In our contemporary world of e-commerce, many people still have this question in their head – what does dropshipping mean in 2024? What’s the business model all about? It’s not bad if you still wonder what it truly means. Sit back and read this article to understand the rudiments and meaning of dropshipping:
Table of contents
- What is the Dropshipping Business?
- What is Orgainc Dropshipping?
- What is Reverse Dropshipping?
- What is Dropshipping AliExpress?
- Reasons: Why Should You Dropship With AliExpress?
- What is AliNext?
- Advantages: Why Should You Dropship?
- What Are The Downsides of Dropshipping?
- Frequently Asked Questions About Dropshipping
1. What is the Dropshipping Business?
At this point, you must have known what buying and selling are all about. Buy at a cheaper cost and sell at a higher rate. Did you know that dropshipping business is even less complicated than the standard buying and selling?
Dropshipping business is a retail fulfillment business model that doesn’t entail having stock. In this business model, when an online store gets an order, they quickly purchase it from a third party and have it delivered directly to the buyer
Surprisingly, virtually everyone into dropshipping business doesn’t get to see their products on or before they get delivered. It’s simple and hassle-free; get an order, buy from a supplier, and have them fulfill your order.
What is the difference from the standard retail stores?
The most significant difference between the retail business model and dropshipping is that in the latter model, the merchant doesn’t own any inventory. Dropshippers don’t buy and stock products. They wait till a buyer orders.
In this business model, the dropshipper automatically transfers all orders to the manufacturer or supplier (one who buys from the manufacturer in bulk and resells). The manufacturer or reseller fulfills the order at a lower cost. The difference between the order price and the cost of fulfillment is what the dropshipper bags as profit. So, the dropshiper has to set the product price somewhat higher than what the supplier or manufacturer offers.
Anyone who decides to own a retail store has basically two options:
- either they buy, stock, and resell
- or find a supplier who will handle the entire process.
Imagine a business model that only lets you focus on marketing and bringing in buyers while you leave the packaging, inventory, and delivery to your supplier. This should be one of the best business models anyone can engage in.
However, you still need capital to get started.
How much does dropshipping cost?
You need some money to get started (set up your store, cost of advertisement, sustenance while you wait for your money to clear, as well as making purchases from the supplier when a buyer orders). But then, you don’t need to break the bank to get started.
One can’t say this is the amount you need to make a defined amount, but it doesn’t call to break the bank. You need to make certain initial investments before expecting ROI.
- Get a responsive and customized store (includes domain and hosting)
- Dropshipping plugin like AliNext (Base package starting at $12 per month)
- Online marketing budget (possibly $500+ per month)
2. What is Organic Dropshipping?
Organic dropshipping refers to generating organic traffic to your store from popular social platforms (such as TikTok, Instagram, YouTube, and Facebook, etc.) as well as through organic search results on Google, Yandex, and other search engines.
Like other online businesses, dropshipping requires marketing investment. However, focusing on organic traffic channels is a beneficial long-term strategy, as it can be 3 to 10 times cheaper compared to paid advertising.
3. What is Reverse Dropshipping?
Reverse dropshipping refers to the practice of selling products sourced from suppliers in more developed countries to consumers in less developed markets.
A good example of this is dropshipping with AliExpress, specifically when you have your own store on WordPress and populate it with products from Chinese suppliers available on the AliExpress platform, while your store attracts traffic from Brazil. This means your customers are people living in Brasília. This is a very profitable dropshipping scheme today.
4. What is Dropshipping AliExpress?
AliExpress dropshipping is quite an impressive model of dropshipping, and it removes the arduous task of dropshipping off the shoulders of the business owner. When you receive an order from a buyer, you buy it from AliExpress, and the supplier will package and ship it to your customer.
In the traditional retail business, the business owner buys and stocks products before marketing. This differs from dropshipping business with AliExpress. You just have to copy the products you wish to sell from AliExpress and upload them to your store, set your prices and preferences.
5. Reasons: Why Should You Dropship With AliExpress?
If you read up till this point, you should have an answer to this common question – What is dropshipping AliExpress?
Here are some reasons why you can’t miss dropshipping with AliExpress:
- If you don’t want custom product images, reviews, and descriptions, you can use AliExpress’ and import them to your store.
- You can easily find a reliable supplier on AliExpress. The consumer feedback and ratings can help you find the best dropshipping suppliers on AliExpress.
- Worldwide delivery is an added advantage with most AliExpress suppliers. When you dropship with AliExpress, you’re sure that your supplier can fulfill orders from virtually every part of the world.
- Often, you get products at very low prices, giving you room to enjoy a better profit margin.
6. What is AliNext?
AliNext is a dropshipping plugin that enables anyone to easily load products from AliExpress into their own WordPress store. AliNext also includes features such as importing product reviews, placing orders on AliExpress automatically, loading tracking numbers, shipping information, and more. In other words, it is a set of must-have features that automate routine tasks for dropshippers in 2024.
So, you should have a store built using WordPress, and then you can simply use AliNext plugin to turn your website into a dropshipping store. If you want to speed up the process and have everything set up for you, including marketing, you can use a custom dropshipping store development service.
7. Advantages: Why Should You Dropship?
It’s always necessary to define your goals before you venture into any business model. Basically, most people who go into dropshipping are committed to being an entrepreneur and making a living selling online. In case you’re being skeptical or are new to this business model, here are some benefits:
Easy to Set Up
Unlike most mortar and brick business models, you don’t need to construct or pay for an outlet or a warehouse. Likewise, you don’t have to worry about tracking inventory, packaging, shipping, handling returns, and ordering products.
With a little capital, you can get a responsive and custom store online, import products from AliExpress with a few clicks, and hone your focus on digital marketing.
Less Capital Requirement
Without a doubt, one of the most significant benefits of dropshipping is its low capital requirements. You don’t have to stack up thousands of dollars for investment before you get started. While it is common for traditional retailers to spend money to stock up, dropshippers don’t bother about it.
Until you make a sale, you don’t have to buy any stock ahead, and this saves you money. You only buy it when your customer has paid you.
Flexibility
What is dropshipping business, and how flexible is it? – this a common question among beginners, and the answer is not far-fetched. A dropshipping business is extremely flexible and can be run from anywhere with access to an internet connection. You just need a place with a reliable internet connection that lets you communicate your suppliers and buyers, as well as monitor your marketing campaigns.
Quite Scalable
In dropshipping, you can easily scale your business by improving your marketing campaigns to receive more orders. You don’t really have t employ more workforce, and the orders will be left for your suppliers to fulfill.
Your work is to scale your business to get more orders while your suppliers shoulder a larger chunk of the project. However, you may need to take your customer support workforce up a notch.
Numerous Products to Sell
Have you ever run a quick search on AliExpress? If yes, you can tell that there are a countless number of products to sell. However, you have to opt for winning products because not all the products listed there can make you big. You can sell trending products, niche, or general products. See some of the winning products in 2024. Sometimes, people ask – what’s the best niche for dropshipping? While some niches might yield great results for one dropshipper, another dropshipper can bag big in another niche.
8. What Are The Downsides of Dropshipping?
Just like every business model you can remember, there are downsides to dropshipping. But there’s good news; the benefits of dropshipping far outweigh the disadvantages, and that makes it a profitable business to venture. Flexibility, convenience, and profitability come with a price. Here are some possible pitfalls of dropshipping.
Zero Track of Inventory
Anyone who owns a business and keeps their inventory can track it easily. But in dropshipping, you don’t know which product is out of stock until you hit up your supplier to fulfill an order. Sourcing from various suppliers can help you get over this, and some apps keep dropshippers updated on inventory.
If you use the AliNext dropshipping plugin, you can easily track inventory. It has a feature that synchronizes stock availability with AliExpress.
Low Margins
If you’re looking for a business model that will give you a huge profit per sale, then dropshipping might not be for you. Your competitors will sell the same products at ridiculously low prices, and you have to cut down your price in most cases to stand out from the pack.
Most sellers who sell at rock bottom prices might have invested little in setting up their site and have poor customer service, but customers will definitely compare you to them.
How about playing the game of numbers? You can sell hundreds of products of a day, and that’s a huge inflow to your account. Still asking how much does dropshipping make? Check these dropshipping success stories to get the fresh information about their earning.
Errors from Suppliers
One of the downsides of dropshipping is you get to shoulder all the blame even when your suppliers are wrong. Remember, your customers don’t know your suppliers, it’s all between you (your store) and them.
Every supplier makes mistakes once in a while. You have to accept the blame from your customers and reach out to your suppliers for corrections, if possible. This is why you should opt for reliable and quality AliExpress suppliers. You wouldn’t want to risk your business reputation because you chose the wrong suppliers.
Limited Branding
Dropshipping, as a business model, doesn’t let you control much about branding and customization. Depending on your choice of supplier, you can have a little custom packaging implemented but not as a traditional retailer.
9. Frequently Asked Questions About Dropshipping
For beginners, the term “dropshipping” might sound familiar, but there are certain questions that boggle their minds. Let’s take a quick look at some of these questions.
How legitimate is this business model?
Dropshipping is a completely legitimate online business. You can liken it to the traditional mortar and brick business where you buy and sell. The only difference is that you only buy the stock when a buyer orders for it in the former. It’s a fulfillment business model where you sell products manufactured by others.
You may want to consult a lawyer to ensure you’re running your business in line with your region’s codes and laws.
Is dropshipping really worth the efforts in 2024?
You have to note that there are no results without effort. So, ignore anyone who tells you that you don’t have to work to earn from dropshipping. It’s not a get-rich-quick business model but can fetch you huge amounts in a short while.
You need a proper guide, and enough resilience with the right team to hit it big. Dropshipping is worth trying in 2024.
What is better than dropshipping in 2024?
One thing that is definitely better than dropshipping is affiliate marketing. A quick example is the AliExpress affiliate program. You can easily set up an account there and earn as an affiliate partner, rather than as a dropshipper. By the way, the AliNext affiliate plugin allows you to use this model alongside the traditional dropshipping model, or even use both in parallel!
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