spend the time and effort needed to set up an online business. Of which sells products for other businesses at a higher price than they sell them for.
If you are willing to spend the time and effort needed, then building an e-commerce dropshipping business can be very profitable and rewarding.
If not then I recommend that you move on from the idea of selling other businesses products at a higher price than they sell them for.
There are other ways that are quicker and easier ways to make money online than with e-commerce drop shipping if it takes too much time and effort.