Do you want to open an online shop but only have a small starting capital? Then DropShipping could be exactly what you are looking for. Here you offer your customers products that you neither produce nor have to have in stock! All you need is a trustworthy wholesaler and a sense for which products are in high demand among consumers.
Does what we are saying sound interesting to you? But you have never heard of DropShipping? Then read on to find out everything you need to know about this modern form of business in online retailing. We will tell you exactly what DropShipping is and how it works. You will learn who CJ DropShipping is, which DropShipping tools will help you and how to find successful DropShipping products.
What is DropShipping?
DropShipping is a popular delivery method for online retailers. They do not purchase their products in advance, but instead have them delivered directly to their customers by the supplier after the order has been received. Your customers do not notice that you yourself never owned the product. And as a retailer, you do not have to purchase goods in advance that may never be purchased. Expensive warehousing is also no longer necessary. All you need is a small budget to finally be able to enter the e-commerce competition. And with an extremely wide range of products to choose from.
Until now, the term drop shipping was often used in German-speaking countries for drop shipping. However, the English alternative, also known as “fulfillment”, has since become established. Basically, drop shipping is divided into three areas depending on your supplier:
- If you use a wholesale warehouse, you have access to the entire product range. Restrictions only apply if the product itself is no longer available from the wholesaler.
- If you use a consignment warehouse, you have exclusive access to a pre-defined storage area. While you are guaranteed to always receive your desired products here, many contractual partners demand higher costs or a minimum of mandatory purchases.
- If you use an on-demand supplier, they will only manufacture your product after you have placed your order. This is particularly suitable for customizable goods. You can define the details of the contract individually.
How does drop shipping work?
Let’s take a look at how exactly drop shipping works. Your task as an online retailer is to advertise your goods. The following is a step-by-step guide to how you should proceed when setting up a drop shipping business:
- Decide on your product range: Choose the specific range of products you want to sell through your online store. This could be anything from the most popular, trending goods to niche products.
- Selecting suppliers: Now you need to find a reliable dropshipping supplier. Finding the right partner here is of the utmost importance. Because your choice influences the quality of both your drop-shipping products and their shipping. On the internet, you will find numerous drop-shipping tools that serve as interfaces to various suppliers. Many drop-shipping software also offer marketplace connections such as to eBay or AliExpress and a direct integration of the products into your shop. CJ DropShipping is an all-in-one supplier platform that specializes in drop shipping. It would be a good starting point for you in your new business model.
- Creating the online store and acquiring customers: You have found a supplier, created your online store with marketing agencies or online store systems, and attracted potential customers to your store. Then the first orders come in:
- Customer order and forwarding to the supplier: As soon as a customer places an order in your shop, you forward the order to your dropshipping supplier. At the same time, you confirm to your customer that the goods will be dispatched quickly. The supplier packs the goods and sends them directly to the customer. If you ask your supplier to use your logo as the sender, the dropshipping will not be apparent to the customer.
- Customer service and returns management: Although your supplier takes care of shipping, customer service remains in your hands. You are the point of contact for your customers for questions or complaints. You take care of billing and also handle returns.
The business is worthwhile for you due to the price difference between the amount your customer pays and the amount you pay your supplier.
Which products are best for drop shipping?
Which DropShipping products should you choose? Making the best selection of goods proves to be a big challenge. Your success as an online retailer stands and falls with your offer. However, since you don’t have to make any advance financial payments, you can also experiment a little. In addition, DropShipping offers you the huge advantage of updating your inventory effortlessly. As seasons or trends change, you can easily exchange products thanks to high-quality DropShipping tools.
However, don’t just pay attention to what’s trendy right now. In addition to demand, the quality of the products and the fastest possible production time are also important. Find the optimal balance of demand, competitive prices and feasibility to increase the attractiveness of your goods to your target groups:
- Find a supplier with high quality standards. If the orders meet the customers’ expectations, they will order from you again.
- Make sure your prices are competitive. You don’t have to be the cheapest, but you should align your prices with your target group and your competitors.
- Give your products a unique selling point. Include some niche or particularly exclusive products in your range.
- Ensure fast production and punctual delivery.
If you still want to know what is currently in vogue, social media and online marketplaces are helpful sources of information.
