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So What Exactly Is eCommerce Dropshipping, How Does It Work, And Why Should You Consider Starting Your Own Online Business?
So you're thinking about starting an eCommerce business... Awesome!
You should definitely learn a bit about what you're getting yourself into before you commit to investing a lot of time, energy, and money into this business model.
eCommerce vs. Dropshipping
If you're not aware already, eCommerce is simply selling products and services online, but it's not that simple.
You can create the product or offer the service yourself, or you can do what's commonly referred to as "dropshipping" by finding a someone or some company who has already created or already offers the product or service and simply being the middle-man by selling the product or service to someone and having your supplier fulfill the order for you.
The Risks of eCommerce
If you choose to go the route of creating and selling your own product, you'll need to take on a lot of risk. You will have the risk of upfront investment in the creation of the product or service, the packaging, and the warehousing and fulfillment, not to mention offering warranty support and accepting returns. You'll also need to reach out to other sellers to create a dealer network so you can continue to grow without spending a ton of money on advertising yourself.
The Benefits of Dropshipping
With all that said, the beauty of dropshipping is that you can have all the product creation, packaging, warehousing, and fulfillment taken care of for you in exchange for you just creating an eCommerce store and advertising the product listings until one sells. You can then just send a "purchase order" to your supplier for that one product to be "drop shipped" directly to your customer without an invoice, and you will be able to pocket the difference as your profit.
The Downsides of Dropshipping
If you are considering dropshipping as the way to start your first online business, you need to be aware that this is not a get-rich-quick scheme. This business model takes a lot of work and investment just like any other. You'll be able to skip a lot of the supply chain, but you'll still have to invest in website design, content, product uploading, advertising, marketing, and hiring and managing a team. All this upfront investment can go to waste if you don't choose one of the best drop shipping items to sell. You won't have any control of product quality, but becoming an "authorized dealer" of the brand-name products you sell on your website instead of just using Amazon or eBay or Walmart as your supplier, you'll be able to use their warranty and returns policy as your own. The bottom line is that you need to know what you're getting yourself into before you get started. Read my story to get an idea of what I went through and maybe it can help you get an idea of what it takes to become successful with dropshipping.
My Dropshipping Success Story
Personally, I got started with dropshipping after I worked at a company that was a distributor for locks and security hardware and gun safes and having some customers that were running dropshipping websites sending me purchase orders for one product at a time. I started getting over 10 orders a day from one of these dropshipping websites and I was really amazed. The amount of orders they would send on a daily basis caught my attention and got me interested in starting my own dropshipping website. However, I didn't want to sell locks and security hardware and gun safes because they are highly complex products and that wasn't something I was interested in selling online.
I started talking with some of the business owners that would come into the distributor to buy products for their business and made friends with one of the guys. We started talking about starting our own website dropshipping products and decided upon a niche that was simple enough and was trending.
After doing some initial research we found some potential suppliers that were manufacturers of their own brand of products. We were able to convince them to give us dropshipping dealer agreements if we purchased a minimum amount of their products upfront.
We asked for their wholesale pricing first, and when we saw that the products had the potential to be profitable after costs like advertising, shipping, and credit card fees, we decided to make the investment and start setting up our first eCommerce dropshipping store.
The product average price point was around $500-$1,000. This price point made sense because the average profit margin was 20-30% before shipping, so after shipping it would be around 15-20% profit margin which would be enough to pay for the ads, marketing, and give us some net profit to spend on content to grow the website.
It took me about a month to build the first eCommerce store, but we got our first order shortly after that and I can still remember the moment that order came in. I sent the purchase order to the supplier, it was in stock, they shipped it to the customer (it shipped all the way from LA to NYC) and it arrived in good condition and I kept about 15% net profit on a $250 order, so about $30 bucks.
A lightbulb went off in my head that day and I spent every moment I could to continue to grow my dropshipping business. It took about a year to get to $100,000 in sales, and by year 3 we had done a few hundred thousand in sales. By the 4th year we did over $800,000 in sales.
In 2014, I even signed a lease on a flex-space brick-and-mortar storefront. This was a unit in a manufacturing district. My plan was to buy some of the products we had on our website, put them on display, and use our new storefront to get suppliers onboard that I couldn't get unless I had a physical storefront. That plan worked great until I tried to get those big name-brand suppliers. Even though we had a storefront, they still wanted an upfront investment of over $10,000 in inventory. I also had to spend a lot of money on displays and merchandising displays, a POS system, and overhead like insurance, electricity, a security system, and employees. It ended up costing me 100x more than I expected, and even though it was profitable for the first 6 months, it ended up making me feel like I was back in the same "place" I was in life when I was working my 9-5 job at the office at the lock and security hardware distributor, so I decided to get out. I liquidated all the inventory and displays, and found someone to take over the lease.
Around the same time, due to some bad product quality from one of our suppliers, we got kicked off of selling on Amazon and eBay within the same week. We still had an eCommerce website based on Wordpress using Woocommerce, but I didn't like the platform because it was really old-looking and slow and even though it converted well, I wanted a new platform. So I looked into starting a Shopify store, but unfortunately, most of my traffic was from organic rankings in Google, and after making the switch, I lost almost all of my organic traffic. So I switched back and got the traffic back, thankfully, but I decided to sell the website so I could take a mini-retirement and start a new eCommerce store a year or so later.
After a year or so, I got back into the same niche and this time using Shopify, which I love using. The store instantly took off and I built it over the next couple of years to do about a million in sales. However, due to personal reasons, I decided to sell the website again. I found a buyer and made the sale. Took another year off. Started a new store in a different niche, made more money, sold that store, took even more time off, then I started and launched the eCommerce Paradise Academy to help teach and coach others to start their own eCommerce business using dropshipping fulfillment method and selling high-ticket products.
After a couple of years of running eCommerce Paradise, I decided to start another store in the same niche as before and it took off instantly, doing half-a-million in sales in the first 6 months.
Today, I continue to teach and consult with clients on how to grow their eCommerce store and scale using the dropshipping fulfillment method. But I'm also experimenting with advanced tactics for SEO, private labeling, subscription products and services, advertising, and marketing.
If you want to get started, I would highly recommend you sign up for my free niches list, free mini-course, and free webinar, and read my guide on what is high-ticket dropshipping, the best dropshipping products, best dropshipping suppliers, and the best eCommerce platforms.
Once you're ready, you can enroll in my High-Ticket Drop Shipping Masterclass, get yourself one of my Turnkey Shopify Stores for High-Ticket Drop Shipping, sign up for my Private Coaching Program, or get your entire business built and launched for you with our Business-In-A-Box Package.
Read my story about how I went from side-hustle to full-time income and became location independent, traveling the world as a digital nomad and living the "Four-Hour Workweek".
If you want to know all the tools I use for my eCommerce stores, you can get all my recommended resources for eCommerce and high-ticket drop shipping.
Drop Shipping Guides for Beginners
Understanding The High-Ticket Drop Shipping Business Model
What You Need To Get Started
Marketing and Advertising
Automation and Outsourcing
Customer Lifetime Value
So much value in the masterclass! Trevor literally teaches you step by step over his shoulder. It’s not like other courses that tell you what to do he actually SHOWS you and that’s what makes this a game changer. If you want to be successful get plugged in with the masterclass. I tried penny pinching and taking a DIY approach but I quickly realized I needed some guidance and the course exceeded my expectations. I followed the steps and I’m almost ready to officially launch my store. I can’t wait to see my results.
Team and Trevor is very consistent in making sure you stay on the path to success. So far so good! I love the communication.
I haven't finished the course yet but there is a ton of valuable info. I look forward to finishing up and diving in!
Great so far Trevor is great to work with very responsive and I have complete confidence that my store will be profitable
Turnkey Business-In-A-Box Service Package for High-Ticket Drop Shipping Beginner Package
This is the best hassle free recruiting service. My first VA was not performing and they hired another competent one the next day.
Fast results and fast delivery of my new store.
Already made back my money on the store within 30 days of purchase. Couldn’t be happier with my experience with E-commerce Paradise and the course that was included covered every detail of this business model. I was able to give the course to my VAs and get to work immediately. I’ve bought three stores from Trevor so far and will definitely be buying more
I’ve had other courses and non Have taught me as much as Trevors course has. This course goes into the nitty-gritty of the business.
It's so great working with Trevor. He's really detailed and knows his stuff.
I’m not sure on the product yet. Still trying to work it out.
The owner has been so helpful. Looking forward to starting my business.
The course is awesome, it has so much detail and content about every single aspect of building and running a HTDS store. Trevor is a great teacher and the bite-size style videos make going through the course a breeze.
Store is being put together and is looking great!
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