Do you believe dropshipping is dead?

Well, it’s not!

An industry review suggests that it is still a profitable income source. However, don’t confuse it with a “earn 100$ a day doing nothing” kind of scheme. When people ask “what is dropshipping?” we simply say that it’s just a method of order fulfillment that does not require to stock products.

Yes, it does sound like an easy method to make money after all the only thing you have to do is sell products of other people and take out commission for yourself, but when it comes to the drawbacks and the challenges that you will face, it becomes hard.

The success mantra in dropshipping is the right approach and with this guide, you will be able to achieve it. Next time you won’t be wrong when someone asks you to define dropshipping?”   

This article will achieve the milestones of explaining the various problems that occur in dropshipping and will walk through the right approach for making money from dropshipping as an e-commerce brand.

Let us begin with the first topic then.

 Problems and drawbacks in dropshipping

Sometimes it can be really hard to maintain the business of dropshipping.

Here’s why:

1. Low profits

It is indeed a fact that the investment required for dropshipping is low, but so is the profit.

The profit works proportionally with the investment therefore, invest more money and get higher returns.

Moreover, you still have to spend your money on marketing and management. Therefore, to maintain everything you need to predict the output.

2. It is very competitive

You will always find competitors who even make a very less profit margin and hence prove the first point wrong.

Since it does not require investment, everybody just jumps in and the market becomes a competition for you and you are also a competition for others.

In easy words, the bigger the market, the lower the margin of profit, and the higher the competition!

3. The supply chain is not in your possession

In a normal e-commerce store, you can easily rectify the issues related to product quality, shipping, and other problems related to the product but in dropshipping, you rely completely on the supplier for this. But still, you have to answer the customers.

Also, the communication gap makes the work really slow. If any of the links of the chain of you, customer, and supplier makes delay in response then the whole chain is affected.

These were some of the major drawbacks that you will face in dropshipping. Let us now look at the proper approach of doing it.

The proper approach of dropshipping

What is dropshipping? And why it seems so hard to you? There’s nothing magical or as hard as rocket science in it and that’s what we are going to prove through this section.

1. Market research

Use dropshipping as a method to test the sales of a product and conduct market research with it. You can predict your profit margin with it and can build an e-commerce business too.

2. Prevent overstocking

You can just stock the product that sells the most and can rely completely on the supplier for the rest. This will save money and resources.

3. Use shipping systems

Make sure that your product does not go too far away from the warehouse of the provider otherwise the shipping cost will increase. Try to send directly from the warehouse to the customer.

4. Avoid products that require high maintenance

What you will earn if you spend most of your money on maintenance? Avoid any product that requires any kind of extra fees or maintenance costs. They will cut directly from your pocket.

So that was all about the current market condition of dropshipping. If you need professional tips for dropshipping then you should read more articles about it to come to a conclusion.