What is Drop Shipping?
Drop Shipping is a unique fulfilment method in which, when you get an order on your shop, your manufacturer/wholesaler delivers the product directly to your customer. You can just set up a shop and start selling without worrying about the inventory, storage space and investment. You just pay the manufacturer when a sale is made.
Benefits of Drop Shipping
Minimum Investment: When you are starting a business venture, the safe bet you do is invest a minimum sum upfront. There is a lot to learn and the more you learn you can reduce the advertisement cost and earn more profits. Investment is only a domain name and a website initially. You may need to spend a lot of your time selecting the niche to focus on. Start selling to friends and family and then with minimum advertisement spend to read the traction. If the traction is good, spend more money on it for good conversion. Learn through the process. The more niche you target and the more you learn deep about the niche, the more profitable the investment will be.
Scalable to 6 Figures: What if you end up in a profitable business where you cannot make enough money in the long run. Drop shipping is easy to scale with the comfort of your home. You need to understand your niche deeply and keep adding products with better marketing spend to reach the goal. Drop shipping in India is a very niche. Any brand or a person who is starting now and learn throughout are having better chances of becoming a huge success.
Easy to Start: You do not need to have any special skills or educational qualification. You have all the resources available online to become a successful brand with drop shipping. You just need a domain name, Shopify website and products to sell. Understand the basics of Facebook Advertisement and go by the basics of targeting a very niche audience with the right kind of ad set. The sale which comes in a week or a two week will encourage you to put in more efforts and learn more. Drop shipping is easy to start a business model in India than any other businesses.
Perfect Lifestyle: The brands who do drop shipping for their fulfilment enjoy a near-perfect lifestyle with ample time for travelling and for themselves. You start a brand, learn the niche, get some sales, scale to be profitable in 9-12 months time and just manage that being anywhere. Travel the world, money comes along. This is not possible if you own a physical business or if you go to a 9-5 job or if you are a professional too.
Product Selection: The target market for your business will determine the niche you are going to select for your drop shipping business. Your serving market determines your business future most of the times. You have to do your own research and zero in on a market category like Apparel, Electronics, Toys etc. Your market should be scaling up fast and the product should be fast moving items like Apparels or Electronics, Toys, Accessories etc. Select the product by searching for the buyer market, seller market, selling prices, competition companies, scope on future like product’s market after 5 years etc. The product selection is the most important aspect of the drop shipping business.
Drop Shipper: This is the next important step for drop shipping. Find a suitable manufacturer for your product to drop ship. You should consider the following points while finalizing on a drop shipper,
- You should do an occasional check on their delivery process and product quality by purchasing for yourself.
- Product Selection in your category, you may start with a single product but eventually, you will need more products in your category while scaling up.
- Prices, obvious reason but compare the prices with the quality offered. Cheap product with cheap rates makes less sense these days.
- Drop Shipping process should be simple and you should not get daily headaches while transferring orders and getting reports.
- Willing to take returns for defective products and offer a free replacement.
Getting a first sale will take time and will test your patience. It depends upon the price point, the product you are selling and the market you are targeting. If the combination of all three works great, you will start selling soon or later once you learn. You need to track every metric possible and account of every Rupee spent. Learn and unlearn during the process and make a better campaign next time. Kill the underperforming ad sets and double down on the performing ones.
Facebook Ads are safe to start at the beginning, as it is heaven for marketers to test the niche with minimum investment. You need to keep on changing the Ad sets and improving the conversion rates to drive consistent sales. You can eventually grow out to Google Ads and Instagram Ads.
This is the most underrated part of drop shipping. The one who gets it right gets everything right soon. The niche you have chosen should be passionate to you. You should add value to your customers by offering the product from your brand. They should be glad and delighted to get the product and use it. You should choose such a niche for your product line. It is not about a single product, you need to select many products within the same niche. The value proposition in drop shipping should be made favourable to your customer be in line with your passion. You can add value via your unique designs, the convenience of shopping, a spread of same product variation under the same brand etc.