In 2019, the size of the global eCommerce market was US$3.535 trillion. In 2021, the figure is expected to hit US$5 trillion and increase to US$6.5 trillion in 2023.
Interestingly, in 2019, most online purchases were completed with smartphones as compared with PCs.
So, what does this mean for a budding entrepreneur?
It means online shopping is the new normal. These habits are now a regular part of consumer behaviour, and the opportunities for tapping into this market are at an all time high. Starting a dropshipping business can be an incredible way to meet this growing demand, and the best time to start is: now.
In the era of Amazon, the growing demand for fast shipping is at an all time high with 40% of customers expecting delivery within two days. For those targeting the largest consumer market in the world,the USA, this guide will give you the steps you need to take to build a successful dropshipping business - with US suppliers.
What is Dropshipping?
In a nutshell, dropshipping is an order fulfilment method in which the retailer sells a product and passes on the order to the supplier who later ships it directly to the customer.
This means the seller doesn't keep any product inventory in stock, but focuses on website design, customer acquisition, and marketing instead.
Dropshipping is a highly scalable business model with almost zero set-up costs, which makes it a favorite among new entrepreneurs with lower risk tolerance.
With the right marketing strategy and strong customer relationship management, dropshippers can expect to generate a good amount of revenue and scale up pretty quickly.
Many online stores of various sizes have enjoyed the benefits of operating with this model. For instance, Wayfair and Blinds are still using dropshipping as their fulfilment model, and they’ve scaled into a household name with hundreds of millions in revenue.
In the past, Amazon and Zappos started out with this model as well.
While actual results vary, we've have success stories from newbies who earn anywhere from a few hundred dollars to tens of thousands of dollars in monthly sales revenue. Eventually, they replace their full-time job with earnings from their eCommerce store.
Advantages and Disadvantages of Dropshipping
Advantages
Easy to Start
Popular eCommerce platforms WooCommerce, Shopify and Wix can be conveniently tweaked for dropshipping by installing a dropshipping platform for this purpose.
Literally, with a minimal barrier of entry and near zero risk, you can start selling various trendy and profitable products almost instantly. How sweet is that?
Low-risk and minimal cost
Dropshipping has a low initial starting cost, and a low risk in getting started. You can start with nothing, build your social channels, and eventually invest in marketing based on any budget that works for you.
You can start dropshipping with any website building hosts as well. WooCommerce itself is a free eCommerce Wordpress plugin and you can opt for the free trial on Shopify or Wix to get a feel for the advantages of either option.
With Spocket, you can simply download the plugin and immediately start selling products from dropshipping suppliers in the USA and EU as well as Asia. Sign up for free and check out the product selection!
Skip the Supplier Screening
By comparison, conventional eCommerce stores source their products from suppliers or wholesalers, which can be domestic or overseas. They have to worry about supplier relations, scaling as well as volume.
The time it takes to research, screen suppliers and products, build a relationship, and test the products is enough of a deterrent for most people starting out.
Opting for a dropshipping platform allows you to skip the entire process of finding and screening suppliers, and get straight to work with marketing and product research.
Skip holding Inventory (and the costs associated with it)
With a typical business model, Products are stored and maintained in a local warehouse before they can be sold. This means overhead costs, a system of managing inventory as well as costs and time associated with maintaining this part of your business.
Dropshipping allows entrepreneurs to skip this grueling process, which translates to a zero warehousing cost and more time to focus on the building of your brand and marketing.
Easy Product Importing and Management
Dropshipping platforms provide automated product selection, description importing, and image uploading, which would save hundreds of man hours and costs associated with photography and copywriting.
Spocket makes the whole fulfilment even faster as most products are from pre-vetted suppliers based in US, Canada, EU, UK, Australia, New Zealand, and some parts of Asia. This alone reduces shipping time from 3 weeks to just a few business days and makes customers, and the retailer, happy.
By providing fast and affordable shipment, you're a few steps ahead of the competitors that source their items from China. After all, satisfied customers are repeat consumers!
Flexibility
Have you ever wondered how the people who travel the world and work from anywhere do it? Well dropshipping is one of those liberating routes.
As long as you have an internet connection, you are able to manage your business from anywhere at any time. Whether it’s on a beach or at home with your kids, the choice is yours.
Drawbacks
High Competition
Like any other business model, dropshipping also has its down side. With its low barrier of entry and almost zero startup costs, the competition is tremendous. Thus, selecting the most appropriate niche is key to having highly sellable products that generate significant profits.
Returns and Refunds
Another drawback is having to deal with returns and refunds, in the case of dissatisfied customers. However, such risks can be significantly lowered by providing utmost care and the highest level of customer service right from the beginning and with strong business relationship with suppliers.
Any seasoned dropshipper will tell you horror stories of having to send return products to Aliexpress suppliers that had language and time zone barriers to deal with. Most would end up having customer returns sent to their home, where they absorb the costs associated with the shipping and refund.
With dropshipping suppliers from the USA, these products are mostly made from small business owners who take care of their retailers with fair return policies and frequent communication. This makes returns easy and fast, with a policy that saves your pockets, and makes your customers trust you.
Choosing Profitable US Dropshipping Products
Dropshipping allows you to experiment with various categories. But choosing the right niche and products is where most dropshippers get stuck. Starting off with a niche you love and searching for products that have high potential for sales are your keys to success from the beginning.
Find a niche (you love)
Successful dropshippers focus their dropshipping business on niches they love, and are already well versed in. Erin started a store for pets when she realized that her experience (and love) for dogs would give her all of the insight she needed to get to her target market. How? Because she is in that niche herself.
So, take your time here and choose something you can see yourself advertising for years on end.
Choose Impulse Products
A great dropshipping product is something so exciting and novel that the customer doesn’t think twice about buying it.
You can find products within your niche by using a niche scraper and looking for dropshipping suppliers in the USA that have these items. These tools give you insights into possibly trending products that you may want to start selling before anyone else does.
For example; take a look at this customized ring:
Who wouldn’t love a ring that had an imprint of the moon on their birthday? It’s so unique and special that couples or best friends all over the world will buy it for their loved ones (and themselves).
Using Google trends you can gauge how much demand there is for specific items. Like below:
You’re looking for a consistent or growing google trends graph, to let you know that these products are evergreen, and always in demand. Once you have a US supplier, You’re golden and ready to make some sales.
This brings us to our next critical point: do your research.
Do your research
Products that aren’t as common, such as those found in laser-focused niches, could be the right category to sell, as long as the marketing efforts are well-targeted and you’ve done your research.
Before settling on a product, consult with two tools:
Once you’ve found a great product, make sure its checked off in terms of consistent interest over time as well as a high number of searches per month.
For instance, novelty enamel pins,camping gear, diving equipment, gadgets for left-handed individuals, swimsuits for plus-sized ladies, and pet wardrobes are all excellent examples that fit into the following criteria for a profitable dropshipping product:
- Room for profit margin
- Instagram-able (marketable)
- Relatively hard to find offline
- Easy to ship
- Have multiple variants or add-on items
For ideas of best-selling products, check out reviews and popular products on Amazon and Etsy. Keep an eye on the ones that have consistent sales and consistent good reviews.
For detailed analytics, sign up with different niche scrapers, and you'll be able to see how top dropshipping stores perform, including how many orders they receive per item. You can use this data to be better than your competitors and scope the newest trends.
Why you should dropship from US suppliers
Due to China’s massive manufacturing capacity and low shipping costs, they’ve been the top contender for dropshipping suppliers since the start of the dropshipping model. With their low prices, dropshippers can increase profit margins without making the retail prices too high by any western standard.
For small products, AliExpress offers fast and super low-cost shipping called ePacket for US delivery. For larger items, the shipping costs for expedited delivery can be a bit too high considering the distance. Not to mention the unreliable package tracking system.
Due to foreign logistics and international law, Aliexpress products can take 20 to 50 days delivery time, which is a deal breaker for US and EU-based customers who are already accustomed to speedy Amazon delivery.
This fact alone may be the reason you’re looking into using US suppliers for your dropshipping business, and for that you’re on the right path.
Partnering with dropshipping suppliers from the USA allows you to:
- Offer much faster delivery for customers in North America
- Overall better perception of quality
- More reliable package tracking system
- More shipping options (including same-day delivery)
- The "American Made" stamp, a powerful selling point ready to be capitalized.
Thus, you can position your store as more patriotic by sharing your attempts to support the local economy and supporting small businesses in the USA. Such heartfelt value is definitely something you'd want to mention in promotions targeting US consumers.
Sure, the base costs are likely higher than dropshipping from China. However, Customers are happy to pay more for items that arrive faster and are of higher quality. Let alone to support local suppliers and the economy as a whole.
Finding US Dropshipping Suppliers with Spocket
Dropshipping comes with many benefits, but it has its own downsides when it comes to markets saturated with low quality products and slow shipping times. Spocket was created as a solution to the issues dropshippers face.
To begin with, Spocket's features allows dropshipping automation that can easily be managed by only one person, so you're saving time and money right from the beginning. The learning curve is relatively short, considering it's available for most popular web hosting platforms.
With 70 percent of suppliers based in the US and EU, delivery time is cut considerably to an average of only two to seven days. With US suppliers, refunds and returns are fair and can be processed much faster, which increases overall customer trust, confidence and satisfaction.
With higher perceived value of US and EU-manufactured products, dropshippers can position their store as an upscale brand, thus allowing them to increase profit margins.
With continued quality performance, the store brand's value would eventually go up, which increases customer trust even further.
In general, Spocket app comes with these plans and features:
Sprocket is the leading dropshipping platform for US and EU products and suppliers. Theres more advantages for individual entrepreneurs targeting B2C market and dealing directly with suppliers.
Therefore, low prices and high profit margins aren't always the formula for a successful dropshipping business
Your success depends on four important factors:
- The quality of products,
- The fast shipping
- The reasonable price
- Excellent customer service
Just make sure that all those four elements of best practices are well presented.
With your success in mind, Spocket Help Center provides comprehensive and detailed tutorials on navigating their dashboard, connecting with an online store, and uploading and updating stock information.
Marketing Your New eCommerce Store
Before launching your new dropshipping eCommerce store, make sure to have a high converting dropshipping website and a good customer acquisition plan.
Here are some guidelines on theme design:
- Select a theme that comes with lots of white space (margin) between products, images, and texts. It's the most fundamental rule of a good website design. The less clutter, the better it's for the eyes.
- Present a few featured products or collections, don't clutter the pages with too many items that are too distracting. The page layout should entice visitors to click through the pages and products, which is also known as a positive user experience (UX).
- For placing CTAs, use The Rule of Thirds. The idea is: placing a simple grid that divides the image into nine squares. The parts of the grid where the lines cross are called "focal points," where you should place the CTA buttons, as our eyes naturally drift there.
Take a look at Frank and Oak’s website below:
The Call to action is clear, and they even entice you with a generously discounted flash sale.
Your customer acquisition plan should cover both organic and paid strategies. Ideally, the majority of traffic comes from organic efforts directed to the site or blog and from earned media, both online and offline.
Organically, start by optimizing the store pages with SEO keywords related to the products sold. Start with these free tools: Google Keyword Planner, Google Trends, and UberSuggest.
SEO Optimization
SEO keywords are critical to being discoverable on the web. If your store is in the enamel pin niche and your customer types in “enamel Pins” on google, Facebook, Instagram or Pinterest, you want to be able to compete and be on the results page.
Make sure you introduce a blog or journal to attract organic traffic, and create a storytelling technique to inform your customers.
Each post should target at least one to three SEO keywords that would attract the target audience intended.
For concepts that you can delegate, consider hiring a digital marketing strategist with strong SEO writing skills to write your web copy.
If your site is brand new with zero organic traffic and almost non-existent outside links, consider paying for ads, such as PPC or sponsored ads. Another way is by paying high-ranked blogs or networks to post about your store or your mission. This is a great way to get your brand out there and build trust in the market.
Successful Dropshippers
We wanted to end this guide with three inspiring case studies and how they started they entrepreneurial journey. From full time jobs to being completely self employed - these dropshippers discovered the key to a successful drophipping business, and shared it with us.
Marc Chapon: $60K in Revenue Per Month
Within a year, Marc's dropshipping store generated $60K per month and now he's teaching an advanced course at Spocket Academy titled Dropshipping Elite: The Advanced Guide to eCommerce.
Without any eCommerce experience, Marc started out by comparing Spocket with Oberlo. He chose Spocket as it allows him to work with US and EU-based suppliers. With $1,000, he got a paid Shopify theme, install Spocket app, and start promoting the site which was named Puppy Love.
For a lead magnet, he created a dog owner's guide for a free download in exchange for an e-mail address. He made sure that the product descriptions are succinct and crisp. In a nutshell, he said that product descriptions should prove that it's worth buying, would bring a significant meaning, and shows why it's better than the competitors'.
Product pictures must also the most updated, clear, and fit the template. And for payment gateway, you can choose any of these: Stripe, PayPal, and 2CheckOut. For Stripe, you'd need to be based in the USA to access the account.
Erin Rafferty: Choose a Niche You Truly Master
Erin Rafferty makes $70,000 revenue per month from her three online stores with Shopify, which is quite amazing considering she was an unsatisfied 9-to-5 employee. Her stores' niches include: women's clothing, baby clothing, and pet products.
Erin selected 25 to 50 products per store, so visitors aren't paralyzed by too many options and she could build a long-term brand. She also included clear return policies, privacy policies, contact information, and FAQs on every page. In addition, the site's clean, clear, and easy-to-navigate design is crucial to entice repeat orders from customers.
Kyle Borawski: Artistic Product Photos and Simple Descriptions are Key
Kyle generated more than $220K in sales from August to October 2019 with his dropshipping store. He trusted Spocket for it provides not only access to high-quality products, but also controls the quality and ensure timely shipping.
As a successful entrepreneur, he makes a daily goal to be one percent better every day. As long as there is some improvement, it's good enough. In 30 days, you can expect to see a 30 percent increase and in a year, 365 percent.
He also mentioned the two important elements to entice new and repeat customers: crisp product images and simple descriptions. Ideally, the images are taken in one photoshoot session. And the descriptions are written in a simple and friendly tone.
He suggested ordering every product beforehand and take product photos by yourself. This way, you'd be able to see the quality of the product and project it in the photos taken. Authenticity is huge in eCommerce.
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