Dropshipping for Dummies

November 10, 2020

So, it’s that time of year again… the beginning of holiday madness. It’s also the time of year when online sales go through the roof! Everyone’s looking to buy costumes, candy, decorations, and accessories, so there’s a lot of money to be made if you know what you’re doing.

Don’t worry even if you’re a complete beginner. In this article, we’ll walk you through the basics of how to make money from dropshipping this holiday season.

The tips and methods shared here on how to start a dropshipping has been used by professional sellers and online retail giants all over the web… but despite the method’s popularity, it’s still perfectly usable and there’s no risk of too many competitors getting in the way of you and all the sales you will make.

Last but not least, as a long-time professional sellers. We understand that getting the right supplier and product idea are the most critical steps to making this a success, yet it also poses the most hindrance to new entrepreneurs.

This is why at the end of this article, we’ve included a list of top dropship suppliers you can use this holiday season, courtesy of SaleHoo. These dropship suppliers are fully vetted so you can be sure they are legitimate, and the products you dropship from them are of high quality.

How to start a dropshipping Business

You’ve probably seen the success stories of e-commerce entrepreneurs like Johnny FD and Anton Kraly and wondered if you can do the same.

Dropshipping is a simple, low-cost way to get started in eCommerce and has the potential to make a significant income.

What is dropshipping?

Dropshipping is an eCommerce business model or fulfillment method that allows you to sell physical products without buying or holding any stock of your own.

You have to find a great product to sell and connect with a reliable supplier that offers drop shipping as a service.

You then list that product for sale on an online marketplace or your online store and start making sales.

This is how dropshipping works…

  1. A customer purchases your product from your online store at retail price.
  2. You place an order for that product with your supplier and pay a wholesale price
  3. Your supplier packages and ships the product directly to your customer
 

You don’t have to buy bulk stock, pay for extra storage space, or deal with shipping, and your profit is the difference between the wholesale price and the retail price. Easy, right?

The benefits of using drop shippers

Maybe you’re just getting started with your dropshipping business, or perhaps you’ve already got one set up with suppliers in China.

Either way, you should seriously be thinking about using dropship suppliers for your business.

Here are five benefits of using drop shippers :

Low Financial Commitment

Financially speaking, dropshipping does not require much (or any) money to get started. Simply because the business model itself allows you to run a full-blown e-commerce store without having to rent a space and store physical products on your own, which is the bulk of the expense for most entrepreneurs.

Greater Flexibility

Because you have no inventory, you are not limited to what you have in stock. For example, if you are selling a pair of shoes, you don’t have to limit your offer to any size or color. You can have an auction catalog that is as extensive as your suppliers, which helps generate more sales.

Low Risk

When you’re offloading the risk of storing unsold products to suppliers, you get to experiment with different types of products and determine for yourself which one will eventually sell.

Dropshipping is a great way to test the market to see what sells and what doesn’t. If an item is slow-moving, it is easy enough to take it off your list of offerings so that you can concentrate on marketing the things that do sell. Of course, you can always keep the runts of the litter, so to speak, around in the off-chance that it will sell. You have nothing to lose, after all.

Easier to Sell

While sourcing the right supplier may not be easy, but once you do (and we will show you how later on) selling the product is just a function on how well you get eyeballs on the product. Which is much harder if you have an inferior product.

Top places to find dropship suppliers

There are a variety of places to find reliable dropship suppliers. Here are some of the best ways to get started.

Google

Simply searching “dropship suppliers [insert local area]” on Google is an excellent way to find some of the best-known suppliers in your area. You can even narrow it down by searching by regions, such as California, Chicago, or Texas. While the companies that show up as the top results on Google are likely to be reliable and accessible, they may not have the best prices, so it’s best to look around a bit and negotiate prices.

SaleHoo

Using a reliable supplier directory like SaleHoo is a great way to find suppliers you can trust. They vet every supplier in list to ensure they’re safe and secure and that they sell high-quality products. You’ll get company information, contact details, and even scripts to use when communicating with suppliers. It’s the safest, most straightforward way to dropship.

Disclaimer: The suppliers you’ll see below are sourced directly from SaleHoo. It’s a small sample, but you’ll find suppliers’ name and description for more than a dozen niches. If you like more in-depth analysis and broader selection of drop ship suppliers, I highly encourage you to check out their directory.

Trade Fairs

If you want to meet suppliers in person, head along to local trade fairs and see if any of the suppliers in your niche offer dropshipping. Trade fairs are a great way to build rapport with suppliers and start a business relationship on the right foot.

Facebook Groups

Join Facebook groups related to dropshipping and eCommerce, particularly ones that are focussed on the US market. These online communities are full of people who are experienced in this area and they may be able to refer you to dropship suppliers in the US. If you engage in conversation and contribute to the groups, you’re likely to get more help from those in the know.

What to look for in a dropship supplier

So you’ve found a few dropshippers in your niche that you’re keen to work with. That’s great! But first, you want to do some research and make contact with each supplier to ensure they’re the right fit for your business. I recommend contacting 3-5 suppliers before deciding on who you want to work with. Here are a few things you should check before committing to a dropship supplier.

When you’ve decided what you want to sell, the next step is nearly self-explanatory; find a person who can supply it for you!

Of course, just because it’s obvious doesn’t mean it’s easy. Finding someone to supply can take quite a bit of time, and that’s presuming you find a supplier that’s honest and helpful.

If you want to find a supplier, there are two ways:

Wholesale directories are the first place to go – SaleHoo is a popular one, but it’s not the only one. As you might suspect, these are directories full of wholesale suppliers. The best are carefully organized and searchable.

These directories can make it quite a bit easier to find those suppliers you need. If you really want to find a good supplier, you may want to look into membership-only directories. They may charge a fee, but they also tend to do background checks and other checks on supply companies in order to ensure they’re legitimate.

Google search – If you haven’t figured out how to use Google by now, then you probably shouldn’t be trying to sell things online! It’s fairly simple to do a Google search, and you’ll no doubt get a large number of results if you have a few useful keywords.

That said, there are a number of things you have to watch out for. It’s hard to tell if a company’s website looks terrible because the company is terrible, or if they simply don’t have the money for a good website even though they’re a good company. And then there are the companies that spend plenty on marketing so that they don’t have to spend anything on actually helping customers. If you’re considering an unverified supplier, be cautious.

Contacting A Supplier

Once you have a few different suppliers that you’d like to do business with, it’s time to actually make contact.

We always recommend a telephone call rather than other forms of communication. Email contact is helpful since you have everything in writing. But for the initial contact, it’s helpful to speak directly with the other person. It will give you a much better idea of who they are and whether or not they’re on the level.

It’s not always easy to call a supplier on the phone, so if you need some help check out our guide to contacting a supplier. We can help you find out what to expect, what questions you should ask, and what red flags to look for in order to ensure you’re not getting taken for a ride.

Suppliers want to charge as much as possible, even the good ones. This is no different from you or any other business. That said, the lower the price you pay, the more profit you make.

So what can you do in order to get the best possible deal? There are a number of things you can do that may entice the supplier to give you a lower price. These include:

  1. Ordering in bulk – If you’re making a large enough order, the supplier may be willing to drop the price per unit. Some suppliers only offer a basic discount for first-time buyers, but if you become a repeat customer you may get an even better price.
  2. Developing a relationship with your supplier never hurts – Just like with anyone else, the more trustworthy and dependable you are the more your supplier will be willing to work with you. Try not to take advantage of them, since you wouldn’t want to be taken advantage of. But there’s no harm in asking if you can get a bit of a discount if you’ve been buying long enough.
  3. Buy directly from the manufacturer if at all possible – Just like buying something at retail price means buying smaller amounts for a higher price per unit, buying wholesale means the same thing when you compare it to buying from the manufacturer. Of course, manufacturers often demand you purchase enough to fill a wholesale order. There are ways around this, however. Your best option is to find other sellers to split the cost. If you’re all buying the same product, then there’s no reason you shouldn’t work together to save money.

Check if it’s a legit dropshipper

A supplier might say they offer dropshipping services, but you want to make sure it’s legitimate. A legitimate dropshipper will have plenty of your product in stock and be able to handle order fulfillment and shipping.

A good dropshipper will be able to go the extra mile, allowing you to provide custom packaging for your products. Ideally, you should talk to other people who have used the supplier for dropshipping to see if they’re up to standard. And make sure you communicate with the supplier clearly to set expectations from the beginning

Shipping times

Customers expect fast shipping. Same-day and overnight delivery are the norm in our fast-paced world. You need to check if your chosen dropship supplier can provide a range of shipping options to satisfy your customers. This is especially crucial during holiday season . If shipping times are too long, you’ll most likely lose the sale to other sellers who can deliver before the holiday.

Minimum orders

Some dropship suppliers have minimum order quantities (MOQs). This means they require you to order a specific number of products to use their services. You want to be careful that you don’t get locked into ordering and paying for 1000 units when you don’t know if you can sell them. The great thing about dropshipping is that you shouldn’t have to buy stock up front. It’s best to find a dropship supplier that will fulfill orders as they come in and doesn’t require you to buy in bulk.

Quality of products

Quality is king! If you’re touting the fact that you’re selling quality products, you want to be sure they’re of a high quality. The best way to do this is to order samples before committing to a supplier. It’s also a good way to test how the supplier handles packaging and shipping. Check every tiny detail of the product to make sure you’re happy with the quality before deciding to use a supplier.

Top 11 dropshippers to use this holiday season to boost sales:

1. Pellatt Cornucopia

Pellatt Cornucopia has been offering gift-giving solutions for more than thirty years to customers in Montreal, Toronto, and Ottawa. They also deliver across Canada and the US and have affiliates in Europe, Israel, and Australia.

For decades, they have developed an extensive collection of gift baskets that include gourmet gift baskets, new baby gift baskets, children’s gift baskets for boys and girls as well as wedding and anniversary gift baskets..

  • No minimum orders
  • Ships worldwide
  • Offers dropshipping services to their authorized retailers. 
  • Orders are packed for dispatch within two business days

2. Toynk Toys

Toynk Toys specialize in carrying collectibles/ toys and costumes for both kids and adults. Their selection varies from mass market toys (dolls, sports figures, etc.), specialty market toys (limited edition props, statues, etc.), imported toys not available in the US, and their ever-expanding costume section. They accept major credit cards through PayPal and Google Checkout. 

  • 17 years in business
  • Minimum order: $100
  • Dropshipping service is available to qualified retailers.

3. CQ Group

CQ Group is a manufacturing and trading combo, loved and focus on bikes, electric bikes for over 14 years. Their aim is to offer users with high-quality and reliable electric bikes, components, accessories with favorable price, and first-class customer service.

  • No Minimum order required
  • Dropshipping services available
  • Ships worldwide

4. Lexi Noel Beauty

This supplier established its business in 2017, manufacturing high-end organic products for cosmetics and skin and hair care. They can do blind drop shipping at no extra fee. They ship internationally, and they accept PayPal and major credit cards as safe payment methods.

Orders will be shipped within 2 days. Wholesale orders will be processed within 2 business days. Turn around time for domestic and international orders is 2 business days. All products are guaranteed to be new and in working order.

5. Sephra Chocolate Fountains

Sephra LLC is the most recognized and trusted name in chocolate fountains throughout the world. As pioneers in the chocolate fountain industry, they have dedicated themselves to creating the highest quality, easiest to use, longest lasting chocolate fountains at the most affordable price. They accept major credit cards and can ship almost anywhere in the world.

  • No Minimum order
  • Ships worldwide
  • Years in Buisness: 50

6. Frame & Optic

This supplier is a federally registered manufacturer and importer of sunglasses established in 2012. They are also a California state-registered wholesale distributor of sunglasses based in Southern California. 

With over 30 years of wholesale shades and wholesale bulk sunglasses worldwide distribution, their goal is to combine high quality, trendy, and fashionable yet affordable wholesale sunglasses to the masses.

They have no minimum order requirement for wholesale and dropshipping.

7. FootwearUS

This supplier is a family-owned and operated manufacturer and wholesaler with nearly 40 years of experience providing quality wide width shoes at competitive wholesale pricing to retailers across the globe.

Whether your inventory needs are large or small, they’re committed to providing you with an efficient and streamlined purchase experience from start to finish, including all phases of ordering, payment, tracking shipments, returns, and reorders. Their goal is a state-of-the-art business transaction for you and your company—all of it backed by the highly personalized customer service that they’re known for.

You may purchase even a single unit and FootwearUS would be happy to ship the order directly to your customers. They offer blind dropshipping so your customers will never know where you got the products from.

8. Fashion Jewelry For Everyone

Fashion Jewelry For Everyone offers a huge range of handcrafted jewelry, including but limited to bridal Jewelry, Swarovski Crystals, Bracelets, Brooches, Earrings, Hair Accessories, Necklaces, Sets, Sterling Silver Jewelry and more..

They accept major credit cards – MasterCard, Visa, Discover and American Express, PayPal and Google Checkout. 

  • No minimum order
  • Ships worldwide
  • Offers Drop shipping and wholesales to retailers

9. AUSTRALIAN UGG ORIGINAL

This supplier established its business in 2009 as a manufacturer of original Australian UGG boots and other sheepskin apparel, based in Sydney (Factory & Factory Outlet). They ship internationally and they accept major credit cards and PayPal as safe payment methods. FREE Australia wide shipping and FREE Worldwide shipping is available for all products made by this supplier. FREE shipping applies to initial order shipment.

Dropshipping service is available and a 20% commission is guaranteed to all approved dropshippers. Datafeed is available upon request.

There is no minimum order requirement for dropshipping.

10. Disposable Camera Company

Disposable Camera Company is an Australia based company of wedding and party cameras. Their minimum order requirement is 8 cameras for wholesale orders. 

You must have a registered account with them to place your orders as a retailer. ABN is also required from Australian retailers.

PayPal is their preferred payment method. 

Dropshipping service is available upon request.

11. Global Merchandise Group

This supplier manufactures and markets its own brand of Virtual Reality headsets. They can supply light bulk, wholesale, liquidations and are open to dropshipping as well. They ship internationally and they accept PayPal and credit cards as safe payment methods.

They prefer to start with wholesale and choose particular customers for dropship as well. They prefer to drop ship for companies that are established and have a vast presence on various online platforms. They will require a resellers license for any purchase that they intend to resell. Otherwise, they will ask for a sales tax ID.

They also offer private labeling services. They do have in-house graphic designers that can assist inbox and instruction manual design if that’s what you’re interested in.

Why is Online Selling So Amazing?

Working from home in your PJs is definitely something great, but there are many other great reasons for working at home to build an e-commerce business:

You get to set your own hours, you work from home, and you determine the extent to which you want to take it. The possibilities are practically limitless. Wish to build an online business empire? Wish to make a few more dollars to save? In the world of online selling, there is no glass ceiling and you never have to worry about sucking up to a boss. It is pure freedom.

It is something you may have probably already experienced. If you have ever sold or purchased something on the Internet, you have an understanding of how it works, which is what makes online selling an easier skill to understand than most other home business options.

You will be free to pursue your own interests. Do you love fly fishing? Refurbishing antique dolls? Cake decorating? When you start to sell online, you can often establish a profitable business of your passions.

It is neither as risky nor as difficult as starting a conventional business. You never have to invest too much of your money when you first get started and don’t actually have to worry about leasing or buying a physical property. The barriers to entry in this business are quite low, which means that just about anyone can try it out.

What are the Drawbacks of Selling Online?

Online selling has a few drawbacks just like with anything else in life. It is important to know about these before you get started so that you can set realistic expectations for yourself.

It will take time. You may have to wait a month or two before you start to see consistent results. It is highly unlikely that you will accumulate over $100 worth of sales on your first day.

There is a learning curve. If you have previously sold things online, you are already a step ahead of the competition. However, you will have to step up your game if you wish to sell online professionally.

You will have to wear different hats. You are the business owner and the amazing team of one especially when getting started. You will have to play the role of a marketer, accountant, web designer, and various other roles as required. It means that you will be shouldering all the responsibility. You cannot blame anybody but yourself if something goes wrong.

Not all the income is passive. Hopefully, you will be dealing with regular customer inquiries, sales, and shipments. This means that you will be very involved with the business until you are able to afford to hire staff. Even then, you will have to continue being involved in all that happens.

Simply put, it is not a scheme for getting rich quickly.

However, if you are ready to spend some of your time developing your brand, building a reputation, and optimizing the processes then the opportunities are endless.

How to choose your Products for Online Selling

neckties to sell

There’s quite a difference when it comes to getting rid of random belongings and becoming a professional seller. Deciding exactly what you need to sell is often the most difficult aspect of the process. Of all the countless items that are on the marketplace, how do you know where to start? Above all, make sure your products meet these requirements:

  • A Profit Can Be Made
  • The Product Has Demand
  • The Competition Is Bearable

Making It your Online shop Legal

picture of legal items

While there are generally federal level laws involving online sales, many smaller jurisdictions will have their own laws that must also be followed. You may need to register as a local business or have certain kinds of licenses in order to buy from local suppliers.

If you need some advice on setting up your business, check out our “Business Basics” article. Here are a few things you’ll have to consider:

Choosing the name of your business: You should think carefully about this one. The name of your store is something you’ll have to plaster all over the internet. It has to attract people’s attention, but it also has to convince them to visit your shop. Naming your shop after a witty double entendre may be amusing in theory, but it’s a lot less funny when no one visits your page because they think it’s a joke.

Make absolutely certain you apply for a tax ID or a reseller license, depending on what your local laws demand. Having these certifications keep the government from taking everything or charging you with illegal selling.

Make sure you have a solid understanding of what business structure you should use. You’re building an empire, not a short-term tent city. Plan for the long-game, rather than taking actions that seem immediately profitable but lead to diminishing returns. Empires are meant to last forever, and yours should be no different.

Choose Where You Want To Start Selling Online

picture of thing to dropship

When it comes to online sales, there aren’t a lot of options.

When you’re starting out, your best bet is to stick with the two big marketplaces; eBay and Amazon. Why?

eBay – eBay has been around for nearly 20 years now, so it’s no wonder so many people use it for online sales. It’s a great website for used goods and one-off items you’re hoping to get rid of quickly rather than keep in stock.

The downside of eBay is that it’s not a highly profitable marketplace. There are certain products that can command a high price, but for the most part, eBay sales are priced cheap. Plan your sales appropriately, and don’t go to eBay expecting to rake in the cash.

Amazon – Part of why eBay runs cheap is because of the ease with which a person can become a seller. All you have to do is set up an account, and you run an online store. Amazon has a much more rigorous screen process, which means only companies profitable enough to prove their worth can sell on the platform.

 In addition, Amazon has a certain credibility that eBay simply doesn’t have. Amazon is considered a place for online stores, whereas eBay is considered an online garage sale. In addition, Amazon offers sellers quite a few options that eBay doesn’t offer. One of the more popular options is the FBA (fulfilled by Amazon) program.

With this program, you can pay Amazon to store and ship products on your behalf. While it’s not suitable for every business, you may find it a better option than drop shipping or attempting to find product storage on your own.

Amazon and eBay are the biggest marketplaces, but there are a number of smaller online marketplaces that might be suitable for your company.

And of course, you can always set up your own website with an online shop feature.

This gives you a lot more freedom in terms of how you offer your product and what customer services you’re able to perform. In addition, you won’t have to pay a seller’s fee to a third party. That said, it takes a bit more time and effort to set up. If you’d like some advice on doing so, check our article “Setting Up Your Own Webstore”. It should help you decide which direction you want to go. 

To get amazing training on how to start a dropshipping company and find reliable suppliers check out SaleHoo for 7 days for only $1

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