Home eCommerce Blog How to Make Sure that Your Dropshipping Business Makes Big Money

How to Make Sure that Your Dropshipping Business Makes Big Money

You know this for a fact — there is absolutely no business without risk. If you're planning to try your luck in the dropshipping business, no one would dare promise you a comfy, smooth journey. Nor are there any guarantees that earnings will come as effortlessly as you may like. On the contrary, in fact; there are bound to be bumps ahead.

You might feel that your products aren't selling as well as expected, or you have been spending too much returning items that are either knock offs or damaged. All these difficulties might ultimately hurt your profit, which would definitely take its toll not just on your business, but also on your financial well-being as a whole.

In the world of dropshipping, you have to reduce what eats away at your profit margins. Below are 3 lessons on how to make sure that your dropshipping business is as profitable as it should be:

Lesson No. 1: Get the Right Products

There are right and wrong products to dropship. The idea is to sell the right ones and avoid the wrong ones. The drill seems quite simple, right? However, determining which products to sell and not to sell can be a challenging process. Luckily, you don't have to drastically deplete your profit by resorting to trial and error just to choose the products that will sell like hotcakes and rake in profits.

Now, the question, what are the right products to sell? The response is quite simple: Go for what's cheap, light, and different.

Sell What's Cheap

Selling relatively expensive items could make for very slow business. Selling costly event tickets through your e-commerce store, for instance, could be futile for your profits, especially if the demand isn't as high as you'd project, or if the competition is too stiff. For dropshipping products from other countries, like China for example, setting the threshold at less than $200 per item ensures that you aren't venturing into a super-risky deal.

It also helps you buy more items for less, because purchasing items wholesale makes it easier to sell your wares at reasonable prices. That increases your profit margins. To find cheaper items, look into popular niches with plenty of accessories, like smartphone cases or fishing gear.

Sell What's Light

The bulkier an item is, the greater the chance that it might kill a portion of your earnings. Dropshippers compete to give their buyers the lowest prices, which sometimes results in slicing a significant portion off your profit just to make room for the wholesaler's costly delivery charges, as well as your own shipping costs if you offer free shipping.

Dropshipping heavier products, such as machinery, can be profitable once you get the hang of it. But it requires a lot of savvy networking and close relationships with suppliers and shipping companies. If you are just starting out in your e-commerce venture, it's probably better to test the waters with smaller items than to jump into deep water immediately and suffer great losses.

Sell What's Different

You constantly buy groceries at a nearby store. That's your grocery store's niche — food and drink and various household items that you need. Because of its location, its selection, or its friendly staff, or maybe some combination thereof, you return for business every week or so.

By establishing itself as something unique, giving you a combination of benefits you believe you can't get elsewhere, it's made you into a regular customer. 

The same thing goes for the world of e-commerce. You need to offer your customers something only you can offer. By finding a niche where you are the master, customers will definitely keep returning to you. This can be achieved through special offers, product exclusively, or by going the extra mile in packaging, customer service, or delivery speed.

Lesson No. 2: Get the Right Suppliers

Finding the best, most credible supplier means safeguarding yourself from untimely deliveries and fake products. Finding the right supplier means looking for them in the right places. Now, how would you know if you are searching in the right spot?

One option is to look for sources that list numerous suppliers in many different locations. SaleHoo, for instance, boasts a directory containing more than 8,000 verified suppliers in more than 100 countries across the globe.

As such, finding a supplier with SaleHoo might just be what you need to ensure that you would be selling genuine items at reasonable cost, delivered in a professional and timely manner.

After getting into the right channel, remember these three G's in looking for the right supplier(s):

  • Get in touch with more than one supplier – You can only get the best deal once you shop around. After you've procured a list of trusted suppliers, contact them and ask about their prices, product specs, and shipping policies. Compare between each, and see which best fits your e-commerce goals. And remember to always have backup suppliers, in case your go-to guy falls through.
  • Get some conversations going – Once you trim down your list of suppliers, now's the perfect time to negotiate (or haggle over) the exact terms of a deal. Here, you can get a feel for whether you could get along well in the future. If you think you'd be able to work well with one another, proceed to the next G.
  • Get samples – This is extremely important, especially if you're importing goods. Go over the samples and look for any damage and flaws. Use it the way a customer might use it and put some additional stress on the product. After all, e-commerce business is all about your credibility, and you don't want to put your name behind things that are second-best, or worse, fake. By acquiring samples, you may also get a feel for the delivery times, which is very important for your buyers.

Lesson No. 3: Get into the Best Sales Channel

Finally, after getting the right products from the best suppliers, you are now ready to be a Power Seller. But first, you have to choose the sales channels that can best cater to your selling needs. eBay, for instance, has become the largest online marketplace in the world since its founding in 1995. Other eBay alternatives can be found here.

There are also plenty of web and mobile apps out there that can help you develop your online store into a strong, nimble e-commerce business. SaleHoo Market Reasearch Lab, for instance, is an awesome way to identify hot items that would profit well. For a list of other e-commerce web and mobile apps, click here.

Now that you've read about how to make your dropshipping endeavors a truly rewarding one, it's time to share your stories. What are your best practices to ensure that your e-commerce business is as profitable as it should be? Let us know in the comments below.

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13 Comments Add your comment
Full Member
Thank you for making all your posts so honest, easy to understand and straightforward. With all of the information floating around out there, Salehoo is by far the best and most reliable information source and guide. I really appreciate the information on what not to do. Best subscription I've ever made. Reply
Site Admin
Sally, thanks so much! It's great to hear that! Reply
Free Member
I actually haven't started selling to my customers yet because I'm still worried about my customers being I want to sell video game console and electronic accessories/replacements because a lot of people (like me) like to get cool new stuff to ramp up they're products, every one who owns a console or electronic device eventually needs replacement parts, and all of these rarely weigh more than 3 lbs a piece. Furthermore, accessories and replacement parts are less likely to show up at someone's door damaged or not working... I'm not saying it's impossible but the odds are in my favor. Another reason why I want to start out selling with this kind of niche is because it will allow my company's transition to selling actual electronics and the more expensive/heavier products or electronics a lot more seamless than it would otherwise when my company reaches a strong place in the marketplace.

The idea that "the sky's the limit" and the fact that I hate my day job motivates me to keep trying no matter what. I've found that my day job has actually taught me how to deal with almost every kind of customer I'm going to be selling to. I'm a self check (U-scan) cashier at the busiest grocery store in our entire region and these check out machines are seriously pieces of crap, it's always breaking or freezing up and messing up people's orders... So people get really pissed off EVERY SINGLE DAY. Guess who has to calm them down? Me! Our policy is "do whatever it takes to make our customers happy so that they'll always come back knowing we'll take care of them." I've been working at this grocery store for 5 and a half years holding multiple positions along the way, I'm back at cashiering due a severe shoulder injury. Point is, while I do hate this job, I've managed to keep it, and the customers freaking LOVE me. This has helped me with unhappy customers on eBay and I know it will with my e-commerce store. I haven't started drop shipping because I know first hand what people are going to expect from anyone they buy from. If they're giving you their money they expect 5-star service even if they're buying something that's less than $2. It may sound crazy but it's true.

This is why I haven't gone live with my online store yet because I already know what's going to go wrong. So I've been buying from my suppliers to make sure that they're going to ship fast and leave my customers happy. It's seriously such a pain and after ordering from them it makes me nervous. I don't have a reputation or a credit line but the warehouses I would ideally partner with would 1.) have a warehouse in the U.S. 2.) ship with USPS, which in my opinion has the cheapest and most reliable shipping service and 3.) have quality product at cheap prices.

It's so hard for because I feel like I'm so alone on this and I wish the best drop shippers would give me the benefit of the doubt but so far I've pretty SOL. Good article though, very true. Reply
Marc Ransom andl the Folks at Salehoo,
Thanks for the information I received today and in the past from Marc Ransom. I'm new to online marketing and am slowly developing the skill sets needed. Realizing 'the LIST' is numero uno and needing to start generating some funds relatively quickly,while understanding and implementing and monitoring results. The email I received not long ago regarding demand and marketability was fantastic. I've started with an affiliate campaign using paid traffic. This is now progressing to a few niche squeeze pages to develop a list and eventually lead to merchandise sales. Salehoo looks like the way to go. However I am about a month away. Not being a technocrat there are still skill sets required as with any other business.. I'm finding people either don't know or are unwilling to share information. Never the less I'm determined to be in this industry. Thanks for the information and look forward to joining the successful ranks of Salehoo.
All the Best,
Anthony Chai (Tony) Reply
Site Admin
Hi, Anthony!

Have you checked out our forum? You can find others there who are in the same boat and get advice from people who have already been in your shoes. You might be able to find the resources you need to get everything up and running.

http://www.salehoo.com/forum/?nobounce Reply
Full Member
I am finally venturing into the supplier and dropshipping world. I am still in the research and analyzing stage and maybe just a little scared. I've had a 100% perfect rating on ebay since 2008; worried that might drop a bit after widening my product line. Words of encouragement welcome. I will say that I am very pleased so far with Salehoo. Very easy to understand and a ton of information. Reply
Site Admin
Hi, Renea!

I'm glad to hear you're having a positive experience. We're always happy when our members are using the resources we provide! I wish you very much luck in your dropshipping ventures -- and if you need a little extra encouragement or guidance, don't be afraid to visit the forums! Our staff and the other members will be happy to share their wisdom.

http://www.salehoo.com/forum/ Reply
Full Member
I've been in dropshipping bussines since March, is awesome how all the advices that you read here become real in the field. Even low profits (just for now), is a business model that works but as everything in life it needs time, listening to market, costumer service, the right providers and some analysis. No one said the road to success was easy. But if your are new in this like me!, DO NOT! throw the towel still beating the market to win the round! Good luck Reply
Full Member
I like your comments, i am currently doing dropshiping with limited success, and that's not helping my confidence, there is a lady talking about her job on here, not great is it. trying to figure out what to sell, as i love anything to do with a cameras, videocamera, or indeed audio. And no it is not easy, and ebay fees, usually eat up most of my profit, and this is now the third time i have tried this. And paypal is another problem as they do hold the payments. And take a guess why i am trying to do dropshipping.
Royce Reply
Full Member
I am just starting on trying to have a presents on the web n a eCommerce market. My concern is i sell other things on eBay and have tried to do fast shipping. Not sure if drop shipping would hurt my speediness by delays or long time in delivering times. How might i control some of that issue. Reply
Site Admin
Hi, Alan --

It really, truly depends on the dropshipper. Some will be speedy. Others might take a while or be terrible about communicating issues. Your best bet is to test the dropshipper's shipping times by placing an order yourself. Make sure you do test orders at random intervals to make sure the quality of service stays the same over time. It also helps to form a good relationship with your representative of the company. And of course, choosing a supplier who is based locally rather than in another country also helps significantly -- customs slows everything down and it's almost impossible to guarantee delivery times for those international orders.

Then of course you have to factor in the potential error on the part of USPS/UPS/FedEx. Mistakes do happen on their part, no matter what they claim. And at the holidays it's even worse. Longer shipping times happen as a result of the higher volume. The odds are quite low, but the more business you do, the more you'll find you have issues. That's just the nature of things. Depending on what you sell, it might be better to use a shipping option with tracking included as your default.

Hope this helps! Reply
Full Member
Thanks for the reply that does help me in deciding. I am looking forward to getting started in the eCommerce business.
Full Member
Hi I am new to drop shipping and I can't seem to find any suppliers that sell name brand items. Some help would be nice. Reply
Site Admin
Hi there!

Brand name products, depending on the niche, can be difficult to sell. Especially in fashion and technology.

However, you can always contact our support team to help you find a supplier with the products you're interested in!

Good luck! Reply
Full Member
i am trying to get into dropshipping business in future through ebay. However, before i get into dropshipping business i want to sell some few things [unlocked huwawei e3350 modem) to get some positive feedback rating from my customers. i want to sell these modems cheaply to set positive part way to sell other items through dropshiiping program. My problem is the shipping cost from Papua New Guinea to worldwide. I enquired at DHL PNG, FedEx, USP and EMS, to get a good shipping rate to list together with the price of the modem but i am not statisfied. The shipping cost will increase the price which will not be competitive to other simillar sellers on ebay. Any assistance here as to how i can get a good shipping rate to start selling would be very much appreciated.

Site Admin
Unfortunately, shipping costs are one of the biggest hurdles to selling online to an international audience. Unless you're ordering entire shipping containers and storing it all in a warehouse, you're going to pay some hefty costs per item -- and even then it can still be costly. Your best bet is probably to find some low-cost, high-margin items to sell to begin with -- electronics tend to have slimmer margins than other product types, so I would steer away from the modems. With a lower per-item cost and bigger margins, the shipping costs are less of an issue. Reply
Is this site good for getting products to do Retail Arbitrage?

Thanks, Nghia Reply
Free Member
1. Do you guys provide list of Manufacturers in China? If yes, then do you screen them to see if they are not trading companies but actual manufacturers?

2. Does a wholesaler usually get there products from a manufacturer?

3. Do you have any wholesalers that sells lets say Disney products?

4. Is this site good if you want to do retail arbitrage?

Thanks... Reply
Site Admin
Hi, Nghia!

1. You can search our supplier database and filter by the supplier's region -- in this case, Asia -- as well as whether they are a wholesaler or manufacturer. We do screen every supplier in our directory to verify that they are legitimate businesses.

2. In some cases, yes. In some cases, the company might manage its own wholesale distribution.

3. If you're looking for a specific type of Disney product, contact our support team at SaleHoo.com/support.

4. From my understanding, retail arbitrage is buying products in store and reselling them online. While you could use SaleHoo stores to do that, you'll face the same sort of challenges anyone with their own online store faces -- namely, traffic. Reselling through a marketplace such as eBay or Amazon is often easier for newbie sellers, and if you have your own site, you should tailor it to cater to a specific niche.

Hope that helps! Reply
Full Member
So far, I'm fascinated with the SaleHoo opportunity. I appreciate all of the information you provide to people just stopping by on your website; I can only imagine how much more information is provided to paid members.

I'm very interested in purchasing a website from SaleHoo and I have just 2 questions:

1. Before purchasing, would I get an idea of the 5,000 items provided in the $47/mo site?
2. What is meant by digital content being offered in the $97/mo site?

Thank you Reply
Site Admin
Hi, David!

The 5,000 items is the limit to how many products you can list in your store -- they're not pre-selected for you.

For the digital content offering, I don't know all of the details. However, our support team will be able to explain it, as well as answer any other questions you may have about SaleHoo stores!

www.salehoo.com/support Reply
Free Member
Hi, guys!

I´ve been working with salehoo for a long time now and they have been gret. I am now looking to expand my dropshipping business. As for this I have now decided to create my own website, more exclusive and sophisticated. I am now looking into the translation of my website in different European languages?

Has someone faced the same situation? Any agencies that could help me out? Any reasons as for why not to do it?

Many thanks! Reply
Site Admin
Hi, Marcel!

You can typically find translators on Upwork, which was formed through the merger of Elance and oDesk. An alternative is Fiverr, which might be good for small-scale projects, but isn't quite as good for large-scale projects like translating an entire website.

You'll also want to look at making sure whatever payment processor you choose supports multiple currencies.

Also, feel free to post your question on our forum, where you can see what experiences other sellers have had!

http://www.salehoo.com/forum/ Reply
Free Member
I am very interested in trying Dropshipping. I have a few questions, do the wholesalers you have on your site charge a joining fee to use there service? Do they take pay pal, not to keen to use a credit card online, Do you have to open accounts with them individually or is is all done through Salehoo? Reply
Site Admin
Hi, Janine!

In general, the dropshipping companies in our directory don't charge joining fees or application fees. Instead, they often assess a per-item dropshipping fee to help offset the overhead/admin costs of dropshipping.

Each company accepts different forms of payment. Some use PayPal, some are credit cards only, some also do ACH/bank transfers or wire transfers. It is entirely at the company's discretion.

You'll need to open an account with the dropshipper. Some are also retailers, so you'll need an account before you can even get access to the catalog and wholesale/dropshipping prices.

Hope this helps! If you have further questions, please don't hesitate to reach out to our support team!


Good luck! Reply
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