6 Important Considerations Before Starting a Dropshipping Business

As eCommerce entrepreneurs, trial and error is an inescapable part of doing business. Making mistakes is sometimes essential to produce success. However, as much as you can, you need to save yourself from costly mistakes that can hurt your business.

Indeed, there’s no replacement for hands-on experience when dealing with business problems. Matthew Lepre, one of the famous eCommerce drop-shipping business coaches in Australia, has guided many aspiring entrepreneurs when starting a dropshipping store. What people say about Matthew Lepre is a testament to his success in the industry.

According to Matthew Lepre, the expert himself, if you’re planning a dropshipping business, here are 6 things you should consider.

1.  Emphasize product quality

When drop-shipping, product quality should be above everything else. When you look for products, don’t just choose suppliers with the cheapest prices. Make sure to see the products for yourself to check their quality.

There are some suppliers who would compromise product quality and the packaging just to be able to offer competitive prices. Make sure to check product samples to avoid customer complaints that the products didn’t match the ones you placed in advertisements.

2.  Don’t rely on one supplier

Just because your drop-shipping business is doing good with one supplier doesn’t mean it should stay that way. You can easily run out of stock if you rely on just one supplier for a hot-selling product.

A supplier may not be able to keep up with that amount of orders. As a result, you can suffer from a backlog of orders and unable to fulfill them on time. The long delay can also cause chargebacks from angry customers.

To avoid this setback before you start a dropshipping business, try to look for at least 3-5 suppliers for every product. Even if you know that your 1st supplier can fulfill all of your orders, a smart move is to split orders among other suppliers to serve as your backup. This helps you build relationships with other suppliers whom you can reach out to in the future should things go wrong with your 1st supplier.

3.  Invest in good customer service

To ensure the success of your dropshipping business, you need to have a good support team that can deal with customer concerns. Having excellent customer service that can respond to queries promptly can help increase your bottom line.

Remember that customers don’t have access to your suppliers. This is why dealing with queries and concerns as soon as possible is your job. Neglecting this may land a serious blow to your customer satisfaction ratings and result in loss of opportunities.

4.  Think twice about product ideas

Dropshipping saves you from the complex and hassle process of storing and shipping products. However, a wrong choice of products can be a pain. After all, dealing with angry and disappointed customers isn’t really a pleasing thing.

As you start a drop-shipping business, avoid being a letdown by not selling these types of products:

  • Copyrighted – It’s tempting to sell products with a famous brand mark since people want to buy them. However, these items are knock-offs that can cause serious legal problems for your online store and harm your reputation.
  • Fragile and Heavy – No customer will like to receive a damaged item. Fragile products involve a complex delivery process. Heavy items, on the other hand, are not only hard to lift. They also make the delivery process difficult and expensive.
  • Technically Complex – Since you’re selling online, your customers can’t check whether the product is fully-functioning. In dropshipping, the products get delivered directly to the customer, so there’s no way for you to check if it’s functioning perfectly. It’s better to avoid types of products that need a thorough checkup before purchase.

5.  Diversify traffic sources

Don’t rely on only one source of online traffic, as this can cost you plenty of time and money in the long run. Advertising on Facebook is already becoming expensive, that it can eat your profit margins. This means you can get lesser profits as a dropshipper.

Don’t place all your eggs in one basket because when you encounter a problem, you may end up with major profit losses overnight. Make sure that your website traffic is from multiple sources. Establish backup plans when running your online business to become flexible whenever there’s a crisis.

6.  Aim for an international market

When you start dropshipping, don’t just focus on English-speaking countries like Australia and the United States, try Europe as it’s a great market as well. Everyone now loves the convenience of shopping online. As long as you already have systems in place, try selling globally.

There are endless opportunities in overseas markets, what’s more, there’s often less competition for your products. To prepare your store for overseas customers, check if your payment gateway can support different currencies and if there are additional fees to be incurred.

Take Note of Lessons During the Process

Hindsight is a major asset, especially in today’s highly competitive market. It’s impossible to perfectly run a dropshipping business the first time. But looking back at your past trials and errors can give you lessons that will show you the way forward. Learn from every mistake and seek advice from eCommerce experts. Do your due diligence from the start to save yourself from making costly mistakes in the future.

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Christophe Rude

Christophe Rude

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