[Updated for 2020]
Unless you've been living under a rock (or really don't care about this stuff) you probably have heard about all the "crazy money" people are making with drop shipping.
Yes it's true, you can make a fortune with this ecom model but you can also fall flat on your face.
In this article I'm going to tell you how dropshipping works and how you can make money from it.
Note, this is not an actual course on drop shipping but a general overview on how it's set up and the courses of action you need to take.
For a complete course I will make some recommendations at the end of this article for you to consider.
What is Drop Shipping?
If you know already, skip this part. Essentially drop shipping is where you are selling a physical product online without actually keeping it in inventory. You simply advertise a product you find (after doing your research) which is available to ship directly from the manufacturer to your customer after a purchase is made.
You make money by marking up the product several hundred percent. For example, a product you can find that sells for $1, you could sell on your site for $20. When someone purchases it, you place the order with the manufacturer and enter your customer's name and shipping details. Shipping costs are low, and in this scenario your average profit would be about $18,
Here's an infographic that explains the process well:
Where Do I Buy The Products?
The most common place where drop shippers get their products is AliExpress. This store is based in China, where most of your shipping will originate. There are other options but Aliexpress is the most popular.
You also may have heard of Oberlo, which makes it easy to import products to your store as Oberlo interfaces with the website.
Here's a screenshot of AliExpress:
How Do I Get Started?
You'll need a website and the best platform to do this is with Shopify. Get a 14 day free trial with Shopify here.There are tutorials within Shopify and they will help you set up your store - their support is great. There are also free resources online that show you how to do this as well.
What Kind of a Store Should I set Up?
I would strongly suggest that you start off with a general store and not something specific, unless you absolutely have to.
The reason for this is that you will be too limited in what you can sell with a niche related store, for example a store that focuses only on bracelets.. If you have a general store, you can branch out to millions of different types of products. You can still do well with a niche store but I recommend that newbies start with a general store so you can test a variety of different products.
After your store becomes successful with a few products that are related, you could use that data to start a niche based store on those related products. Makes sense?
What Products Should I Sell?
Probably the most asked question that people ask when they want to get into drop shipping. The best advice I can give is to simply copy what others are doing. But, don't just blindly copy another site.
There are tools available that can help you find winning products that will sell, you just have to know how to find them.
You could also check the "best sellers" list on Aliexpress, but keep in mind there's going to be a lot of others testing these products as well.
Paying attention to what is on Facebook is a good start. See how the engagement is with a product. Are lots of people sharing the Ad? Does it get a lot of likes?
Check the date, make sure it's not up for a long time because a lot of products have a typical life cycle. Remember fidget spinners? No one talks about them anymore but if you started selling them when they were in their infancy, you could have made a fortune.
There are tons of ways to find products and this was just a drop in the hat. A good course will give you a lot of different strategies to find products, too much to list here.
Should I do Facebook Ads, Google Ads or SEO?
The short answer would be - all. However that's a hell of a lot of work so in the beginning you should stick with one. If you're an SEO whiz and don't mind waiting for your products to rank, then you could go the SEO route. However, it better be an "evergreen" product so that it's still being searched for long after it ranks.
Facebook ads is usually the go-to type of advertising that all the "guru's" teach. The reason for this is the targeting - you can really drill down audiences to a very specific niche.
For example, if you want to sell fishing lures, you would target people that are interested in fishing. Be careful though, because with Facebook you don't want to go too broad. You want to drill it down to maybe Bass Fishing or Fly-Fishing.
The more specific you are, the more chances you are targeting a real fan of fishing, not just someone who thought a fishing article was cool and liked it at some point. It's highly unlikely they are going to buy a fishing lure just because they liked a fishing story. Know what I mean?
Google Ads are a whole different beast and this will be tackled much differently than Facebook. It's a method that as of late is starting to get some traction and dropshippers are starting to use it. It's not a replacement for Facebook (or could be) but used as a supplement to make even more money.
If you've heard from guru's how they have made millions of dollars in eCom, it could be true, however there is something they might not be telling you.
When you see screenshots of their Shopify stats, you might see a lot of money but how much of that is pure profit? The biggest expense in drop shipping is Ad cost. Next is shipping, followed by Shopify fees and any other costs involved.
At the end of the day, on average drop shippers make between 20%-30% profit. Now I know what you're thinking - that doesn't seem like much. However, If your store made 10 grand one week, pocketing 2-3K a week ain't bad.
Teach Yourself or Get Trained
There's a ton of free training online to help you make money with drop shipping. However let's be honest here - there's little chance you'll be successful, especially if you don't know what you are doing.
I think it's absolutely crazy for someone to go into dropshipping without any training and start throwing money at Facebook ads.
There's so much in between that you need to know and the guru's aren't going to tell you that for free. If they do, how valid is their advice? How dated is it?
With just a smaill investment (my favorite course is only $197) you could arm yourself with all the information you need to get started and make money with your ecommerce/drop shipping business.
Your other option is to find this info yourself, but honestly do you want to spend all that time looking? What if it's bad advice? Be smart about it and invest a little in your education. The money you invest in a good course could pay for itself in a very short time.
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