Dropshipping is a growing business that allows you to start an online business without inventory quickly with a low investment. The idea of this variant of e-commerce is to take advantage of the gigantic Internet sales market.
The constant growth of electronic commerce is generated by the development of ever more innovative technologies, the strengthening of security, and the strengthening of legislation concerning online sites. All these questions concern, for example, one-click payment, in installments, cross-channel, user experience, customer reviews, delivery times, product returns, etc.
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Online sales without stock, more commonly known as dropshipping, are also one of the factors for the expansion of e-commerce. This practice has considerably increased the number of e-merchants on the web as well as the number of online shops. If you want to get into this business, here is a concrete definition of dropshipping, the advantages, and good practices to be efficient and profitable.
What is dropshipping?
The main function of dropshipping is the absence of stock and logistics. As a seller, you do not store any products, and, at no time, do you manage deliveries. Your supplier or wholesaler will take care of all these parts: inventory management, shipping, delivery, etc.
To give you an example, imagine that you want to create an online store for kitchen accessories.
- First, you will look for a supplier or a wholesaler who offers products in your niche and your theme.
- Once you have found quality products that meet your expectations, you will add them to your online store.
- You will write the product sheets for these articles and put in place different levers to attract visitors and encourage them to buy: SEA, SEO, marketplaces, etc.
- After a few days… A first order! It was Richard, living in the Paris region, who bought a utensil to make pancakes.
- You will collect the money and order the product from your supplier or wholesaler, indicating Richard’s contact details. This is when you hit your margin.
- Your wholesaler will then take care of all the logistics and will deliver the product directly to your customer.
In dropshipping, we find the notion of the supplier, distributor, and buyer. Here is a diagram to explain how dropshipping works.
The benefits of dropshipping
Here is a non-exhaustive list of the different advantages of selling online in dropshipping.
The elimination of logistics
It’s a surprise to no one. The main advantage of this business is the total elimination of logistics for the dropshipper. At no time do you need to store products, prepare the packaging of parcels and deliver them to your customer?
This lack of stock will also be beneficial for your wallet! The investment to start selling online without stock is considerably reduced. Your only expenses will be related to the creation of your online store and the promotion of your products on the web.
Start your own business
With dropshipping and micro-entrepreneur status, you can become your boss and start your business quickly. The Internet allows you to work when you want and where you want!
Target the whole world
An online store is constantly open, 7 days a week, 24 hours a day. Unlike a physical store, your clientele is not limited! You can target any audience in any country at any time, even while you’re on vacation.
Of course, these are not the only advantages! There are a whole host of other benefits associated with the practice of dropshipping.
How to get started effectively in dropshipping?
Even if this business is accessible to anyone, there are nevertheless some important points to address and highlight to prepare well and successfully launch your business.
The choice of the e-commerce solution
It’s a priority! The quality of your platform will define the future of your online business. You must opt for a solution that perfectly suits your expectations and needs. The 2 solutions that stand out the most on the market are Dropizi and Shopify.
These are SaaS platforms that provide you with an all-in-one tool to create your online store and manage the different features of your e-commerce. All technical aspects are managed by the platform itself: hosting, updating, maintenance, integration of new features, etc.
The choice of niche
Each product is different and each product has its audience. To be successful in dropshipping, you need to find products that hit the mark! To make the right choice, analyze the trends around you and the different marketplaces such as Amazon or AliExpress. The best ratio for a winning product is growing popularity combined with low competition.
The choice of supplier
Your wholesaler or your supplier will have a significant impact on the success of your e-commerce site.
The Internet is full of suppliers of all kinds in all sectors. Unfortunately, most of the time they are popular wholesalers, and many drop shippers are already working with them. This is a sign that the competition is very tough!
I, therefore, advise you to look beyond the first 10 search engine results and contact online stores with very little notoriety. For example, creators on Etsy are sellers who will surely be delighted by your partnership proposal to improve the visibility of their products.
Once you think you have found the right supplier, I advise you to do some test orders to analyze delivery times, return management, availability, product quality, etc.
The marketing strategy
You can have the most beautiful drop shipping site in the world, if your digital strategy is not optimal, no prospect will visit your store! To differentiate yourself from your competitors, you must effectively work on your various web marketing levers: e-mailing, SEO, sea, social networks, marketplaces, etc. You must forge a real brand image on the web and put everything in place to improve your visibility.
You now know what dropshipping is, the different advantages of this business as well as the important points to know to get started effectively. All you have to do is put your site online to make your first sales and generate income!