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Dropshipping In South Africa: Pros, Cons, And Real-Life Experience

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18 minute read

Dropshippnig in South Africa

What’s the best way to do dropshipping in South Africa? Is this a business-friendly country? Let’s find it out!

Table Of Contents

In one of our previous articles, we were talking about the regional specifics of dropshipping business in Nigeria.

In fact, the challenges described in that article are not ‘exclusive’, and they are not typical for Nigeria only.

There are 195 countries in the world, and of course, many of them experience similar issues that in regard to:

  • Geographical ‘remoteness’ of these territories;
  • Long delivery time and high shipping fees that are explained by these countries’ location;
  • Unavailability of major payment gateways that are commonly used in the global eCommerce practice.

But, none of these factors can stop you from launching your own dropshipping store!

Dropshipping is a business that provides equal opportunities to everyone. So, even if you were born in a faraway country, you can enjoy the benefits of this amazing venture.

How?

Let’s look at the example of South Africa!

How to start dropshipping in South Africa

Our experience proves that this business is quite popular in South Africa. Our company regularly processes requests from the new entrepreneurs of this country!

Every month in the period from December, 2017 to December, 2018, we had numerous queries for custom store development, as well as AliDropship plugin purchases originating from South Africa.

Surely, it proves that people in South Africa are strongly interested in this business, and are ready to get first-hand knowledge of its countless advantages!

So, what do you need to do if you want to open a dropshipping store there?

In fact, the algorithm of launching your own dropshipping store is identical for every person living in any point on the globe: you can view a beginner’s checklist here.

In the article linked above, I explained the technical resources and the market knowledge you need to have, and gave a full action plan to launch your website and promote it in order to achieve your first sale.

Whatever is your country of residence, you need to follow these steps carefully. This is you key to achieving the best business result possible.

And, if you live in South Africa, you need to make a number of region-specific decisions about your store. The most important one of them is the choice of the target market – let’s see what I mean by this.

2 ways to run your dropshipping business in South Africa

So, when you’re deciding how exactly to run your future business, essentially, you have 2 options:

  • Living in South Africa and aiming the store on your fellow citizens;
  • Living in South Africa, but targeting a foreign country instead of the domestic market.

Each of these options has a number of pros and cons, so it’s important to consider all of them before you proceed with your business launch.

Dropshipping in South Africa: pros of the local market

This option can seem to be fairly logical. As you live in this country, you can easily adapt your business to the regional specifics, right?

Therefore, in this case, you get the following advantages:

  • You know the laws

Taxes, customs’ policy, ban on some product import, and other bureaucratic things won’t scare you off. As the citizen of this particular country, you know what regulations may apply to this business. And if you don’t, you surely know the codices and other legal documents that contain the necessary information.

Ideally, you should fill your store with the items that are highly popular, but not really commonly sold in this particular area. So, if you target the country you’ve known for years, you understand what are the most desirable products here, and which of them are not accessible (not sold in offline stores, or sold for a super high price, etc.). Selling these exact products through your online store, you get a HUGE competitive advantage – and do a really responsible thing for your local community!

  • You know your target audience quite well

When you’re targeting your fellow citizens, you have a clear idea about the language they speak, the amount of money they’re ready to spend on your products, the most trusted informational channels, etc. Even if you don’t know something about your potential customers, you have a direct access to this market, and you can easily conduct your own research. The data you collect is the vital element of your product policy, marketing strategy, pricing decisions, etc. Thanks to these findings, you can tailor your business to the specific needs of your future clients.

  • It’s much easier for you to research the market

I’ve already mentioned the research aspect several times, and I should say that as the resident of your target country, you have a great advantage in this case. At the very least, you know where and how to look for the necessary stats (governmental statistics bureaus, regional research agencies, local analytical websites, etc.). Moreover, the stats is provided in your well-known language. Therefore, you don’t need to translate anything, and there isn’t a language barrier that would stop you from understanding the data and the terminology.

  • You can get your first sale quite easily

Usually, your first sale happens in several weeks after the business launch. But, if your dropshipping store is aimed on the people within your own country, you can try speeding up this process. How about persuading your family, friends and relatives to buy a couple of things from you? Their actual shopping experience will let you test the whole process and understand whether everything is OK with your website. Plus, their real reviews will serve as the foundation of the social proof in your store – which is a great thing for your media coverage, reputation, and further customers’ trust.

Does it sound like an opportunity of a lifetime?

Dropshipping in South Africa: cons of the local market

If you live in South Africa and run a dropshipping business here, you should remember some region-specific aspects of it:

  • Not every AliExpress seller can deliver the items to this country

It’s a fact – but not a problem.

Some Chinese manufacturers can’t arrange a delivery to South Africa – but, it shouldn’t disappoint or discourage you!

The best thing you can do is filter these sellers out at the very beginning of your AliExpress search. To do this, take a look at the top right corner of your AliExpress page. There, in the ‘Ship to’ field, your location should be recognised by the system automatically.

If the automatically set country is wrong, choose the correct option in the dropdown menu.

To make it even more convenient, you can also change the default currency shown by AliExpress – don’t forget to save your settings!

As the result, after applying all these filters, you can confidently browse AliExpress and have no worries about the seller’s capability to send the items to your country. If the products are shown to you when these filters are on, you can totally add them to your store!

  • The delivery options can be inconvenient for your buyers

That’s another issue you need to consider if you want to dropship to South Africa.

In fact, here’s the thing: there aren’t many shipping services that can deliver AliExpress products to South Africa for free. Plus, it commonly takes them over a month to deliver the orders. For a quicker delivery, you need to pay a higher shipping fee.

Yes, it might be unpleasant. But, there are a couple of tricks to modify this situation!

Look at this product page. By default, this seller will send the item to South Africa by the China Post Ordinary Small Packet Plus. This shipping method is provided free of charge, and the estimated delivery time here is 42-59 days.

To chose alternative shipping terms, click on the tiny arrow next to the name of the default shipping provider.

A window with the possible options will open, and there, you’ll be able to find something more suitable.

To pick the best alternative out of all the available options, please, read this article.

And, don’t forget that even a long delivery isn’t always a bad thing. Buying a product with a month-long delivery is better that being unable to buy the product at all 😉 So, if you’re selling the products that aren’t available in your country, your buyers will be happy to have at least some way to get them.

  • Not all the globally recognized payment providers work smoothly in South Africa

Probably, the most popular global payment gateway that is used for eCommerce businesses worldwide is PayPal. Technically, it works in South Africa, too. Still, many users claim it’s inconvenient (the money must be withdrawn from the account in 30 days after receiving it, it’s obligatory to have a credit card to use this system, etc.).

There’s nothing to worry about, though! As an owner of a dropshipping store, you are not obliged to only work with PayPal. There are lots of other worldwide payment systems that you can easily integrate in your site.

For example, if your online store is build on AliDropship plugin, you can use any of these payment gateways for it. Or, if your dropshipping website is built on WooCommerce, you can use any of the payment gateways from this list.

As you can see, dropshipping in South Africa, indeed, has a number of special regional characteristics. However, with a wise management, you can easily overcome all these obstacles and sell dropshipping products on the South African market. By the way, that’s exactly what our forum contributor Daniel does: as he shares it in his forum thread, he targets the buyers from South Africa. And, as he tells it in his inspirational success story, he makes $80-$150 per month with this activity – not bad, right?

Dropshipping from South Africa: pros of the abroad markets

If you live in South Africa, it doesn’t mean that you can ONLY dropship to South Africa.

Dropshipping is the business with no geographic boundaries at all, so if you want to sell your products to Portuguese stay-at-home moms, or to Japanese students, or to Canadian retired people – it’s up to you to decide.

Certainly, this business strategy gives you a number of serious advantages:

  • You can start without any official registration

Legally speaking, when you’re dropshipping, it doesn’t matter where you live and what is your target country. AliExpress sellers readily cooperate with any buyers. They don’t even ask whether you are a private individual or a company representative. Plus, they don’t mind if you ask them to ship the order in a country different from your place of residence.

So, you may only feel the need to register your business officially when it grows to a super large scale. That’s what our client Mousslim did when his monthly dropshipping profit hit the mark of €67,000 check out his story to learn more.

  • There are no limits on the products choice

If you are planning to sell your items to the South African customers, naturally, you can only pick the items that can really be delivered to this country.

At the same time, if you’re going to sell your products to the people from European or American countries, you can choose from a much wider range of items. So, here you can fill your store not with the items you CAN dropship, but with the items you WANT to dropship!

  • A cheaper and quicker delivery is available

If you want to dropship globally, you can use the service of advanced shipping companies. There are providers that can deliver your packages in a couple of weeks, and won’t charge much for it.

A shining example of such a brilliant service is ePacket: it only costs around a couple of dollars, so you won’t disappoint your customers with extra high fees. What’s even more important, with ePacket, the average delivery time is 2-3 weeks or even less. Isn’t it great that your buyers won’t have wait for long?

As of May, 2018, ePacket delivery was possible for 37 countries in the world. So, if you’re planning to dropship overseas, you have plenty of appealing regions to choose from.

  • There are no geographic boundaries

When you don’t need to tie your business to a specific geo location, you can make really interesting niche stores that are appealing to diverse customer segments across the globe.

For example, in your store, you can unite cooking enthusiasts, or embroidery fans, or followers of  a specific sports activity – and it won’t matter for you where do these people come from!

You will be able to create a niche shopping destination that is attractive to a specific fan group; and, for a number of reasons, this store will be much more appealing to them that a giant marketplace like AliExpress itself.

  • You can work with richer customer segments

It’s not a secret that from country to country, the purchasing power of an average citizen differs a lot.

If you’re choosing your target market at your own discretion, nothing stops you from concentrating on the people who can easily afford online shopping and don’t mind spending a little extra. In this case, you can lure them by creating the right environment for impulse purchases.

As you can see, working on a foreign market is as appealing as dropshipping in South Africa. Maybe, it’s just the perfect business strategy for you.

Dropshipping from South Africa: cons of the abroad markets

At this point, you might be wondering: are there any downsides of dropshipping on a foreign market?

The entrepreneurs choosing this strategy should consider the following aspects:

  • Probable language barrier

What language will you choose for your dropshipping store? What language will you use to communicate with your customers?

These are vitally important questions to answer. Do you know at least one of the globally spoken languages (for example, Mandarin Chinese, English, Hindustani, Spanish or Arabic)? If you do, you can aim your business at a global community of this language speakers. But, if you only speak your native language, you won’t be able to work with a worldwide audience.

  • Unknown customer profile

Targeting the people who live outside your home country, you need to know much more than their first language. You should understand their mentality, know their wishes and demands, learn the promotional channels they trust, etc.

To do this, you need to go through the region-specific marketing reports, and research your audience. Sometimes, it might be a time-consuming task – especially if you don’t know where to look for information, or don’t know the local language well.

  • Unfamiliar legal terms

If you work on a foreign market, it’s important to know the laws the countries you’re targeting. Some countries may have a limit on the volume of imported goods, or a ban on some particular product types, or a specific tax system, etc.

This is why you need to dedicate some time to reading the official documents of the targeted countries. You will have to pay a special attention to tax laws and regulations and customs policies. They will let you understand what is the amount of tax your buyers will have to pay (if any), and what types of products you can’t import.

Usually, these regulations allow you to do dropshipping business easily. Most likely, there won’t be any tax fees on importing small-scale packages. And, the commonly forbidden types of imported products are drugs, explosives, weapon, and other life-threatening things that you’re highly unlikely to dropship 🙂

So, if you want to run your dropshipping business on some foreign markets, you can easily pull it off! That’s why our another forum user from South Africa was recommended to start exploring the US market. And actually, lots of entrepreneurs target the customers outside their home countries: for example, our client Pirn from Estonia targets the USA market and enjoys his $10,000+ monthly revenue, which is totally awesome!

That’s it!

Now you know what are your options of dropshipping in South Africa, and we hope it will inspire you to move your own business forward!

By Olga L.
Olga is a content creator at AliDropship, and she aims to explain the most complicated drop shipping concepts in the simplest terms possible.
9 Comments
Fasil January 16, 2019 11:55:05

Hi,

I need to start a dropshipping store which sell products in USA is that possible. Please help

Apostolos January 16, 2019 13:36:28

Hi and thanks for the great info on this article. I think one thing that should be updated is the need to form a company, so you can run an online business. And this need comes from the fact that you must embed on your website a global payment provider so you can accept credit cards. So, in the link you provided for the available payment gateways, Stripe and 2Checkout they want you to have a company registered and they also ask for legal entity formation documents, utility bills etc. and they are very strict about this. If you don’t give them proof that you have a legal business registered they will reject you. I think the only way to use Stripe without a registered company is only if you are a U.S citizen and you live there.

    Mutungi January 16, 2019 14:52:21

    Thanks @Apostolos, Am also in Uganda but finding a lot of terrible getting the most sweet-able global payment service provider for example pay-pal is not in Uganda for now only in Kenya and the funds can only be accessed through equity bank Kenya not even equity bank Uganda so i end up trapped in the loop of no option.

    Please any advise on how i can over come that????

    Thanks

      Apostolos January 17, 2019 8:49:28

      Hi Mutungi, one good option is to create an LLC (limited liability company) in the U.S. There are states in the U.S that have good laws for taxation (Wyoming, Nevada, Delaware). You can form a company online, you don’t have to go to U.S to create an LLC. You order it and they sent you all the necessary papers and documents. So if you have a U.S. company you can use any payment provider you want because America has them all. You can use Stripe, Paypal and a lot more. The only problem is the bank account. If you want a business bank account for your company you have to go to the U.S to open it. Maybe if you have a friend that lives in the U.S you can have him as a partner in the LLC (2 member LLC) and he can go to a bank and open a business account for the LLC. Otherwise, another option would be to get a Payoneer account and they give you a virtual U.S bank account without the need to travel to the U.S. and you can start like this with applying for Stripe account to be able to receive payments on your website. Hopefully this willl work and you don’t have to travel to the U.S for opening a bank account.:)

Wim January 16, 2019 14:55:31

Thank you for year great post again.
I have the intention to start online business myself as soon as possible. However I am stuck concerning the products I allowed to sell in the EU (European Union). My home land is Belgium. I see a lot of great products on Aliexpress, however when I talk about it to fellow entrepreneurs, they warn me not to do it, because you can get into serious problems with regulation authorities. According to them, the products need to comply to the EU safety regulations, required packaging labels, etc. I think such regulations also apply for the US (for example CPSIA for toys, FCC for electronics, restricted substances, etc.). How do I know which products are complying the EU regulations? How do dropshippers in the US deal with this?
Thank you for your feedback.

Yogesh Anand January 17, 2019 5:48:16

Hii, My question is that i am living in India then How to start drop shipping business in India and aiming to target on domestic Indian market and also want to target a foreign country market?

I dropped my e-mail id, Kindly guide me in this regarding to my e-mail id.

Thanks.

Albert Paul Devanand January 17, 2019 5:59:24

Hi,
Help me and guide me to start a dropshipping business, operating from my home country targeting US market.

I’m certainly not clear about this business and please let me have your toll free no. if any available.

Thank You.

mornay becker May 13, 2019 14:11:49

Hi

What are the tax laws in regards to dropshipping to the international market?

Thanks

    Olga L. May 14, 2019 10:43:59

    Hi, thank you for your question!

    Every country has its own tax regulations: there are no laws that would regulate the international market in whole.
    With our AliDropship plugin, you can configure the tax settings in 2 different ways: you can learn more about them from this article https://help.alidropship.com/settings/other-settings/tax-settings

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