Shopify dropshipping is a popular e-commerce business model that allows anyone to sell physical products without having to own any stock. It’s ideal for entrepreneurs who are looking to start a Shopify store with limited capital, want to test a product before investing in it, or for those who don’t have the space or know how to run a physical store.
In this guide, you’ll find the answers to the following questions:
Whether you’re just getting started or have been at it for a while now, read on for a complete overview of Shopify dropshipping!
What Is Shopify Dropshipping?
Instead of purchasing inventory upfront, Shopify dropshipping allows you to order products from a wholesaler on demand. When a customer places an order in your Shopify store, you simply order the product from the wholesaler, and they ship it directly to the customer’s address.
This saves you the trouble of needing to manage, store and move inventory and allows you to provide your customers with products on demand. Shopify dropshipping is a way of starting an e-commerce business with less risk of losing money. For example if a specific product doesn’t sell, you don’t need to worry about moving a large amount of pre-purchased inventory. It also only requires you to have an internet connection and a device, which makes it a great way to run a Shopify e-commerce business on the side, or in a way that is flexible and works for you.
When starting your own Shopify dropshipping business, you can open up a store within hours without any upfront investment. Additionally, because you don’t ship anything yourself (just order products from wholesalers), shipping costs are nonexistent. Shopify dropshipping saves you time, space and money — leaving you with more energy to focus on growing your business!
How Does Shopify Dropshipping Work?
Shopify dropshipping is a business model that allows anyone to sell physical products without ever owning any stock. Once you have set up your Shopify store you will need to choose a supplier. Your niche will determine which dropshipping solution and supplier works best for you. When deciding on a niche for your Shopify dropshipping, it is a good idea to think what you are passionate about, as well as what is popular online right now.
Step #1. Placing an order
A customer will place an order and pay for the products on your Shopify dropshipping store.
Step #2. Contacting your supplier
You will transfer the order and the shipping information to your supplier.
Step #3. Getting billed
Once your Shopify dropshipping supplier receives the order, you will be billed for the items ordered.
Step #4. Paying for the services
You will pay your supplier, this usually includes the product cost at a wholesale price plus a dropshipping fee.
Step #5. Delivering the products
The supplier will then package and ship the goods directly to the customer. You just select the products you wish to sell on your Shopify dropshipping store and have the supplier take care of the rest!
Because when doing Shopify dropshipping you are not responsible for the picking, packing or shipping of the physical products, it is very important that you have a reputable supplier who you trust and can rely on to provide the service that you advertise. Additionally, when starting Shopify dropshipping it is important to get samples of the products you want to sell on your store so that you can make sure that the image on the supplier website coincides with what you wish to provide your customers with.
How to Start Shopify Dropshipping?
To establish an effective and profitable Shopify dropshipping store first of all you have to understand the steps that need to be undertaken:
Step #1: Create your own Shopify store
The most essential step when setting up Shopify dropshipping is actually creating your own Shopify store. You’ll need to set up your website and consider your brand and marketing strategies if you want your business to see any success. Since you don’t need to worry about the managing of inventory or shipping, this gives you more time to focus on your Shopify store. Setting up an easy to use and aesthetically pleasing Shopify store that fits the brand of your Shopify dropshipping business is a vital first step.
Check a detailed guide on how to start a Shopify store in our blog post → here.
Step #2: Find the right dropship vendor app(s)
There are many dropshipping app extensions for Shopify available. These extensions provide access to a range of marketplaces which act as the middleman between your e-commerce store and your customers. Shopify app store has everything you might need for your Shopify dropshipping business, whether it is an accounting software or a shipping app. There is a wide variety of options to choose from – Oberlo, Printful and Sprocket, to name a few.
After you find the right ones, all you have to do is to connect these dropship vendor apps to your Shopify store.
Note: Some Shopify dropshipping apps only allow you to sell items from one manufacturer, while others work with multiple suppliers, and some just specialise in certain products, such as coffee, for example.
Check the list with Shopify dropshipping apps and more in our blog post → here.
Step #3: Add products to your store
Depending on the app you’ve chosen for your Shopify dropshipping you need to pick the dropship products and import them to your Shopify store. You can edit the products info or leave it as it is. From now on you are ready to start your Shopify dropshipping business.
Step #4: Take care of your finances
Finally, as with all businesses, it is important that you have your finances in order when doing Shopify dropshipping. Utilising accounting automation software such as Synder will ensure you have everything in order come tax season. You can import your online payments from Shopify directly into your accounting software. Synder offers a variety of features that allow you to manage your finances and have a clear overview of your incomings and outgoings. Let the solution simplify one of the most off-putting and overwhelming aspects of entrepreneurship, and give you back the time to focus on the fun stuff — promoting your store and planning the next steps of your business!
Shopify dropshipping is a great opportunity for entrepreneurs who are just starting their businesses. It is one of the best ways to sell your products without having to carry any inventory.
But there are some pitfalls you need to avoid. When it comes to the design of your Shopify dropshipping store, you need to ensure that customers can easily find what they are looking for, so make it simple. Your store should look professional as well, so it might be a good idea to invest in a professional domain name.
Make sure that the products you sell on your Shopify dropshipping store are high quality, that you source them from reputable suppliers. Don’t forget to check that your suppliers ship out the orders quickly, otherwise you will end up with unhappy customers who can leave bad reviews on your Shopify dropshipping store.