There’s no denying it you’ll find a lot of misinformation regarding dropshipping online, from so-called ‘gurus’ promising you unlimited riches in an unbelievably short time to disgruntled wannabe entrepreneurs who claim that dropshipping is dead.
The truth is that dropshipping is alive and kicking!
Depending on the approach you take, it can be an amazing business opportunity that can liberate you from the 9 to 5 or end up becoming a total disaster.
We are here to set the record straight and share the truth about dropshipping with you here – the good, the bad, and everything else! It’s not for everyone, but if you follow the right steps, are willing to work hard, and put in the time, it can be an extremely profitable and liberating online business.
Table of Contents
What Is Dropshipping?
Before we get started, let’s quickly define what dropshipping is. Dropshipping is a popular business model that was made possible by the internet and e-commerce. It’s a business where the owner doesn’t carry any inventory but instead relies on third-party partners to fulfill customer orders.
A dropshipping business uses an eCommerce platform such as Shopify to sell these products. When a customer purchases an item from the seller’s website or the platform they are using, the dropshipper orders the product from a dropshipping supplier, who will ship it directly to the customer. In this manner, the dropshipper receives payment in advance from the consumer and can purchase the item from the supplier at a reduced price, generating a profit on each product sold.
Although this business strategy might sound deceptively easy, there is much more to grasp to make it a successful venture. The truth about dropshipping is that it has its pros and cons, like any other sales endeavor. Therefore, before you invest your time into this type of eCommerce business, you need to be aware of what those are.
Why Choose To Dropship as a Business Model?
Dropshipping is an excellent option for entrepreneurs with limited funds and time. It’s a way to start your own business without the hassle of inventory or product distribution. The main advantage of dropshipping is that this model has limited financial risks, as most of the money invested will go towards marketing campaigns, advertising, and building your brand.
It Has a Low Entry Barrier
Dropshipping is a great option for entrepreneurs who want to start their own business on a shoestring budget. It’s also an excellent choice for those who want more control over what they sell in their store but lack the capital required to buy inventory outright.
No Need to Hold Inventory
As well as offering low startup costs, you also save on storage costs as there is no need for warehousing or shipping goods yourself. Dropshipping can even be a more profitable option than wholesale or retail sales due to the lower overhead costs. All you need is an online store and a few suppliers rather than holding inventory or finding space to stock your products. This, of course, means that you also don’t have to worry about shipping or packaging products yourself.
It’s a Low-Risk Business
As dropshipping has no upfront inventory cost, it means there’s less risk involved than traditional retail models. You’ll find plenty of horror stories online of entrepreneurs new and experienced who have purchased a ton of stock, hoping to make money but ended up not being able to sell it. They lost money on the inventory and had to pay for it to be stored at a fulfilment centre or warehouse. This is something you won’t have to concern yourself with if you are running a dropshipping business.
It’s a Flexible Business Model
Dropshipping offers a high degree of flexibility. For example, it’s easier for dropshippers to test out new markets because they don’t need large amounts of capital upfront, and it’s cheaper if the market doesn’t work out. You can also scale the size of your business quickly as it grows without having to worry about warehousing costs.
As dropshipping can be done from anywhere with internet access, it allows you the flexibility to work from home or anywhere else in the world, making it the ideal opportunity for all sorts of people, from stay-at-home mums to digital nomads. Working on dropshipping as a side hustle can also be a great way to make extra money without having any major responsibilities related to it.
However, there are some misconceptions concerning dropshipping which we will now discuss.
Dropshipping Is Not a Get Rich Quick Scheme
Dropshipping will not provide you with quick riches if you’re looking for an easy path to success or fast cash; this is not the business you’re looking for. You might have seen YouTube videos with the ‘insane 24-hour results’ that certain dropship experts are getting and how you can sign-up to their course where they will share their secrets.
There is nothing wrong with joining a course or getting coaching; in fact, we advise it. Just don’t believe any claims that you will achieve these super results fast, and be wary of any ‘experts’ who say you can.
You can read a review of the Dropship Unlocked Masterclass here and the journey you can expect to take when following a genuine and proven program. Our Dropship Unlocked review will give you a balanced view of the challenges you will face and why joining a lifetime mentorship program such as this is such a smart move.
It’s important that you have a clear understanding of how it works so that you don’t get caught up in unrealistic expectations about earning lots of money quickly in any niche. If you seriously want to start dropshipping the right way, then it will take time, just as with any other kind of sales.
You’ll need to put in some work and be smart about your strategy if you want to make any money. That said, there are plenty of people who have made six figures or more by running successful dropshipping businesses.
Dropshipping Is Not a Scam
In contrast to the get-rich-quick guys, you have the ones claiming that dropshipping is a scam. Typically, they have an ulterior motive – to sell their online business method. They will extoll the benefits of their affiliate marketing, Amazon FBA, or blogging system and attempt to persuade you that dropshipping is not worth pursuing. Essentially, it is designed to make you doubt your decision to drop ship and follow their path instead. Often the author will have no real knowledge of what a real dropshipping business is. Take what they say with a grain of salt!
Another example of a person who commonly calls out dropshipping as a scam is someone who has actually run a dropshipping store and failed. You will find these sorts of people in places like Reddit complaining how it didn’t work for them, so it must be a scam. We will discuss some of the pitfalls and things to avoid shortly, but you can guarantee they are sure to be making at least one of these mistakes.
Many of these disappointed dropshippers will start selling using outdated methods such as setting up a Shopify store and filling it with products from AliExpress. They will end up with many complaints and returns from customers about slow shipping times or low-quality products, and the whole business will be a complete headache. That is, of course, if they get any customers at all!
Often they will piece together things they have read on the Internet with some YouTube videos and try to build a cohesive system of their own.
I mean, what can go wrong? A customer buys it from the site at one price, and they buy it from the supplier at a cheaper price, and you take the profits. It’s not rocket science, right?
Well, have they taken into account shipping costs, ads, taxes, finding the right product or niche, the right supplier, and all the other missing parts of the puzzle? Probably not.
This is the reason many dropshipping stores don’t succeed, and the failed entrepreneur decides it is a scam before moving on to the next shiny object.
It is often asked online, is Dropship Unlocked a scam? Well, the best way we can answer that question is by pointing you to our website blog, where you can read dropshipping reviews from real dropshippers who have joined their program, and you can make up your own mind.
Dropshipping Is Not as Easy as It Seems
Dropshipping allows entrepreneurs to start their own business with little capital, hassle, or risk. It’s an amazing opportunity for anyone looking to enter the world of eCommerce and own their own store to make a good profit, but it’s not as straightforward as it first appears.
One of the realities behind dropshipping is that it can be difficult for beginners with no prior experience in entrepreneurship or marketing to get started independently. At first glance, it seems easy, but there are hidden difficulties that take some time and knowledge to overcome.
Everyone will encounter their own challenges and roadblocks. The best way to learn is from a successful coach like Lewis Smith from Dropship Unlocked, who is in the trenches, so to speak, and who will steer you on the right path to success in this kind of sales. This can be the difference between a failed dropshipping business or an extremely successful dropship business.
It’s Low-Risk, Not No-Risk
Dropshipping is a low-risk venture to get started, but it’s not no-risk. As we have already discussed, It is low risk because you’re not required to buy any stock upfront and don’t need to pay for storage costs.
However, dropshipping does have other costs, such as expenses for advertising and market research. If you don’t get this part right, it can be a risky business model.
The other risk is that of wasting your time – if you don’t get dropshipping right, it can be a huge waste of time.
That’s why following the right training or working with a dropship coach is important. With a proven roadmap, you can reduce the risk of wasted hours or ad spend and build a more resilient business. Just make sure the coach you choose is actually running their own stores and has ‘skin in the game’.
Dropshipping Mistakes To Avoid
First of all, you should understand dropshipping requires time and effort. Don’t come into it with the attitude that it’s all going to be a walk in the park and that limited effort will be needed on your part. It’s not a passive income model; dropshipping takes work. It can be fun, but it also needs proper control and discipline.
There are certain dropship mistakes you should avoid to become successful. It’s not as easy as just opening an online store, choosing to dropship, and then sitting around waiting for customers to buy from you.
There are some common dropship mistakes that inexperienced dropshippers tend to make, including:
Selling Products of Low Value
Many newbie dropshippers go wrong because they don’t realise it is just as easy, if not more so, to sell one high-value £500 product as it is to sell fifty £10 products. A business that offers a dropshipped high-value product has an opportunity to make more money than the dropshipper that focuses on dropshipping low-cost items. Dropshippers who sell products at too low of a price often struggle with meeting their bottom line because there is less margin for profit.
Not Using Local Suppliers
There once was a time when customers would be fine waiting for days or even weeks when ordering online for a product to arrive. But not now; with plenty of eCommerce sites offering next-day delivery, shipping from overseas sites such as AliExpress is no longer a viable option to improve sales and increase customer satisfaction. As we’ve seen during the COVID-19 pandemic, you have little control over Chinese suppliers’ shipping times or logistics.
Using local suppliers who speak the same language, operate in the same time zone, can offer next-day delivery, and have no issues with returns will dramatically increase your chances of dropshipping success. Not only can you communicate better, but you’ll also have higher levels of customer satisfaction. Dropship Unlocked describes this as the ‘Home Turf Advantage’ – selling high-quality products directly to the customer from the UK will give you the best product margins possible.
Not Sticking With It
Not all dropshippers get great results straight out of the gate; it takes time to build momentum. But those who quit too early are missing out on its long-term potential. Dropship businesses can have slow growth at first, but it does work well as an established business method, and if done right, you can achieve reasonable returns on sales in a relatively short time.
It’s a good idea to be patient and keep your focus on your desired goal. Those who can’t persevere through the early stages of their dropshipping business struggles will find themselves giving up quickly. That’s why dropshipping is a good method for entrepreneurs who can tolerate a slow, steady growth rate and are prepared to stay committed over the long term.
Yes, it takes time and effort, but you will likely find success and profitability if you stick with it.
Not Considering the Long Term
It’s always fun to jump into a new enterprise and get started making a profit, but if you don’t start with the right strategy based on market research, it can impact your business at a later date. It can be tempting to find trending cheap products on AliExpress that fly off your virtual shelves, but when the negative reviews start coming in, and your supplier is getting later and later shipping products to your customers, it becomes a recipe for disaster. When you start getting too many refund requests (that you’ll have to pay for), you can even get your merchant account shut down.
The watchword is ‘sustainability’; you want your dropshipping business to be there for you today, tomorrow, and ten years from now.
Not Finding the Best Suppliers
When dropshipping, your supplier is everything. If you don’t find a good supplier, the success of your online store is virtually impossible. Dropshipping is all about relationships with your suppliers and finding the best companies to work with.
You want to focus on a supplier who can provide good customer service and high-quality products that meet your standards but also fit within your niche. The old saying “you get what you pay for” holds true in dropshipping, and by working with quality dropshippers, you’ll have better products that give your customers a great experience.
This is another area that new dropshippers don’t consider when starting out. They open their store and then ‘crickets’ no customers. After a few days, they start googling like crazy and discover that they need to run ads. The gurus tell them that social media is the place to be, and dropshippers open accounts and start spending money on social ads like Facebook. Little do they know that by relying on Facebook adverts to sell their products, they will waste money and find it very difficult to scale using this advertising method profitably.
The most optimal way of getting your products in front of potential customers is Search Intent Marketing which is the art of using search terms on Google and other search engines that are relevant to what you sell. Of course, Facebook and other marketing platforms have their uses, for instance, for strengthening brand.
As a dropshipper, you aren’t expected to reinvent the wheel, but you should still consider establishing your brand. The fact that dropshippers are selling other people’s products doesn’t mean they don’t have to look after their branding or think about the marketing and promotional side of things.
Dropshippers can use marketing techniques such as sending out emails to attract customers back to their site or posting on social media sites to promote their brand.
Going it Alone
One of the biggest misapprehensions that brand new dropshippers make is that they don’t need any help and can figure out all this stuff themselves. So, they read a few dropshipping guides and try to implement the dropshipping process without any help. They do this for a few months, and their results are poor, so they give up. It’s important to keep things in perspective; dropshipping is not rocket science, but it does require some education and constant learning. One of the keys to dropshipping success is to follow in the footsteps of experienced dropshippers.
If you plan to dropship on your own, without any training or coaching, good luck; you’ll need lots of it to succeed!
The Truth About Dropshipping: In Summary
The truth is, it’s not easy to succeed as a dropshipper. Still, if you’re willing to put the time and effort into your store, it offers you the opportunity to build your own business from the ground up and become financially independent.
Dropshipping is not a way to get rich quickly; it can be hard work, but it can also be an enriching experience.
Does dropshipping still sound like the opportunity you have been looking for after discovering the business’s realities? If so, you should think about investing in a proven system from an experienced dropshipper to guide you through the process and make your dropshipping dreams come true.