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How Much Does It Cost To Start A Dropshipping Business In 2020?

How Much Does It Cost To Start A Dropshipping Business In 2020?

Do you have plans of starting an online business and asking how much does it cost to start a dropshipping business? 

Then you are in the right place because that is what we are going to talk about here today.

How Much Does It Cost To Start A dropshipping Business

The truth is that starting a dropshipping store can cost more or less money, depending on how you approach the entire process. 

There are plenty of factors to consider when starting a dropshipping store, such as picking a niche, selecting the products, choosing the right suppliers, launching the store, and marketing. 

The other ones include fulfillment of orders and superb customer support.

As you can see, there are crucial factors to consider, but the good thing is that this is the kind of business which you can start with very minimum capital and reap big in the long run only if you do the right thing. 

So, how much does it cost to start a dropshipping business? The good news is that the right way to start doesn’t require a massive capital from you. 

You can start with very low costs and then scale up as your business continues to make sales, strengthen your brand, and keep on adding more products.

Another alternative that you can consider is using third-party services that require money upfront, and these are typically referred to as “middlemen.” 

They are the companies that charge you fees to access to some of their products for sale.

The main drawdown of these companies is that you may end up losing a lot of money, and this hinders your success as a dropshipper.  

Here is how the middlemen structure looks like:

Manufacturer -~ Supplier -~ Distributor (Middlemen) -~Your Store -~ Buyer

We highly recommend that you avoid using the middlemen when starting your dropshipping business, because it’s usually the wrong approach that generally ends badly.

When conducting your research before launching your store, you will come across plenty of companies that charge high fees to start a dropshipping business. 

Often, such companies are middlemen whose primary goal is to charge you high fees to access necessary for building your online dropshipping store and sell products that belong to them.

Whenever a company charges such high costs for someone to start their dropshipping store, just know that their main aim is to get money off you since they assume you don’t have any experience.

Dropshipping Startup Costs

How much does it cost to start a dropshipping business? It can cost you $0.00 to start a dropshipping store if you use a platform like Shopify

Shopify offers a free trial for 14 days, where you can launch your store and start selling the products.

All you need to do is just conduct thorough research, choose your niche, source the products from reliable suppliers, and start selling them.

Once the 14-day free trial period is over, Shopify will require you to pay $29/month for the basic package.

You will also get $100 free credit from Google for marketing your store and get traffic from potential customers. 

Another thing is that you can choose to buy a domain that can cost about $11/year, which has the name of your store for branding purposes. 

Sourcing and linking with suppliers don’t cost you anything. Shopify is a very convenient eCommerce platform used by thousands of other eCommerce stores since it helps to make work easier for you in terms of managing your dropshipping store. 

What you need to do is ensure is that you build an appealing dropshipping store that will attract visitors and feel that they can fully trust your brand.

 It is not a must for you to have the best design, all you need to do is make sure your store looks good and is well presentable with all the features outlined perfectly and the products should have excellent descriptions and reviews. 

You can always import reviews from the suppliers, and there are apps on Shopify which you can install to help you with reviews importation.

One huge advantage of the dropshipping business model is that it doesn’t cost you any money to source for products that you want to sell.

You can do this by yourself, provided you’ve selected your niche. Once you have your niche planned out, the next step is to source products from suppliers with high ratings and ones that you can fully trust.

So, how much does it cost to start a dropshipping business? You have to remember that not all suppliers can be trusted, which is why you need to be extremely keen when choosing suppliers during product sourcing.

Building a dropshipping business is like building a brand that will last for long. To achieve this, you have to make sure everything is done correctly. Choosing the wrong suppliers might negatively affect your business.

Therefore, that is one crucial thing you have to keep in mind if you want your brand to succeed and make 7-figure sales consistently. Customers need to know that they can trust you and that your brand sells high-quality products.

Here is how an excellent dropshipping business structure should look like:

Manufacturer -~ Supplier -~ Your Store -~ Buyer

Typically, as you start a dropshipping business, it may cost you $0.00, but as you progress and your business continues to grow, you may be looking at various monthly costs.

For example, if you decide to use Shopify and the 14-day free trial period is over, you will start paying the $29/month. Shopify connects with Oberlo, which helps you to source products from suppliers. 

Oberlo has 500 products cap, which may hinder you from scaling once your store starts generating many sales as your brand grows.

Therefore, you would need to upgrade to the Oberlo monthly package, which costs $29.90, and this totals $58.90/month recurring.

The good thing is that you only pay for the domain once a year. These are monthly recurring costs, excluding marketing costs. 

There are marketing costs if you decide to market your products on social platforms such as Facebook, which the most popular one, Instagram, and Twitter.

You can also use Google ads for marketing your store, which is also a very lucrative marketing method.

How Much Does it Cost to Start a Dropshipping Business – Marketing.

When it comes to running a dropshipping business, you also have to consider the marketing aspect. You need to market your products to generate sales. 

Marketing also helps to get your brand out there for customers to know about you and see the kind of products that you are selling. Usually, you have to be comfortable losing at least $500 before you start becoming profitable. 

Opening a retail store can cost about $10,000 before you started seeing some profit.

 Therefore, spending at least $500 on an eCommerce store is a minimal investment because you can scale it with time and make you more money in the long run.

However, for your first store, you need to find ways to keep costs low, and some of the methods include avoiding spending money on custom logos, photos, as well as website designs. 

Try to keep things as simple as possible, and then you will change gradually with time as you continue growing your brand.

The Costs of Dropshipping on Other Platforms

Apart from Shopify, there are also other platforms where you can dropship products and establish a stable dropshipping business.

So, how much does it cost to start a dropshipping business on these different platforms? We are going to get into detail about this below. 

Amazon Dropshipping Costs

Pricing for Amazon dropshipping starts at $20/month. The good thing is that Amazon offers the tools which help to simplify your work as the seller and make the experience better.

 Amazon also provides a spreadsheet that you can download to get all the information about inventory and order.

 Amazon dropshipping also allows you to modify product pricing and quantity easily. 

However, the only disadvantage is that Amazon has put restrictions that prevent you from selling on the platform.

The only way to sell on Amazon is through their FBA program. FBA stands for “Fulfillment By Amazon,” and it is whereby you connect with suppliers who then ship products to the Amazon warehouses where they are fulfilled and shipped directly to buyers once they make orders.

The FBA program is quite costly to get into and start, which can be a massive hindrance if you have a low budget. 

eBay Dropshipping Costs

Another alternative platform to consider is eBay. eBay is a great and convenient platform that you can use to kick-start your dropshipping business, and it doesn’t involve a lot of costs.

So, how much does it cost to start a dropshipping business on eBay? There is a listing that you need to pay to have your products listed on the platform. 

The good thing is that they offer a free option in case your product ends up not selling. But the starting price for the product is supposed to be between 0.01 to 99 cents.

To dropship on eBay, you must register an account, add products and let buyers start bidding on your products. 

The best bidder wins the product you are selling, and then they complete the purchase. eBay is an auction site where you can sell anything from cars to household goods, among other products.

Another disadvantage about eBay is that they require sellers to fulfill orders directly from the warehouse of a supplier. 

You cannot purchase items from another marketplace that ships products directly to customers. 

They are very strict with this policy, and they state that if you do this, they might remove your listing. 

Alidropship Startup Costs

Alidropship is another platform that you can use to launch your dropshipping business.

 It is a popular platform similar to Shopify, plus it is very convenient and affordable. With Alidropship, you won’t have to pay any monthly recurring costs.

Alidropship offers different ways to kick-start your dropshipping business. One of the methods is that you can buy their plugin for $89, which works well with WordPress. 

Once you install the plugin in your WordPress dashboard, it allows you to link with AliExpress and source products from suppliers.  

Another option is that Alidropship offers options whereby you can order custom-made stores at different prices depending on the packages you choose. 

These packages include;

1. The basic package – costs $299, and if you add their hosting, which costs $48. The total startup cost would be $347.

2. Advanced package – Costs $499 plus their hosting, which is $48. The total startup cost for this package would be $547.

3. Ultimate package – Costs $899 plus their hosting, which is $48. The total startup cost for this package would be $947.

The above three packages each come with different features. Of course, the ultimate package includes a lot of features.

 However, each of them offers you the option of having your store designed by professionals, payment method configured, social profiles created, and domain plus website setup.

 Your only job would be to get your store once it is done and start marketing the products. The store is designed according to your preferences and the niche that you choose.

The cheapest way to start your dropshipping business with Alidropship is through buying the Alidropship plugin, setting up your site through their free website themes, and WordPress hosting and buying a domain for your site.

However, this will require a lot of work and skills from you.

How Profitable is Dropshipping?

The question that most people ask is whether dropshipping is a profitable business model. The answer to this question is a resounding, yes!

However, one thing you need to know is that dropshipping is not a get rich quick scheme.

You can’t just launch the business today and expect to make thousands of dollars tomorrow. 

Similar to most other businesses, it takes time and effort to start reaping the fruits of your labor in this business.

You need to be willing to learn and work hard to make considerable profits consistently. Luckily, nothing is impossible.

How much does it cost to start a dropshipping business?  The Bottom Line

How much does it cost to start a dropshipping business? That question highly depends on your approach. 

As you’ve seen from everything we’ve discussed, the costs are relatively low, and there are also high startup costs. 

Whatever the case, you need to ensure that you know what you are doing – try as much as possible to do proper research and connect with mentors and other dropshippers in the field to learn as much as you can if you want to see a little bit of success.

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Samwel Dollah

I was looking for ways of making a living working online from the comfort of my home,few years in am able not only to work from home but also help others achieve their dreams too. I am a full-time eCommerce expert dropshipping business ,Niche research and Facebook ads Expert.

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