Here's what you get when you become a Dropshipper with Click and Ship.

If you’ve thought about starting an ecommerce store, you’ve heard of dropshipping. It’s a streamlined approach to order fulfillment where you don’t own or ship any inventory. Gone are the days where retailers have to lease warehouse space, juggle supply chains, and manage inventory. Whether you’re an ambitious newcomer or ecommerce veteran, understanding and using dropshipping could be the key to taking your online store to the next level. Ahead, you’ll learn everything there is to know about dropshipping, from how it works to benefits, and how to start your own dropshipping business today. 

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Key points about dropshipping include:

1. No Inventory Management: Dropshippers do not keep products in stock. They operate as intermediaries between customers and suppliers, facilitating sales without handling the actual inventory.
2. Supplier Partnership: Dropshippers collaborate with suppliers or wholesalers who maintain stock. These partners handle product storage, packaging, and shipping.
3. Order Fulfillment: Upon receiving an order from a customer, the supplier automatically receives the order with all the customer's shipping details and the supplier then ships the product directly to the customer.
4. Focus on Sales and Marketing: Dropshippers concentrate on marketing, sales, customer service, and building their brand, leveraging their time and efforts without the need for managing inventory logistics.
5. Low Overhead Costs: As they do not invest in inventory, dropshippers typically have lower upfront costs compared to traditional retail models.

Dropshipping provides an accessible pathway for entrepreneurs to start an online business without the complexities of inventory management, making it an attractive option for many individuals looking to enter the e-commerce space.

When starting your dropshipping venture, the first step is choosing what you want to sell. Once you've made that decision, head to popular platforms like AliExpress, Amazon, Shein or Temu to source your products. It's possible that other dropshippers are already selling similar products. To determine the viability of a product, a helpful tactic is to head to Amazon, search for the product, and examine the ratings and comments. A product with favorable ratings and positive feedback is more likely to be a successful seller.

Research is key in dropshipping. For success, focus on sourcing best-selling products from these platforms. Analyze other sellers offering the same products to gauge pricing strategies. Utilize platforms like Facebook and other social media channels to gather ideas and kickstart promotions for your items.

Once your selected items are listed on your Click and Ship Store, it's essential to begin promoting your store to attract shoppers. Leverage Marketing by Click and Ship, ensuring your best-selling products receive the attention they deserve. Effective promotion and marketing strategies can significantly boost visibility and drive sales for your dropshipping business."

This perspective emphasizes the importance of thorough research, sourcing best-selling products, leveraging existing seller strategies, and actively promoting products to maximize success in the dropshipping industry.

Benefits of dropshipping

Here are a few other reasons why dropshipping is such a popular ecommerce business model for both large and small businesses.

1. Less upfront capital required

Probably the biggest advantage to dropshipping is that it’s possible to launch an ecommerce store without having to invest thousands of dollars in inventory. Traditionally, a brick-and-mortar or ecommerce retailer has to tie up huge amounts of capital purchasing inventory.

With the dropshipping model, you don’t have to purchase a product unless you’ve already made the sale and have been paid by the customer. Without significant upfront inventory investments, it’s possible to start dropshipping and become successful with very little money.

Additionally, because you’re not committed to selling through any inventory purchased upfront, like in other business models, there’s less risk involved in starting a dropshipping store.

2. Easy to start

Running an ecommerce business is much easier when you don’t have to deal with physical products. With dropshipping, you don’t have to worry about:

• Managing or paying for a warehouse
• Packing and shipping your orders
• Tracking inventory for accounting reasons
• Handling returns and inbound shipments
• Continually ordering products and managing stock level

3. Low overhead

Because you don’t have to deal with purchasing inventory or managing fulfillment centers, your overhead expenses are quite low. In fact, many successful dropshipping stores are run as home-based businesses, requiring little more than a laptop and a few recurring expenses to operate. As you grow, these costs will likely increase, but will still be low compared to those of traditional brick-and-mortar businesses.

4. Flexible location

With dropshipping, a successful business can be run from just about anywhere with an internet connection. As long as you can communicate with suppliers and provide timely service and support that meets customer expectations, you can run and manage your business.

5. Wide selection of products to sell

Since you don’t have to pre-purchase the items you sell, you can offer an array of trending products to your potential customers. Plus, you can rotate or change your dropshipping products list without having to worry about unsold inventory. If suppliers stock an item, you can list it for sale on your online store at no additional cost.

6. Easier to test

Dropshipping is a useful fulfillment model for both launching a new store and for business owners looking to test the appetite customers have for additional product categories, e.g., accessories or wholly new product lines. The main benefit of dropshipping is, again, the ability to list and potentially sell products before committing to buying a large amount of inventory.

7. Easier to scale

With a traditional retail business, if you receive three times the number of orders, you’ll usually need to do three times as much work. By leveraging dropshipping suppliers, most of the work to process additional orders will be done by the suppliers, allowing you to expand with fewer growing pains and less incremental work. Sales growth will always bring additional work—especially related to customer support—but businesses that utilize dropshipping scale particularly well relative to traditional ecommerce businesses. You can dropship on many platforms too, like Amazon, eBay, and Etsy. 

Drawbacks of dropshipping

All the benefits we mentioned make dropshipping a very attractive model for anyone getting started with an online store, or for those looking to expand their existing product offerings. But like all approaches, dropshipping has its downsides, too. Generally speaking, convenience and flexibility come at a higher price. Here are a few shortcomings to think about when considering a dropshipping business.

1. Low profit margins

Low margins are the biggest disadvantage to operating in a highly competitive dropshipping vertical. Because it's so easy to get started, and because the overhead costs are so minimal, many competing businesses will set up a dropshipping store and sell items at rock-bottom prices in an attempt to grow revenue. Since they’ve invested so little in getting the business started, they can afford to operate on minuscule margins. Typically, these sellers will have low-quality websites and poor (if any) customer service, which can help you differentiate your dropshipping business. But that won't stop customers from comparing their prices to yours. This increase in competition will quickly hurt the potential profit margin in a niche. Fortunately, you can do a lot to mitigate this problem by choosing the right products and selecting a niche/vertical that’s well suited for dropshipping.

2. Inventory issues

If you stock all your own products, it’s relatively simple to keep track of which items are in and out of stock. But when you’re sourcing from multiple warehouses, which are also fulfilling orders for other merchants, inventory can change on a daily basis. Fortunately, these days, there are a handful of apps that let you sync with suppliers. So dropshippers can “pass along” customer orders to a dropshipping supplier with a click or two and should be able to see in real time how much inventory the supplier has. Click and Ship also lets merchants take automated actions when a supplier’s stock hits zero. For example, when a product is no longer available, you can automatically unpublish the product, or keep it published but automatically set the quantity to zero.

3. Shipping complexities

If you work with multiple suppliers—as most dropshippers do—the products on your online store will be sourced through a number of different dropshippers. This means you have no control over the supply chain. Let’s say a customer places an order for three items, all of which are available only from separate suppliers. You’ll incur three separate shipping costs for sending each item to the customer, but it’s probably not wise to pass this charge along to the customer. And even when it does make sense to include these charges, automating these drop shipment calculations can be difficult.

4. Supplier errors

Have you ever been blamed for something that wasn’t your fault but had to accept responsibility for anyway? Even the best dropshipping suppliers make mistakes fulfilling orders—mistakes for which you have to take responsibility and apologize. In addition, mediocre and low-quality suppliers will harm the customer experience via missing items, botched drop shipments, and packing or product quality issues, which can damage your business’s reputation<.

5. Limited customization and branding

Unlike custom-made products or print on demand, dropshipping doesn’t give you a lot of control over the product itself. Usually, the product dropshipped is designed and branded by the supplier. Some dropshipping suppliers can accommodate your business’s product changes. Even then, however, the supplier has the most control over the product itself. Any changes or additions to the product usually require a minimum order quantity to make it viable and affordable for the manufacturer.