What Is Dropshipping?
Dropshipping is an order fulfillment technique in which the online merchant does not store or ship any of their own products. Instead, merchants enter into agreements with dropshipping suppliers: wholesalers and manufacturers who agree to pick, pack, and ship products on behalf of the merchant.
After the merchant receives a new order on their website, they simply notify the supplier, and the item is dropshipped directly to the customer. The merchant never touches the product.
7 Reasons To Rethink Dropshipping
While there are definitely perks to dropshipping, there are quite a few downsides you should strongly consider before you take the plunge. Dropshipping is not easy, nor is it risk-free. Here are the top seven reasons you should reconsider dropshipping with your online store.
So far, 2021 has been a year full of business achievements. However, there has been a persistent question among the dropshipping audience, which remains a mystery:
– Is dropshipping dead?
– Can’t you turn it into a successful business by 2021?
The business is estimated to be dead and has reached a stage where it is no longer can make you a fortune.
In light of the above questions, we can summarize the fundamental problems that individuals often have with a dropshipping model for eCommerce:
- Delivering the product can take several weeks, which makes customers sad.
- In general, only unbranded products are accessible
- No restraint over your services
- Chinese products and packaging identified as inexpensive/substandard quality
- The process of returns or refunds is excessively lengthy
According to the above remarks, one can conclude that dropshipping isn’t, in fact, the eCommerce world’s outstanding business model. Rather, you can assume that dropshipping isn’t deceased.
Let’s dig into why dropshipping can still be believed as a successful business in 2020 and beyond.
1. Dropshipping is getting more ambitious, not dead yet
The dropshipping business model has witnessed a massive increase over the last few years. The world has become a global community with such understanding and intelligence at the palm of our hands.
As dropshipping has proceeded for several years now, a significant number of people have been jumping the ship in the last couple of years. However, dropshipping has undeniably become too challenging to control on a small scale.
Therefore, individuals don’t see dropshipping as a meaningful action plan to continue with things as simplistic as claiming that the dropshipping business is dead.
Something you should take into consideration while doing business through dropshipping:
Individuals don’t order products from various stores that have an extended delivery period they need. They order the products they desire!
This factor itself justifies that dropshipping isn’t just a terrible model, as a business. You need to sell the products people don’t need but want them!
Therefore, if someone enters your store’s category of ‘consumer electronics.’ and orders any product, the odds are that they might not need it immediately. They can wait, and it is not as expensive as other products, so it’s all fine.
2. It’s tough job, but it yields good results
The reason is that its tough job relative to years ago is probably it’s far more competitive.
Now let’s discuss how will that be paying off?
Since it’s an inexpensive and business with higher returns, a dropshipping store doesn’t take much investment to set up because you don’t have to hold a stock, you don’t have to deliver any product, and mostly you don’t have to employ a lot of staff. Everything you need to do is pick a niche. Otherwise, your store will look like every other store, and you can not project.
Choosing a niche indicates you’ll have to spend much time targeting the market and passing the message through. After doing appropriate marketing, you’ll be selling a whole lot beyond a non-focused online store that tries to enter all the range of products that’s out there.
You can also enhance your business appeal by getting a small lot in your space that you can sell for a value price as ‘Immediate Shipping.’ So, with the elegance of not waiting, you can attract your customers, but for those who don’t want to pay extra, the price and wait would seem like a good deal.
Remember, the entire thing is about the tactic that you use.
3. So is it an ideal alternative for the business in 2021?
Unconditionally it’s a perfect pick without any single doubt. Yet not necessarily if you’re about to mention products in your Magento stores and are thinking about starting selling without much tough work. Ecommerce is not an easy peasy, the Internet is more than ever a busy area, and no one will notice your message until you work hard.
In 2021, an effective Dropshipping involves a few primary changes by picking the dropshipping companies selectively that you want to use.
No one can invalidate a brilliant business opportunity like dropshipping by 2021, or any year for that matter. So take your step forward and start working on it and if you win, you will make a lot of money.
A. Is dropshipping still beneficial?
Dropshipping is unquestionably still beneficial in 2021. But if you consider you can sell and get business only by listing products in your store and without making lots of attempts, then you can’t succeed. You need to understand profitable dropshipping products and all the marketing strategies for your store to use it effectively.
B. Can you name the best dropshipping companies?
There are many companies around the world, but there are few who are doing tremendous work in the field.
Worldwide brands, Salehoo, Oberlo, Wholesale2b, Megagoods, Dropship Direct, Sunrise Wholesale, Dropship Design, Doba, and Inventory Source, are some of the best dropshipping companies.
C. Can you give a list of niches that makes dropshipping successful?
Wireless devices, Mobile Bars, Sportwear, Wearable devices, Baby Care Products, Smartwatch accessories, Men’s Grooming and Personal Care, and Pet Products are the niches that can make dropshipping successful.
Alternatives To Dropshipping
At this point, you might be convinced that I take a dim view of dropshipping, and you’re mostly right. I see dropshipping as a largely unsuccessful get-rich-quick scheme.
However, I am not opposed to every aspect of dropshipping. I think partial dropshipping and outsourcing fulfillment can work very well for some merchants. Here’s how:
Use Dropshipping As An Add-On, Not Your Base
Dropshipping works well when it is paired with traditional selling. Say your store sells high-quality dog treats (which you store in your warehouse — or garage, whatever), and you want to branch out into selling dog toys.
You can easily use a dropship model to flesh out your store with these additional products. Having a few dropshipped products will keep your site from becoming fully dependent on your supplier, and you can still benefit from the simplicity of the model without being fully dependent on it for your store’s profits.
Sell Traditionally But Outsource Your Shipping
This is an excellent option for merchants who can’t store merchandise in their garages anymore and don’t have the time (or the personnel) to pick and pack all their orders.
Outsourcing your warehousing and shipping to fulfillment providers like Shipwire and Fulfillrite can give you the same freedom that you get with dropshipping, but with lower risk. You’ll enter into a contract with that fulfillment partner, so they’re responsible for shipping on time, and you can still be sure of the quality of your products. If your online store is built on the Shopify platform, you even have an in-house fulfillment option. Read about our take on Shopify Fulfillment to see if it might be a good choice for your business.
The only downside? Fees. Fulfillment services can be quite expensive. You’ll have to crunch the numbers to make sure the convenience (and smaller staff size for your business) is worth it.
Sell Traditionally: Pick & Pack For Yourself
Perhaps you’re only just starting out, and you don’t yet have enough sales or products to justify a warehouse. In that case, there is nothing wrong with fulfilling orders yourself! It’s cheaper, and you can make sure it’s done exactly the way you’d like. Once you have an established customer base, you can look to dropshipping as a way to expand your offerings — and your profits.
If you choose this more traditional route, you can still take advantage of some tools to simplify the sales process and make your life easier. One solution: Use shipping software to make everything easier once customers place orders. You can find reasonably priced shipping software you can use to integrate with your eCommerce platform and make it a snap to calculate shipping rates, print shipping labels and packing slips, and even access discounted shipping rates to save you money.