There's a lot of promise out there about the huge profits made from dropshipping - but is it really true? And what are some important tips for success?
An impressive example of how to create a lucrative dropshipping business comes from our dropshippingXL programme. Vincent started using vidaXL as his supplier one year ago for his eCommerce store, and now earns €50,000 per month.
"I started using vidaXL after three years of experience selling on Amazon. I wanted to change my supplier and chose vidaXL for its range of products that would appeal to the market I had in mind," he says.
"In the beginning, there were some difficulties, as with all new businesses. But, after a few months, I was earning €20,000 per month. One year later, I'm seeing an annual revenue of €600,000. By no means does this happen after 30 days of setting up your dropshipping store, however with the right mentality and business sense, you can find a very profitable niche."
The big question is what exactly did Vincent do to achieve such lucrative numbers? He shares his key tips in this article to help you follow in his footsteps.
It's highly recommended to set aside funds to start your eCommerce business. The idea that you can start with €0 is widespread on the internet but not realistic. While the starting costs are very low, you will need at least €100-€500 to cover the fundamentals.
These will be your basic initial costs:
When starting from scratch you may not want to invest in a professional logo, branding, or custom-made website at this stage. These can be paid for with funds from your first few months of selling. However, if you have the capital ready to go (or you have the professional skills yourself) and you are committed, you can jump right in and get these paid for.
Searching for a trustworthy supplier with high-quality products will make or break your business. To get the most out of the dropshipping business model, it's recommended to find products that aren't going to sell for a very low price. For example, selling €1 items or less isn't going to get very far in terms of profit margins.
There are well-known suppliers that are popular for their huge range of low-cost items. You can take caution in opting for these suppliers to avoid poor-quality products that are saturating the market.
Things to consider when selecting your dropshipping items:
Suppliers such as Alibaba, AliExpress, and DHGate are renowned for slow shipping that can take weeks if your customers aren't based in East Asia. To prevent long delays for your customers, think about choosing a supplier that has warehouses and logistics facilities closer to your buyers.
DropshippingXL has warehouses across Europe, the US, and Australia to make delivery times more efficient for these markets.
As mentioned in our blog post about online statistics, more people are using their smartphones for internet shopping. In fact, 70% of all retail website visits worldwide in 2021 were from a smartphone, according to Statista.
Use this information to your advantage and make sure your webshop is optimised for smartphone users. It's a simple aspect that can be easily overlooked. Essentials for your webshop: fast loading time (three seconds), adaptive menus and pages, larger text, well-written features and benefits of your products, along with calls to action on each page.
Always check the mobile functionality settings in the back-end of your webshop and test on a smartphone device to see how well your webshop functions for on-the-go internet shoppers.
Consistency is the biggest driver of success. It can take months, if not at least one year, to see your dropshipping business really take off and grow. Don't give up. There will be obstacles and challenges, but this is part of business. Keep working on your dropshipping and you will see it pay off in the end.
With these tips, you should be able to make great profits just like dropshippingXL entrepreneur, Vincent. By dedicating time, energy, and resources to your eCommerce business with an eye on the latest buyer trends, you'll soon see the payoff.