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What is Dropshipping?
Dropshipping is a retail method that involves the retailer NOT having items in stock, but rather purchasing the items from a third party supplier which could be a manufacturer, wholesaler, or another retailer, and having it delivered directly to the customer.
How does dropshipping work?
The cycle of dropshipping is a pretty simple one.
- Step one: Customer places an order from your online store.
- Step two: Your store automatically sends the order to your dropshipping supplier
- Step three: Dropshipping supplier prepares your customers order.
- Step four: Dropshipping supplier ships the order directly to your customer.
Advantages of the dropshipping business
- You don’t have to worry about having a physical stock of products before you can sell something to your customers.
- The supplier is responsible for the products in his own stores and will take care of shipping or supplying the customers in your own name.
- Customers don’t have to know you are a middle man
- It’s relatively quick and easy to start.
- Great opportunity to make passive income
- You can start from home.
- It’s easy to scale up when your customer base increases.
What do you need to start a dropshipping business?
- A good business idea: A good business idea is necessary to starting a successful dropshipping business. Ask yourself, what do you want to sell? Carve out a niche for yourself and determine the category of products you want to sell
- Choose a good supplier: Find a supplier who is dependable and reliable and also sells at affordable prices so you can make profit.
- Create your online store: Get quality pictures of the products from your supplier and post them online. Always remember to check if items are still in stock!
- Open a business account: A business account will help your business be more financially capable. You çan place restrictions on the account to enable proper finance management.
A WEMA business account is highly suited for this. It is an account created to target small businesses and can be operated online for ease of business. It is designed to help small businesses grow. It has a minimum opening balance of just N10,000 and has the full benefits a current account has to offer. Charge rates on this account are affordable at a monthly turnover.
Some Dropshipping Niches Ideas
Here are some of the trending businesses online at the moment;
- Men’s Clothing & Accessories Dropshipping Niches
- Women’s Fashion & Accessories Dropshipping Niches
- Health & Wellness Dropshipping Niches
- Kids & Babies Dropshipping Niches
- Home & Kitchen Dropshipping Niches
- Phone Accessories Dropshipping Niches
- Home and Pets
- Cars and Motorbikes
- Hair Extensions and Wigs
How to Start A dropshipping business in Nigeria
1. Find out what you want to sell:
What kind of products are needed at the moment? What problem needs to be solved? This and more will influence your decision on the niche you want to carve out for yourself.
2. Find a supplier
This is another important step. Find a supplier who will be willing to allow you to serve as an intermediary between him/her and the consumers. Also, find out if they will be willing to handle the logistics of delivery.
3. Build your website:
If you can do this yourself, great! If not, pay to get this done. Buy a domain name, host your site and you are ready to go! Simple websites can be created with sites like WordPress. Alternatively, you can market your products on social media platforms like Instagram, Facebook, and even WhatsApp for business.
4. Invest in marketing
Marketing methods essentially depend on you. Nowadays, marketing is now digital. Beyond having a website, consider building your online presence via popular social media platforms like Facebook, LinkedIn, Twitter, etc. You can also use popular e-commerce platforms like Jumia, Konga, etc to host your products.
5. Keep proper financial records
While dropshipping can earn you a tremendous amount of money, it is important that you account for this money. Separate your personal finances from your business account records and ensure that everything is well documented.
That said, dropshipping is big money for those who can put in the work. While competitors may arise due to the minimal logistic efforts required, it’s important that one keeps up-to-date with the latest marketing trends in order to stay ahead of the competition.
Below are some dropshipping business frequently asked questions (FAQ) by other people that might also be helpful:
- Is it worth starting a dropshipping business in 2021?
Yes! Due to the current economic crisis, many are looking for easy ways to make passive income, and dropshipping is one of them
- Is dropshipping free to start?
This largely depends on what you want to start with and the complexity of your business model.
- Can you drop ship on Amazon?
Yes, you can.
- How much money do you need to start dropshipping on Amazon?
Amazon has two packages, the first one which is charged at$0.99 and the second being the bulk package that cost 50.00
- Why is dropshipping bad?
Dropshipping has both advantages and disadvantages (please see above). One of the major disadvantages is visibility. Because the client believes that the drop shipper is the retailer, any slip up on the part of the supplier can be disadvantageous to the drop shipper’s business.