How to Make a Success of Drop Shipping

Drop shipping is one of those business opportunities that appears extremely lucrative and operationally manageable on the surface, but in reality can be extremely challenging. However, when done properly the rewards can be extensive if you hit it in just the right sweet spot.

Follow our guidelines below, clarifying a step by step approach to setting up a drop shipping venture. Step one is probably the most important – get this right, and the rest should follow.

  1. Research and Choose a Niche

Do not take a scattergun approach to choosing your products. You’ll end up with far too wide a range of potential audiences, mixed messages and a lot of confused buyers who will turn away from you. (Remember – the confused mind never buys).  Thoroughly research a niche market – understand its wants and desires, its areas of pain. Its challenges. Consider factors such as market demand, competition, and profitability.

Based on your niche, you can then put some time into researching suitable products. For example, your niche may be car enthusiasts who need a well-priced and practical range of car detailing products. Look for niches with passionate audiences and relatively low competition.

  • Market Research

The more you know about your target audience, the better you can curate a range of products that they are going to be interested in. Your market research should go above and beyond simple Google searches (though Google is an essential source of information when it comes to search terms and online buying behaviour of your niche).

Your research should also identify any gaps in the market, which represent the opportunities for you to source suitable products with less competition.

  • Create a Business Plan

You need a plan – a roadmap for your business that will ensure you keep focused on success. A business plan needs to include your business goals, target market, marketing strategies, financial projections, and operational plan. Do not skip this step, as it is your opportunity to highlight potential obstacles and prepare in advance. You can usually download template business plans off the internet, which will guide you through the areas which you need to focus on.

  • Find Suppliers

When choosing suppliers, there are a number of tick boxes they need to check – is the product of a reputable quality? Are they reliable (do they respond promptly to phone calls and emails)? Is the price good and does It give you a healthy profit margin? What is delivery like? The quality of your own service relies solely on the reliability of your supplier, so make sure you choose wisely.

  • Build Your Online Store

There are many different options to choose from when deciding on a shop platform – these include Shopify, WooCommerce, or Magento. If you are fairly competent with simple site building you should be able to build a simple shop quickly and easily. As your business grows it will get more complex, so look for professional help in the future. In the meantime, a simple shop window should give you the start you need.

  • Market Your Store

If you have got your niche right, your marketing endeavours will give you a much higher return on investment when it comes to driving potential customers to your website. Key marketing strategies include a mix of digital marketing channels such as social media marketing, search engine optimization (SEO), email marketing, influencer partnerships, and paid advertising.

Make sure that your customer service is second to none. The happier your clients are from the beginning, the more they will keep coming back with new orders. The lifespan of a customer is an important metric when assessing the success of a marketing campaign.

The range of analytical tools which give insight into the performance of your site is second to none, so keep a good eye on the daily metrics, and don’t be afraid to tweak anything that doesn’t appear to be working as well as it could.

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