Drop shipping items via big retailers such as Amazon, eBay, and via Shopify can be a profitable business that can range from a simple side business to an expansive profitable endeavor. Yet, there are a few things to consider when starting a drop ship business. As I was asked a few days ago, by a colleague with some reservations: “Drop Shipping: Does it work?
What is drop shipping?
Drop shipping is a business model, where you do not hold inventory. After signing up with a whole-seller, you decide
where you want to sell the product and for what price. You then collect the customer information, and money,
forward some of the money (whatever the base price of the product was), and the information
to the whole seller you work with, and they will send the product directly to the customer.
Sounds like a great way to make money right?
Well, as with any business model, there are things to consider:
1. Your main work is still marketing. So if you are not willing to market products, by creating websites, setting
up content, and just assume people will find you, then this is not the business model for you. You have to be willing
to put in the time to reach out via social media, and other traditional marketing strategies to increase your money
2. Finding a reputable drop shipping supplier. In order to be successful, you need easy to work with supplier, who has high-quality products at a low price, in order to keep your ability to make money high. Do your research before settling on a whole-seller and read all of the reviews, before committing to anything.
3. You are disadvantaged over bulk-buyers and resellers. Those who purchase in bulk and hold their inventory
tend to get better prices per items, allowing them to sell the same product for less, which is especially important
on sites like eBay.
Read my article: Passive Income Streams: 7 Quick Tips For eBay Selling Success
So what are the benefits?
1. As I already mentioned, you do not hold any inventory. So if you are looking for starting a business from the comfort of your home, especially as a stay at home mom, you will not have to deal with inventory and the storage of those items.
2. Shipping and packaging are taken care of for you. Again, this takes space and time, which is something most
people starting a business are lacking.
3. No minimum orders – you have very little out of pocket costs, especially when it comes to holding inventory. It costs money to buy items for resale, with drop shipping you do not pay the supplier until you collected the money from the customer.
4. There is a large lack of risk, which is especially important when first starting out.
Drop shipping is the first online business model my husband and I worked on together. It led me to believe that making money online is possible, and it began my journey to assist others in setting up their own profitable eBay stores, and retail websites.
Sounds like a great way to make money to you? Then stay tuned, as I will continue to write about this type of business model over the next few weeks. I am looking forward to sharing my experiences in drop shipping with you!
What you will find out in the rest of the series on drop shipping:
How to find a reputable drop-ship supplier
How to set up an eBay account and store
How to find a great, profitable niche for your drop shipping business
Fiercely Independent Blessings!