Home / Shopify / How to dropship on Shopify 

What is dropshipping?

Dropshipping is an order fulfillment method where a business doesn’t keep the products it sells in stock. The store sells the product and passes on the sales order to a third-party supplier, who then ships the order to the customer instead. 

The selling merchant serves as a go-between, which is the major distinction between dropshipping and the traditional retail business. 

With the right approach, dropshipping can be a successful fulfillment method, including trending, worldwide brand name items. That means taking the time to conduct market research and finding the right suppliers.  

Dropshipping items with multiple wholesalers might have advantages and disadvantages. Of course, low profit margins, a fiercely competitive market, and little control over the supply chain are potential roadblocks. 

Is Dropshipping legal?

Take it easy. Dropshipping is not only legal; it’s all around us. Both eCommerce stores and regular retail shops engage in dropshipping.  

After all, dropshipping is just a fulfillment method. You take the customers orders and have your supplier ship the products to them directly. For that reason alone, plenty of retail stores prefer dropshipping. It’s an easier, quicker, cheaper, and less risky fulfillment method than holding inventory. 

Advantages

Easy to get started

While starting an eCommerce business is challenging, it’s relatively easy to get started with a dropshipping business. Think of all the research, planning, budgeting, website building and the multitude of other activities you need to do before you even begin selling.  

Little to no investment 

Perhaps the best thing about the dropshipping business model is that you don’t have to purchase and hold the stock you sell. You only buy the stock once you’ve made a sale and the customer has paid you.    

Dropshipping is flexible

You can operate and manage your business as long as you can speak with suppliers and customers without difficulty. Many successful dropshipping businesses are run from home. You may not even need to quit your job to start your store as you can often balance it around current commitments.  

More choice of products 

As you don’t need to stock up on or store the products you sell, there’s a lot more choice of items you can offer.   

Scalability

It’s considerably easier to grow a dropshipping business than a regular online store. As your order volume grows, the job shifts from you to the supplier, allowing you to expand your firm without having to pay for additional people to assist with the work brought on by the additional sales. 

Disadvantages

Less competitive pricing

The key to a successful drop shipping business is making a profit on the difference between the price of your products and what your dropshipping partners charge you.   

Stock reliance

As you’ll shortly discover, dropshipping has good and bad aspects. The strategy makes it possible for you to respond to and adjust to customer trends, but it also leaves you open to unexpected stock shortages. 

Highly competitive

Dropshipping is a viable business model for many because of its low barriers to entry, however, this means a lot of people are doing it. Competition is stiff and it’s harder to make a name for yourself.  

Low margins

Low margins are perhaps the biggest disadvantage of starting a dropshipping business. 

How to Start Dropshipping on Shopify?

The most essential step when setting up Shopify dropshipping, is creating your own Shopify store. You’ll need to set up your website and consider your brand and marketing strategies if you want your business to be successful.   

Step #2: Find the right dropship vendor app(s)  

There are numerous Shopify dropshipping app extensions available. These add-ons give you access to a number of marketplaces that serve as a go-between for your online store and your customers. To name a few of the wide variety of options to choose from: Oberlo, Printful, and Sprocket. 

After you find the right ones, all you have to do is to connect these dropship vendor apps to your Shopify store.    

Step #3: Add products to your store  

Depending on the app you’ve chosen for your Shopify dropshipping, you need to pick the drop ship products and import them to your Shopify store. From now, you are ready to start your Shopify dropshipping business.   

Step #4: Take care of your finances  

Last but not least, in order to successfully use Shopify dropshipping, your funds must be in order. You can make sure everything is organized for tax season by using accounting automation software like Synder. 

If you want to build your own web shop or have questions relating to e-commerce development platforms or apps, read our blog posts for Shopify and Shopware. Our dedicated outsourcing team can be your collaborator in e-commerce. 

Arrange a free consultation now!