What’s the point of going to all the hard work of creating a dropshipping store if it isn’t going to last? I’m going to run you through the misconceptions as to why people believe dropshipping is a short-term business only and how you can ensure it will be a long-term venture for you.
When I first started researching dropshipping back in 2016, I read a lot of information stating dropshipping isn’t long-term and that if you do manage to create a successful store, it won’t last long. The business model sounded so appealing to me but I didn’t want to put all this work into something that may not last.
Dropshipping is a long-term business if you create a brand around your store and provide genuine value to your target audience. This means sourcing quality products from reputable suppliers with fast shipping and giving your customers a quality buying experience.
Why Do People think Dropshipping isn’t Long-Term?
Before writing this article I did some research. I read various websites and forums as well as watched a few YouTube videos based on dropshipping being unsustainable and claiming dropshipping will die.
I completely understand why people think this. The problem is they are looking at it from their limited understanding of dropshipping and basing their opinions on the minimal knowledge they have. I bet every person who is stating dropshipping isn’t long-term hasn’t had a successful dropshipping business themselves.
If I heard of a business that sells poor quality products from China with long shipping times, I’d assume it’s unsustainable too.
Profit margins are another reason people assume dropshipping can’t be long-term. I mean how can you compete with stores that order products in bulk at lower prices whilst you’re ordering products individually at a higher price?
Dropshippers have several options to combat this:
- Sell unique products you can’t find in most retail stores.
- Sell impulse buy products that are low enough in price consumers don’t bother price checking.
- Have their suppliers private label and customize products specific to their consumers needs.
- Be creative with advertising and change the angle to which the product is marketed.
- Brand the store to give the customer the impression they are the creator of the product giving the product a higher perceived value.
Is AliExpress Dropshipping Sustainable?
Dropshipping from AliExpress can provide a poor customer experience in terms of shipping times, product quality and supplier reliability. Although this is not always the case and these issues can be resolved, dropshipping from AliExpress should be looked at as a short-term business.
When it comes to AliExpress dropshipping, I agree that the business model has too many flaws making it unsustainable to run a successful long-term business. I’ll go through just some of the flaws:
- Shipping times are long
- Product quality is hit and miss
- Packaging isn’t great
- Many shipping errors with suppliers as they are dealing with high volume
- You’ll be facing a tonne of competition
- Consumers can go to AliExpress and purchase the same product themself
- Profit margins aren’t always great
There are ways to reduce or eliminate some of these flaws with using AliExpress. It’s a viable option in the short term, however, once you start scaling your business these flaws will be exacerbated making it more work for you and providing a worse experience for your customers.
Don’t expect your customers to only be unsatisfied, they’ll also give you a bad Facebook feed score which may lead to your account being suspended and request chargebacks which will freeze your Paypal account.
An option to avoid many of the problems associated with AliExpress is to use a platform such as CJ Dropshipping or Zendrop. They act as a middleman between you and the suppliers and negate many of these flaws and simplify the whole process.
Often the prices on these platforms are lower than AliExpress as they deal directly with manufacturers avoiding the product being passed through multiple suppliers before you purchase it.
How to Create a Long-Term Dropshipping Business?
This is where many people go wrong with dropshipping and why the failure rate is so high. They don’t have any long-term strategy in mind and are too eager to get their store up, running and make their first dollar. I’ll run you through some of the important steps in creating a long-term dropshipping business:
I wouldn’t recommend starting a general store if you want to create a long-term business. Niche stores and one product stores are a better option as you’re focusing a store towards a specific audience of people who have a real need or want towards your products.
Most dropshipping beginners go straight for the hot trending gadgets on AliExpress. The problem is as soon as a product starts selling, everyone can see the sales ticking over. Before you know it thousands of dropshippers start copying and the product gets saturated in no time.
Sell products that are evergreen that people have been buying for years and will continue to buy for years. This doesn’t mean you have to sell generic products, you can still sell regular products but opt for a variant you can’t find in most stores.
High ticket products don’t generally deal with short-term trends and are a great option. If you go down the high ticket route, avoid AliExpress. Your best option is to find domestic suppliers with fast shipping. Platforms such as Spocket and Salehoo can help with finding reliable domestic suppliers.
You’ll never succeed long-term in selling low quality products. You’ll end up with endless customer service, no returning customers and account suspensions.
Once you’ve confirmed the profitability of a product from AliExpress, switch to ordering in bulk from Alibaba if you’re in a position to do so. The product quality is generally much higher and the shipping times will be faster.
Using domestic suppliers is another option that will provide you with much better quality than sourcing all your products from China.
This is one of the most important aspects of turning your store into a long-term business that will provide you with an income for years to come. Creating a brand around your store will make your dropshipping store NOT feel like a dropshipping store. A few ways to build a brand are:
- Theming your store in a way that your target audience can relate to
- Make your store and logo look professional
- Private label your products
- Create a social media presence around your niche
- Start a blog
- Provide personalized customer service
- Use branded packaging
The objective is to create a store targeted towards a very specific group of people to make them feel as though the store is designed specifically for them.
Adequate profit margins are another huge factor in the longevity of your business. Don’t try and compete with your competition by lowering your prices. Branding your store will enable you to charge a premium price and still make sales.
Your margins must be high enough to allow you to pay for advertising, shipping, VA’s and other expenses. This is generally at least 3x the product price for lower priced products and at least 2x for high ticket items.
Many people think dropshipping is short-term. Implementing these strategies can be a long-term business and can make a very profitable side hustle to your full-time job.
Will Dropshipping Die?
I decided to create this entire website as a free resource to help people create their own dropshipping businesses. I’ve currently written nearly 50 articles and it’s a lot of work. Why would I even bother if dropshipping was going to die?
Dropshipping is simply a way of fulfilling orders and although this business model will change over time, it won’t die.
Dropshipping has been around since at least the 60s if not earlier. Back then stores would advertise products in a brochure and have their customers make orders from their homes and then the store would order products accordingly and have them delivered to their customers. Source Contrado: When did dropshipping start.
Dropshipping has evolved and will continue to evolve. Dropshippers are innovative and they always manage to find a solution to whatever issues arise. As long as there are human beings on this planet, dropshipping will stick around.
If you’re unsure of any of the eCommerce terms I suggest you read my article which can be used a resource if any of the terminologies gets confusing.