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Dropshipping is an order fulfillment method that does not require a business to keep products in stock. Instead, the store sells the product, and passes on the sales order to a third-party supplier, who then ships the order to the customer.

However, contrary to popular belief, dropshipping is not a get-rich-quick scheme.

Sure, it seems like easy money you sell other people’s goods and take a cut for yourself but when you factor in all the drawbacks, obstacles, and day-to-day management, it’s far from easy.

However, if you approach it the right way, and use the proven strategies below, dropshipping can still help you build a successful business just not as quickly as you’d hoped.

5 Hard Truths About Dropshipping No One Talks About

• Low profit margins.
  Sure, since you don’t have to manage or store your own inventory, the overhead is low but so are the returns. You put less money in, but you get less money out. That means you have to do a lot of business just to stay afloat, let alone turn a profit.
• Highly competitive.
  There will always be overly optimistic entrepreneurs who focus solely on the low overhead part, ignoring the clear evidence above. Because very little capital is required to start a dropshipping business, that low barrier to entry means a lot of competition, with the most popular markets suffering more than others. Basically, the bigger a company is, the more they can reduce their markups to offer the lowest prices.
• No control over supply-chain.
  In standard ecommerce, if customers complain about product quality, fulfillment speed, or return policies, you can address the problems yourself. In dropshipping, you’re more or less at the mercy of your supplier but you’re the one who still has to talk to your customers directly. Dropshippers are essentially trapped, doing little more than hoping the supplier addresses the problems while simultaneously reassuring the customer about something that’s out of their control. On top of that, there’s also a delay in communication as the dropshipper goes back-and-forth between the customer and the supplier. If one answers slowly, all communication grinds to a halt and the problems take longer to fix.
• Legal liability issues.
  Although this isn’t a common problem for dropshippers, it’s worth mentioning. Some suppliers aren’t as legitimate as they claim, and you don’t always know where the merchandise comes from. Even more deceptive is when suppliers illegally use a trademarked logo or another company’s intellectual property, which happens more than average.
• Difficult to build a brand.
  Like ghostwriters or behind-the-scenes songwriters, dropshippers must understand that the credit for their work goes to someone else. If whatever product you’re selling is so amazing, your customers are going to focus mostly on the product’s brand and forget about the shopping experience entirely.

In theory, dropshipping sounds like a great idea because it’s inherently scalable without you having to do a lot of work up front. But when you dig down a bit further, there are a lot of complications that you need to be aware of.

Most people try to open up a dropshipped shop expecting it to be easy, but in reality, there’s a lot more to it than you think.

This article will provide you with a realistic and comprehensive view of the pros and cons of dropshipping.
In theory, dropshipping sounds like a great idea because it’s inherently scalable without you having to do a lot of work up front. But when you dig down a bit further, there are a lot of complications that you need to be aware of.

Most people try to open up a dropshipped shop expecting it to be easy, but in reality, there’s a lot more to it than you think.

This article will provide you with a realistic and comprehensive view of the pros and cons of dropshipping.

How To Find Dropship Suppliers

• Because dropshipping is so popular and the internet is ripe with scammers, you first must learn how to spot a FAKE wholesaler.
• First off, a REAL wholesaler will never charge a monthly fee for the privilege of accessing their catalog of goods.
• Genuine dropship wholesalers are merely distributors and their goal is to sell their product in bulk, not run a monthly membership site.
• Second of all, a real dropship supplier will never sell their own products to the end consumer at wholesale prices.
• Remember, a wholesaler’s primary customer is a retail shop and it would go against their best interests to compete with their own customers.

The Pros Of Dropshipping

• The Setup Costs Are Practically Zero
• It’s Simple To Setup
• The Risks Are Much Lower
• Dropshipping Is Location Independent

The Cons Of Dropshipping

• You Won’t Be Getting The Lowest Price
• You Will Need To Charge Higher Shipping Costs
• Dropshipping Can Be A Logistical Nightmare
• Your Customer Service Will Be Out Of Your Hands
• Amazon Makes Dropshipping Even Less Attractive

How To Start A Dropshipping Business & Take Fewer Risks

At this point, you might be convinced that I am totally opposed to dropshipping, and you’re mostly right. I see dropshipping as a largely unsuccessful get-rich-quick scheme.

However, I am not against every aspect of dropshipping. I think partial dropshipping and outsourcing fulfillment can work very well for some merchants. Here’s what I mean:

Don’t Build Your Site On Dropshipping

Dropshipping works well when it is paired with traditional selling. Say, your store sells high-quality dog treats, and you want to branch out into selling dog toys.

You can easily flesh out your store with these additional products by using a dropship model. Having a few dropshipped products will keep your site from becoming fully dependent on your supplier, and you can still benefit from the simplicity of the model.

Sell Traditionally But Outsource Your Shipping

This is an excellent option for merchants who can’t store merchandise in their garages anymore and don’t have the time to pick and pack all of their orders.

Outsourcing your warehousing and shipping to fulfillment providers like Shipwire and Fulfillrite can give you the same freedom that you get with dropshipping with less risk. You’ll enter into a contract with that fulfillment partner, so they’re responsible for shipping on time, and you can still be sure of the quality of your products.

Fulfillment services can be quite expensive. You’ll have to crunch the numbers to make sure the convenience is worth it.

Sell Traditionally: Pick & Pack For Yourself

Perhaps you’re only just starting out, and you don’t yet have enough sales or products to justify a warehouse.

In that case, there is nothing wrong with fulfilling orders yourself. It’s cheaper, and you can make sure it’s done exactly the way you’d like.

How do I choose the best dropshippers for my business?

You’ve narrowed down a list of dropshippers to choose from but how to choose? First, remember that the dropshipping model is flexible enough so that you can use different dropshippers for different products, depending on where their strengths are. However, it’s often a better idea to keep your list of trusted dropshippers small, so that you can develop strong relationships and have open communication with your suppliers. When you’re choosing your dropshippers, keep a solid idea of what you want your business to look like in your head, including the purchase order process.

Best Drop Shipping Companies

• Doba

Doba is one of the most comprehensive drop shipping services out there.

It not only provides a detailed directory of manufacturers and wholesalers but also offers a platform to simply add the products you want without having to partner with multiple drop shippers.

Typically, you have to partner with 20+ drop shipping suppliers. With Doba you just have to find the product to sell, list them on your site and then start selling.

Doba will contact the supplier and send the product to the customers, removing the hassle of managing drop shippers.

• Oberlo

If you haven’t heard about Oberlo in running your drop shipping business then you haven’t truly been drop shipping.

Oberlo bills itself as the leading marketplace to search and find products to sell online at your Shopify store.

Their platform for Shopify facilitates drop shipping by connecting merchants with suppliers, who then ship products directly to consumers.

• Dropship Direct

Dropship Direct offers well over 100,000 items from more than 900 brands. It’s free to use, but access to its Premium WholesaleFiles information is $37.00/month.

This gives you a chance to try it for free, giving you access to its tremendous stock of items.

It’s more like a directory of suppliers. Here, you pick your item to start with, then you can demand to have that thing dispatched to your client.

So, you don’t really need to be in contact with the drop shipper.

Dropship Direct cataloging features keeps you up-to-date on the latest trends and new products added to its diverse inventory.

• Sunrise Wholesale

Sunrise Wholesale is a service that drop ships products directly to your clients.

You gain access to over 15,000 brand products, and you can search for these products.

Sunrise allows you to export your products including images and descriptions to eBay, Amazon and your own website

It even integrates and syncs with Shopify and Big Commerce.

Recently, Sunrise Wholesale partnered with an import company to give it access to a 600,000-square feet warehouse and distribution center.

• SaleHoo

SaleHoo has more of a focus on presenting a detailed directory for companies you can partner with for your business.

They have 8,000+ companies in their network that give you access to over 1.6 million products.

All the 8000+ suppliers are verified by the SaleHoo team, so you can trust them for quality and other factors.