Beginning a DropShipping business is much like a traditional brick-and-mortar business. The first year can be the most formidable challenge you’ll face. To help you navigate your first 12 months, the DropShipping experts at Armaan Resales explain what you can expect along the way.
The first month of any business requires a lot of paperwork and is arguably the biggest challenge. You’ll need to do many things before you can get up and running, and it’ll take some time before you begin to see profits from your venture. Here are a few things you’ll need to do in your first few months of DropShipping:
Identify the DropShipping store owner
There are three types of business structures to choose from:
- Sole proprietor or sole trader
Each business type has its advantages. It’s crucial to do your research and decide which is best for your situation. Many DropShippers choose to go the sole proprietor route since it is relatively easy to set up and has fewer requirements than the alternatives.
Identify the business
The identity of the business and the owner are ultimately linked. Sole proprietorship and partnership are two types of businesses. You can also set your DropShipping store up as a limited company. As with the first, doing your research and understanding which is best for you is the way forward.
Each online marketplace and eCommerce platform is different, as are their requirements. Before you can start selling on their platforms, they’ll need to ensure that you can legally operate using their services. Some of these includes:
- Providing a valid passport or accepted form of ID
- Company registration details, including VAT number
- Business address
Once you’ve set up your business, you’re VAT registered, and you’ve successfully registered with a platform, you’ll need to learn the ins and outs of your chosen online marketplace to make the most of using its services to sell your goods. The top online marketplaces provide a wealth of information to help their sellers succeed, including:
- Amazon Seller University
- Shopify’s Guides
- eBay Seller Hub
- Big Commerce Guides
- Walmart Seller Help
- Takealot Seller Solutions
If you’re doing this without a team of experts like Armaan Resales, you will need to educate yourself so that there are no surprises along the way. Knowledge is the best resource on your DropShipping journey.
Finding your niche
The biggest job for an eCommerce retailer is finding the right products and sourcing them from reputable wholesalers. Ensuring your products are high-quality and wholesalers provide excellent communication and delivery times is paramount to your business’s success.
This step can be very time-consuming. There are thousands of product wholesalers globally, and it’s important to do your homework to ensure you find the right suppliers for your business. Check out our guide to setting up a DropShipping store for insight into the steps required to find a wholesaler you can trust.
Once you’ve chosen your products and found a reputable supplier, you’ll need to add these products to your store. Depending on the online marketplace or platform you’ve chosen, adding products to your listing is different. It’s best to check the requirements of your hosting site, as this could make or break your business.
Your products are in your listings, and you’re ready to go. Before you hit that button to load your products into the live feed, there are a few things that you should consider:
- Delivery expectations: Set realistic delivery timelines to manage customer expectations
- Returns, replacements and refunds: Depending on your platform, you may need to identify your criteria for product replacements and refunds, including timelines for how long you’ll accept returns. Some platforms have their own guidelines in place that you’ll need to adhere to, and it’s important to consider that when choosing your online marketplace
- Customer demand: It’s hard to forecast product and customer demand when you’re just beginning. It’s advisable to research product trends to gauge customer demand so that you can keep up with supply and demand.
When will I start seeing profits?
First, it’s important to understand that the steps above take time. How much time it takes depends entirely on the work you put in. Equally important is being realistic about timelines. Starting your own business is time-consuming and requires effort.
DropShipping profits will come with time, but seeing those yields is reliant on several factors, including:
- Product quality and availability
- Service quality
- Deliverability metrics
- Customer communication during returns and refunds
- Marketing strategy
You shouldn’t be dismayed at the work required to get your DropShipping store up and running. Suppose you partner with an expert like Armaan Resales. In that case, the entire process can be significantly faster with the help of a team of experts, sophisticated automation systems and a trusted network of suppliers.
Beyond the first year
Once your business celebrates its first year, it’s time to re-evaluate things. Ask yourself:
- Am I happy with the profits my business turning over?
- Do I want to diversify my products?
- Do I want to expand into new markets?
If your DropShipping store is already seeing substantial sales and you want to scale your business further, there are a few things you can do.
- Set up a second store on your chosen platform: This can help you diversify your product range, allowing you to sell new products without affecting your current profitability.
- Go international: One of the great things about eCommerce is its ability to reach customers globally. Consider the list of countries your business currently sells to and take advantage of emerging markets.
- Diversify your marketplace: If you feel that your current DropShipping store is peaking, it may be wise to consider branching out into new marketplaces or platforms. Having an additional store could significantly increase your presence with your target market, thus enhancing profitability.
How can Armaan Resales help?
With more than a decade of experience, Armaan Resales has the expertise to help get your DropShipping business up and running quicker. With smart software that automates time-consuming processes and an ever-growing network of trusted product suppliers, partnering with Armaan Resales takes a lot of the hard work out of starting your DropShipping business. Get in touch with our team of experts to begin your DropShipping journey today.