The beginner guide to dropshipping 2022

Dropshipping can be used to operate a store without holding any form of inventory.
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Last update:

June 22, 2023
Dropshipping is a viable business opportunity that can be carried out at minimal cost and may not require you to own a physical shop before you can start the business. But before you can do that, you have to understand what dropshipping entails by following this guide.

A beginner’s guide to Dropshipping 

The online marketplace is an avenue for business owners and consumers to carry out business transactions. There are lots of opportunities that are available for people who are seeking to trade without having to get a physical shop. How possible is this? Have you heard of the term dropshipping? Do you know that with this business avenue, you may be able to make both active and passive income? How can you start a dropshipping business and what are those tools that may be helpful as you explore the world of dropshipping.

What is dropshipping?

Dropshipping is a type of business model that can be used to operate a store without having to hold any form of inventory. After you have made a sale, your products will then be shipped to you by your supplier from the store or warehouse. The products are also shipped directly to the doorstep of your customers.  As a drop shipper, there would be no need for you to worry about packaging, shipping, or storage of products.  

The business model of drop shipping and how it works

An ideal model for drop shipping comprises three main components, which include: The customer, you the retailer, and of course, the manufacturer. The manufacturer plays a critical role in the drop shipping industry. Duties of the manufacturer include product creation, inventory-taking, and product shipping to customers. The manufacturer carries out a shipment on behalf of retailers. Manufacturers have to replace defective products. They carry out restocking of sold-out goods.

The manufacturer bears inventory risks and other forms of risk. Retailers get products at cheaper or wholesale prices from the wholesaler. In the business of drop shipping, you, as a retailer, use your website as a platform for selling the products supplied to you by the manufacturer. However, you can sell the products under your brand name. A drop shipper is responsible for selecting the appropriate marketing strategy needed to promote the sales of the product. The retailer or drop shipper is also saddled with the responsibility of setting prices of goods as well as paying for the cost of shipping.

A drop shipper sells directly to the customer, who is the last point in the business model of dropshipping. In terms of sales disputes or any other issues, the consumers consult the drop shipper who sold the goods to them.

Is dropshipping profitable?

Dropshipping can be a very effective form of business, especially if you have the right tools at your disposal. One reason for the profitability of the business is because you are not required to pay for shipping and manufacturing costs. Getting the right suppliers can help make profits almost immediately after the start of the business.

As a drop shipper, making use of good shipping software that can help you calculate your earnings as well as organizing your shipments with less difficulty. 

Reasons why you should start the business of drop shipping

Businesses are often characterized by risk, but the dropshipping business is one that has low risk. The startup cost is minimal, and you are only required to pay for those items that you are selling to your customers. The cost of product creation and storage is not borne by you hence requiring less capital to start the business. Dropshipping business may be a great way for you to become an entrepreneur. You may choose to operate this business at your convenience. 

Daily operational activities include the processing of orders and responding to customer's inquiries. With the ShipSaving software, processing of orders and organizing shipments can be done without any stress. These processes are automatically carried out by the ShipSaving software, thus helping you to save time and resources. With the ShipSaving software taken over particular responsibilities, you can have more time to focus on product branding and promotion to enhance general sales. 

Is dropshipping worth it?

Dropshipping is worth your resources and time. It may be challenging to make money from dropshipping without having to spend some time online to market your products or set up a store. Other activities that may be time-consuming includes determining pricing and sales strategy. But despite all the effort you have to commit to the business, it is worth it.

How can you start your dropshipping business?

Having seen the benefits of starting a dropshipping business, you may decide to start the business. With these simple processes, you can start your dropshipping business:

• Select the right idea for your dropshipping business

Before you begin your dropshipping business, there is a need to choose the right product to sell. Select a product that is of high demand so that you can make more sales as a drop shipper. Some business coaches may tell you that it is better to pick a niche that you have passion for. That may be just a half-truth. A profitable business idea should be your focus to excel in the dropshipping business. Being passionate is easy when the business is profitable.

• Carryout Competitor Analysis

Competitor analysis is the next approach to take after you must have decided on the best product to dropship. Competitor analysis involves knowing what your competitor sells and how their products are sold. Google competitor analysis is a reliable tool for analyzing your competitor's strengths.

By entering the location of your business as well as your product name on Google, a quick search will show the top competitors dealing with those products around you. Other third-party sites can also help you to gather data needed for your dropshipping business.

• Look for a supplier

Finding a good supplier is easy if you have the right tools available to you. ShipSaving is a platform that allows you to properly manage your e-commerce business right from the process of searching for suppliers to helping you with shipment solutions. Get a list of potential suppliers and find out from them about the minimum order that you can make since you are just starting. You may also do well to find out about their shopping times as well as expected discounts.

• Build your dropshipping store

To build your dropshipping store, you can make use of several platforms where you can have an online store to market your dropshipping business. To do so, you must first get a domain name. Getting a domain name that ends in dot com may be preferable when compared with other subdomains. To make your business easily visible on search engines, use your product niche as part of your domain name.

• Sign up on Shopify or create a website

You may want to create an e-commerce website for your dropshipping business, but you can choose to use Shopify. Shopify is regarded as a comprehensive and reliable e-commerce platform for your dropshipping business. It is designed with easy to use tools, resources, and features that may help you excel in your dropshipping business. Get a nice and attractive Shopify theme. 

• Market your business

At this stage, it may have already selected your product niche and set up your online store on Shopify. You need to market your business of drop shipping with much zeal. As a starter, you may be limited by finance, but that could be enough motivation to be more proactive in your marketing approach. You can make use of Facebook advertising, influencer marketing, and other marketing strategies to promote your business.


You have seen that the business of dropshipping is one that is profitable if you understand the rudiments of dropshipping. You can make use of some of the steps highlighted in this article to help you get started in your dropshipping business. Dropshipping business can be started with minimal capital because you may not be required to own a physical shop. You are also saved the stress of buying goods for the shop as you are only acting as a bridge between the actual shop owner and the final consumer.

Written on:

May 24, 2021
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