Is dropshipping in South Africa something you have considered as a potential business? I’ll run you through if it’s even a viable option in South Africa and how to go about it.
What is Dropshipping?
Dropshipping is a type of eCommerce in which the retailer sells products on their online store without stocking the item themselves. Instead, they purchase the product from a supplier and as a sale is made from their online store, the supplier then ships the product directly to the customer. The retailer keeps whatever profits are left over after the sale is made.
There are many reasons this business model has increased in popularity. Low start-up costs, low risk, no handling inventory, the potential for large profits and can scale very fast.
Is Dropshipping Profitable in South Africa?
Dropshipping isn’t as prominent in South Africa as it is in some other countries. Which can be positive and negative depending on how you look at it. The advantage of this is there isn’t as much competition and it has much more room to grow. The disadvantage is online retail in South Africa isn’t as large and therefore the market isn’t as large.
Before 2020 eCommerce accounted for 2% of all retail sales in South Africa. The good news for entrepreneurs is due to the pandemic there has been a major boom in online sales. This could change how the online retail industry evolves in the future.
According to Statista, eCommerce sales reached USD 6.45 billion in revenue in 2023 and are expected to reach USD 10.11 billion by 2027. The most popular categories of eCommerce sales are electronics and fashion.
In other words, this exponential growth in eCommerce makes it a great time to start a dropshipping business in South Africa.
Is Dropshipping legal in South Africa?
Yes, Dropshipping is legal in South Africa. Many people have this misconception that dropshipping is illegal. You are essentially just a middleman selling products to customers just like any normal retailer is. The only difference is you don’t hold your own stock.
It is however illegal to sell products prohibited in South Africa and to sell trademarked or copyrighted products.
To check which products are trademarked in South Africa, check out CIPC
To check which products are prohibited and restricted from import, check out SARS
For information on South African tax rates, SARS Tax rates
Does Dropshipping Work in South Africa?
There are a few main reasons why the retail industry hasn’t seen the same exponential growth as other countries before 2020.
- Shipping – Shipping times are slow and expensive and many smaller towns simply don’t receive deliveries.
- Internet – Limited internet access in many areas and expensive data costs.
- Payments – South Africa doesn’t have as many payment options compared to other countries and tends to prefer to use cash.
Don’t let these issues discourage you as these are all problems that are improving with time. Whenever there is money to be made, solutions will be discovered to these problems. Yes, there are more challenges but this is why the dropshipping market is relatively untapped in South Africa.
If you consider South Africa’s largest online retailer Takealot generated R6.26 billion in 2020 with these issues, there is clearly still money to be made online. However, you may need to come up with different tactics to be successful.
AliExpress Dropshipping to South Africa
AliExpress is the most popular place for dropshippers to source their products and sell to their own country at a marked-up price. The reason for this is the huge marketplace stocking every possible product you can think of and the low prices.
Even in countries such as the USA, shipping times can be long at a few weeks. In South Africa, shipping times from China can be as quick as 10 days but can take up to 2 months. This is going to make some unhappy customers which will require more customer service on your end. To speed up delivery times you will generally have to pay more for a separate shipping method. This will vary depending on which supplier you purchase from.
Many suppliers won’t ship directly to South Africa so you need to filter these guys out right away. Make sure you click the ships to South Africa option at the top of the screen to only show suppliers who ship to South Africa. Then click the free shipping option otherwise you will end up with suppliers charging exorbitant shipping prices only.
Although shipping will take a long time, don’t let it completely discourage you from dropshipping from AliExpress. If you’re selling a product the customer needs or wants and can’t buy it anywhere else, they will be willing to wait the longer shipping times. Always make sure you are transparent with the shipping times from the start, don’t leave your customers in the dark. If they expect fast shipping and you don’t deliver, you can expect some angry emails.
Below are the major shipping carriers estimated shipping times from China to South Africa. The prices vary depending on the product size and weight. Generally, the companies that provide the fastest shipping times to South Africa also charge higher prices making it impractical for dropshipping.
The most affordable shipping options from China are SunYou, SunYou Economic Air Mail and Cainiao Super Economy. They offer either free shipping or low-cost shipping but you obviously need to deal with the long shipping times.
|Shipping Carrier||Estimated Shipping Times||Tracking|
|DHL||9 – 22 Days||Yes|
|UPS Express Saver||12 – 22 Days||Yes|
|FedEx IE||10 – 18 Days||Yes|
|e-EMS||20 – 40 Days||Yes|
|UPS Expedited||12 – 25 Days||Yes|
|SunYou Economic Air Mail||30 – 50 Days||No|
|FedEx IP||7 – 15 Days||Yes|
|China Post Registered Air Mail||40 – 59 Days||Yes|
|Cainiao Super Economy||30 – 50 Days||No|
|Aramex||16 – 38 Days||Yes|
|SunYou||20 – 40 Days||Yes|
|China Post Air Parcel||38 – 56 Days||Yes|
If you plan on dropshipping from AliExpress, check out my article on how to dropship from AliExpress the right way.
Selling on Takealot
Another alternative that isn’t technically dropshipping is to use Alibaba to sell products on Takealot. Alibaba is the sister company to AliExpress but focuses on selling products in bulk. This makes product pricing and shipping much more affordable. The obvious downside is more upfront costs.
Using Alibaba to purchase products in bulk and selling them on Takealot may be a great alternative. Takealot is essentially South Africa’s version of Amazon. One big difference and advantage Takealot has over Amazon is it runs its very own courier service which was necessary with South Africa’s high shipping prices.
You can have your products sent to one of Takealot’s warehouse fulfillment centers. Takealot will then store your products, manage inventory, package and ship the products as customers make a purchase from you. Takealot charges fees for these services.
Takealot does require all of its sellers to go through a screening process before being accepted as a seller on its platform. They need to make sure you are a good fit for their business and that you will abide by their policies.
Alibaba Dropshipping to South Africa
This is another option if you like the idea of buying in bulk but don’t want to sell on Takealot. You can still purchase in bulk and sell on your own Shopify store. This is obviously a little riskier because of the initial outlay without any guarantees that the products will sell. You can however negotiate with the supplier to purchase a smaller MOQ to eliminate some of the risks.
This method of dropshipping is becoming more popular in the USA. Regular dropshipping from AliExpress has many flaws and those flaws are made worse living in South Africa with the long shipping times.
Some of the advantages of dropshipping in bulk are:
- Shipping – Once you have a bulk order in South Africa you can have it shipped to your customers from South Africa making shipping times much faster.
- Quality – Product quality with Alibaba products is of a much higher quality than AliExpress, however, this will vary from supplier to supplier.
- Margins – You can get the products cheaper when purchasing in bulk, which makes your profit margins higher.
When you have the products shipped to South Africa you have 2 main options:
Have the products shipped to your house and pack and ship the products to yourself. This is really only viable if you have space and you’re not scaling your business too fast but your margins will be slightly better this way.
Your other option is to use a fulfillment center in South Africa. A fulfillment center will store your products and pick, pack and ship your products to your individual customers for you. You have a few options when it comes to fulfillment centers in South Africa:
These companies will take most of the work out of your hands and simplify the whole process. Each of them has a different pay structure and it’s worth doing your homework as to which company will work out the best value for you.
For more information on dropshipping from China in bulk, check out my article Is AliExpress dead? The new way to dropship from China.
Dropshipping to the USA from South Africa
The best thing about the internet is it doesn’t have borders. This makes selling in countries that you don’t live in possible. If you plan to dropship to other countries, read this article first as I give you the best countries for dropshipping. You know you live in an amazing time when you can live in South Africa, purchase products from suppliers in China and sell them to people in the USA.
Why even sell to the USA instead of South Africa?
- The USA has more than 4 times the population which means 4 times the potential customers.
- Shipping times from AliExpress to the USA are much faster with ePacket.
- The USA has a large average disposable income.
- They are very big online spenders.
This doesn’t mean it won’t come without its challenges.
- Dropshipping in the USA has become highly competitive.
- It will be harder for you to know the popular trending products.
- You will be selling products in USD. This means you get paid in USD and if you don’t have an American bank account, you will need to pay a payment processor like Paypal a currency exchange rate to convert your profits back into rand.
For more information check out my article dropshipping to the USA as a non US citizen.
Dropshipping using South African Suppliers
If you’d rather keep it simple and dropship to the South African market and didn’t want to use a Chinese supplier, this may be your best option. This will mean you create your own Shopify store and source products from suppliers in South Africa.
The big advantage of using domestic suppliers is shipping will be faster, suppliers will be more reliable and the quality will generally be much better than Chinese products. Dealing with people from your own country will make sorting out any potential issues much easier.
Niche Selection in South Africa
I always recommend having a niche store over a general store. Yes, the world’s largest online stores are general stores, however, most stores online are niche specific stores. There are several reasons for this.
- When starting out it’s much easier to stand out from the crowd when you focus on one specific niche.
- You are perceived as more of an expert in that niche if your store is purely focused on the type of product. This also makes your customers trust you more.
- You are able to rank higher in Google if someone types in that specific niche. Creating a blog around your niche will go a long way to helping you make that front page of Google for free traffic. General stores have no target audience to create a blog around.
Deciding if you want to focus on high ticket or low ticket products to sell. There are pros and cons to both. If you want to dropship high ticket products, steer clear of dropshipping from China. Use reliable domestic suppliers with quality products. The last thing you need is to try to organize returns to China which will happen with lower quality items.
Next, there are certain criteria for finding profitable dropshipping products that will give you your best chance of success.
Products that people will want for years to come and are not just short trends.
Make sure your product has a decent enough profit margin after you factor in shipping and any other costs. The markup % will vary depending on the price point of the niche you dropshipping.
Make sure your product is able to be sold on Facebook ads and Google ads. Check out their policies beforehand, Facebook is especially strict on what can and can’t be sold on their platform.
If you are dropshipping in South Africa, your product weight and size will be a big cost factor. Dropshipping larger products may not be feasible.
I don’t want to be dropshipping everyday products people can pick up at their shopping center at a lower price.
I try and avoid products that can break easily, have multiple moving parts and anything complex that can either break easily or I’ll have lots of questions about.
Problem solver or passionate
I like products people are either extremely passionate about or products that solve a problem for people. People are willing to spend more money on these items and are easier sells.
This criteria is a guide and not set in store. Don’t feel as though if your niche doesn’t meet one or more of these factors it isn’t going to work.
Researching your market should be something you do whilst you are deciding on a niche. Most dropshippers decide on a niche, create their store then try to find people who want to buy their products. There’s a better way to go about it.
Making sure you have demand for your niche will be your first step. Using a keyword tool will give you average monthly search results. Google keyword tool is generally the go-to tool for searching demand but they make you jump through some hoops to use it for free. Keywords everywhere which is a chrome extension is a better free option.
Next, you want to check how many people are already selling your products. Search how many people are using paid ads on Google and Facebook. Remember you want some ads, it means people are buying, but too many can make it hard to break into that niche.
With Facebook audience insights you can search for your exact target audience. You can filter it for South Africa and find numbers of people in groups who would be interested in your niche and purchase behavior for your chosen audience. Extremely important to check out beforehand if you plan to advertise on Facebook.
Dropshipping Suppliers in South Africa
Dropstore is a platform that helps connect suppliers and dropshippers. Once you sign up you have access to more than 200 supplier’s products to dropship. This streamlines your business and makes the whole process much easier. There is a monthly fee of R199 a month but is free to browse their product marketplace before signing up.
A well-known dropshipping company that has been around since 2012. They specialize in dropshipping gadgets, phone accessories, RC toys, novelties and toys. Free to join
The Scents specialize in dropshipping fragrances, skincare, makeup, hair care products and candles. Shipping charges begin at R90 and R50 for each additional item. Orders are shipped within 24 – 48 hours of the order being placed.
Mantality has 1,000s of man-related products for you to dropship. They stock men’s gadgets, skincare, grooming products, sports supplements, fragrances, hair care products, leisure and gaming products.
Teeprint is a print on demand business. This means you can create a design for t-shirts and Teeprint will print your design onto the t-shirt for you and ship them to your customers for you. You can print your designs onto various merchandise including hats, mugs, hoodies, singles and many more.
Building your Dropshipping Store
One of the most daunting steps for newbies is actually building your dropshipping store. The good news is this is actually one of the easiest steps.
Gone are the days of having to pay some IT company thousands to build your website for you. With the current website building platforms, once you have learned the basics and gone through all the settings, you can literally build a store in a day.
Below are some of the most popular and easiest to use platforms out there.
Shopify is probably the platform you have heard about the most and for good reason. Shopify is the most popular among successful online retailers. It’s packed full of features, thousands of apps, integrates with most other platforms and is very easy to use. The basic plan is $29 a month and is really all you need.
Another great and very popular option is Wix. One big advantage Wix has over its competitors is all their themes are free compared to other platforms that have a variety of free and paid versions. Wix is easy to use with its drag-and-drop interface. If Shopify is slightly out of your budget then Wix at $18 for their basic plan may be a better option.
If you’re trying to start your dropshipping business on as little money as possible, WooCommerce will be your pick. WooCommerce is free, however, you will have to purchase hosting and a domain. This generally comes with the other platforms. WooCommerce is still a great option and has beautiful looking websites. It will require a slightly larger learning curve compared to the other platforms.
BigCommerce is packed full of great features, has great SEO tools and some great sales features built in which other platforms are paid apps. May require a little more time to learn the basics compared to Wix and Shopify. Comes with a 15-day free trial and is $29.95 a month for their standard plan.
You can’t really go wrong with either of the platforms listed above. Personally, I think if you can afford it, Shopify is the best option at $29 a month. Shopify has the best all-around features and very easy to use. If you’re still undecided, check out my article for a more in-depth comparison.
Driving traffic to your store
Search engine optimization is free organic traffic from ranking Google. Because there is less competition in South Africa compared to countries like the US, your chances of landing on the front page of Google are much better.
There are several things you can do to help your ranking.
- Create internal links and external links
- Unique product descriptions
- Create a blog around your niche
- Make sure your website is running quickly
Facebook Ads in South Africa
In 2022, there were over 29 million Facebook users in South Africa alone. CPC (cost per click) will be much cheaper in South Africa relative to other countries.
Without a doubt, the most popular method of advertising for dropshippers is using Facebook ads. The reason it’s so popular is you are not selling your ads to anyone who may not have an interest in your niche, you can target a very specific audience who is hungry for your specific niche.
Although the cost of Facebook and Google ads varies greatly depending on many different factors, overall Google ads will cost more. For this reason, most people tend to use Google ads more for the higher ticket products.
You can target your audience in Google ads differently from Facebook. Google focuses on related keywords and phrases to target your specific audience.
Optimizing and Scaling
Once your store is up and running and making sales, you’ll want to optimize and scale your store for maximum profits. This basically means analyzing your data and making various changes to get the best possible results.
The types of changes you may want to make are:
- Product descriptions and images – Changing the product descriptions and marketing them in a different way will dramatically change who will be interested in your product and therefore give you a whole new audience. Creating unique product images with people using the item in real-world situations will be one of the best ways to help conversions.
- Change target audience – Targeting a different audience with your ads is a huge change and only really worthwhile if your product is not converting as you would expect it to. If you change your audience you will also need to change how you market your product.
- Offer – Changing your offer will be more of a trial and error process until you find the deal appeals to your customers the most. This may be a bundle deal with your product, 50% off, 2 for 1 offer or offer them a coupon code for a discount.
- Scaling – As tempting as it may be scale quickly, you will be better off scaling a little slower and analyzing the data before scaling further. You may get inaccurate results if you vary your daily ad spend too quickly and Facebook is more likely to ban your ad.
As you can see dropshipping in South Africa comes with its own set of challenges. Logistics in terms of shipping and expensive internet data costs are the major issues. As time goes on and they sort out these issues, China will make shipping to South Africa more of a priority. This will make shipping cheaper and a more feasible option.
With 59 million potential customers and only 2% of retail sales made online compared to the global average of 16%, it seems South Africa could be in for a potential eCommerce boom. It’s up to you if you want to get in early or wait for the onslaught of dropshippers.
I hope this article has helped you out. If you have more questions, feel free to send me an email and I will either try to get back to you personally or add more information to this article.