What is a Home Based Drop Shipping Business? An Overview
How Does a Drop Shipping Business Work?
A drop shipping business can add some serious side income to your life. It’s one of those opportunities which can even replace and expand your full-time income. But what exactly is a dropship business and how does it work?
In a conventional type of internet retail business, you would purchase large quantities of a particular product from a manufacturer or distributor in wholesale. You would then stock these products in a warehouse and work on marketing & selling them. You would be responsible for tasks such as:
- accepting orders
- packaging & shipping products
- accepting refunds, etc
Enter the model of drop shipping business…
Can this make for a good type of home business? This is currently one of the most lucrative ways of doing business online. Essentially, you are a middleman of sorts. Your customers buy products from your website, but you never physically stock or handle those products. In a dropshipping business, the products go directly from the source to the buyer. But as far as your customers are concerned, they are dealing with your brand. They have no idea what is happening behind the scenes.
Some drop shipping product distributors even offer services where your customers can call them directly and place orders. The wholesale distributor would accept orders on your behalf, under your brand’s name, and ship to your customers. The packaging would have your company’s name on it, and no one would ever know that you’re just sitting at home in your pajamas running this seemingly large online store. What a brilliant business idea, huh? Of course, this type of arrangement often includes extra fees and can cut into your profit margins.
How To Run a Dropshipping Business
Once you find a legitimate distributor — you now have access to hundreds, even thousands of products.
The next step is to set up an online store and promote it. Without promotion, it doesn’t matter if you have the best online store on earth, it will not be successful. No buyers are going to come there — and you are not going to make any sales. Simply speaking, without promotion, you will not make any money. You may actually end up losing money. The topic of marketing your eCommerce store is a whole another can of worms better left for another discussion, so we will put it to the side for now. Let’s focus on one thing at a time.
Once you start marketing your online store website and start receiving orders, you simply forward these order to the drop shipping distributor(s) whom you are working with. The wholesale distributor takes care of shipping the order to your customer. You pay the drop shipping supplier and pocket the difference.
This, in a nutshell, is how you can theoretically make a profit with an online drop shipping business.
What Can You Sell?
When it comes to the type of products you can sell with your drop shipping business.. the world is your oyster. It’s all on what you want, what you like, and what you want to get involved with. Of course, profit margin has something to do with it also.
Below are just a few popular examples of merchandise you can sell via wholesale drop shippers:
- apparel, clothing, and shoes
- home decor
- baby products
- food items
- fitness and exercise equipment
The list can go on and on. It all depends on you and what kind of service you are looking to provide to your customers, as well as what you think you would enjoy working with.
How Much Profit Can You make?
This depends on numerous different factors, including the type of product which you are selling and how you are operating your business. The profit per item can range anywhere from a few dollars to hundreds and even thousands of dollars in certain markets. Not to be a party-pooper, but it’s possible to even lose money if you aren’t doing things right (or you may be running a loss-leader campaign on purpose to gain new long-term customers).
My all time favorite source for thousands of legitimate drop shipping companies and suppliers…
They’ve been around forever, and thousands of entrepreneurs have been using their service to run successful dropship businesses. We’re talking over 8000 dropshippers and wholesalers. We’re talking over 7 million products from any category you can imagine. We’re talking guaranteed wholesale prices. They are the most comprehensive drop ship resource online that you can imagine. They will connect you with the drop shipping companies you’re looking for.
They are even certified by eBay to engage in the business. Does that mean something to you? It means something to me.
I’m going to be fully honest with you: prepare to be overwhelmed by choices after you join. But take it easy and relax. Find a niche & category that you want to specialize in: clothing, computers, televisions, handbags, brand name products — whatever. And deal with suppliers based on what you’re looking to sell and make money with.
You can take the free trial, but be prepared to pay a one-time fee to gain permanent lifetime access to this amazing resource.
If you can’t invest a small amount in your business, then should you really be thinking about going into business for yourself?
Click here to see who I’m talking about and join if you want to do something with making a business for yourself. You can spend all day everyday online reading reviews or just go direct to the source and start building business relationships. Start making money.