Looking to start a new business but without the commitment of investing a lot of initial capital? If so, dropshipping might just be the thing for you!
In case you’re new to the whole concept for dropshipping, here’s a brief intro to it:
To put it plainly, dropshipping involves selling products directly from a third party to customers. The profits you make come from the difference between the actual price of the product and the price you’re selling them at. What makes dropshipping one of the most convenient ways of doing business is that you don’t have to bear any warehouse costs — you keep no inventory on hand and ship products to the customers directly from the seller.
Thanks to the ever-increasing hike in eCommerce activities around the world, dropshipping has become one of the most successful modes of business, and the dropshipping industry continues to turn in huge profits each year.
If you’re also looking to start a dropshipping business, you need to keep these factors in mind to get successful.
1. Do not limit your product choices to the best sellers on Amazon or eBay
A common mistake that those new to the dropshipping business make is that they limit their product choices to only the best selling products on platforms like Amazon and eBay. This exposes them to cutthroat competition, against which a new entrant can barely ever survive.
The key to getting good profits, and ultimately thriving, is to avoid choosing products or niches that already have a concentrated seller base catering to them. If you only focus on the best seller products, you’ll find it very difficult to compete with the bazillion other sellers out there, who are selling the exact same thing, that too at much lower prices. Because with so much competition in the market for that particular product, it’s only natural that these sellers will have very competitive pricing as well.
For you to successfully compete against such businesses, your prices must be as low as theirs or even lower. Now, big established setups can afford to set low prices, because the magnitude of their operations and sales volumes are large enough to cover up any losses. But for someone who’s just starting out (and as such doesn’t have a solid customer base), it won’t be possible for you to break even, and you might even end up incurring losses. Your business won’t be sustainable in the long run, and eventually, you’ll be forced out of the market.
In a business where the profit margins are already quite narrow, a far better option for a newly established startup would be to select products that show promise, but don’t have a large number of sellers. For sure, you can take niche inspiration from Amazon or eBay, but you should not consider selling the exact same product.
2. Cheap prices to attract customers
Customers today are becoming increasingly aware and conscious, especially when it comes to online shopping. They scavenge the internet in search of the best deals and only make a purchase after detailed research of their own.
Therefore, the first thing that people do when buying stuff online is to compare prices between various sellers. And why shouldn’t they? Everyone wants a good deal, right? It only makes sense that people would want to use their hard-earned bucks to buy stuff at the best price point that they possibly can.
You might be thinking about how hard it will become for you to search for such products that are cheaper to buy and have more profit margin. FindNiche can help you in this process. It has a big database of more than two million AliExpress products, thousands of niches, and around eight hundred thousand stores related to different niches with their analytics. The various filters would make the product hunting process more straightforward, more accessible and more time-saving.
You can type in your relevant niche in the search box of FindNiche to start the process. Of course, you can take the help of the filters to refine the process. There are tons of low priced products with high margins that you can select from. If you set the price filter to show the results of products that cost less than $5, you’ll be amazed to see the list of high-value products at a low cost. We recommend you to go for the top 10 products from FindNiche’s results.
You can minimize your dropshipping product costs by choosing suppliers that offer good deals and choosing a supply channel that doesn’t include unnecessary intermediaries or mediators in it. Try opting for a shorter, more condensed channel, with a minimum number of intermediaries. Because with each additional intermediary, the cost of your product will be driven up, with the shipping process only becoming more complex and inefficient. AliExpress is one of the best platforms for this, and with the help of FindNiche, it becomes super easy to hunt products.
3. Important considerations: weight, size, shipping country
When deciding on the products for your dropshipping business, it would be wise to consider factors like product weight, size, and country of shipment, when making the final decision. These details might seem unimportant to a novice, but seasoned sellers can understand why details like these can have a significant effect on how well or poorly your dropshipping business ultimately does.
In order to drive down your shipping costs and therefore reduce the final prices for end customers, you should try to choose products that don’t weigh a lot, are compact, and are shipped from a country that you know for a fact has efficient and speedy shipping. This will ensure that your shipping costs and time are both minimized, thus making the overall process more efficient and cost-effective. If you’re using FindNiche, you can do this process easily by using the available filters.
4. Use social media platforms to your advantage
In today’s social media-centric world, social media platforms like Facebook and Instagram have become important tools in the business arsenal. Social media is a vital means of achieving growth. Businesses have started to realize the importance of leveraging this powerful tool in the best way possible.
Especially for a business that’s based entirely online, like that of dropshipping business, it’s of the utmost significance that you pay special importance to maintain and continuously improve your social media pages. Try to keep an active profile on the social media platforms that your targeted customer base is most likely to be active on. Don’t forget to post engaging content on these pages to capture your audience’s interest.
The benefits of maintaining a strong online presence are manifold. Social media provides you with an effective platform to interact with your existing customers and reach out to new potential customers. Market your business right, and you’ll soon begin to see the difference in your sales.
While anyone can create a social media page, the real challenge lies in maintaining it in a manner that attracts and appeals to your targeted customer base. The key is to know your audience and market your brand to them in a way that will draw them in. Social media is also a great way to share your customers’ positive feedback with potential buyers, hence generating positive word of mouth.
Another benefit of using social media is that you can also use it to conduct surveys and polls about what new products customers would like to see on your page.
A significant advantage of social media regarding product hunting is that you can have an idea of most viral products through community trends. You can also spy your competitors for their products that get the most engagement.
5. Achieve effective searching via some essential dropshipping tools
It can be a daunting task to choose which products you should sell via dropshipping. Luckily for us, there are certain tools at our disposal that can help us decide which products would make the best possible choice for our dropshipping store. Not only that, but they can also help us keep track of stocks and prices, thereby helping us make informed decisions about product choices. Such tools will help improve your business’ research and marketing efforts, while also saving you considerable time and money. Sounds like a total win, right?
If you have the resources, we’d recommend that you consider investing in a paid tool like Pexda or ShopGenius. These tools will help you on the journey. With a wide variety of resources, it would be easier for you to conduct your online business, but you have to pay for the tools.
On the other hand, if you are working with a limited budget, you can still reap some of the benefits mentioned above by referring to a free data analytics tool like Google Trends. It’s one of the best free tools out there that help you find the niches with the best sale volumes and overall potential, while also giving valuable insights related to the competition in different niches.
FindNiche, which we've already covered, is also free. This tool is specially developed for dropshippers to find winning products and niches. You can find a lot of niches and products precisely according to your selected criteria. No matter whether you can afford paid tools or not, we recommend you to try FindNiche at least once.
We hope that this article has provided you with value and has helped you in exploring the ways to find winning products. If you have any queries, please don’t hesitate to ask in the comments section.