Key Points:
- 33% of online stores now use dropshipping as a fulfillment model
- Dropshipping allows you to sell products to your customers directly from the supplier
- Popular dropshipping platforms include eBay, Shopify, and Oberlo
Dropshipping has become one of the most popular shipping methods for eCommerce businesses. Dropshipping is an online retail order fulfillment model where, instead of stocking products in your store, you purchase them directly from third-party suppliers and ship them directly to your customers.
The dropshipping industry is expected to reach a market valuation of $557.9 billion before 2025. In fact, 33% of online stores use dropshipping as a fulfillment model. With these figures, you are likely marveled at how successful dropshipping is.
And yes, while dropshipping is very lucrative, with eCommerce merchants making good sales daily, it is easy for others to fail. This reasoning could be by choosing the wrong niche or not being patient to follow the necessary steps.
This blog post will go over every reason why dropshipping fails to avoid them and adopt the best practices that will help your dropshipping store scale.
Table of Contents
10 Reasons Dropshippers Fail
To be successful with dropshipping, you need to learn both the positive and downsides as it will help to know if dropshipping is right for your eCommerce business. We'll cover the top 10 reasons dropshippers fail in this section and what you can learn from them.
1. Selecting the wrong dropshipping supplier
Selecting the wrong dropshipping supplier can be one of the costly mistakes you can make as a dropshipper. While finding a supplier can be easy, partnering with a good one is very important. Unfortunately, many dropshippers have resorted to picking suppliers based on the lowest prices, which is not always the best option.
When finding a reliable supplier, look out for the ones with great reviews, a return policy, and those who are willing to give you a tracking number or link with which your customers can track their products. A good supplier will save you a great deal of stress.
2. Doing little research
Online stores will require a lot of time researching the type and target customers, especially for choosing a shipping strategy like dropshipping. For example, some dropshipping products sell well during festive periods, so you don't want to choose a product that won't make a profit in a particular season.
Before you choose to use dropshipping as your shipping and fulfillment strategy, keep in mind the following:
- Research the products your customers care about
- Research current trends
- Find products with good branding potential
- Research the price of popular products
Overall, you have to make sure you research the best platform to use for the product you want to sell. Yes, as simple as it sounds, a lack of research can deter you from making good sales as a dropshipper.
Related post: What is Dropshipping: A Detailed 101 Guide
3. Starting out with too many products
Many dropshipping businesses fail because they start with too many products. If you're starting a dropshipping store, you have to first learn the nitty-gritty of the dropshipping by starting with a low range of products. Then, focus on these products and learn all you need to know about them to adjust well when adding more.
Many people don't know that you have to learn about every product you sell - how to ship them, the kind of social media ads to run for them, and how to reach out to the right customers. Imagine having to run Facebook ads for over ten products. In this instance, you'll end up spending a lot of money, and there is no guarantee that they will all convert.
However, starting with a few products will help you keep track of each product, the ones that convert easily and the ones that do not, and from there, you can decide to add more or restructure.
4. Poor customer service
Bad customer reviews can kill any business fast if you don't prioritize customer service. So as a dropshipper, you have to develop good customer service skills.
It is essential to keep your business thriving amidst the high competition. Every customer has a lot of options and can quickly stop shopping with you. In fact, 58% of American consumers will stop doing business with an eCommerce business because of poor customer service. Therefore, you have to regularly communicate with your customers and update them with every necessary information to curb this issue.
5. Selecting the wrong niche
Yes, doing little research can affect you in the long run, which is why you need to research your business niche. Therefore, it's vital to ask yourself if you're interested in your business niche.
The level of interest you have in particular niche influences how fast you will make sales. So it's advised that you avoid picking a niche you have no interest in or a little knowledge.
To curb this issue, do your research, read about the niche you want to go into, and communicate with eCommerce merchants before choosing dropshipping as your shipping strategy.
6. Lack of branding/marketing
Lack of branding and marketing is a challenge that many inexperienced dropshippers face. For instance, putting in the bare minimum, like importing products and images to your store, isn't going to cut it, especially if other dropshippers are selling the same or similar products.
Instead, you want to include multiple product images from varying angles, product descriptions, an optimized website design for your store, or even a video to showcase the product you are selling. But, again, the key is to market your product to stand out amongst other competitors.
In addition, properly marketing your products ultimately can determine the success of your online business. So, you want to market your products on multiple social media platforms to increase visibility.
7. Choosing the wrong marketplace to sell on
It is possible to sell a product with a good sales record and not make any sales. It boils down to the type of platform you use to market your goods. Using the wrong platform to sell your products can largely contribute to why dropshippers fail.
While it's advisable to use multiple platforms to advertise your products, you must use the right one. You can achieve this by looking out for the ones with the highest conversion and sticking to them. Popular platforms to sell your products include eBay, Amazon, Mercari, and Poshmark.
8. Delayed shipping
Forty-two percent of eCommerce shoppers expect a 2-day shipping option for every online purchase they make. So when it comes to shopping online, consumers want fast and reliable shipping to meet their expectations.
As a dropshipper, there is no way you can beat fast shipping like Amazon Prime if you ship from far away places like China. More specifically, shipping from China to the USA takes up to 20 days and sometimes more.
Despite the possibility of experiencing delayed shipping, you can still sail by doing a few things: keep in touch with your supplier and, most importantly, work with a reliable one to help with shipping times.
Customers don't like surprises, so inform them beforehand by communicating their estimated delivery lead times for shipping. Overall, it's best to share and update your customers, whether good news or bad news.
9. Lack of control of products
Finding high-quality products to sell as a dropshipper can be tasking, but you have to work on finding high-quality products in your online store.
So often, first-time dropshippers select the cheapest products and upload them on their site without checking the reviews and even the return rate of the product. The consequence of this is that customers may ask for a refund, and others will leave negative reviews, which will affect your store later.
Since dropshipping implies you have less control over the products you deliver, consider the following to curb this issue:
- Research a product well before selling
- Go for products with great reviews and comments
- Skip a product if it has a high return rate
- Go for the best products even if it means you have to pay more
- Research similar product listings from competitors
Doing the above will give you reasonable control over the products in your dropshipping store, and you're sure on your way to making great sales.
10. Lack of patience
All reasons above boil down to one – patience. While it is great to be enthusiastic about opening your online store, you have to consider being strategic about it, and strategies take patience to implement.
You need the patience to deal with customers and pick a niche. Also, to reach your target customers and make great sales, you will need to be patient while investing your time and attention to the business, doing every necessary thing you need to do to thrive and have a successful dropshipping business.
Why Dropshipping Fails & How Easyship Can Help
Every business venture has its pros and cons. Be it dropshipping or a physical store, some of the essential things in learning about the downsides of dropshipping is how to combat issues like lack of control over products or how to market your products better.
Even if other dropshippers fail, you don't have to be a part of that group of unsuccessful dropshippers. Many dropshippers can have a successful dropshipping store with a high conversion rate.
Fortunately, Easyship can make this possible for you by leveraging premium shipping features that will make dropshipping hassle-free for starting a business. Some of these premium shipping features include:
- Easyship Shipping Rates Calculator: Access high-volume discounts and competitive rates from major couriers' shipping options. Plus, get instant access to delivery lead times from premium shipping couriers
- Real-Time Shipping Rates at Checkout: Easyship shows the cheapest, fastest, and best value shipping options at your store's checkout. This feature makes it easier to be flexible with your shipping options while letting customers have a choice
- Easyship Branding Suite: Easyship provides a delivery experience consistent with your brand. Add your logo and advertising materials to your packing slips, landing pages, and tracking emails
Ready to ship? Sign up for a FREE Easyship account and get instant access to discount rates for dropshipping
Dropshipping FAQ
What percentage of dropshippers are successful?
It's estimated that dropshipping businesses succeed between 10% and 20%. However, success is ultimately defined by the eCommerce merchant.
Is dropshipping no longer a viable business model?
Dropshipping is hard, but still can be a viable business model for eCommerce businesses.
Is dropshipping still profitable?
Yes, dropshipping is still profitable depending on the research, effort, and work you put into your business.
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