Dropshipping has become a wildly popular business model in recent years, with entrepreneurs from all walks of life starting their online stores.
But you may have certain questions in your mind- Dropshipping: will it be saturated in 2022? Is dropshipping worth starting now?
This article will explore the answers to these questions and more. So read on to find out if dropshipping is still a viable opportunity for you.
What is dropshipping, and what’s the big deal?
Dropshipping has become hugely popular in recent years as it allows entrepreneurs and small businesses to start selling goods with very little investment needed.
The dropshipping business model enables eCommerce entrepreneurs to sell without stocking any products. Instead, they work with suppliers who ship the products directly to the customers.
When a store owner receives an order from a customer, they simply contact the dropshipping supplier, then ship the goods to the customer’s door.
So, what’s the big deal?
Dropshipping is a fun and exciting business model that can help you start an online store with little to no money.
It allows you to start selling products immediately without having to wait for your product or place a large order with a supplier.
In addition, many people recommend dropshipping because it requires little technical knowledge or experience.
How the dropshipping business model works
Using a dropshipping business model is one of the cheapest and easiest ways to enter e-commerce. It has been around for quite a long time now and still wins many people over as it is straightforward and effective.
There are 5 steps in this model:
- You find a suitable dropshipping supplier.
- You create an online store.
- You advertise your products (usually through social platforms like Facebook or Instagram).
- Customers place their orders in your store.
- You send them directly to the supplier who handles the delivery for you (you also pay the supplier a fee for this, but it is usually much less than the price of hiring your delivery service).
You can start your dropshipping business in two ways: by creating an online store from scratch or by buying an existing eCommerce website. It’s worth mentioning that when you purchase an existing store, you also get the traffic, so it’s a great way to kick-start your online business.
What Are the Biggest Challenges for Dropshippers in 2022?
Let’s jump straight into this. There are some significant challenges that future drop shippers need to be aware of before starting their own eCommerce business.
Some of the big challenges are listed below:
Challenge 1: Finding a reliable supplier
Dropshipping suppliers are the backbone of this business model, so you need to find a supplier that will provide you with good products at all times.
If you start dropshipping business today on your own, one of the biggest challenges is finding a reliable supplier who can handle your orders quickly and offer high product quality. It’s not easy to find the right supplier, but with time and experience, you can surely get one that suits your needs best.
Challenge 2: Keeping up with the fast-paced eCommerce industry
The journey of an eCommerce entrepreneur never gets easy. Because the competition is growing fast, you have to keep up with the ever-changing industry to get ahead of your competitors.
For example, did you know that more than 1 million people search for the word “rings” on Google? (Just imagine the opportunity to sell customized rings)
To survive, you must adapt. And this is where I see the potential for big dropshipping businesses.
Because not only you’ve got to keep up with the fast-paced eCommerce industry, you’ve also got to keep up with technology changes!
Challenge 3: Ensuring that your products are competitively priced
Multiple suppliers don’t offer their products wholesale, so you have to find a way to keep your store competitively priced without losing too much money.
As mentioned earlier, dropshipping means that you don’t deal with the actual delivery of goods, so you need to find the most suitable shipping company for your business if you want to use this model. Finding the best shipping company could potentially save you a lot of money in the long run, but it can also be a bit difficult to find the right company for yourself.
This profitable business could potentially make you very rich (especially if you find a reliable supplier and keep up with the latest trends without forgetting your roots), but it requires patience and hard work to be successful.
Challenge 4: Staying on top of all the new trends in dropshipping
As mentioned earlier, dropshipping businesses are pretty much immune to the problems that face traditional eCommerce stores.
That’s quite an advantage over other business models, but it also has drawbacks.
The global Dropshipping market is not easy; you need to be aware of the latest trends and news in the online business if you want your store to stay relevant.
If you don’t follow the latest news, your store will quickly become obsolete, which is not suitable for business.
Challenge 5: Dealing with negative reviews and poor customer service ratings, which can have a significant impact on sales volumes
Negative reviews from unhappy customers or poor customer service can significantly impact your overall sales volumes.
That’s just a fact of life for any business. Still, it can be incredibly disheartening when you’re running a dropshipping store that doesn’t have the brand recognition of other established eCommerce businesses.
Dropshippers need to be extra careful when it comes to customer service because people will not hesitate to tell their friends about their poor experience (which can lead to negative reviews and low sales).
Challenge 6: Managing inventory levels to avoid out-of-stock issues or overselling items
Since many eCommerce businesses use the dropshipping model, there is a problem with oversupply in some niches.
To avoid overselling items and out-of-stocks, you need to monitor your inventory levels carefully.
It isn’t as difficult as it seems; most modern eCommerce platforms have built-in tools that help you keep track of your inventory levels.
But, if your dropshipping store is not using an eCommerce platform that tracks inventory, then you’ll need to turn to third-party apps that do this for you.
The good news is that you won’t need to manage stock levels yourself because the dropshipping suppliers will handle all of this for you.
Challenge 7: Keeping expenses low so that your store remains sustainable and profitable
Dropshippers often have a hard time finding reliable suppliers who offer high-quality products at low prices.
To keep your store competitively priced, you need to find dropshipping suppliers who can offer wholesale prices on items in high demand.
You also need to keep your operating costs as low as possible, so you don’t overspend on advertising and other running expenses.
Challenge 8: Getting your customers to buy more than one item at a time
Most eCommerce businesses aim to increase their average order values over time so they can make more money from each sale.
However, since drop shippers don’t sell their products directly and don’t hold any inventory, it’s harder to achieve this goal.
In the end, you are not dealing directly with your customers; your store is acting as a middleman between them and third-party suppliers.
To make more money from each customer transaction (either for one or multiple items), you need to find ways of getting your customers to buy more than one item at a time.
In some cases, the best way to do this is by setting up a store offering bundles or related items as an incentive for customers who buy multiple products.
The pros and cons of starting a dropshipping business
Dropshipping sounds like a pretty sweet deal from what you’ve read so far.
It sounds easy, and there is less risk involved since your store won’t be making any upfront investments in stock, which means that it’s perfect for beginners and seasoned entrepreneurs.
So, what are the pros and cons of starting a dropshipping business? Let’s take a look:
The pros of starting a dropshipping business:
- You won’t need to invest any money upfront.
- It’s easier to start a business if you’re not technically minded (no need to worry about hosting, eCommerce platforms, etc.)
- There is less risk involved than with other models of eCommerce
The cons of starting a dropshipping business:
- You won’t have any control over your product.
- You will need to find the right suppliers for your product (which can be pretty tricky)
- Customer service is less hands-on than with other business models (you will need to communicate with your supplier in case of problems)
Is dropshipping still popular in 2022? Will people continue to use it?
It may be strange to believe that the market for dropshipping is still growing when you see all the other eCommerce giant stores such as Amazon, Walmart, and eBay.
However, you must remember that these stores focus more on their proprietary products than dropshipping.
This means that you will not be competing with them in this field.
In contrast, if you were to sell on Amazon and eBay, you would need a significant amount of capital and resources to compete against the giants.
Instead, with dropshipping, you can sell your products without worrying about any competition at all!
So, if you are starting your own business with little investment, dropshipping is worth giving a try.
How to find products to sell online
What should I sell? – The ‘Easier said than done’ question
Many people ask this question about starting online businesses because there are so many different niches to choose from!
It’s challenging to work out what products will be the best sellers, especially when you’re just starting.
The truth is that it depends on your niche, and what kind of products are you passionate about. Because you won’t be successful selling a product you dislike. This is why it’s always a good idea to start with simple and cheap products to source.
You can always change these products later, but it’s essential to consider the following first:
- What’s currently trending
- Is there a major problem I can solve?
- What can I do to make a better version of a successful product?
- Can I find a better version of a successful product?
Luckily for you, we’ve created a helpful guide that includes 20 High-Ticket Dropshipping Products in 2022.
How to set up your dropshipping store?
The quickest way of setting up your dropshipping store is by using a platform that has built-in tools to help you monitor inventory levels, optimize products and shipping rates.
Some platforms out there will even help you create your custom landing page for free!
The following are the most popular eCommerce platforms:
Shopify itself is a platform, which allows you to create your eCommerce store. You can easily manage products and orders on the back-end. You don’t need any coding skills for building a site with Shopify – it’s all drag-and-drop software that anyone can use.
Bigcommerce works just like Shopify – it’s another platform to create your eCommerce store.
3. eBay Stores
eBay is an excellent place for dropshipping. It has a high trust level, and you can easily list new products.
The eCommerce platform Volusion works almost the same as Bigcommerce and Shopify.
WooCommerce works as a WordPress plugin. You can use it to create your eCommerce store on your website by installing the plugin into your WordPress installation.
DropshipMe is online software, which allows you to create your eCommerce site without any website-building experience.
Best ways to make your dropshipping store profitable in 2022
That’s the question that many entrepreneurs are asking themselves nowadays.
It would be great if a magic pill or hack were to make your store still profitable in just a couple of days. However, it doesn’t work out like this.
Dropshipping is not some get-rich-quick scheme. It’s about being patient and finding a proper strategy to reach your goals.
You may wonder, what’s the best way to find this strategy?
Below, there are many different tips and tricks you can use to increase your revenue:
Tips for marketing your store and driving traffic to it
Tip 1: Create a marketing plan and stick to it
If you want to grow your dropshipping store, you need to create an effective marketing plan and stick to it.
It’s effortless to give up on it. If you don’t have a specific goal of what you want from your store and where it is going, then there’s no way for you or anyone else to know where you are.
Don’t make this mistake – create a plan to promote your store and stick to it!
Tip 2: Use social media sites like Facebook, Twitter, and Instagram to post about sales or events.
This is a great way to market your products, build your brand awareness, and create customer loyalty.
You must have heard this one before, but it’s always worth repeating: social media can be a great way to boost your products and grow your brand.
Posts on social media related to sales or events will let people know that they need to take action soon (and not wait around forever).
Tip 3: Offer free shipping on orders over $50
This is a great way to convince customers to buy more products. If they already spent half the money, why not order one more product?
On the other hand, offering free shipping might be a bit costly for your store. The trick here is to find the golden mean that satisfies customers and doesn’t break your business’s bank.
Tip 4: Give away coupons for your store with discounts when people sign up for your mailing list
Another great marketing tactic is giving your store coupons with discounts.
If you have a lot of products in your store, it’s a good idea to create various discount offers to encourage people to buy more than one item at once.
People will appreciate the gesture, and it might convince them that they need your products.
It’s also essential to make sure you don’t go overboard here – customers may start looking for ways to abuse such a service, so you’ll have to build some sort of protection into your website.
Tip 5: Host contests on social media where the winner gets something from your store as a prize
A great way to generate hype on social media is through hosting contests where the winner gets something from your store as a prize. This will get you some positive buzz, and more people will be interested in what you have to offer next time they see you online or offline.
Again, you’ll have to build some protection here so that people don’t abuse your contest.
Tip 6: Keep an eye out for new trends in fashion that you could offer at your store – this will help keep things fresh and exciting!
A great way to keep your store fresh is to be aware of new trends in fashion. Keeping an eye on these can help you figure out how you can expand your store’s product line and make it more exciting for customers.
You can introduce these into your store and give people the opportunity to buy vogue products.
This will help to keep your store feeling fresh and new, which will, in turn, encourage customers to buy more products.
However, it’s important to note that if trends change too quickly or drastically, they may not still profitable for your store, and you’ll need to re-evaluate the product line.
The future of dropshipping: will it be saturated in 2022?
People enjoy the idea of selling physical products without having to worry about buying or storing them, but is it too late to get in on this game? Is dropshipping saturated?
Many eCommerce entrepreneurs believe that Amazon will be the only successful online store in 2022.
They think that the market is too saturated for new businesses to succeed.
However, this article presents a different opinion from an industry expert who believes that dropshipping will not be as saturated in 2022 compared to now.
Is dropshipping worth to be tried? Absolutely! The eCommerce landscape looks very promising, and entrepreneurs should not wait until the market is saturated to start their own business.
Why? The demand for dropshipping has increased drastically in recent years. With eCommerce sales forecasted to surpass 2.14 trillion dollars by 2021, there are bigger opportunities than ever before!
Around 15-20% of all eCommerce businesses are dropshipping stores.
Frequently Asked Questions (FAQs)
Q: What are the most popular dropshipping niches?
A: The most popular dropshipping niches are:
- Clothing & accessories
Since these product categories can be found in brick-and-mortar stores across various industries (including clothing stores like Zara and H&M, electronics stores like Best Buy and Target, and department stores), they are very profitable for dropshipping entrepreneurs.
Q: How do I choose the best dropshipping niche for my store?
A: Choosing an exciting niche for your store is vital because it helps differentiate your business from other eCommerce stores (and allows you to stand out from your competitors).
Choosing a niche that is:
- High in demand (high search volume and low competition)
- Easy to be sourced (not too many suppliers, not too difficult or time-consuming to find dropshipping suppliers for the products)
- Easy to grow (can be started with less money, new suppliers can be added easily without incurring high costs)
- Can create multiple new revenue streams (in-demand products can increase your store’s authority and credibility, making it more likely that customers purchase other products from the same niche)
Q: Do I need to be an expert in the dropshipping niche to start a store?
A: To choose the perfect niche for your store, you don’t have to be an expert. You just need basic knowledge of the industry, enough passion for the products, and just enough technical skills to build your eCommerce website.
To sum it up, if you are interested and passionate about the products and the industry you are in, then it would be easier to do your research, source suppliers (and negotiate the best price), and build an eCommerce store.
Q: Do I need to have a lot of money and resources to start a dropshipping store?
A: No. All you need is good internet speed and plenty of time!
The most important thing is that you are passionate about the products you sell because it will make it easier for you to source these products, build your eCommerce website, and promote your store.
Also, you do not need to have any technical skills or experience to start a dropshipping business. Just know how to create an eCommerce website (using WordPress or Shopify), and that’s it!
Q: How much money can you get with dropshipping?
A: That depends on how much effort you put into it! If you are starting your own dropshipping business, the sky is the limit! You can make as much money as you want.
Basically, there are three types of dropshipping products:
- High-ticket dropshipping products
- Medium-ticket dropshipping products
- Low-ticket dropshipping products
Depending on the product types, your profit margin will be different. As long as you are dedicated to growing your store and adding new products over time, there are no hidden reasons stopping you from making a lot of money with this business model!
Q: What should I know about starting a dropshipping business?
A: There are 3 main things you should be aware of before starting a dropshipping business:
- Sourcing suppliers takes time, so expect it to take a few weeks or even months before you find the right supplier for your store. You need to test the products your dropshipping suppliers are selling BEFORE you add them to your store. If they don’t sell well, remove them from your website and replace them with better-selling products.
- Dropshipping is NOT a get-rich-quick scheme! It takes hard work and time to build your store and grow your customer base.
- You also need to do marketing if you want people to find your eCommerce website and become buyers. You won’t get there overnight, but you’ll get there if you keep pursuing it.
Q: Is dropshipping saturated?
A: Not yet, but it’s getting there.
The market is getting bigger, and more and more people are trying to make money with this business model.
As a result, the industry is becoming very competitive, and it’s hard for new dropshipping stores to compete against established players.
That being said, if you want to start your eCommerce store, then there is nothing stopping you from doing it!
You just need to work hard and stay dedicated.
Q: Is it better to start now or wait until there are fewer drop shippers?
A: That’s a great point! You should start now because there is no indicator that states the number of dropshippers will decrease. It only keeps growing and growing .
On the other hand, you have the advantage of starting a dropshipping business when dropshipping is still relatively new to many people, so there are less established players in the market.
Q: How does the dropshipping business model work?
A: Here’s how the dropshipping business model works:
- Set up an online dropshipping store
- Choose the products you want to sell.
- Fixed your desired price
- Customers place orders.
- Your supplier will package and ship the item directly to your customer on your behalf.
- Pay the actual price to your supplier and keep the profit.
The market for dropshipping stores continues to grow and shows no signs of slowing down.
As customers continue to look online for products found in brick-and-mortar stores, entrepreneurs have a unique opportunity to take advantage of the demand by starting their eCommerce store offering physical products without worrying about buying or storing them.
Dropshipping is not a saturated market, and entrepreneurs should feel confident about starting this type of business. The future of dropshipping is bright, so go ahead and start your eCommerce business today!
Keep these tips mentioned in this article in mind as you start your dropshipping store!
And remember, the demand for dropshipping products will continue to increase exponentially!
The future looks promising for dropshipping entrepreneurs!
>> Start your dropshipping business with Shopify here!