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6 Steps to Start a Profitable Dropshipping Business – An Ultimate Guide


What Is Dropshipping

Dropshipping business is a business model, its not a trend or a fad that will go away after a few years.

Yes, the ways of conducting a dropshipping business may change but, this evergreen business model is here to stay. It will help you make millions with the right approach and strategy.

It is one of the best ways to quit your job to start your online business.

dropshipping business

Are you completely new to dropshipping business? Then I would recommend you have a look at what is dropshipping and how the business model works.

Refer to the “What is dropshipping business” blog post. It will be a perfect start for new enthusiastic entrepreneurs to start their dropshipping business.

If you already know the dropshipping concept, let’s dive in straight away to developing your dropshipping store.


shopify dropshipping

How to start a dropshipping business? The 6 steps dropshipping business plan.

Step 1: Choose your niche

This is the most important and most difficult stage. Many new drop shippers fail to start because they cannot cross this stage.

it is because of their inability to arrive at a niche of their choice.

The high number and variety of products available in various niche categories make it confusing. Hence, it makes it difficult for anyone to choose their dropshipping business niche.

Trust me, if you already know what niche you want to work with, you have already done more than 20-30% of the work.

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The information overload overwhelms the beginner drop shippers. Their quest to find the most profitable niche keeps them shifting from one niche to another. Without actually building anything in their first dropshipping business.

Without completely scaling their store in one niche, they quickly shift to another niche to build another store. This process goes on & they forget the main agenda, which is to build a dropshipping business & SCALE IT.

You can build hundreds of stores, but you wouldn’t earn a penny if you do not scale any one of them.

Hence, don’t fall prey to information overload. Avoid creative building syndrome and get straight to building and scaling your store in any one niche of your choice.


In my honest opinion, no niche is the best niche for your dropshipping business. You can make millions with any niche, I can bet on this.

But, the strategy will differ for every niche, which, the dropshipper has to figure out in their dropshipping business plan. For some niche paid ads would work the best. While other social media following would make wonders.

Your choice of niche is a starting point, based on which, your dropshipping business strategy would differ.

On a safer side, I would recommend you to choose a dropshipping business niche that you understand. It is much much easier to sell a product that you understand and resonate with. In the niche which you understand, you will be in a prime position to develop the best strategy for it. Because you know the product inside out.

But, be cautious enough to research the internet for the trends related to your niche. Do not choose a niche that has no demand. This will take you nowhere.

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Some of the best tools to search the internet to learn about your niche are,

  • Google trends
    The data here is very reliable because it fetches it from Google. It will help you find the trends about any topic, for any region, for any duration. Hence, this is the most basic research tool to help you with preliminary insights about your chosen niche.
  • Ubbersuggest
    This tool by Neil Patel is a great free tool to start with. You can get premium-level features for free up to a certain limit. You can conduct keyword research, competitor analysis, social media analysis using this tool. For anyone who is starting now, Ubersuggest must be on your platter.
  • Social media pages.
    One great hack to research about any niche is to have a look at social results for the same. Type in your niche name in any social media and check for the engagement of the niche with the audience. This will give you a rough idea of how you can leverage social media for your niche results.
drop shipping business niche
Image Source: Google Trends

Concluding, Do not waste your time on choosing the perfect niche for your dropshipping niche, there isn’t a single one. Start with,

  • A Niche that has profit potential or has significant demand.
  • A niche that is already doing well and has the potential to scale in the future.
  • A niche whose products you understand well enough to sell them.

Some of the evergreen niches you can start with are,

  • Home improvement
  • Beauty & Fashion
  • Clothing & accessories
  • Digital gadgets
  • Health
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If You have an interest in any of these niches or have significant knowledge about them, consider them to be safer options to start your business.

I repeat, again, do not try to make it perfect. You’ll waste tons of time. Always learn as you do and try it instead of speculating about it. There is no substitute for hands-on experience.

Take a break now, go research about your possible niche choices, and make a shortlist. Come back to learn the next


Step 2: Competitor Analysis

By now, You must have an idea about the niche you want to work with. If not, do not worry and research further. Don’t spend too much time on that.

Once you know your niche, the next ideal step is to research the competitors in your niche. With competitor analysis, you’ll get to know the things that are already working.

By looking at top competitors in your niche you can understand the “good” things done by them, which, you can include in your strategy. The idea is simple,

  • Analyze your competitors,
  • See what is working for them,
  • Shortlist these proven factors for your strategy and
  • Develop your strategy & action plan based on these proven factors.
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Follow these steps to develop your preliminary strategy. you can always change your strategy as you go further into development. Yet, this process acts as the best starting point in competitor analysis.

Let us look at some of the tools you can use for competitor analysis.

1. Ahrefs

This tool is the best tool available for competitor analysis. One can also get an overview of the e-commerce aspects of your competitors. The data this tool will provide is comprehensive and highly detailed. One can get many insights to form AHrefs which they can use to develop their strategy.

They offer a free trial at $7 for 7 days. You must try this tool to see if it works for you.

For people who are tight on budget, stay tuned, I have some free tools recommendations as well.

2. SEMRush

Like AhRefs, SEMRush offers similar capabilities for competitor analysis.

The number of features available with this tool can overwhelm you. But, the value provided through this tool is amazing. This is my favorite tool which I also use for my other dropshipping businesses.

SEMrush

SEMRush can help you in developing organic traffic channels for your store. Their offering & key insights are very valuable.

They have a 7-day free trial. I would strongly recommend this tool for anyone. Even the ones with a lower budget because of their 30 day trial period.

3. Ubersuggest

Again on the list is Ubersuggest, a free tool for many premium features. Anyone tight on their budget can try out this tool.

ubersuggest dropshippingubersuggest dropshipping1
Image Source: Ubersuggest

4. Social Media Analysis

This hack is very interesting to gain much-needed competitor insights. Follow the given steps,

  • Select any competitor you wish to analyze.
  • Visit their Facebook page, it exists.
  • Visit their ad library.
  • Browse through all the ads the competitor has published.

This will give you data about all the ads the competitor has ever published. You get to see the ad creatives, ad engagements. This knowledge will help you in understanding the strategy used by competitors for engaging their audience.

5. Buzz Sumo

Buzzsumo is a great research tool. It will help you to explore the content distributed by your competitors. It spans the content distributed on various social media platforms.

It gives you detailed insights. Insights about content engagement such as likes follow, and comments. These insights will help you understand your competitor’s content strategy.

The sole reason for competitor analysis is to understand what is working and what is not. It is more important to know the strategies we should not apply, than finding the winning strategies for your dropshipping business. This reduces the margin for error.


usa dropshipping suppliers
Dropshipping Suppliers

Step 3: Find a supplier

Finding a dropshipping supplier can take time, and it is necessary to spend some time on finding the right suppliers.

The quality of your dropshipping suppliers, the quality of their products has a direct impact on the reputation of your e-commerce store. You must spend significant time in selecting the right supplier for your dropshipping e-commerce store.

One way to ensure the quality of the supplier is to order the products for yourself and check the quality. Also check the shipping times, packaging, supplier support.

Only after you are confident about a supplier, you can go ahead with doing business with them. This is essential for effective relationship building.

Some of the plugins you can use to find your suitable suppliers for your dropshipping business are,

Get Winning Products to Your Store

1. Oberlo

Oberlo is the most comprehensive dropshipping plugin available for dropshippers. It has a huge volume and variety of suppliers across the globe. Oberlo has top suppliers from the USA, China, Australia, UK. You can assess these suppliers and use them for your dropshipping business store.

It is free for a lifetime up to a range of 500 products, above which you will have to get their paid plan. The only issue here will be of longer shipping times from suppliers if they are from China. Yet, you get some quality USA dropshipping wholesalers that you can choose.

Yet, being upfront about longer shipping times to your customers solves the issue. Oberlo is the prime choice for Shopify dropshipping.

2. Alidropship Plugin

Again, it is the most comprehensive plugin to manage your dropshipping business store. Compatible with WooCommerce as well as Shopify (With different branding). It is highly recommended.

Also, for anyone who is short on time and wants to buy a brand new operational dropshipping business store, they provide that as well. Check out their custom store options here. You can straightaway pay a certain amount and get your dropshipping store ready to sell your products. How cool is that!

Checkout the Alidropship plugin here.

3. Spocket

This is a paid plugin with four subscription options. They have high quality selected suppliers from the USA offering lower shipping times.

They also offer a strong network of dropshippers which can help you to learn from the best. You can also get high-quality reviews for USA dropshipping wholesalers available on Spocket.

I would recommend this plugin if you are targeting people from the USA. Shipping times are hardly less than 7 days for many products. For a few products, shipping times are as low as 3 to 4 days.

You must give it a try if you have an existing dropshipping business store that you are trying to upgrade. Try it here.

spocket us dropshipping
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4. Modalyst

They offer a paid plugin, but, they allow adding 25 free products. Very much a quality option for dropshippers who plan to sell limited products.

They are like Spocket in their collection of USA dropshipping suppliers. You will find low shipping durations for most of the suppliers.

They also offer a white-label dropshipping program. The white label program will help you to create your brand with your products. The products that you sell will have your own branding labels. Imagine selling shoes, or women’s leggings with your own brand name.

Never was it so easy to create your brand! isn’t it? Know more about white label dropshipping business here.

These are popular plugins that help you in selecting and managing suppliers. You can also choose to work with separate huge, dedicated suppliers such as,

These are e-commerce giants with tons of products to choose from. They offer special support for dropshippers as well.

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The advantage of these suppliers is their huge size. It allows us to select any product from any niche. They have warehouse presence across the globe. Their wide presence makes them provide short shipping times on most products.

These options are more than enough to find your first supplier as per your needs. You can also research online, specifically on Facebook to find dedicated suppliers.

Go for free plugins or buy a paid plugin based on your budget and commitment to building your dropshipping brand.


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Step 4: Build your e-commerce store

Building an online store is the next logical step. One can conduct a dropshipping business without an online store as well. But, such businesses CANNOT be scaled after a point.

The choice of platform on which you can build your dropshipping store is very important. This is because your store can make or break your dropshipping business.

Your online store is the place where the actual commerce, transactions take place. This is where you make money. Hence, you wouldn’t want to compromise on the quality of your online dropshipping store. So, build your store on a trusted platform.

There are two elements to building an online store.

First, the domain name and second, the hosting provider.

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The domain name should resonate with your online store and the products you wish to sell. It is not a requirement, but it helps consumers make sense of your store with ease. I would recommend 3 extensions while choosing your domain name.

  • .com extension
  • .xy (where xy represents your country if you are targeting only one country, such as .ca for Canada.)
  • .store extension (Highly growing & relevant for online stores)

Here are some of the best domain registrars that I recommend. You can choose any one that suits your needs & budget for your domain name.

  • Hostinger
  • Siteground
  • Namecheap
  • GoDaddy
  • Google Domains

There are many more!

After the domain name, the next is the hosting provider.

Hosting providers are very important. Because they have a direct impact on the performance of your store. Hence, choose the hosting provider with utmost care and scrutiny.

I have shortlisted my recommended hosting providers that are best for e-commerce operations. You may choose any one of these.

best hosting provider in india
Recommended

Many e-commerce store-building platforms have their hostings, such as in Shopify or BigCommerce. If you choose any of these e-commerce platforms you would not need a separate hosting account. You will get free hosting with these e-commerce platform builders. (with their paid plans, of course)


E-commerce store builders have drag and drop functionality. This helps anyone with no technical knowledge to build an e-commerce store within a few hours.

Hence, Choose any e-commerce store builder over developing your store on WordPress using woo-commerce. Because the learning curve for building a store with wooCommerce is high. It requires significant technical expertise. Also, it is not recommended for a complete beginner.

You can choose WooCommerce if you have access to WordPress developers. You can hire such developers at Fiver at a minimal cost. Click here to know more.

Here are some of the best platforms on which you can build your drop shipping store,

1. Shopify

Well, if you do not have any technical expertise, or you want to open your e-commerce store in a few hours and start selling, then, Shopify should be your first choice.

Out of my personal experience, it is the best e-commerce store building platform available in the market. The ease with which a complete beginner can build her online store and start selling is second to none.

Yes, it is also costly, $29/month with a free trial of 14 days. But given the time it saves you compared to other e-commerce platforms, it is a “huge” value for money.

Have a look at this complete step by step video guide to opening your Shopify dropshipping store and start selling in hardly an hour or so. It’s Free!

shopify dropshipping business
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2. Wix

The next on our list is the Wix eCommerce platform. Wix is very versatile when it comes to the design of your dropshipping business store. Frankly speaking, the visual appeal of your dropshipping store adds up high value to your brand. It avoids your store from looking Shabby and ads authentic look to your eCommerce store.

Getting started with Wix is damn easy. You can build your store in under 5 minutes. All you have to do is answer a few questions regarding your business and Wix ADI will do everything for you. Wix ADI is Artificial Design Intelligence where with a few clicks you get a ready-made eCommerce store that looks premium.

Wix offers a free plan so you can get started with a dropshipping business for free. But, they will display their ads, logo on your store in the free plan. However, Wix offers super cheap plans. What you will pay for Shopify for one month is what you will pay for Wix for one entire year. Also, you get 14 days of free trial on their premium plans.

Wix is the best option for drop shippers on low budget to kickoff their dropshipping business for free.

Get Started with Wix for free!

3. BigCommerce

BigCommerce is as good as Shopify in many features. But, when it comes to plugin support it lags behind Shopify. At the Shopify app store, we get many plugins which we can use to make our e-commerce store better.

Yet, it is a must-try for people who want to explore new options.

The only drawback is the limited number of supported payment gateways. This number is lower as compared to Shopify. This makes it difficult to drop shippers in some regions, such as Asia. Don’t take me wrong, in terms of capabilities it is as good as Shopify.

They do offer a 15-day free trial without a need for a credit card. This means you can try out this option for free and make an informed decision for your store. You pay $29.95/month after your free trial.

4. WooCommerce with WordPress

The most recommended choice for building your e-commerce store if you are tight on budget. If you consider long-range, that is, 2 3 years down the line, this option will prove to be the most cost-efficient.

It provides you with high customization options and higher control over your dropshipping business store. But, for a complete beginner or even for experienced e-commerce players it takes time to get used to WooCommerce using WordPress. The learning curve is high.

Hence, I recommend this option for anyone who has time on their side. Someone who is low on budget and wants to invest as little as possible while trying out dropshipping.

Note For complete beginners. If you want to build a store on WordPress but have no expertise, you can anytime find WordPress, woo-commerce developers on Fiver at a very low cost. You get your work done with minimal investment in these developers. Check here.

There are other e-commerce store building platforms available for your dropshipping business. They are options such as,

You may check out these options at your perusal.

Learn to setup payment gateways

Read how to set up payment gateways for your dropshipping e-commerce store. Learn how to accept payments from a global audience in their domestic currency. Read now!


how to promote drop shipping business
Marketing Mix for Dropshipping

Step 5. Marketing and Advertising

Your store is ready now. You have added the products to your dropshipping business store, you have designed it well. The next logical step is to keep your store in front of your consumers. Hence, marketing!

1. Social media

It is critical to have a social presence for your brand. Hence, Open social media accounts on social platforms where your consumers spend the maximum time.

Remember, do not try to involve more than 3 social media channels in your advertising mix. Otherwise, it will make it complicated for you to track and analyze your results. My suggestions would be to go with,

Facebook

No matter what your niche is, you’ll find your audience on Facebook. It is a must-have social channel in your marketing mix. You can target any customer in any corner of the world with Facebook.

Facebook ads provide us with high detailing options with which we can effectively target our audience. The costs are much lower than any other social platform.

Facebook paid traffic is “the” most widely used tactic to generate traffic for your store.

Pinterest

Since you are selling a physical product, having a visual showcase of your products is a much better choice.

There is nothing better than Pinterest as a visual social media social channel. It has unique benefits over Instagram which is “very” helpful to e-commerce brands. Their clickable pins are a huge bonus for e-commerce stores.

Pinterest paid ads are available only in few countries as of now. But, the clickable pins feature makes wonders for you, at no cost, if you do your Pinterest SEO neatly.

Niches such as beauty & fashion, clothing & accessories, home improvement perfectly fit within a Pinterest promotional strategy.

Learn how to develop your e-commerce marketing strategy on Pinterest

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Instagram

Instagram has a huge audience base. Roughly 1 billion people use Instagram every month.

The majority of the users of Instagram claim that they at least follow 2-3 brand accounts. It is a highly effective platform to build a social following which you can leverage for your e-commerce store. The users on Instagram are majorly youth, making it a great platform for marketers.

The introduction of reels feature on Instagram is an added advantage. You can use this feature to replace your presence over YouTube.

Instagram ads are my personal favorites. These are easy to set up, engagement is high and strong. Also, one can send customers directly to the product page with Instagram ads. This increases the conversion rate of your store.

If you want to generate free traffic, learn the art of hashtags on Instagram. Niches such as beauty & fashion, clothing & accessories will perfectly fit with the Instagram promotional strategy.

YouTube

I would rather call YouTube as a search engine. If you have products that have appealing videos, then do consider promoting your products on YouTube.

But, it is not always the case with every product to have a video, hence, it is an optional choice for users. YouTube would work wonders for Digital Gadgets and health niche. Here you can make instructional videos to explain the working of your product.

The advantage associated with social channels is the use of influencer marketing. You can choose influencers in your niche from different social platforms and

2. Email Marketing

Email marketing is effective if you already have existing customers. For a completely new dropshipping business store, it may not be effective. But, as you start selling your products your email marketing can kick-off. It is one of the most cost-effective marketing channels. The ROI is huge for email marketing. Focus on email marketing after you have a sizable audience.

Read this guide to set up email marketing for your e-commerce store.

ecommerce email marketing
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3. Content Marketing

Content marketing is a long term strategy. It is not going to get you traffic in a month or two. It will take at least 7-9 months before you get any significant traffic from your content (It is a rough estimate).

SEO should be a secondary strategy in your marketing mix for your dropshipping business e-commerce store. Yet, you must not ignore it since it has huge benefits if done right.

Read this blog post on how to use content marketing for e-commerce. Learn the art of creating appealing content with ease.


It is necessary to constantly track, analyze, and optimize your marketing efforts. Also, optimizing your dropshipping business store for better performance is required. It helps you to provide a high-quality experience to your consumers.

Use free tools such as Google search console, Google Analytics to track and analyze your audience. You get important insights about your audience which you can integrate with your future marketing efforts. You also get e-commerce insights from Google Analytics which are highly useful.


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Customer Service

Step 6. Customer Service

Remember, selling is about building relationships, not just closing off the deal.

Have the highest quality customer service ready for your customers. Try to keep it as personalized as possible.

Your customer will come back to your store, irrespective of the product you sell if you provide her with a quality shopping experience.

Take some time to develop high-quality customer service channels for your store. Use various plugins that help you in managing your communication with customers effectively. This topic is so huge that I have a separate blog post explaining the same.

Read more about how to develop high-quality customer service for your dropshipping business e-commerce store.


Conclusion

I have tried to explain as much as I can in this blog post without making it super long. Also, I have provided links to other blog posts that help you in understanding the remaining aspects which I couldn’t explain in this post.

Do make it a point to read them.

The entire process of building your dropshipping business e-commerce store from scratch wouldn’t take you more than a day.

Of course, you would need to be ready with your niche and choices of suppliers before developing your dropshipping store.

I wish you all the very best with your dropshipping efforts!

Get in touch with me if you need any personal advice, or you wish to collaborate or to just say hello and suggest some improvements.

I am always available to discuss!



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2 thoughts on “6 Steps to Start a Profitable Dropshipping Business – An Ultimate Guide”

  1. Pingback: What Is Dropshipping? The Ultimate Guide For Dropshipping In 2020 || Digital Lives

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