How to Start Dropshipping: Step By Step
How to start dropshipping? Should I start dropshipping with Shopify or with another marketplace? These questions have a clear and common purpose: to know all the important steps to start this business. In this article, we will give you some tips and advice to start dropshipping. All this, to help you set up and grow your own store, and to help you make up your own mind about this subject.
What is dropshipping?
Dropshipping appeared at the end of the previous century in North America. Very quickly, this method spread until it reached 33% of the web-merchants in the USA in 2002. In full explosion in Europe, it is important to come back on this system which is much talked about.
This is a three-way method allowing a customer to place an order to a dropshipper ( trade without stock) who takes care of the relationship with the wholesaler. The objective is that the wholesaler ensures the delivery directly to the final consumer.
Finally, nothing better than an illustration to help you understand the method:
How to Start Dropshipping? Step By Step
How to start dropshipping? Choose a good niche
First of all, it is important to select your business. What do you want to sell? Possibly do some market research to find out what you want to sell. You may find that some products have too much offer and not enough demand. On the other hand, others hide extremely profitable margins with ever increasing demands.
For example, if you are an influencer on social networks, and you are looking for a new income through the sale of certain products, be aware that the sunglasses market, the watch market or EarPods type items are extremely saturated at the moment.
So look for ways to make a difference by offering products in growing areas. And possibly, you can bring a knowledge or even a personal touch.
Starting dropshipping... with or without legal status?
Is it possible to do dropshipping without a legal status?
A short clarification is necessary. You should not confuse the situation in which, as an individual, you are going to resell used items belonging to you, and the one in which you create a real professional activity.
In the first case, you simply resell goods that you did not acquire with the intention of trading them, on an occasional basis. In the second case, you buy goods or materials with the intention of making a profit, on a regular basis. You then become a trader, a professional seller.
Like any dropshipper, you must create a legal entity, a structure in which to carry out your activity. This will allow you to negotiate with suppliers and sell your products legally.
So what legal status should you choose for your dropshipping business?
The auto-entrepreneur status for your dropshipping activity
Does simplicity appeal to you? Do you want to start your business alone and without too many costs? In this case, the auto-entrepreneur status is probably the one that is best suited for this activity. It will allow you, as a micro-entrepreneur, to test your store. This solution is probably best suited to entrepreneurs who want to test their project and see if it is viable in the long term.
If you are growing your dropshipping business, opt for an LLC status. Even if this legal statuts is a bit complicated, it guarantees greater security. Moreover, it doesn’t limit the amount of your sales.
How and where can I find suppliers for dropshipping?
As brands do not always display the possibility of dropshipping on their website, do not hesitate to ask them directly. There are many possibilities to find your supplier through Aliexpress or eBay.
How to create a dropshipping website?
Several choices are available for you to start dropshipping, It’s up to you to make your own decision according to your needs:
Shopify: one of the most famous e-commerce solutions, starting at $29/month. Beware, some plug-ins are not free.
Woo commerce: this is the e-commerce plug-in for WordPress. With over 700,000 users, it is the leading e-commerce solution in the world. It is less easy to use than its competitors (no preconfigured theme, complicated handling, few supports, etc.), but it makes sense to install if you already have a WordPress site. The advantage is on the SEO side. Woo commerce is the most powerful tool for SEO thanks to Yoast (customizable URLs, accessible metadata, etc.).
The best choice depends on your situation. But if your online store needs to be multilingual, you want to be able to customize everything, and you plan to integrate it into an existing website, then choose Woo Commerce.
Anyway, study the different options available to you and go for the option that best suits your product/support/budget needs.
Improve your SEO
The acronym “SEO” is not foreign to you, but do you know exactly what it is? It is the optimization of your pages, your content, in order to improve your position in search engines. The key to success for anyone who wants to sell online: being as visible as possible!
Let’s admit that the discipline is more to sell to Google than to your customers at first. But then, it is the best way to reach the customer.
In order to receive your first visitors and first sales on your online store, you will have to select your keywords. You can use different tools to find the best ones. You can find the expressions to use with the help of sites like Google Keywords Planner or UberSuggest. Use them to make a list to integrate in the structure of your site, as well as in its various contents (like a blog page for example).
Start dropshipping: writing product sheets
Is your website structure ready to launch your new business? Good! Now it’s time to fill it in. Get some pictures from your suppliers, or make them yourself to bring a personal look.
Take the time to write your product sheets. Don’t copy the information sheets of brands or wholesalers. First of all, this will harm your referencing and you will lose credibility with Google and with your customers. Take the time to produce well-crafted texts, original descriptions in which you will have added the important keywords.
If you do not master writing product sheets or taking pictures, do not hesitate to call upon a freelance writer for these specific missions. It is important that the output is qualitative and professional in order to inspire trust in your potential clients and help you stand out from the crowd. Keep in mind that competition is tough in the Internet world.
Prepare the webmarketing strategy of your store
Once your online store is ready to make its first sales, plan to advertise it! It is not enough to create an online store for Google’s crawlers to jump at your feet and make you the guru of dropshipping!
For this, you will have to turn to social networks. Facebook, Instagram, Twitter or Pinterest, possibly Linkedin if you want to reach professionals. The important thing is to select your network well according to your target audience.
On the other hand, you can use Google Adwords (just like Facebook) to advertise on it. And don’t worry, even if the initial investment is important, the income will be even more important at the end of the next month!
The advantage of Google is that people will see your ad in the first position if they type in your keyword. Don’t forget that SEA (or paid search) is a complex science. It is better to be accompanied by experts in the field. Otherwise, you risk wasting your advertising budgets by not getting the expected result.
Creating a blog can be useful to bring back even more traffic via SEO and more credibility from your community. In addition, the platforms that publish blogs are usually well optimized to attract the favor of search engine robots. It is often easier to rank well through this than through your own website.
How much money to start dropshipping from scratch? Mistakes to avoid
By asking yourself the right questions, a few basic mistakes related to money and time become easily avoidable when you start dropshipping. It’s up to you to make up your own mind about how to run your business.
First mistake: starting dropshipping without money and without thinking about the overall budget
The first of these mistakes would be not investing enough money in this project. When you start your store, you should know that a minimum budget is necessary in order to be able to start, to make yourself known and eventually to grow your business if the opportunity arises.
Indeed, the Facebook Ads and Google Ads budgets are substantial and more than necessary to target your customers, make yourself known, collect data on your potential buyers and advertise to them.
Second mistake: starting dropshipping straight away without investing time
The second of these mistakes is not investing enough time in your business. It is necessary to take your time when you start dropshipping. Writing your product sheets, your legal disclaimer, possibly holding a customer support via email or phone, etc., every little detail helps to ensure trust from buyers. A feeling that is more than necessary when your online store is in its launching phase.
As you can see, it is impossible to start dropshipping on your own!
Third mistake: pricing
It is very important to set the price of each product sold on your site, not only according to the prices on the market but also according to your profitability.
Indeed, many new dropshippers simply set their prices by searching the Internet and comparing to the same or similar products to find out what the competition is charging. They don’t care about their margin and profitability.
The result? At their balance sheet, a business that makes no money and offers no profitability!
Of course, it is important to look at the prices of your competitors in order to know if your company is competitive. Some websites offer to reference on a single page all the prices applied to the same product by the competitors in form of a price tracker. This is a good indicator to take into consideration. However, you should not forget to examine your sales margin and your cost price. This allows you to check if your company, by charging these prices, will be profitable and will bring in money.
If, as a dropshipper, you realize that your company is not profitable on certain products, after having made all the calculations beforehand, you will have to think about modifying the product catalog and changing some references to choose other more profitable ones.
Last mistake: starting dropshipping without knowing your customer and e-commerce trends
The last and most harmful mistake is not learning enough about your store’s business. It’s important to understand what’s going on. Therefore, analyze your site’s data with solutions like Google Analytics, Matomo or Heap. Also, find out what’s trending online, what products are hot, what events are coming up, etc.
Setting up and launching your dropshipping store is the biggest step, but the benefits can be very significant if you do it right and keep managing your site well.
Don’t give up on your project! Many solutions are available to help you, and new ones are constantly appearing, with the aim of making your dropshipping job easier.
You now know everything you need to succeed. You are ready to start your dropshipping business.
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