Dropshipping Business: Ultimate Guide To Dropshipping [2020]

Do you want to earn a 7 figure income online???

There are a lot of opportunities to earn online. Some of these are Google AdSense and Affiliate Marketing. But this requires you to start your blog or website and then put in lots of effort to attract visitors to your blog. 

You need in-depth knowledge and strategy to convert our visitors, and all this isn’t possible without some expensive tools & plugins.

But what if you don’t have to go through these stages and find out something that can help you earn a lot online without having your blog or website?

Dropshipping is the best opportunity to make money online just by sitting at home and enjoying a cup of coffee. This post shares all the information that you need to know about starting a Dropshipping business and its requirements.

Explore the world of Dropshipping and drop other sources of income that don’t allow you to make much profit.


About Dropshipping

Dropshipping Business

Dropshipping is all about your customers purchasing any product online from you, but you don’t need to have a stock of that particular product or hold any inventory.

When a customer purchases any product, then that product is shipped directly from the supplier to your customers at their doorstep. The product is shipped from the warehouse undertaken by the supplier without you worrying about the stock or inventory.

Therefore, Dropshipping allows you to promote products of your interest without you packing and storing the product at your end to be delivered to your customer anywhere around the world.

So did you understand the difference between Dropshipping and e-commerce business?

The difference is simple, and you must have understood that in Dropshipping the retailer does not have to stock the products instead the retailer transfers the order to the supplier with complete details of the customer (name, contact number, billing & address) and then relies on the supplier to deliver the shipment to the customer's doorstep.

The reason for the popularity of Dropshipping business and its success is in front of you, and that is why most of the ecommerce portals are using Dropshipping for increasing their business.


Working Process of Dropshipping

You will be surprised to know that the working model of Dropshipping involving only three prominent cards. These are Supplier, Retailer, and the Customer.

You are the retailer who takes orders from the customer and transfers the order to the Supplier who can also be the manufacturer. You being the retailer, are responsible only for promoting the products and taking orders from the customer.

The manufacturer or the retailer is responsible for maintaining the stock and refilling the stock if orders are flooded. The manufacturer is also responsible for delivering the order to the customer, and in case the customer rejects the order due to defectiveness, then replacing the defective products.

But if the manufacturer is taking so many responsibilities, then will you (retailer) earn a good amount?

Yes, even though the manufacturer has many responsibilities to play, you will still earn a lot as you will get the stock from the manufacturer in wholesale, and it is you handling the marketing part.

When we say that the retailer handles the marketing part, it means that the retailer is responsible for showing interest in particular products and choosing them to sell online on the manufacturer’s website or an ecommerce platform.

But selling on the manufacturer’s website or ecommerce platform doesn’t mean the retailer won’t have any identity. The retailer sells the entire products under their brand name, and the customer can see only the retailer and not the manufacturer.

Thus, the retailer is responsible for promoting and marketing the products and also handling the inquiries & complaints from the customer’s end and transferring it to the manufacturer.

The risk involved at the retailer is zero as the retailer doesn’t have to purchase the product in bulk. Most of the time's retailers selling offline keep a huge stock, and when the order flow is less is becomes difficult to sell the remaining stock.

In Dropshipping, the retailer has to pay a wholesale amount to the manufacturer only when a customer orders a product to the retailer. This means minimal investment at the retailer's end and also eliminates the risk of buying stock in bulk and not being able to sell them later.

It’s a win-win situation for the manufacturer and the retailer, too, as the manufacturer receives the payment from the retailer before shipping, and the retailer doesn’t have to keep the stock not has to take the burden of packaging and shipping.

The customer who is the end consumer is the most important aspect of Dropshipping.

The retailer should have a good idea and well-researched market plan to know what products customers are showing interest in or what their needs are that other retailers can’t fulfill.

If a customer is satisfied with your product specification and pricing, then the order goes to you, and the customer will further communicate to you regarding any issues that occurred with the product purchased.


Steps Involved in Starting a Dropshipping Business

Although Dropshipping doesn’t require you to invest a lot of money, it has to be carried strategically with deep research. Not having enough ideas about Dropshipping may result in heartbreaking as your efforts will go in vain. 

We have listed out some crucial steps that you need to know for starting a Dropshipping business and becoming successful as an online entrepreneur.
  • Come up with an Idea

The first and foremost step in starting a Dropshipping business is to have an idea about the trending niches and evergreen products that are most like and purchased by customers either in a specific region or around the world.

You can choose backpacks, jewelry, smartwatches, and many more products in any niche from clothing to electronics.

Search on Google with different keywords and accordingly decide which niche has the most searches. You can make use of some keyword research tools if you have some money to invest in.

  • Look for a Dropshipping Supplier 

The key player in Dropshipping is the supplier or the manufacturer. Consider the supplier as the most important piece of the puzzle without which you cannot be successful.

Ensure that the supplier you choose has a good stock and delivers the orders on-time as you being the retailer are solely dependent upon the services provided by the supplier.

If anything goes wrong, the customer will contact you and not the supplier. Remember, not every supplier offers Dropshipping, so take out some time to research suppliers having years of experience.

There are many more factors to be considered while choosing a supplier like fees charged and time of delivery. Ensure you are making a profit from the supplier or else find out someone else.

  • Choose a Platform to Sell Online

Before you proceed to sell online, what you must have is a tax ID or a license that permits you to be resale online.

Choosing the right selling platform to sell online will decide your success. Most people choose Amazon or eBay as they are already in the market with huge popularity. 

Set up a seller’s account on such marketplaces, and by agreeing to their terms and conditions, you can start selling online. You have to pay some fees for the products sold on these marketplaces as their commission.

Although Amazon or eBay are the preferred marketplaces, that doesn’t mean you can’t have your ecommerce platform.

Using Shopify, you can set up your ecommerce website and start selling, but this requires a lot of time and spending a good amount of money on purchasing tools for SEO.


Reasons to Choose Dropshipping for Online Business

Want to know why Dropshipping is a wonderful idea to start your business online?

If you are looking to start your entrepreneurship life by earning online, then you should know how Dropshipping can change your life and generate a huge opportunity to earn online. 

These reasons will boost you to start Dropshipping and encourage you to start earning online. 

  • Dropshipping involves very low risk and is, therefore, a popular business model to earn online.
  • You have to pay to the manufacturer only for the products purchased by the customer; hence the cost of investment is very less.
  • You don’t have to keep a large stock as products are directly delivered from the supplier’s warehouse to the customer’s doorstep.
  • Since it is the supplier delivering the order to the customer, you don’t have to make any effort in packing the product and reading it. This reduces the cost of hiring staff for packaging and delivery.
  • Most of the things happening in Dropshipping are automated and require only a click of a button. Like when a customer orders a product, the billing is done automatically to the customer instead of you having someone to prepare the bill and forward it.
  • When the product is delivered to the customer, it is not the manufacturer whose name is mentioned on the bill, and it is your brand name that appears to the customer.
  • You can leave your boring 9 to 5 job routine where you are made to work against your will or passion.
  • You can earn a lot with no boundaries. It is you who have complete control over the market. The more precisely you promote the products, the more likely you will succeed with low investment, low risk, and huge profit.

🌟 Dropshipping Business FAQ

✅ What is Dropshipping Business?

In the dropshipping business, you need to sell merchandise to your own customer from your online store without holding an inventory. From your store, the customers can purchase a product at retail price. You need to forward this order to your supplier who pays you the wholesale price.

✅ Do I need to register a Dropshipping Business?

Yes, Once you start to make a sale, then it becomes imperative for you to register your business. But until you start making a sale, then there is no rush to register.

✅ Do I need an LLC for Dropshipping?

While running your dropshipping business, you need to protect your personal business and personal assets. Therefore it becomes for you to have LLC for Dropshipping business.

✅ Can I start Dropshipping Business with no money?

Yes, several platforms allow you o start a dropshipping business with no money investment at all. Some of the significant platforms are Amazon, eBay, and Shopify.


Final Verdict:

You can make hundreds of dollars if you have a good idea and proper research on how Dropshipping works.

There’s nothing illegal about Dropshipping as you are reselling products online with the supplier fulfilling the order shipment. The only thing required is a valid sales tax ID.

Dropshipping is a huge success and profitable as you have to invest less and earn more.

This is all the information to help you start with your Dropshipping business.

Good luck, Dropshippers!

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