How do I start my dropshipping business?

Hey, my name is Nick and I'm 16 years old, so I could be one of the youngest members on the board to my knowledge. But it's never too young to start becoming entrepreneurial in my opinion. I'm a sparky mathmatician, and your typical new-age computer wizard, but I am crippled in one department; experience. I am honestly lost to this whole idea of online selling, moreover selling. I know how to do it, I know of research tools such as HammerTap, of which I am currently involved in, and I have sold upon eBay before. My only question now is slotting it altogether. My analogy would be cooking a cake for the first time; what order do the ingredients fall into place? There's no recipe book for business, so how am I to know what ingredients I need? or even worse, have I got them all?

It's a scary prospect for a 16-year old, and dropshipping only seems appropriate as my mum is a full-time worker and I'm at school, so keeping stock would be difficult. I have a £200 budget, so I'm hardly expecting to take over eBay. All I need is the confidence to flap those wings; would anybody be able to help out a newbie? Thanks!

Hi Nick, and welcome to SaleHoo, nice to have you onboard.

I would suggest that there is in fact a recipe book, perhaps not all the measurements are there, but if you're serious about building any business, including an online retail, I think that book is a well thought out business plan.

Biggest mistake I see people make in this industry is underestimating just how difficult and competitive this game is, then that quickly transfers to frustration and ultimately to giving up.

Make no mistake about it, online retail is a business and if you don't treat it as such then making a success out of it can be extremely hard!

I can see that from what you have written already that you have some firm ideas on what's suits you and the direction in which you want to proceed, and that's a great start to any business plan, so build on that till you know where you are now and where you want to be in 5 years time, and have a road map as to how to get there.

I would suggest, as I do with everyone, kick off with second hand. eBay is a bargain hunters paradise, feed the beast bargains, and it will eat them quicker than you can list them.

Areas such as Garage Sales, Weekend Markets, Thrift Shops, even Local Classifieds can all be sensational sources for inexpensive, but quality and popular products. Even better if your not shy and can talk a good bargain!

Yes, it does take more work than drop shipping, no doubt about that, but it does have several strong advantages over drop shipping in my opinion. Variety is the big one, you never know what you'll find, and keeping your items fresh can mean that you can keep your customers coming back again and again.

Price, yes it is money upfront, however the price you can pay can leave you with good margin to sell on sites such as eBay, but you do need to know the value of items and be able to talk a good deal.

A unique position in the market, everyman and his dog are selling iPhones, but by sourcing second hand you have the opportunity to get your hands on products that aren't saturated on eBay.

Of course it is also a great, and relatively inexpensive way to do market research with products.

You sound like you have a good head on your shoulders, and being a mathmatician you will have an understanding of 1 + 1 = 2, or in business terms, good planning equals a good chance of success : )

Hi Both...
I've learned something new from you all today...and yes I'm Noob too...
Wish me luck!

Hi Salehoh, always nice to welcome someone new to the site. Glad we have already been able to be of assistance, but just yell out anytime : )

@Nick and Salehoh: Welcome to SaleHoo guys! If you need help with anything please don't hesitate to contact us at support@salehoo.com :)

I also recommend keeping in touch with us on Facebook and Twitter for daily wholesale and eBay selling tips:

Link hidden: Login to view
Link hidden: Login to view

Cheers!

Welcome to the site, Nick and Clement! It's great to have you guys here.

Hi

I have my website ready and have just subscribed to Salehoo but not sure how to link your products to my website or ebay. please help

regards
ravi

Hello and welcome to SaleHoo, Ravi!

Just to clarify, SaleHoo is not a drop shipper and we don’t stock any products ourselves. The first thing we suggest you do is decide what type of products you want to sell. Once you've thought of a couple of ideas, use SaleHoo to look for drop shippers for the products you want to sell. When you've found some suppliers who fit the bill, contact them directly for more information on how you can list their products on eBay or your website.

All the best!

Hi

I have my website ready and have just subscribed to Salehoo but not sure how to link your products to my website or ebay. please help

regards
ravi

As mentioned in my reply to one of your emails, SaleHoo does not currently provide a listing manager/push to marketplace tool for eBay. Some of our drop shippers may provide this service, however you will need to contact them about this directly.

Although the idea of listing products straight from the drop shipper’s site to eBay sounds appealing, we do not recommend it. The reason being that you have absolutely no way of distinguishing yourself from the hundreds of other sellers using the same tool to sell the same products!

If your titles are the same, your pictures are the same, your description is the same, the shipping and service is the same – what is your competitive advantage? Where is your unique selling point?

You might get a couple of sales if you are lucky, but it’s not a workable model for building an ongoing profitable venture.

That’s just our 2 cents!

Cheers!

And Ravi, it would be nice if you could add your photo to your profile :)

Just to take Richelle's competitive edge point a little futher. POD, or Point Of Difference, is one of the biggest boxes you need to tick off when establishing any business.

It establishes a competitive advantage over a competitor, and then gives you a point at which to focus on with your marketing. Now a POD can be pretty much anything, and to establish one you need to research what your competitors are doing, and then either improve in an area they are already covering, or establish a new area that is not currently being covered.

The thing with drop shipping products, you're extremely limited in the areas that you can create a POD, because in essence you are a broker, and as such you don't have any real control over your own business.

Because of this issue it's important that you sharpen every aspect that you do have some level of control over to give yourself some marketing edge if at all possible.

Competition in any business is strong, but when you're talking about eBay, it's cut throat. You need to be giving your customers the very best service you can to not only ensure the first sale, but to ensure they come back!

It's quite funny actually. I had a message from a member a few days ago now, wanting my opinion on some advice they had been given on another trading site.

They had been told that now they had done all the hard work and built up their customer base, it was time to put their prices up and reap the rewards!

Now this advice came from someone who was supposed to know what they were doing, but if that's the case then as I told the other member, I must be on another planet.

In any business, if you are fortunate enough to build the business to a point where you do have a good solid customer base to draw ongoing sales from, that's NOT the time to sit back and relax!

That's the point where you turn up the flame and work even harder. If you take your foot of the pedal at that point at that point and try to take advantage of the good will you have build with your customers by driving your prices up for purpose of nothing more than financial gain, then that POD you have in place is at serious risk of disappearing over night, and a large part of your customer base with it.

You can never take your eye of the ball in this game, the moment you show a weakness in any facit of your business, a competitor is going to be knocking on the door trying to exploit it for their own gain!

OK, maybe a little off point in regards to a POD, but it all ties in together!