Drop Shipping Business: 30 Steps We Took To Reach $97 000 Per Month

April 5, 2017 Category: Marketing tips
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People all over the world get more and more interested in drop shipping business every day. But they face difficulties when they try to learn something about it.

There are some guides available online for beginners. But they are all written only as a theory. If you are looking for instructions based on real experience, you won’t find much. There are no case studies, and no success stories from real dropshippers.

Our company has a huge experience in drop shipping. We are creating and promoting lots of our own successful dropshipping stores. Our team has gained a solid practical knowledge over years. We decided we can share our experience with the wide audience. We want you to use our practical tips and recommendations. We are sure it will help you create a profitable drop shipping store.

We started doing drop shipping in 2015. As of today, we have 25+ stores. In the beginning of March 2017, our monthly revenue was $97 000.

Here you will find the 30 steps we took to achieve this impressive result.

 

HOW WE STARTED DROP SHIPPING BUSINESS

 

E-commerce field is thriving. The growth of social media, mobile shopping, digital payments, artificial intelligence, big data, and personalized experiences are changing this business.

In particular, drop shipping business grows really fast globally. It has a huge potential because it is easy to start and run. People with any education and skills can do it. This is why we decided to give it a try and see what we can achieve.

Step 1. Business research

We started our journey with an analysis.

Can we run drop shipping business?

Who will be our suppliers?

Will we find customers?

What do we need to launch this business?

What technologies we need to learn?

These questions are crucial. Without them, it is impossible to understand where to go next. You will need to do a detailed research. As a result, you should get a clear view of your goals, opportunities, and challenges.

Step 2. Learning from competitors

This is tricky because not all the store owners openly say they are dropshippers. Still, any online store is a source of knowledge. Understanding how the store is designed and advertised can help beginners a lot.

We were inspired by the experience of Zappos. This is the biggest shoe and clothing webstore on the globe. It was an ordinary drop shipping store at first, but in 10 years Amazon said it would buy Zappos for $1.2 billion.

Looking at others, you can learn a lot. For example, you can use someone else’s experience to improve your product page. Or, you can learn how someone promotes their store in Instagram and other social networks. This type of information helped us a lot. It is important to rely on it when you have no experience yourself.

Step 3. Understanding the legal part: registering a company

Most of businesses should be registered. For drop shipping business, this is not always necessary. It all depends on the country where you run this business. As a beginner, you can start with no registration.

We learned it when we talked to AliExpress sellers. We wanted them to be our drop shipping suppliers. They don’t mind if you are a private individual and not a business.

As a rule, buyers also don’t ask about it. But it is important that you provide them with money back guarantee and free shipping worldwide. These options should be offered by your suppliers, so check if they can do it.

Step 4. Understanding the legal part: taxes

Taxes are a vital part of every business. Drop shipping taxes exist in the form of custom fees. Custom fees are added to the cost of item, and it is a buyer’s responsibility to pay them.

Custom fees are different in every country across the globe. This is why you need to notify your buyers about it. Ask them to check what are the custom fees in their own country. Your customers must be aware of the local laws and reglations, and they must pay custom fees if necessary.

Step 5. Choosing the source of supply

To create a drop shipping store, you need to find products and their descriptions somewhere. But these products and their sellers should be really special. It is important that they meet some criteria.

The sellers, for example, should be ready and glad to work with you. They should deliver items to any place in the world. Also, they should agree to deliver orders without putting their own promotional materials  in the packages.

After a long analysis we decided to choose AliExpress. We think it is the best platform with dropshipping suppliers.

It is really important to choose the right niche. It means a lot for the success of your drop shipping store.

We have a lot of webstores, and all of them sell different products. Every niche for these stores was chosen with the same algorithm. It is a special mechanism we have developed ourselves.

Step 6. Understanding own interests

It is much easier to run a drop shipping store if you are deeply interested in it. So, we recommend you to think about your passions first.

When you have deep knowledge of your niche, you provide a better customer service. If you like and understand your niche, you can pick the best items for your store. You can provide these products with top quality descriptions.

Your clients feel that you are passionate about your business, so they trust you. Also, they know that they can get professional and detailed consultations.

Step 7. Defining target audience

Who are your clients?

It is important to know your target audience. This is how you will promote and advertise your store more effectively.

It doesn’t matter what countries they are from. Drop shipping has a global reach, so you are not limited by a region. Instead, you need to know what they are interest in, and how you can attract them to you store.

Step 8. Exploring social networks

You need to know what online channels are the best for promotion. Do your potential clients use forums, blogs, and social networks? For example, if you know that your buyers prefer Facebook, you can efficiently advertise your dropshipping store in Facebook groups.

Step 9. Searching on AliExpress

When we choose a niche, we always go on AliExpress to check its potential. It means that we look at the number of products offered on the platform, the reputation of suppliers, and buyers’ feedback.

It is necessary to understand if we can find enough offers from this niche. These offers should meet some criteria (a big number of orders, positive feedback on the quality, good reviews about the seller, etc.). We need to fill a store with lots of items, and we need to update our product range from time to time because it keeps our target audience interested.

Step 10. Checking the marketing potential

Can we promote this niche in social networks? Can we do something for its search engine optimization? Is the niche good for paid ads?

It is necessary to answer these questions when you choose a niche. If it has a good potential for promotion, you will be able to attract more customers, and earn more.

We have developed a detailed algorithm to check SEO potential of a dropshipping niche. It will help you find best drop shipping opportunities from the point of view of promotion.

 

HOW WE SET UP STORES

 

When you create a store, it is important to make it convenient for your customers. We did our research and understood we can make something great.

This is how we developed AliDropship plugin. It can help you create and run fully functioning and professionally looking webstore.

Step 11. Buying a domain name

We use the GoDaddy service to buy a domain name. Choosing the name, we prefer something short and easy to remember. Alternatively, you can include the most important keyword in the domain name. It will make it much easier for you to promote the store.

Step 12. Choosing a content management system (CMS)

There exist numerous content management systems. Simply speaking, a CMS is a solution that helps you create and manage content online.

When you develop a drop shipping store, it is really important to choose the right CMS. It should be functional, easy to understand, and easy to manage.

We prefer to work with WordPress. It is perfect for drop shipping stores because it is easy to run. Also, it is really functional and convenient for business.

You can also make it even more functional if you install plugins with additional features. AliDropship plugin is a good example of such plugins. It was created by dropshippers and for dropshippers, so it has all the features you need for drop shipping business.

Step 13. Choosing a hosting solution

This is the necessary part of creating your drop shipping business. Web hosting is the service that you use to publish your webstores online and make it visible for Internet users. If you don’t want to do it all yourself, you can ask for a professional help with hosting.

Step 14. Creating the store design

When the website itself is ready, you don’t have to do much with it. As soon as you install AliDropship plugin, all the main things will be done automatically.

It is especially important for design. A webstore design means a lot for the business success, but it can be tricky. People who have no experience in developing sites often have a lot of questions about making a good store design.

With the plugin, you can choose one of several themes available, and use it for your drop shipping store. All of them look nice and professional. You can be sure that your store visitors will enjoy being on your site.

Step 15. Importing products

Later in this article you will learn how to choose the right products.

The plugin allows you importing items from AliExpress automatically. You need to set the search parameters, and the plugin will do all the rest. You don’t need to spend hours on AliExpress to choose and import items to your store. You only need to spend several minutes and do a few clicks.

Step 16. Multiple payment options

Your goal is to sell something to your store visitors. It should be convenient for them to make a payment. Remember that you sell your products to people all over the world! This is why you need to include several payment options. For example, our plugin accepts payments made through PayPal and major credit cards processors.

 

HOW WE DROPSHIP

 

drop shipping business

How does drop shipping work?

The most common questions we get are related to management and organizational issues. They may seem challenging to beginners. This is why it is so important to cover them.

Step 17. Choosing products

Quality, features, and price of the products you import to your drop shipping store are your competitive advantage. It is one of the main drivers of your business success. We have a full guide about choosing the perfect dropshipping products on AliExpress. Generally, you need to check if you like the product description, its photos, and reviews from previous buyers. Also, it might be useful to order a couple items yourself. This is how you will check if you want to add them to your store.

Step 18. Choosing suppliers

Suppliers mean so much for the success of your store! AliExpress is different from major drop shipping platforms. They typically ask you to pay a fee to view suppliers’ contacts and their offers. On AliExpress, you can access all the necessary data for free.

So, AliExpress is a great place to search dropshipping suppliers because you can see detailed statistics on every seller. This is really useful because you can check the feedback and performance of any seller you like. Also, it is really easy to contact sellers. When you communicate with them, you can understand if they will be good partners for you.

Step 19. Placing orders

When somebody buys something from your store, you need to give all the information to your supplier. AliDropship plugin does it automatically. It notifies the seller about the ordered product, its quantity, and the buyer’s address. It is all done by the plugin, so you won’t mix up anything. It is really useful when you have a lot of orders.

Step 20. Working with troubled orders

Sometimes it happens that our customers are mistaken. They provide incorrect names, surnames, and even postal addresses.

Sometimes they change they mind.

Sometimes they ask for returns and refunds.

Sometimes they can’t track the package and say it is lost.

This is our job to be really polite and patient. We are all humans, and anything can happen. We do our best to negotiate and offer several possible solutions. And of course, we have to contact the sellers and note them about problems we have. It is necessary to provide the top level customer support if you want your business to grow and thrive.

Step 21. Preventing fraud

Internet fraud gets more and more widespread. We are always polite to our customers, but we are really attentive to their behavior.

If a customer tries to pay from several various credit cards, it is suspicious.

If all these attempts fail, it is suspicious.

If a customer uses a credit card that is different from his own name and country, it is suspicious.

If we have any doubts, we typically ask the buyer to send us an ID form. Also, we wait a couple of days before processing the order. If it is a fraud, the payment system will recognize it, and the order will be cancelled.

In general, we recommend you to follow the instructions of your payment system provider. They have their own sets of rules for such cases, so learn them and stay safe.

 

HOW WE PROMOTE DROP SHIPPING STORES

 

Step 22. Working with SEO

Search engine optimization is really important in drop shipping business. If you do it right, you can achieve great long-term results.

You need to think about SEO when you choose a dropshipping niche. You should also consider it when you choose the domain name, and when you write texts for the store. The more you work on it, the more visitors will find your store in Google.

Step 23. Using social media

Social media can drive lots of customers to your store. If you do it right, you can achieve a wonderful performance, and then sell your dropshipping store for a great profit.

We have tried and tested a lot of strategies to promote dropshipping stores on Instagram and advertise stores on Facebook. Our clients share success stories of drop shipping business and they show that promoting your dropshipping store in social media brings you a great revenue.

This process takes a lot of time and effort, of course. But you can make it automated if you like. To do that, read our research and review of Social Rabbit plugin that automatically makes promotional posts for your webstore in any social networks you choose.

Step 24. Learning about paid ads

To promote your store the fastest way, you can also use paid advertisement like GoogleAdwords and Facebook ads. If you use your money wisely, even more Internet users will learn about your store. We used paid ads to promote dropshipping stores, and the results are really impressive.

Step 25. Dealing with clients

We have already mentioned we try to stay patient and tolerant in every situation. But apart from that, we also do a lot to enhance our clients’ experience.

We create a positive atmosphere in our stores, and it makes them different from AliExpress. Our buyers can always count on professional and timely support. Also, we modify product pages of dropshipping stores  to make it easy for our clients to get information and make a purchase.

Step 26. Thinking on product strategy

When we analyze what our customers like and want, we can use the knowledge wisely. We can add new products from time to time to keep the buyers satisfied.  Also, we monitor the market trends. This is how we learn that some new products appeared on the market.

Remember that it is necessary to advertise these products. If you add something new, make sure your store visitors and social media subscribers learn about it.

 

HOW WE EXPAND OUR DROP SHIPPING BUSINESS

 

Business should grow. If you stop working on your store, it won’t be that much successful. This is why our work never stops.

Step 27. Improving customer experience

You can do a lot to increase your customers’ engagement and motivate them to return to your store.

Make sure it is easy for them to navigate your store. Check if it easy for make a payment. Don’t forget to include all the information on delivery terms and conditions.

Also, always be honest about the delivery time. Remember that you need to notify every new client about it. People don’t mind waiting for their order, but they need to know the correct information.

Step 28. Adding new products

We already mentioned that it is really important to keep your store offer up-to-date. If you add new items regularly, your clients are interested in visiting your store again and again.

The bigger is your product range, the bigger is the average check. It means you can also add the products that are related to your niche, and your customers will also be interested in buying them.

But we recommend to follow a specific concept when choosing new products. Always remember what is the general idea of your store, and don’t get distracted. It is especially important if you promote your site as a niche store.

Step 29. Creating new stores

When you launch your first drop shipping store, you don’t know much about the management and promotion. But as soon as you get enough experience, you understand it is not really difficult to run such store. It means you can use your knowledge to create more and more stores in other niches.

Remember that your store is an asset. If you run it wisely, you can sell it for a good profit. We learned it from the experience of our client Alex who manages several dropshipping stores at once and sells some of them from time to time.

Step 30. Exploring

There is so much to learn! New ideas, new niches, new traffic sources, new promotional methods, and many more.

Business and technology evolve every day, so you have a whole world to explore. Always look for something new, and don’t be afraid to try and test different things. This is the engine that drives you and your business.

These are the 30 steps that we took to get our impressive business results. We started from zero, and less than in 2 years we achieved the average monthly profit of $97,000.

We hope our experience will motivate and inspire you to start your own drop shipping business. If you have any questions, feel free to leave them in the comments section below. We wish you the best of luck on this road to success!

36 Comments
Ryan April 5, 2017 8:19:37

May I ask how the income is divided between the stores? Is it like 80% from 5 stores and 20% from other 20 or more dispersed?

    yaros April 5, 2017 8:39:22

    Ryan, you hit the right nail on the head, approx. 80% of profit is generated by 4-6 stores and 20% by other sites.

Thomas April 5, 2017 16:05:51

Thanks for sharing Yaros!
Could you also tell us, do you currently run any stores that are not profitable, or have you ever cut out a store because the niche was not profitable?

    yaros April 6, 2017 4:28:37

    Yes, actually you never know for sure what niche will be profitable for you until you try it. And we had to stop running some stores.

      Anthon April 8, 2017 12:10:27

      How long do you wait until you stop store?

        yaros April 10, 2017 5:36:12

        It all depends, but usually I decide to stop a store when I see that all my marketing strategies are not working fine with this niche.

Paul April 5, 2017 16:12:33

Who do you use as your payment processor as most of the majors no longer allow drop shipping?

    yaros April 5, 2017 17:30:25

    We are using Stripe on all our sites, some clients are using 2CO, another group is using Authorize.net, some are using PayU. What processors have stopped working with dropshippers!?

        Mark April 7, 2017 12:23:31

        That article does not say drop shipping is “not allowed”. It says it’s under “more scrutiny”. If you run your store honestly, you won’t have any problems.

      Paul April 5, 2017 17:41:39

      I forgot to say, great article also and thanks for the reply!

      Raymond June 9, 2017 1:55:34

      Hi Yaros,

      Is there a reason not using Paypal for dropshipping?

        yaros June 9, 2017 3:41:25

        Hi, we are using PayPal on all our stores. It’s better to use both options – PayPal + credit cards.

Taha April 5, 2017 16:38:37

Great article Yaros. Please shed more light on ROI, avg breakup of costs like cp, marketing, taxes, refunds etc.

    yaros April 5, 2017 17:32:56

    Thank you! We are going to cover some of these topics in our next posts, stay tuned!

Angus April 5, 2017 21:17:40

Thank you for sharing. When I buy items on eBay, when they come into Australia they always have a customs declaration sticker showing how much I paid for the goods. If I drop ship I assume the customer gets this same declaration just with their address on it. Is this the case with Aliexpress? How do you manage this charging a customer $20 for a product where they see the cost is $5?

    yaros April 6, 2017 4:25:17

    Honestly saying we have never got any complaints from our clients about any prices stated on packages. btw AliExpress sellers often put lower prices on packages that a buyer can avoid any custom fees of his country.

John Nkunde April 5, 2017 23:35:33

I really would like to be part of this and to learn how its done.Directly extend more imformation all the time some thing comes up.

Vit Aliy April 6, 2017 1:18:45

Great article! One question, is it possible to create bundles with your plugin? Two different products in a store are bundled together?

    yaros April 6, 2017 4:19:44

    You can do it by adding product variations.

Dmitri April 6, 2017 5:44:54

Great work Yaros and a team!!

My wife and I had created our first store using your plugin.
And today we are focusing on Instagram Shoutouts – never done it before, will see how it is going to turn out.

Dzul April 6, 2017 14:56:31

My only problem is Stripe is still not supported in my country. Unless someone can help me setup a bank account in the USA so I can use Stripe is very wonderful.

    yaros April 6, 2017 15:21:08

    You don’t need US bank account to use Stripe, use Payoneer instead. We will describe this strategy in our next article.

moi May 31, 2017 15:17:15

Thanks for this great article.
What about using Shopify, How crucial it is for designing a dropshipping store?

    yaros June 1, 2017 3:52:55

    Shopify is a good platform and it is used for ecommerce projects by many people, but we prefer WordPress because it is more flexible, has more features and possibilities and gives 100% control over your webstore. Besides, you don’t need to pay monthly fees with WordPress (it’s free).

Sparta June 9, 2017 20:36:39

Hi, Thanks for your AWESOME article. I have some question listed below.

1. Should I find supplier or seller in Aliexpress and will contact with them for working with me as a partner for my dropshipping business? Or your plugin will do everything.

2. You said that you used stripe for payment and seller will take responsibility for refund or dispute. Stripe will setup with my mail and buyer will buy from my website and I will be paid by stripe account so how the seller or supplier will handle dispute and refund?

3. If some supplier or seller cheat with me after confirm partnership what can I do that situation ?

4. Can I start without your plugin?

Thanks in Advance.

    yaros June 12, 2017 4:11:04

    Hi,

    1. You don’t need to contact suppliers in advance. You just select products from different sellers on AliExpress and import them in your store.
    2. Please check https://alidropship.com/codex/how-will-i-handle-refunds/
    3. You don’t need to sign any agreements, you just purchase items on AliExpress for your clients as a usual AliExpress buyer.
    4. Yes you can, but a lot of manual work will be involved and you will have to spend much time and efforts before you can start your dropshipping business.

younus ahmed June 14, 2017 1:28:26

Great article.
Im literally new in this and have no experience.
Do i hire someone to build a website?
Are there video courses that i can watch?

Titri Sumaryati June 27, 2017 11:12:21

Inspiring article!!!
Is Aliexpress plugin can be used for several store? Or only one store?
Which one is more advantage for beginner: do the store by ourself or Order custom webstore from Aliexpress?

    yaros June 27, 2017 11:21:38

    Thank you! One plugin license is valid for one domain. Even a beginner can build his own dropshipping business using just the plugin. However, if you want to save time and get a completed dropshipping store developed by experts in this field, you are welcome to order a custom store service from AliDropship https://alidropship.com/start-new-business/

      Abbey August 9, 2017 15:50:58

      Thank you very much Yaros. The basic plan of custom store includes only Facebook integration with other social network left out. My question is, will I be able to integrate other social networks by myself later? If yes, how easy will it be?

      Also, can all the promo materials that are included in the ultimate plan be requested for later after going for basic plan. If yes, how will the process be?

      Lastly, is there any difference in the web design offered for various plans?

      Regards

        yaros August 10, 2017 4:47:12

        It is really easy to integrate other social networks.

        I did not understand your question regarding promo materials.

        No, there is no any difference in designs.

          Abbey August 10, 2017 9:01:22

          I meant the promo videos and social media promo tool that is included in the ultimate plan.

blake July 16, 2017 2:13:05

Hello, I am Blake from China. I want to be a supplier for drop-shipping stores. What should I start this business?

    yaros July 17, 2017 4:25:37

    Hi, you need to have a store on AliExpress I guess.

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