Dropshipping on Shopify

If you're considering dropshipping products using Shopify, find out everything you need to know about how to do it successfully.

Contents

What is dropshipping?

How to start dropshipping on Shopify

What products should you not dropship?

Best items to dropship on Shopify

Shopify apps for dropshipping

What are the margins for dropshipping on Shopify?

Tips for dropshipping on Shopify

What payment processors can I use?


What is dropshipping?

Dropshipping is when a merchant doesn’t keep any products in stock; instead they fulfill orders from a third party which are shipped directly to the customer. So the merchant acts as the middle-person without handling products directly. There are lots of Shopify merchants who dropship.


How to start dropshipping on Shopify

It is possible to start your dropshipping business while you’re still in full time work, before transitioning to working full-time on your dropshipping as revenue and profits reach the right level.

It’s important to be realistic - Shopify estimates that it’s possible to generate between $1,000 and $2,000 dollars per month, within a year, if you’re working between 10 and 15 hours a week building your dropshipping business.

Shopify has a short guide to getting started with dropshipping, including deciding on a business structure and how to organise your finances.


What products should you not dropship?

If you’re thinking of dropshipping on Shopify, there are some kinds of products that are worth avoiding. Here is a list to help you dodge some common pitfalls.

1. Consider the size and fragility of your products

Bigger and heavier items will cost more to ship, might have more risk of breakage and could be more difficult to manage.

2. Counterfeit products

Apart from being illegal, your customers will realise, be disappointed, and never come back. It’s a lose-lose situation.

3.Products you can’t advertise on Facebook

Items such as adult products, counterfeit products, weapons, tobacco, drug-related items, unregulated supplements. Check out the platform’s advertising policies before you make any decisions.

4. Clothes

You don’t necessarily have to avoid these, just be aware of receiving returns due to sizing issues (especially if you are shipping internationally).

5. Electronics

As a dropshipper, you are liable for any problems but be aware that you don’t see or handle the products, plus there is more to go wrong with electronics so the risk is higher. That said, it remains a popular niche but it’s something to be aware of.

6. Safety equipment or cosmetics

Crash hats might break in an accident, leaving you liable. Make-up might result in an allergic reaction. What we’re saying is: think about any implications of the product you’re selling going wrong.


Best items to dropship on Shopify

There are certain types of products that do well for dropshippers. Consider niche products but also keep an eye on trends that you might be able to capitalise on quickly. Here are some examples of products that have done well for dropshippers in recent times.

1. Face masks

A perfect example of an item that has been trending in 2020 (along with hand sanitiser), buying these and then selling on at a profit to people keen to stock up has worked well for many dropshippers.

2. Ear plugs

This might seem like a strange one but the logic here is that they are cheap and small, making them an easy option for you. They are also likely to be lost quite regularly,  making them a potential repeat purchase for your customers.

3. Charging cables

Similar logic to the ear plugs: small, relatively cheap products that may require repeat purchases due to customers losing them.

4. Phone and tablet cases

You can buy model-specific cases or a ‘one size fits all’ waterproof case which works for everybody.


Shopify apps for dropshipping

Shopify has a whole ecosystem of apps that are available for you to plug in to your store to enhance functionality and make life easier. There are lots of apps that are helpful to dropshippers which can save time and money. Here are a few examples. 

1. Cart Convert

This app increases your average order value by recommending additional products to customers on your store. It’s easy to set up and has both a free plan, and a paid version with enhanced features.

2. Oberlo

This dropshipping app helps you find and upload products to your store. It uses a network of suppliers and enables you to ship products from your supplier’s warehouse directly to your customer. It has a limited free starter plan then has paid versions depending on how many products your store has available.

3. Modalyst

Modalyst is an official partner of the AliExpress Booster Program for dropshipping.

This partnership allows Modalyst to connect Shopify stores directly to AliExpress suppliers and products for dropshipping. All product info and orders are synced through an API. This means that AliExpress Order IDs and Tracking is automatically synced with your account through the Modalyst API-connected official partnership.

4. Sprocket

This app has a list of suppliers around the world and features automated, real-time order processing to help save you time. The app has several price points depending on the range of products you want access to, from a free plan up to $99 per month.


What are the margins for dropshipping on Shopify?

As you won’t be buying your stock in bulk in advance, but rather purchasing a single unit from the supplier every time you make a sale on your store, prices will be higher for you.

The average margin you could expect is about 15%.

To increase your margins you can of course increase prices, or buy in bulk so the lower margins are offset by the higher volume.


Tips for dropshipping on Shopify

It’s true that it is easy to dropship on Shopify. What that means is that there are hundreds of thousands of people doing it, so the competition is fierce. Here are some tips to help get you started. Doing all of these things right may give you the edge over your competitors.

1. Make sure your store looks great. Whether that’s by hiring an agency to help build it or by using a professional looking theme, you need to stand out from the other stores selling the same product. 

2. Ensure your product descriptions are well-written.

3. Create a blog and post on it regularly.

4. Create a great About Us page to reinforce you are a real business with real people behind it.

5. Make use of good imagery.

6. Make sure you provide excellent customer service! Make it easy to buy products from your store and be easily contactable if customers need to get in touch.

7. Personalise your emails - this forms a part of your customer service experience and relationship-building.

8. Maintain an active social media presence. Help engage with and grow your audience.


What payment-processors can I use for dropshipping on Shopify?

Dropshipping can often be considered high-risk by payment processors, but Shopify Payments is often able to support dropshipping stores. Whether you’re eligible for Shopify Payments depends on the location of your business as well as the types of products you’re looking to sell. It’s important that you review both the Shopify Payments requirements here as well as the Shopify Payments Terms of Service before you get started.

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