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If you have ever thought of starting your own business, then you might have come across the term DROPSHIPPING.
But what does it truly mean? Is dropshipping right for beginners? How to start dropshipping? And most importantly, how does it work?
As a beginner, there are a few things you need to know before you get started.
In this blog, we will clear your concept around dropshipping, discuss how to start dropshipping from China & a step-by-step approach to establishing a profitable dropshipping business.
What is Dropshipping?
Dropshipping is the process of delivering goods directly to your customers from a supplier or vendor without having a physical business location (such as a storage or a warehouse).
In a nutshell, dropshipping is the act of selling goods without getting involved in the process of goods storage, order fulfillment, and shipping of products.
A notable benefit of starting a dropshipping business is you don’t pay for the goods until the customer pays for them.
Thus, dropshipping from China is a profitable option for all those who don’t want to pay much for the initial inventory or don’t want to risk buying items that won’t sell.
With so many green flags, starting dropshipping from China is considered a brilliant choice for beginners as well as professionals, where they can pick their own niche of products and run their own dropshipping-based eCommerce stores.
About 27% of online retailers today primarily use dropshipping to fulfill customers’ orders.
(Appscenic)
Why Should You Start a Dropshipping Business?
Dropshipping from China is a popular business model for new business owners to start making money online.
If you own an eCommerce store & looking to earn profits without spending much on inventory or taking up too much of responsibilities, then look forward to this business.
Dropshipping for beginners is a brilliant option for several reasons:
Zero Up-Front Cost
This might be the biggest benefit of starting a dropshipping business, where the business owner (you) only buys the product when the customer does.
This eliminates the risk of purchasing products that may or may not sell and brings the up-front cost of products to zero.
Flexibility
This is no bar on how few or more products you will sell to your customers. Sell as many (or few ) products as you want.
Furthermore, you can work whenever and from wherever you want, even staying in the comforts of your home.
Reduced Risk
Since you don’t have to pay for inventory, there’s a lesser risk of losing money due to lost merchandise. Moreover, when you dropship from China, the products are shipped directly from their warehouses to customers (taken care of by drop shippers).
This eliminates the chances of any product being damaged.
Access to a Wide Variety of Products
In dropshipping from China, you are freed from pre-purchasing the products before they get sold. Rather, you can count on your drop shipper to dropship China products that come with a wide variety of product niches.
This gives you the flexibility to work on your product line and sell a variety of high-demanding products.
No Logistics Handling
For many business owners, packing, shipping, and fulfilling orders is a big headache.
Dropshipping for beginners is a big relief because you don’t have to go through the hassle of keeping track of the orders, preparing for shipment, and protecting the items till they are handed over.
No Physical Inventory Storage
Dropshipping business eliminates the need for having any physical inventory storage.
As a business owner, you can easily expand your choice and variety of products. Since you don’t need to store any of your products, it boosts the scalability of your business.
By 2023, the global dropshipping market is anticipated to reach a market cap of $243 billion.
(Grandview Research)
Why Do Businesses Prefer Dropshipping From China?
Being a global manufacturing hub, China is a sought-after destination for most businesses to source products for their online stores.
The reason is simple: dropshipping from China is highly profitable for businesses.
The products sold in China are incredibly cheap due to their low production costs, which is why starting dropshipping from China is so popular among eCommerce platforms.
So, wondering how to start dropshipping from China?
If you are planning to set up your own eCommerce and then start dropship from China, the following perks will help you achieve better profit margins for your store.
Vast Selection of Products
China is known for offering a wide variety of products to businesses of different sizes. Its diversity allows wholesalers and drop shippers to explore various niches and product types.
From office supplies, outdoor products, and electronics to fashion and virtual giveaways, China wholesale dropshipping service can offer you everything.
Cost Effective
This is the primary reason why most businesses prefer dropshipping from China. Products procured from China are much cheaper due to their low labor and production costs.
This cost-effectiveness results in higher profit margins for drop shippers, especially when purchasing power is high.
Scalability
Chinese suppliers are capable of handling large volumes of orders, which helps businesses to scale faster.
As your dropshipping business grows, these suppliers can effortlessly handle the increasing demands without any delays.
Ease of Finding Suppliers
Platforms like PapaChina and Alibaba make it relatively easier for eCommerce businesses to find unique promo items and trade with Chinese suppliers.
These platforms also provide a level of transparency and security in transactions.
Customization & Private Labelling
Chinese suppliers specialize in offering customization and private labeling to branded products.
This aligns closely with market demands helping an eCommerce business grow faster and stand out with an array of trendy promotional items.
Ecommerce Integrations
Chinese suppliers are familiar with the needs of eCommerce businesses, and thus they provide integrated features to work seamlessly with drop shippers.
How Profitable is Dropshipping for Beginners?
Dropshipping from China is known to be a profitable business model with tremendous opportunities for quick growth.
Dropshipping for beginners is worth the investment if you’re someone looking for a low-cost, small business idea.
In fact, drop shippers can earn over 50% more profit than those who keep their own stock inventory.
As a business owner, since you don’t need to worry about overstocking and warehouse costs, you will have fewer expenses other than working on your business model.
On average most dropshippers gain 15% to 20% profit margins. Of course, if you can generate higher profits, that’s commendable.
It is important for drop shippers to offer a variety of distinctive products & cheap promotional items that have a high demand in the market.
This strategy not only sets them apart from competitors but also caters to a broader range of customer interests.
Profit margins in dropshipping typically range from 10% to 30%. Stores with social media profiles often see 32% higher revenue.
(Shopify)
Step By Step Process to Dropship from China (For Beginners)
Step 1 # Choose A Dropshipping Business Idea
Just like any other business, dropshipping from China takes significant commitment and a few set targets to climb the ladder of success.
If you are thinking about how to start a dropshipping business, then it is quite simple.
The journey starts with choosing the right dropshipping business idea that turns out to be profitable.
Alongside opening up a retail store and looking into competitors and market trends, start investigating a high-demand niche you’re interested in.
Do extensive research about that product line, say Holiday Gifts, and estimate the returns it can earn you.
Some popular examples of such product lines could be:
- Customized Mobile Phone Cases
- Yoga mats for meditation lovers
- Exercise equipment for fitness folks
- Personalized T-shirts for the fashion-savvy
- Dog crates for pet owners
- Vitamin C Serums for skincare enthusiasts
Step 2 # Do Competitive Research
If your niche has a lot of competitors in the market (which is a good thing in dropshipping), keep your research limited to about 2-3 big players, like Amazon, Alibaba or PapaChina, it will help you stay focused and plan your next steps.
Make a note of everything about your product line from your competitors: the websites, prices, marketing strategies, best-selling products, content, etc.
It is important to keep your research in a file so that you can refer & compare as and when needed.
The most popular category for dropshipping products is clothing, which accounts for 20.8% of the market.
(Growth Devil)
Step 3 # Choose a Dropshipping Supplier
Choosing the right dropshipping supplier is a critical step toward starting a successful dropshipping business.
You need a reliable supplier that aligns with your business model and understands your needs & priorities.
By now, you’ve vetted what dropshipping products best fit your business for online retail.
Next, it is important to find a supplier that offers you high-quality services that you can rely on.
Global brand marketing hubs like PapaChina are unique marketplaces that support businesses and escalate dropshipping from China to the next level.
Whether it is electronics, fashion, office supplies, or eco-friendly promotional giveaways, one can find products with good profit potentials from dropshipping suppliers around the world.
Along with a diverse collection of popular product lines like custom promotional items, these online suppliers are also committed to making your dropshipping from China a breeze.
84% of eCommerce retailers cite that the biggest barrier to starting their dropshipping business is securing a good supplier.
(Shiprocket)
Step 4 # Build Your eCommerce Store
The next important step in the process of dropshipping from China is building your own online retail store.
E-commerce platforms like WooCommerce and Magento can help you build and launch your online selling space.
Dropshipping from China streamlines the entire eStore setup process, from finding a suitable domain name to adding sales plug-ins. Your setup activities must include everything that makes your business ready and allows you to handle global clients.
Your eCommerce store will be the home where you drive online traffic, sell products, and process payments.
It should be a complete commerce platform that allows you to maintain your purchase history, keep track of orders fulfilled, and sell products in multiple currencies.
Step 5 # Promote Your Products
If you want your business to stand out in the market, it is important that you use innovative ways to promote your products.
It can be tradeshow giveaways, employee appreciation tokens, community event mementos, corporate swags, or personalized gift ideas.
However, marketing and advertising efforts primarily depend on the budget & target audiences.
One can yield results faster if one uses marketing channels that align with the predominant preferences of their audience.
Here are a few ways of automating your marketing process through online advertising platforms. These will help you quickly find customers who are ready to buy from you.
Using such marketing channels, you can easily dropship from China & find incredible scaling opportunities down the line.
Facebook Ads
Running Facebook Ads for dropshipping is relatively easier than most conventional marketing methods.
These Ads are scalable, and products do well on them. With such a mass appeal to a global audience,
Facebook can easily tap into people’s desires & encourage them to buy items like summer promotional giveaways & more.
Google Ads
Promoting your products through Google Shopping Ads is also an effective way to attract buyers from around the globe.
There’s typically more price competition with Google Ads, however, if it suits your budget, it is worth trying it out.
Mobile Marketing
You can also connect with your customers on their mobile phones.
For example, you can start a special membership text club & encourage your loyal customers to sign up for exclusive deals & special orders.
Email Marketing
Marketing your eCommerce store by sending targeted and personalized emails to your clients is a brilliant promotional idea.
You can mail promotional offers, product recommendations, and informative newsletters to your customers to increase engagement & boost sales.
Such initiatives build long-lasting relationships & drive repeat business.
Content Marketing
If you want to increase your ROI and maintain a constant flow of traffic to your store, add content marketing to your dropshipping business plan.
Share blogs, start a podcast, or make video content on YouTube around the dropshipping niche.
This will educate your target audience & promote brand awareness.
Social Media Community
Engage with groups of people who are passionate about your niche through social media.
You can join groups on Reddit, Facebook, Instagram, LinkedIn, & other online forums, & start conversations with potential customers. This will boost sales & build trust around your brand.
Dropshipping can increase the profitability of an eCommerce store by up to 50% compared to onsite inventory management.
(Fundera)
Step 6 # Analyze and Improve Your Offering
After successfully marketing your online dropshipping store, it is time to examine and evaluate your offerings.
It is important that you thoroughly analyze the process & answer some of the important questions about your store.
Sales
– What are my best-performing marketing channels?
– Where should I spend more money?
– What are my top-selling products?
Customer Behavior
– Are people buying more from desktop or mobile?
– What’s the conversion rate for each device?
– Who are my loyal customers?
Profit Margins
– Which product lines maximize your profits?
– What products & variant SKUs are the most profitable?
– What can my sales & gross profits look like every month?
You can also use analytic tools and the Search Consoles to measure your website traffic over time & enhance your SEO efforts.
Moreover, if you are using a third party for social media, check the reports monthly to make sure your business model is working efficiently.
Launch Your Own Dropshipping Business Today!
Whether you are a beginner or a pro-business owner, dropshipping from China is always a low-risk and low-cost way to start selling products online.
Now that you know how to dropship from China & clearly understand the strategies to boost the KPIs, It’s time that you start your own business & make smarter decisions for your online store.
