Does Drop Shipping Work?
As a person who has had and continues to have success with drop-shipping I’m here to explain to you why you’re failing at drop shipping. Don’t worry I’m not one of those douche bags who will only point out the problem. I’ll also offer solutions and what you need to do to potentially save yourself a lot of time, misguidance and headaches.
Drop shipping, essentially is the process in which you sell products that you don’t physically have. Once a customer purchases from your website(or whatever platform you use to sell products) you then purchase the the item at a wholesale cost from your supplier who will then blindly(they’ll think it’s from you) ship the item to your customer. You keep the profit and everyone is happy. The pros of this is that you don’t need any physical inventory, which is huge for anyone who is operating on a low to moderate budget.
So now that you know what drop shipping is. Here are my 5 reasons from personal experience why you may be failing or setting yourself up for failure at drop shipping. The reasons may not surprise you but should make sense. That’s because drop shipping is a concept that’s very simple that has been convoluted by websites trying to make a quick buck.
1.Anyone Can Join Style Website(for a fee)
Seriously think about it. IF everyone can join then what’s the point? I can tell you from experience that all the products these companies offer to sell are already being sold for much cheaper on ebay and amazon. It’s like being told, ” Hey! We’ll drop ship 1,000’s of products for you that we marked up and charge you a monthly fee on top of that. What do ya say there?”. Well that’s not really what they say but they might as well.
Stay away from websites where anyone can join. The only possible way to truly make that method work is to compete on platforms like Ebay and Amazon and to buy so much bulk that you can compete with the likes of those in China. Which I think is where your subscription supplier is getting them from to begin with. If anyone can sell the product and they don’t honor a Minimum Advertised Price then your screwed from the start. It just becomes a game of margins and eventually a waste of your time.
Now I don’t know what your main objective is. Maybe you just want to get a sale to give yourself a little confidence boost but if I’m being completely honest with you guys. It takes as much effort to sell a $20 product as it does to sell a $2000 product. The only difference is the profit margin.
Let’s say the margin is 10%.
You can see that one product will make you $2 and the other will make $200. How much do you value your time?
2. Poor niche/market research
“I’m going to drop-ship drones because my cousin bought one and all his friends want one too!”
I always tell anyone who is interested in drop-shipping to do some research before deciding to choose a niche. It’s as simple as taking a little trip over to google trends to find out the seasonality of the product/niche your interested in. If you’re going to choose a niche that is seasonal, lets say camping. You’re going to need to know when camping is getting most of it’s search terms. That way you can develop a plan for marketing(e.g. Winter-time store wide discounts and summer-time camping packages)
Time and time again when you choose a niche/sub niche you’re much more likely to get a sale compared to the Amazon style store where you’re selling anything and everything.
3. Niches with too much brand loyalty!
If you get involved with a niche where there is too much product loyalty then your bound to fail if you can’t secure on these suppliers. Cell phones, Headphones, sneakers, clothing. For instance, when I say “cell phones” you probably immediately think of Iphones or Samsung products. It will be nearly impossible to get these companies to drop-ship for you and to offer anything less is a whole new challenge on its own.
So now you’re probably thinking “Well, what products can I sell that don’t have high loyalty?”
There are thousands of products being sold everyday that don’t have high loyalty. For example, lets say… Electronic key door locks compared to sneakers or office chair vs. laptops. Electronic key door locks and office chairs have no real brand loyalty. No one goes shopping for chairs and says, “hey If it’s not the new Nike Lebron James office chair then I’m not interested”. Sneakers and computers are dominated by big name brand companies. Big name brand companies that have thousands of retailers purchasing hundreds of units of their products everyday.
So find a product that have no brand loyalty. When it comes to fishing tanks is there a brand that comes to mind? First idea is free 🙂 ( don’t actually try this; it’s a bad idea to share your niche.)
4. You have no idea how to actually market your website.
So how do you plan to get sales after your website launches?
“I’m going to make a facebook and get all my friends to support it then I’ll post in forums and do seo”
Social media and good SEO content will play a role in your business’s success but it’s not that crucial, let me tell you why. Selling or re-branding products that already have a proven market as well as an already established presence doesn’t require you to compete nearly as much. Going back to the last point. If you could sell Iphones on your website would it be necessary to have good SEO? Of course, but word of mouth itself would probably generate you sales alone. (For all you literals out there, relax… you do need to build awareness, but that’s all done through one simple ad technique.)
5. You’re Simply being Too Cheap!
It cost money to make money. There’s no other alternative.
This can go two ways. For starters you’re trying to find success through low margin products. Unfortunately this exponentially increases your work load and god forbid you have to deal with charge backs and returns in the future. It’s just a headache that’s not really worth the small $5- $10 profit margins. The other way you’re being too cheap is your reluctant to invest in applications, services and resources to drastically increase visitors browsing experience.
You’re reluctant to invest in:
- Advertising: Google, Facebook, etc.
- Content creation(unique content for organic traffic)
- E-mail marketing tools
It’s not impossible to make your website successful for little to no money but put it this way… you could make in one month what probably could take minimum 3-months by spending as little as $25 on advertising. All I’m saying is how much is your time worth? If your answer is not much, then go ahead and run the cheap route. I believe if you’re consistent then regardless any path you choose you’ll find success. Just be patient… Super patient.
What have I personally tried vs. What has actually worked for me
Well about 3 years ago I had just about tried everything.
- drop shipping on ebay/amazon
- joined doba.com and made an account
- found companies in china that drop ship
- paid subscription for wholesale list
There were some favorable results but I had to work my ass off and in the end it wasn’t worth it. I realized that after I sold a $20 item and made about $8 profit only for the customer to want a refund and drag me through the ebay buyer protection process. I was done with this fish in the sea mentality.
Drop Ship Lifestyle
I’ve wrote about DSL before but it seems like when I did no one took it seriously. The internet is becoming more and more important to everyday life. You should definitely try to get in on the action. For those who don’t know how I found DSL…One day I came across a program called drop ship lifestyle and saw this course offering to teach you the ins and outs of drop-shipping and the proper steps you need to take to create and run a successful store. Me being the type of person I am I figured, “Why not?” and decided to check them out.
I was sold on the whole concept and what the programmed offer. I especially liked the one-time payment for life-time access to a community of people who know how to and continue to make money online. We share tactics, techniques and even personally coach newbies into their first sale. I can personally attest finding this program has taught me what exactly I was doing wrong and what I needed to do to. The only problem at the time was before I could start the course I had to pay $997 to join(30-day cash back guarantee)… Stricken for cash at the time I kept telling myself when I had $1000 dollars saved up I’d join this program so for the time being I waited. Fast forward 3-4 months and I finally joined the course. In hindsight I instinctively felt safe choosing this program because everything from the sales pitch to what they actually offered and gave me was so much more. $997 may seem like a lot to join but I’ve since made that back and now continue to help others get their first sales eCommerce.
( I know you’re reading this and you’re thinking your head that, “I can find everything free on the internet”. That’s true but you could learn the wrong info…I’ve been down that rode and it only makes sense to pay for a good education. Learn it right the first time.)
The promise really is if you follow the system exactly as they teach it, then there is no reason why system shouldn’t work.
I personally have 6 of my own eCommerce websites and of that 2 regularly average about 1 sale a week. Most of my items are priced at $1000 for one store and the other( a personal hobby of mine) averages about 2-3 sales a week but with an average cost under $100(low margins). Below is a screen shot I took. Which is something you should get use to if you’re interested in joining DSL because every new member loves to share their first sale with screen shots on the private forum.
I can personally tell you there is no greater feeling than when you’re sitting on your couch at home watching cartoons and your phone vibrates to tell you you just made +$1000 USD revenue today.
I learned everything about drop-shipping and creating a legit business through DSL. Speaking frankly, I made $200 profit off my first sell. Now in the USA that’s pretty decent for a days a work of sitting on the couch. For those of you reading in Thailand I don’t even need to mention how far $200 can go.
I only share this to motivate you. Trust me it won’t be easy at first but as they say, nothing worth having ever is. It’s real work but it’s for you. The return on my initial investment was paid off after my 4th sale and although at first I wasn’t 100% on board. I know it’s true, just follow the program. It works.
As an active DSL member I’ve agreed to not lie, make-up or misguide readers about sales and/or how much money you can make through this program to bate you into joining. I can’t promise you’ll be a millionaire over night but I can say if you’re truly dedicated ,consistent and patient then there is no reason why this program can’t reap you the the same results it’s reaped for me and thousands of others.
Should you decide you join I am more than happy to help you with any questions and really walk you through all the way up to your first sale. Or you can go back to your 9-5 that you love so much?
Here’s another new store I created with my brother. Knowing what I know now it makes me really confident moving forward and I think this program can do the same for you too.
Free 10 day Drop Shipping mini-course
If you’d like to learn more I personally advise that you do the free course 10 day course first. You’ll get a better idea about drop shipping and then understand why it makes no sense to not have a hobby-store on the side bringing in additional income. It’s definitely not for everyone but If you can set aside 4 hours a week and ask questions when you don’t understand certain things, then I’m 100% confident you’ll find success.