Anyone with an entrepreneurial spirit is always looking for new ways to make money. Sometimes it doesn’t go that well, and you end up with NFTs, which turned into a dumpster fire for many investors.
On the other hand, there are some concepts that are as valuable as gold. These unique ideas have the potential to make clever entrepreneurs very rich.
One such concept is dropping shipping, an extremely lucrative niche with a current market value of over $287.36 billion. This figure is expected to reach over $1,253 billion within the next six years.
It’s no wonder that a lot of entrepreneurs are trying to jump on the drop-shipping train, but it’s not that simple. Nothing valuable ever comes easy, and many end up losing a lot of money because they don’t know what they are doing. You want to avoid making the same mistakes they have. Let’s look at four of them today.
Choosing the Wrong Niche
We all have unique preferences that are shaped by our personalities. Some of you might prefer selling custom t-shirts, while others might want to focus on makeup products. What is the right answer? Unfortunately, people think that if they sell what they know and are familiar with, they will have success.
They think that just because they love the niche, others will too. Yes, there is always going to be a market for any product, but the point is, how big of a market?
What works in one city, state, or country is not going to work elsewhere.
This is why you need to do considerable research about what will work in your location and context. It’s also not as simple as going for the ‘safe’ option because you are also going to have to deal with an oversaturated market. Thus, the first mistake that people make is failing to choose the proper niche. Do your research and choose wisely.
Picking Unreliable Suppliers and Importers
The second biggest mistake that people make is not investing enough effort in finding the right supplier and importer. It’s understandable in one way. People want to get their operations up and running as soon as possible.
You probably took out loans or borrowed money to start your business, and every day that it doesn’t bring in money is dangerous. However, the true danger lies with unreliable suppliers and importers. You must remember that, unlike a regular brick-and-mortar business, your supply chain is your lifeline in a drops hipping business.
You simply cannot allow ridiculously long delivery times, poor packaging, and incompetence. Even you will have to bear the brunt of things when you choose poor importers and suppliers. Poor communication can truly make for some logistical nightmares.
This is why you might have noticed a lot of successful drop shippers resorting to apps like Importify, which automate the process.
Of course, before using such a service, you need to ensure compatibility. Know the list of supported websites for Importify here. People use such apps because, even if you end up with a not-so-stellar supplier, the automation does cut down on a lot of common drops hipping issues. That said, you still want to focus on good suppliers as one of your top priorities.
Failing to Establish a Proper Brand
Even though you are drop shipping products, the basic principles of marketing and sales still apply. Customers enjoy a reliable and familiar brand name to be loyal to. It’s what makes them decide to pick you over your competitors.
If customers really enjoyed a product that you sold but you don’t have a powerful brand name, it isn’t ideal. They may not recommend you as much to their friends and family, and it can feel like there’s not a lot of authenticity to your products.
Something else to remember is that branding isn’t only about how successful you are with customers. It also plays a huge role in how investors view your business. If you have plans to scale up, you are going to need to project such an image through your branding that people want to give you their money and see what you can do.
This only happens when you have a rock-solid brand image. Take the time to sit down with a marketing consultant and really think about how you want to brand your business, because this is important.
Ignoring Influencer Marketing Potential
A lot of entrepreneurs get stuck in one mindset and fail to see potential when it exists. The way people view influencers is a prime example. As a drop shipping business, you will find that paying for traditional ads can be expensive, and the results you get are only a fraction of what you might hope.
Thus, people often pay way more than necessary to ensure that their leads are at the level that they would like. However, what if there was a better method of advertising your dropshipping business? It turns out that influencers are surprisingly good at marketing.
Not taking advantage of influencer marketing is a big oversight to make if you own a drop shipping business. There’s a reason that influencers have become such a massive figure in our current world. It’s not just because they make relatable content.
Influencers are able to persuade their followers to give your business and the products you sell a chance. Considering that there are so many influencers out there at varying levels of popularity, you can make use of this marketing type on any budget.
In conclusion, drop shipping is an extremely lucrative niche that’s also easy to fumble. It is possible to make an insane amount of profit as you don’t have to worry about warehousing and shipping. These two factors complicate any business, but drop shipping manages to take that burden from you.
What you are left with is a highly flexible business model where the profit margins are very attractive. If you avoid making some of the mistakes we looked at in this article, you will surely reach and surpass any goals you make.
