How Much Does It Cost To Start Dropshipping? (2024 Update!)

How much money do you need to start dropshipping? That’s one of the most common questions we hear from ecommerce companies looking to grow their profits with dropshipped products.

One of the reasons dropshipping has become such a popular business model for entrepreneurs in recent years, is that it offers a relatively low-cost (and simple) way to grow an online business.

Technically, you can start a dropshipping store for less than $100.

However, while dropshipping is a lot less expensive than running a traditional ecommerce store, there are still costs to consider.

Here’s everything you need to know to answer the question: “How much does dropshipping cost?” in 2024.

What is Dropshipping? A Quick Intro

Before we look at the various dropshipping startup costs you’ll need to consider when launching your store, let’s start with the basics.

Dropshipping is an ecommerce business model that allows you to run an online store and sell items without purchasing and managing inventory upfront.

You simply choose a “dropshipping supplier” to work with, and list the products they offer on your store.

When a customer places an order, through your marketplace storefront or ecommerce website, you send their information to your supplier.

The dropshipping vendor then picks, packages, and ships the order to your customer. Only once the order is made do you pay for anything.

That means there’s no inventory costs to manage (such as physical warehousing costs), and no risk that you end up with stock you simply can’t sell.

It’s easy to see why the dropshipping market is set to be worth around $1862.64 billion by 2032, isn’t it?

How Did the Dropshipping Business Landscape Change in 2024?

Over the last couple of years, dropshipping has grown increasingly popular, thanks to the rise in online entrepreneurs, the creator economy, and the evolution of ecommerce.

In 2024, dropshipping has continued to evolve, much like the wider ecommerce landscape, adapting to changes in technology, and consumer behavior.

Perhaps the three biggest changes to the dropshipping market this year include:

Growing Market Saturation

Dropshipping’s low barrier to entry, and relatively low startup costs make it a popular choice for all kinds of entrepreneurs.

As a result, the market is becoming increasingly saturated. There are more dropshipping companies out there than ever before, as well as more suppliers.

However, this doesn’t mean “dropshipping is dead”. With the ecommerce market set to reach around $57.22 trillion in value by 2032, there’s still plenty of potential out there.

Dropshippers today simply need to be more cautious about choosing the right products and target niche.

New Consumer Trends

Dropshippers, like most vendors, are contending with new consumer trends in the changing ecommerce landscape.

Increasingly, customers are embracing online shopping, but they’re demanding more quality and value from the companies they buy from.

They want faster shipping, top-notch service, and a focus on sustainability.

This is prompting dropshipping vendors to offer more eco-friendly products and services, to appeal to a more eco-conscious consumer base.

It’s also leading to an increase in the number of dropshipping companies offering specific “local fulfillment centers” and vendors to companies looking to offer faster shipping feeds to their audience.

Evolving Tools and Ecommerce Platforms

In 2024, ecommerce platforms and dropshipping sites have become more advanced.

We’re seeing an increase in the number of companies offering more advanced automation options, access to AI tools for improving customer service, and more.

Some print on demand companies are even using generative AI tools to help companies with the creation of designs.

The evolution of more advanced technology should make launching and managing your dropshipping store easier in 2024.

However, the more powerful the features, the more you can expect to spend.

How Much Does Dropshipping Cost?

So, how much money do you need to start dropshipping?

Compared to starting a traditional ecommerce or retail business, the costs are definitely a lot lower.

But it’s never free to start, manage, and scale a successful business. Even dropshipping has some startup costs to consider.

You might need to a massive business loan, but you will need to be willing to invest something into your dropshipping venture.

The exact dropshipping startup costs you’ll pay depend on your approach to dropshipping.

For instance, for a very simple startup, all you really need is two things:

• A Shopify Subscription
• A DSers subscription

While these aren’t the only tools you can use, they’re our top choices. Shopify is one of the most popular ecommerce platforms out there, and it even offers a $1 first month offer to beginners.

After that, you’ll need to spend $39 per month to access the Basic Shopify store plan.

DSers is the leading AliExpress dropshipping tool for Shopify. Since AliExpress offers extremely cheap products, it’s a great way to start a low-cost business.

While there’s a free plan for DSers, it will limit your scale with a 3000-product cap.

However, you can use the free plan to start your business, then upgrade to the $19.90 plan when you’re ready to grow. This plan also includes things like bundle mapping and automatic inventory updates.

One other thing, if you want to make your dropshipping store stand out, we do recommend buying your own domain name. You can do this through Shopify for as little as $14 per year.

So overall, the cost of starting your dropshipping business would be:

• $72.90 for the initial cost: $39 per month for Basic Shopify, $19.90 for Advanced DSers, and $14 for your domain name.
• $48.90 per month after that.

Breaking Down Dropshipping Startup Costs

So we’ve covered the basic costs of a bare-bones dropshipping venture. However, there are actually quite a few different costs to consider if you’re really committed to your store.

Let’s look at some of the core startup expenses you’ll need to think about.

Costs for Dropshipping Product Validation

This is one of the most commonly overlooked dropshipping startup costs, but it’s also among the most important.

Ultimately, validating your products is crucial to ensuring you can actually make a profit.

While you don’t have to handle products yourself as a dropshipper, ordering samples of your own items, and making sure they live up to your quality expectations is crucial.

It gives you a chance to do a lot more than just examine the quality of the products.

You can also assess the timeliness of the delivery (shipping speed), the packaging appearance, and the customer service offered by your team.

You can investigate how easy it is to make a return, and even take unique product photos for your online store.

So, how much does product validation cost? That depends on how many items you want to sell.

You should order at least one version of each product you’re sourcing from a dropshipper.

So, if you’re selling 5 products, and they add up to around $75 to order samples, this takes your initial startup costs (plus your Shopify and DSers account and domain name) to around $150.

Costs for Enhancing your Dropshipping Store

The $39 per month you’ll spend on your Shopify subscription gives you access to a lot of features, from a great website builder, to integrated marketing tools and inventory management capabilities.

However, you’ll still need to pay a little extra if you want to take your store to the next level.

Let’s say, for instance, you want to differentiate your store from other Shopify sites with a premium theme.

That means spending around $200-$350 for the theme, plus any costs associated with getting a developer or designer to help edit your theme (if you need extra support).

Then there’s adding functionality to your store. Shopify has a great checkout, but it doesn’t allow you to offer discounts on bulk purchases.

This means you’ll need a Shopify app to offer new sales experiences. You might also want to use apps for:

Upselling and Cross-selling

Cross-selling and upselling are two excellent ways to increase your average order value and revenue on an ecommerce store.

Cross-selling involves offering a service or product connected to something the customer has already purchased (like a matching pair of shorts to accompany a skirt).

Upselling involves encouraging customers to buy a more expensive version of an item.

There are various tools you can use to do this on Shopify, each with their own fees, such as:

• Monk Cart Upsell: $30 per month
• Bundles and Upsell: $29.50 per month
• Bold Upsell: $9.99 per month

Bulk Pricing

Bulk Pricing apps on Shopify are solutions that allow you to deliver discounts to customers buying larger quantities of products.

This is a good way to encourage your shoppers to buy more. Once again, you can use various tools on Shopify to enable this feature, such as:

• Quantity Breaks: $20 per month
• Discount pricing: $19.99 per month
• Bulk Discounts: $18.95 per month

Exit Intent

Exit intent tools allow you to automatically deliver enticing offers to customers who are planning on abandoning your website.

The technology tracks the mouse movements of website visitors, detecting when customers might be about to close their browser window.

This reduces your risk of potentially losing sales.

The apps you can use for this include:

• Wheelify: $6.99 per month
• Spin a Sale: $9.99 per month
• Smart Popup builder: $29.99 per month

The Extra Costs

Adding all of these features to your store will take your initial $150 cost of launching your store (after product validation), to around $210 on average, if you install all three of the app options above.

Combine this with your $200 premium theme, and you’re up to around $410.

Dropshipping Store Marketing Costs

Now we come to perhaps the biggest thing that will influence your dropshipping startup and operational costs: marketing.

While many of the costs associated with launching a dropshipping store have a specific price tag, marketing is a little different.

It’s difficult to know how much you’ll need to spend on marketing, as the price can vary depending on the channels and strategies you use, the support you need, and how competitive your marketplace is.

First, it’s worth noting that the average conversion rate for ecommerce is around 2-3%.

This means if you get 200 people to your store, you can expect about 5 to purchase something. In other words, if you want lots of sales, you’re going to need a lot of traffic. That’s where marketing comes in.

There are a few different marketing strategies you can try with different associated costs.

Content marketing, for instance, can be a relatively low-cost way to drive traffic to your store, if you know how to create content. One of the biggest options for dropshippers is Facebook paid advertising.

The average CTR for a Facebook ad is around 0.9%, this means to get 200 people to your store, you need to reach 20,000 people.

The cost of 20,000 impressions varies depending on who you’re targeting, but the average cost for around 1000 impressions in 2021 was $14.90.

That means you’d pay around $300 ($14.90 x 20= $298) for 20,000 impressions. There are ways to lower these costs. For instance, the better your ads are, the lower your cost per click will be.

You can also target countries with lower CPM rates if you can ship internationally.

Plus, you can use strategies to increase the conversion rate and average order value of your store, using excellent product pages and images, offers, and limited-time discounts.

This will increase your conversion rate, boosting the ROI of your marketing campaigns.

How Much Money Do You Need to Start Dropshipping?

So, how much money do you need to start dropshipping? The answer is that it all depends.

If you want to use Shopify and DSers, have your own domain, a custom theme, and a selection of apps to help with sales, you’ll spend around $410.

Then you can expect to spend another $300 or so on an initial Facebook marketing campaign.

Plus, there are other fees to consider too, from potential transaction costs to the fees associated with actually shipping your products to customers, and the costs of other marketing and sales apps you might want to use.

Ultimately, the cost to start your dropshipping venture is still a lot lower than what you’d spend to launch a traditional store.

However, if you thought you could get started for free, you’re out of luck.

Additionally, it’s worth remembering once you start your dropshipping store, you’ll need to keep pumping money into it.

You’ll have to keep investing in new marketing strategies, product research, and innovative ways to make your store more profitable.

Dropshipping Startup Costs FAQ

What budget do you need for dropshipping?

With all of the resources and dropshipping tools available online today, you don’t need a huge amount of cash to start a dropshipping business.

You can get started with as little as $100, depending on the technology you want to use.

Can you start a dropshipping store for free?

Technically, yes, but only if you already have an ecommerce platform, or you’re using a free trial.

You can find dropshipping apps that connect you with suppliers and allow you to list a variety of products on your store for free.

Is dropshipping still profitable in 2024?

Though the dropshipping market is becoming more saturated, it’s still a profitable option for business leaders.

The ecommerce market is still growing, and Grand View Research predicts the global dropshipping market will reach a value of $557.9 billion in just a few years.