To Sell products under $5 is an awful idea since that rate is relatively low…
In this post, I’m going to tell you what is dropshipping, and how exactly you can make money online with Oberlo.
You may be reading this piece because you want to make money online. And trust you me, the feeling is mutual because I also had to come to grasp with what dropshipping meant.
There’s a reason why what I’ll say next makes for a red herring. Usually, I’m very reserved in my commentary, but today I’ll go ballistic.
When you look up on the internet what dropshipping is, you’re going to feel a lot of, excuse me, and manifest nonsense about dropshipping.
I’m going bare-knuckle with you today. I’m going to tell you what drop shipping is and why it’s great, but I’m also going to be really upfront with you regarding the challenges to dropshipping.
A lot of people launch stores, and they fail. You can set yourself up for success by getting in the first place, a realistic definition of dropshipping. With the intro, we’ve got some definitions to get-to.
How To Make Money Online With Oberlo : What Is Dropshipping?
Dropshipping is a business model. It’s not a trendy product nor an end in itself.
To understand the dropshipping business model, you have to know how online businesses, what we regard as eCommerce businesses work.
In a classic online business scenario, the entrepreneur assuming it’s you, either produces themselves or buys from someone else, a product that they then sell to their customers.
If you create the products yourself, you’re going to have as many products as you can produce to sell to your customers.
However, what if you’re buying products from someone else then selling those products to your customers?
Typically, in such a case, you’ll have to obtain a minimum quantity of products from your supplier before selling them to customers.
For instance, say you’re going to sell purses online.
With the traditional eCommerce business model, you would go to a supplier and buy like a thousand purses before you have any customers because you’d need to put those purses in a warehouse and then when a customer finally orders from your store, you’re responsible for packaging those purchases and sending them to your customer.
Now, there’s nothing off with this business model. Tons of successful businesses do just that.
But if you’re a new entrepreneur and you don’t have a lot of experience finding customers or marketing, and you don’t have in the first place, a war-chest to spend on buying a thousand purses or whatever.
As such, it can prove hard to get started with this conventional eCommerce business model.
Dropshipping to the rescue. The way dropshipping works is that, in place of buying that minimum quantity from a supplier, you instead work with specific suppliers who okays selling you a product at a time.
As part of showing you how to Make Money Online With Oberlo,first lets see the advantages.
Benefits of Dropshipping
The dropshipping business model comes with lots of benefits as .
Below are some of the benefits.
The business model allows you to list a product in your online store. That is to say; you’ll have a product page that says purse for sale, describe it & you have the price.
But you don’t have storage if anywhere, you haven’t bought that purse from the supplier. Yes, in essence, it’s virtual.
The customer will come to your store and then decide to place an order on that purse.
When they do, you get your customer’s money; then, it’s upon you to head over to your supplier and instruct the supplier to send one of the purses to your customers’ address.
If the supplier accepts that you buy that purse from the supplier at that time, they proceed to ship the purse to your customers, and voila, transactions are complete.
You make money
This business model has several great stuff going for it. Chief among those things is you can make money, Mulla, dough.
Let’s put some dollar signs on that transaction. Suppose you find the supplier. You engage, and then the supplier sells you the purse for $10.
You can then do as an entrepreneur to list that purse on your online store for say $20-$25.
Then when the customer comes to your store, orders that purse for $25, you keep the $25, save for the fact that you have to pay your supplier $10 for them to ship the purse to your customer then.
Now, in this instance, you’ve raked in $15 in profit. You’ll probably spend some of that money on marketing or overhead costs, say on shipping, et cetera.
But the bottom line is that a $15 profit per transaction is a tidy sum to start making profits.
Are you here still? Awesome! We’ll highlight a couple of other advantages and then move to the nuts & bolts of dropshipping. And given the nature of dropshipping, you can scale this stuff fast.
I’ve already alluded to it. You won’t need to spend on inventory upfront. And this is crucial because it saves you a lot of money that you might spend on products that you’re not sure we’ll sell yet.
Low-risk business model
Dropshipping is low risk because it offers a way of testing to see what you want to do as a business.
This is another advantage of this model because there is no heat to deciding today what your business will be selling for the next six months.
List several different products in your store instead, and see which products sell better.
Then focus on investing more in marketing those products.
In case you don’t have any business ideas yet, dropshipping presents a remarkable way to start testing a lot of different business ideas at once without spending a lot of money,
Dropshipping business also offers logistical ease in the sense that you won’t have to deal with storing products in a warehouse, appropriately package and ship the same to customers’ addresses so on so forth. Your supplier takes care of all of that to you, and that frees up your time.
Challenges of Dropshipping
Much as dropshipping packs several privileges such as convenience, zero inventory, logistical ease, scale-up opportunity, and lower-risk business, the business equally comes with challenges.
Jack of all trades
Just because your suppliers handle all the logistics, thus freeing your time, you shouldn’t misconstrue that to mean you’ll have a lot of free time.
And if we refer to our previous definition, this a business model, and as such, it takes a lot of effort more so, to grow it fast.
It must sit right with you that you’ll have different hats, it’s a hack to dropshipping. With a model, you’re more than an entrepreneur.
In this trade, you’ll do the marketing, accounting, the customer service support you name them.
If you’re the type of person without qualms learning a lot of different skillsets, then dropshipping is one such perfect business model to try your hands on.
However, if you’re the kind that prefers going real deep into one thing, then specialize, it’s best you at least find yourself a business partner before taking on dropshipping.
Are you learning something on how to Make Money Online With Oberlo? I hope so, let us check some facts about the expenses.
Also, we indeed talked about money and the fact that with dropshipping, you don’t need to spend a lot in the minimum order quantities upfront, but you still need money to start dropshipping.
There’s an article about how much money you need to get started, Realistic Dropshipping Startup Budget 2020. Trust me; you’ll find the piece resourceful since we review it all the time, and those numbers prove accurate.
To launch dropshipping a store, we’d suggest that you set aside money in the range of $300-$500.
This budget range can afford your the best chance of success; however, people have successfully started dropshipping stores with less than that.
If you can pull off a successful store from scratch with less than that, prepare to put in a lot of time into your store.
You’ll have to invest in either of these two currencies, time, or money to get this business off the ground, and $300 represents a happy medium of both.
With $300, you won’t stay up all night, building this business, and you will still be able to see it grow.
Shipping is another challenge, especially for newbies. Now I know I’ve just mentioned that shipping with dropshipping is easier because your supplier would take care of all of that, and that’s true.
But what I mean by shipping complexities is managing your expectations and that of your customer around shipping.
We currently live in a world where we expect next day shipping delivery from Amazon.
However, the fact is that a lot of your dropshipping suppliers base in China and your Chinese suppliers can ship to customers around the world inside two to three weeks, give or take.
I’m writing this piece amid a COVID-19 pandemic when shipping takes longer; we’re equipping you with all the data.
You need to understand the reality around your shipping times.
So, ensure that you check out our other resources on shipping if you have more concerns about this, but before you do, let me say this.
Virtually all new dropshippers think that no customer will buy from their store because of shipping times.
I want to reiterate so that I hammer this point home. I don’t want you to call it quits for this same reason. Because If this were true, I wouldn’t be here, or Dropshippingit.com wouldn’t be here. The entire business model wouldn’t be sustainable.
Customers are willing to wait for products, but this hinges on your ability to test products. Customers will wait for say, bath towels or bedsheets, for commodity items that they know they already need in their lives.
Customers will wait for new products that arrest the attention, products that they never knew they needed until they saw the ad.
And folks, this is the key. You’ve got to get the product-market fit right to get over the shipping concern.
Fortunately, we have loads of resources to help walk you through this, including Oberlo 101.
It’s a complete guide to launching a store in the industry. It’s comprehensive in the sense that it delves deep into product research. So, if you’re interested, you can check that out here.
I know you probably puzzled how Oberlo fits in all of this setup. Well, Oberlo is the app that lets you find products to sell from the suppliers and then put them in your online store.
Oberlo works exclusively with Shopify, an eCommerce platform that allows you to create your online store.
Are you still here fantastic! Let’s talk about one more thing. Because so many entrepreneurs toy with the idea about owning brands.
They visualize a product riding into the customer’s mailbox with their logo on it and logo on the packaging.
If you want to Make Money Online With Oberlo in 2020 with your shopify store then this guide will help you big deal.
And that comes from a place of pride in being an entrepreneur.
When you’re just getting started with dropshipping, that kind of customization isn’t feasible because you’re working with the supplier selling products they’ve already made.
However, there’re a lot of entrepreneurs who run seven-figure businesses of completely branded products. And they started with dropshipping.
Once you prove to the supplier that you can sell products, the supplier will likely be more willing to work with you on customization.
Just because you want to sell your custom products doesn’t mean that dropshipping isn’t an excellent way to get started.
Furthermore, if you fall short of digital marketing skills, it can prove dicey to invest in a branded product, launch your store, and then discover that you have no idea what you’re doing with Facebook ads.
In the beginning, you might save the money on branding products and, instead, spend it on learning Facebook ads with a product that’s proved to sell already.
Then you can scale into custom products and have your swimsuit line of branded products.
And now you know what dropshipping is, you know what Oberlo is, why dropshipping is a fresh business model. Equally, you know why dropshipping is still a bit of a challenging business model.
If you feel that you’re up for this challenge, I have great news for you. I’m here for you. Dropshippingit.com is here for you because we’re always sharing suggestions on products to sell, help with some of your questions on Facebook ads & more.
Apart from how to Make Money Online With Oberlo,there are other dropshipping apps that one can use.
As you continue reading you are going to learn more on this blog.
Plus, ensure that you check out our other resources, a blog chock full of info on how to launch your dropshipping business model. This post could be the first step you take towards something great.
I hope it is. And I hope you’ll share your success with us along the way.
If you have a question or comment about how to Make Money Online With Oberlo, hit us in the comment section below.
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