In the recent years, it seems like everybody and their mother has gotten interested in dropshipping. Low entrance barriers, moderate investments and promises of living rich while looking at your laptop from an exotic beach in Bahamas drew quite a crowd to dropshipping.
However, is that the reality that most dropshippers live? And is it possible to make a decent living off dropshipping, if not make a fortune? Let’s find out.
Table of Contents
Pick a lucrative niche
Besides the actual work you have to put in, picking a niche is by far the most difficult part of setting up a dropshipping store. Whether it’s RGB-colored socks or pet grooming accessories, it’s up to you to find a niche that hasn’t been beaten to death and where you can succeed.
There’s only one trick – neither I or anyone else can tell you what this niche is.
By randomly picking about and finding what seems lucrative, you’ll have to guess around quite a lot to find something that will make you rich. It probably sounds like a cliché, but the best advice is to go with something you love and you know a lot about. If that doesn’t work out…
Be ready to pivot
There’s very few dropshippers who made it big and got rich on their first try. The reality is that before any big success, there were at least a dozen failures. One thing in common with all great dropshippers is that they weren’t afraid to fail, get up and try again, looking for a niche that does work.
Get ready to delegate
If you take a look at CEOs, managers, they have one thing in common – they don’t work on their own. Instead, they have entire teams at their disposal, handling different tasks.
At some point in starting your dropshipping store, you’ll realize that the work you have to is becoming overwhelming. At the same time, you’ll have to handle your website, marketing, SEO, social media, fulfillment, shipping and communication with wholesalers.
No matter how competent you are, there’s only 24 hours in a day. As soon as you realize that you cannot manage the work on your own, delegate some of it so that you have more time to focus on the bigger picture.
In order to truly get rich from dropshipping, you can’t allow yourself to spend 3 hours a day handling orders and complaints. Outsource the work to a virtual assistant or someone you know and focus on bringing in more visitors and revenue.
Only those entrepreneurs who look at paying for work as investment and not a spending can get wealthy, whether in dropshipping or not. By delegating work, you’re creating a solid foundation for future growth of your dropshipping store.
Don’t think twice about refunds
Inevitably, not all of your customers will be happy. Sometimes there may be an error on the wholesaler’s part, the item could be damaged in transport or it could simply be different than described. In any case, you’ll get a complaint and most likely, a request for a refund.
Where most dropshippers make a mistake is trying to argue out of a refund or a replacement. While this may make sense in a traditional retail system, it’s not good practice in dropshipping.
For the cost of a single item, you can face negative consequences such as poor feedback on your website, social media and other online platforms.
Instead, chalk it up as a loss and simply offer a refund or a replacement. Think of it as an expense for growing your business and not a loss. There will be instances like this one which you should simply ignore if you want to get rich from dropshipping.
Charge more than you think
One of the biggest reasons why dropshippers fail and don’t achieve success is because they simply don’t charge enough. Here are some of the ways to overcome that and ensure you can make decent money from your store.
First, ask more for shipping. You cannot always precisely calculate how much you’ll charge for shipping, so it’s better to err on the safe side and ask for more. This is especially true if your customer is ordering several items from your store, all from different wholesalers. They won’t be able to combine shipping, and you’ll have to pay 3 different shipping costs.
Second, have higher margins. Most dropshipping stores have margins ranging from 10-30%, which is really not a lot considering the amount of effort that needs to be put in. Successful dropshipping stores have margins from 50% and upwards, because they need room for errors.
You won’t always be able to get the best price, because the distributor only sells one or two items to you, while they could sell dozens to hundreds to someone else. This means that the price you see at the website may not be the price you’ll get.
Moreover, you need to create some room for your ad spend. Before the store gets some organic traffic (and even after that), you need ads to drive buyers to your website. Always factor in extra costs for ads to the final price of the product.
Can you really get rich from dropshipping?
The short answer – yes, you can absolutely get rich from dropshipping. The long answer – you can get rich, but only after picking the right niche and spending significant amounts of time building your store, driving traffic to it and learning a lot about digital marketing and sales.
If you’ve ever wanted to set up your own dropshipping store but don’t know where to get started – we got you covered. At ADSpirine, we take care of everything, from website development, SEO, SEM, PPC and content marketing. We have everything you need to set yourself up to become the next dropshipping success. Contact us today and get started!