How to Start a Dropshipping Business in 2024 (Easy Guide)

Dropshipping is the hottest business opportunity since affiliate marketing. It’s quickly grown into a multi-billion dollar industry that dominates the ecommerce space.

In this comprehensive guide, I will show you how to start a dropshipping business the easy way. Whether you’re new to the online business world or have previous experience, you will have a clear understanding of how to start a dropshipping business by the end of this guide.

I’m going to take you through the entire process, step-by-step. I’m also going to avoid unnecessary jargon to provide you with the most practical blueprint for starting a dropshipping business on the net.

How to Make Money Dropshipping Step by Step

1. Find a popular niche

Finding a niche is the first step towards starting a dropshipping business. It’s important to locate a popular niche with low competition and high demand. This will allow you to stand out from the competition, increase your chances of success, and build your own unique brand.

There are a number of ways to find a good dropshipping niche. Let’s take a closer look at some of the most popular and effective techniques.

Reflect on your interests and hobbies

Reflecting on your interests and hobbies is the best way to start the process of finding a niche for your dropshipping business. You should think about the topics you have a genuine interest in and decide if they would be a viable business idea.

For example, if you have an interest in health and fitness, you could sell home gym equipment or sports accessories. If you have a passion for the outdoors, selling camping accessories could be your calling. Either way, it’s always a good idea to choose a niche that you’re passionate about.

Research and study other sellers

Researching other sellers is another powerful way to find a lucrative dropshipping niche. You should start by browsing top-selling products on platforms such as eBay and Amazon. In fact, Amazon has a best-sellers page, whereas eBay provides a list of the most popular categories.

If a particular item grabs your attention, check the seller’s other listings. Then, search for similar items on eBay, Amazon, or Google and study the products of multiple sellers. This is a great way to generate niche ideas and find other successful companies that you can use as inspiration.

Use a free keyword research tool

Using a free keyword research tool such as Google Keyword Planner or Wordtracker is a simple and easy way to find a dropshipping niche. Simply input a starting keyword and the tool will instantly return a list of similar keywords, as well as details on average monthly search volumes and competition.

Use a trend-spotting tool

Google Trends is another great free tool for finding dropshipping niche ideas. Simply input some starting keywords and the software will reveal the interest of that product over a specific period of time. It will also provide you with related topics and queries.

Use a dropshipping niche finder tool

Another option for finding a profitable dropshipping niche is to use a dropshipping niche finder tool. By using a niche finder tool, you will be able to quickly locate the most popular dropshipping niches and products to sell, without having to do a ton of manual research.

2. Create a brand name

Once you have decided on the niche you want to target, it’s time to come up with a brand name for your dropshipping business. It doesn’t matter if you’re planning to build an ecommerce store or sell on marketplaces like eBay, creating a good brand name is essential.

Here is a list of tips to help you select the perfect brand name for your dropshipping business. Make sure you read them thoroughly as this is a very important step in our guide.

Keep it short and catchy

Having a memorable and easy-to-pronounce brand name is recommended. That’s why you should try to keep it short and catchy. You should also try to make it relevant to the niche you’re targeting. For example, if you’re selling pet supplies, a name like ‘PowerPets’ or ‘HappyPaws’ would be ideal.

Use a business name generator

Business name generators such as NameSnack and Namelix are free to use and allow you to quickly generate ideas. Simply input a keyword and you will be instantly provided with dozens of options. It’s recommended to try multiple business name generators to come up with a list of potential names.

Make sure the name is available

Once you have come up with some brand name ideas, the final step is to check their availability. The best way to do this is by using an all-in-one name checker tool such as Namechk or KnowEm. These platforms allow you to simultaneously check the domain availability, as well as the username availability on social media websites such as Facebook, Twitter, and YouTube.

You should also perform a trademark search to ensure the name has not already been registered by another company. If the name is available, register the domain and open accounts on all social media websites as soon as possible to secure the usernames.

3. Choose a selling platform

Now that you have a brand name and niche to target, the next step is to choose a selling platform for your dropshipping business. There are many places to sell dropshipping products so you should carefully consider your options and select the best solution based on your preferences.

Sell on marketplaces

Dropshipping on marketplaces such as eBay and Amazon is the most popular option for newbies. This is because eBay and Amazon are both very easy to use and have millions of global buyers. Plus, literally, anyone can sign up and start dropshipping on eBay or Amazon right away.

However, it’s important to review the guidelines before dropshipping on eBay or Amazon. You must be sourcing products from a genuine wholesale or trade supplier. Dropshipping items from other retailers such as Walmart is not allowed on eBay or Amazon.

You should also consider the fees for selling on platforms like eBay and Amazon. This will help you to decide if dropshipping on a marketplace is the right option for you.

Build an online store

Although selling on marketplaces is a great way to generate quick sales, building an online store is the better solution. With your own ecommerce website, you won’t need to worry about competing with hundreds of other sellers. You will also have more control over your dropshipping business.

From Shopify and WooCommerce to Ecwid and BigCommerce, there are dozens of dropshipping website builders to choose from. Most people go with Shopify or WooCommerce as they are considered the most reliable solutions. However, the best platform will largely depend on your budget and experience level.

Purchase a turnkey store

If you don’t have the time or experience needed to build an ecommerce website, you can purchase a turnkey dropshipping store. Most providers of turnkey dropshipping stores offer a complete end-to-end service which includes designing, and configuring the website.

Once the store has been created and delivered, you can immediately start adding products and generating sales and traffic. You can also edit and customise your store in just a few clicks. It’s one of the quickest and easiest ways to launch a dropshipping business on a budget.

Sell on Facebook Marketplace

Launched in 2016, Facebook Marketplace has quickly grown to become one of the most popular websites for buying and selling products online. Although it was originally designed for selling used stuff to local buyers, the platform has seen an increase in demand for brand-new items.

In fact, Facebook Marketplace recently introduced the option to accept payments and provide direct shipping to customers through the platform. This makes it another great website for starting a dropshipping business. However, it’s important to note that the payment and shipping options are only available to US sellers currently.

Sell on multiple channels

Selling on multiple channels is the best way to increase your sales and exposure when dropshipping. You can start with one platform until you gain enough experience and slowly branch out. Ideally, you should be selling on every possible channel including eBay, Amazon, Facebook, and your own store.

Using multi-channel selling software is recommended as it will allow you to manage listings, sales, customers, and inventory across all platforms from a single dashboard. Moreover, any changes you make to your listings will be automatically synced across all channels.

4. Get automation software

Finding suppliers and managing inventory is the most challenging part of starting a dropshipping business. That’s why it’s essential to use dropshipping automation software.

Most dropshipping automation solutions allow you to find and import best-selling products from multiple top suppliers, as well as fully automate stock and price management. In fact, you can use dropshipping software to run your entire business from one platform.

By this stage in the guide, you should know what type of products you want to sell and where you want to sell them. Therefore, it’s simply a case of finding software that matches your business model.

There are dozens of dropshipping solutions on the market, each compatible with different suppliers and selling platforms. Please refer to our guide on the best dropshipping software to find a platform that suits your requirements. Most of them have free plans so you won’t need to pay anything upfront.

It doesn’t matter if you want to dropship electronics on Amazon or pet supplies through an online store, you can be sure to find software that works with your selling channel and suppliers in your niche.

For example, Wholesale2b is an all-in-one dropshipping platform that features more than 1 million top-selling products from over 80 suppliers in the USA. Wholesale2b is also compatible with every major ecommerce platform including eBay, Amazon, Shopify, and WooCommerce.

If you don’t want to use automation software and prefer to source products from suppliers manually, please refer to our guide on the best dropshipping suppliers in the US, as well as our article about the best dropshipping suppliers in the UK.

5. Start creating listings

Whether you’re selling through an online store or a third-party marketplace, there are a number of things to take into account when it comes to creating listings. The following tips will help you to your traffic and sales by creating attractive product listings.

Keep in mind, that if you’re using automation software, you will be able to quickly list products on your selling channel. In most cases, this can be done in bulk using a web app or Chrome browser extension. If you’re not using software, you will need to manually create listings.

Use high-quality product images

Using high-quality product images is the easiest way to create attention-grabbing listings that attract buyers. When dropshipping, you should consider editing product images to make them unique.

Websites such as Img2Go allow you to quickly add a watermark to images which will increase brand awareness. Even just tweaking the size of images will help you to be more unique.

You could even go a step further and take your own unique product images. Most dropshipping suppliers will be happy to send out product samples so you can take your own pictures. Alternatively, you can use an ecommerce product photography service.

Create keyword optimised titles

Creating keyword optimised titles is essential when dropshipping, particularly if you’re selling on eBay or Amazon. You should always include as many relevant keywords in your title as possible. This will increase your exposure when consumers search for products on eBay, Amazon, or Google.

To do this, you can use a free keyword research tool or study the titles of similar products from other sellers. You can also use free title builders such as FireTitle to generate ideas.

Write your own unique descriptions

Although it may be time-consuming, writing your own unique product descriptions is the single most effective way to stand out from competitors. It will also give you the opportunity to optimise your listings for search engines by sprinkling relevant keywords throughout the description.

If you lack the time needed to create unique descriptions, you could use a dropshipping description writing service. Freelance websites such as Fiverr and PeoplePerHour are great places to hire writers to create professional descriptions for a small fee.

Set reasonable selling prices

The most common mistake newbie dropshippers make is setting their prices too high. It’s important to find a balance between earning high-profit margins and generating maximum sales. It’s better to generate a small profit and more sales than a large profit with hardly any sales.

Make sure you work out your expenses and selling fees to come up with a reasonable selling price for each product that you’re dropshipping. In general, you should aim for a 20-25% profit margin.

There are a ton of free online profit calculators such as Salecalc and eBayFeesCalculator. These tools allow you to quickly work out your fees for eBay or Amazon, as well as payment processors such as PayPal. Simply input your selling price and cost price to get an instant breakdown of fees.

Choose winning products

Choosing winning products is the best way to fast-track your way to success with dropshipping. That’s why it’s important to research products and select items that are popular and in demand. You can do this manually or you can enlist the help of a dropshipping research tool.

Most dropshipping research tools allow you to quickly find top-selling items that are already generating profit for other stores and dropshippers. Generally, this involves spying on competitors, tracking sales and revenue, or accessing a curated database of the most profitable dropshipping products.

6. Drive traffic and sales

Naturally, sales are the lifeblood of your dropshipping business. You need to make the effort to drive traffic to your store or product listings to maximise sales. Here are a few of the most effective ways to boost sales when dropshipping through a store or marketplace:

Optimise conversion rate

There are a number of simple ways to optimise and increase your dropshipping conversion rate. You can try offering free shipping or write your own unique descriptions. You can also tweak your prices or lower them to attract the most customers.

If you have an online store, you can add customer reviews, improve load speeds, and enable guest checkout. Using dropshipping video ads is another proven way to drastically increase conversions.

Plus, most ecommerce platforms have a ton of third-party plugins and apps that can help to improve your conversion rate. This includes apps for simplifying the checkout process, adding more payment options, enabling live chat, and using exit popups.

Run sales and promotions

Running sales and promotions is another effective way to drive traffic and sales. If you’re dropshipping on eBay, you can create multi-buy offers to encourage more orders, whereas Amazon allows you to set up a number of different promotions and offers.

If you’re dropshipping through a website, you have more flexibility to run custom promotions such as flash sales, lightning deals, and buy-one-get-one-free offers. In fact, there are a number of plugins and apps for running sales on Shopify or WooCommerce, as well as other store-building solutions.

Improve search engine rankings

Improving your organic search rankings on eBay, Amazon, and Google is the most effective way to drive free traffic to your product listings or store. The best way to do this is by making sure you include relevant keywords in your titles and descriptions.

You can use a keyword research tool such as Google Keyword Planner or Wordtracker to find keywords with low competition and high monthly searches.

If you’re selling through an online store, it’s recommended to install a search engine optimisation plugin such as the All in One SEO Pack for WordPress. Shopify and other popular store builders typically have third-party apps or built-in features for SEO.

Create an affiliate program

Launching an affiliate program is one of the best ways to boost sales for a dropshipping store. Platforms such as GoAffPro allow you to quickly create an affiliate program for free. This will allow online marketers to advertise your store and earn a small commission on sales and referrals.

Advertise your store and listings

Advertising your store and product listings is essential if you want to make the most sales. You can do this whether you’re selling through an online store or marketplace. Let’s take a closer look at some of the most effective ways to advertise and promote your dropshipping business:

• Run ads on social media. Social media ads are the most popular way to drive traffic to a dropshipping store. In fact, some of the most successful dropshippers generate millions in revenue by using video ads on Facebook and Instagram.
• Try promoted listings. If you’re dropshipping on eBay, you can try using promoted listings. This is when you pay a small extra fee on sales to get more exposure and traffic to your listings.
• Advertise on Amazon. When selling on Amazon, you can advertise your products to increase sales. With Amazon ads, you only pay a fee when buyers view your products.
• Use Google Ads. Running ads on Google is another great way to drive traffic to your dropshipping store. With Google ads, you can get your business or products featured at the top of search results.

There are many other ways to advertise your dropshipping business and drive sales. YouTube is a great place to learn about the latest digital marketing techniques for ecommerce and dropshipping. A quick search will return hundreds of video guides on traffic generation for beginners.

7. Process customer orders

When you start generating sales, it’s important to process customer orders as quickly as possible. Typically, you should aim to place orders with your supplier the same day they are received. Here are a few other tips to consider when it comes to processing orders:

• Add tracking information. If you receive tracking information from your supplier, make sure you add it to your selling platform.
• Send order notifications. To keep customers happy, always let them know when orders have been dispatched by sending a notification or email.
• Always check addresses. When placing or forwarding orders to your supplier, always check the delivery addresses to ensure there are no issues during transit.

If you’re using dropshipping software, you may be able to enable automated order processing. In some cases, you can even automate tracking info uploads and order dispatch notifications. Most all-in-one dropshipping solutions have these features built-in.

8. Manage customer service

Aside from processing orders, you also need to manage customer support for your dropshipping business. Keep your customers happy and they will continue to return and purchase products from you. Here are a few tips for when it comes to managing customer service:

Process customer returns quickly

If a customer needs to return an item for any reason, make sure you arrange it with your supplier as quickly as possible. In most cases, your supplier will be able to provide you with a return address or return label. Simply forward this information to the buyer.

Keep in mind, that customers can initiate a return directly through eBay or Amazon. That’s why it’s important to deal with returns as quickly as possible when dropshipping on marketplaces.

Answer questions from buyers

When running a dropshipping business, customers will sometimes ask questions about your products or policies. Make sure you respond in a timely manner and directly address any concerns. You can search online to find answers about certain products or features if you’re unsure.

Request feedback and reviews

You should always follow up with customers after an order has been delivered to request feedback or reviews. Building up positive reviews and feedback is particularly important when selling on marketplaces as many potential buyers like to read reviews.

9. Track income and expenses

Tracking income and expenses is another important part of running a dropshipping business. You need to know exactly how much revenue and profit you’re generating. Even if you’re completely new to dropshipping, you should start tracking income and expenses right away.

Many dropshippers track income and expenses using spreadsheets. However, you can use accounting software to simplify the process and make it less time-consuming. Accounting software will automate a number of tasks and calculate your income, expenses, and profit margins with ease.

An alternative, or rather a complementary tool you could use is an invoice generator. It plays a crucial role, not only in automating the generation of invoices but also in tracking down financial transactions. This tool will help you keep track of the money you’re owed by customers and provide a clear picture of your receivables. Plus, it ensures consistent, professional billing practices.

Remember, keeping track of your income and expenses, as well as receipts and paperwork is essential when it comes to paying taxes. You should also consider hiring an accountant to help you with tax returns when you start to generate consistent sales and profits.

10. Keep growing the business

The last step in this dropshipping guide is to keep growing the business. To do this, you should regularly create new listings, edit existing listings, and work on increasing your feedback score, as well as gaining more customer reviews and sales history.

In time, your dropshipping business will start to snowball and generate recurring income. The key is to stay motivated and consistent with your efforts. You’re unlikely to see an avalanche of sales right away, but with some hard work and effort, the sales will come.

Frequently Asked Questions (FAQs)

How does the dropshipping business model work?

The dropshipping business model involves selling products online without purchasing inventory or stock upfront. Instead, products are sourced directly from a wholesaler or manufacturer, only after a sale has been generated.

For example, let’s say David runs an online store. After finding a dropshipping supplier, he lists a product for sale on his store for $20 with free shipping. When a customer purchases the product, David forwards the order to his supplier and pays the wholesale price of $10 for the item.

In turn, the supplier packs and ships the order directly to the customer, without including a shipping invoice or company branding. The difference between the selling price ($20) and the wholesale price ($10) is David’s profit to keep.

Why start a dropshipping business?

Starting a dropshipping business has many exclusive benefits when compared to running a traditional ecommerce or retail operation. In fact, the benefits of starting a dropshipping business outweigh the cons of not buying products in bulk for resale.

You won’t need to buy any stock upfront and you won’t need to hold any inventory. Moreover, you won’t need to send any products or deal with returns. This makes it the ideal business for those who want to get involved with ecommerce without risking a lot of money upfront.

Another benefit to starting a dropshipping business is being able to rapidly increase your product range. You can list thousands of products for sale in record time, particularly when using dropshipping software. Plus, a dropshipping business can be run from anywhere in the world.

Can anyone start a dropshipping business?

Yes, anyone can start a dropshipping business by following the steps outlined in this guide. You don’t need any previous experience with ecommerce or online marketing. All you need is access to the internet and a reliable supplier to source products from.

That being said, building a successful dropshipping business requires time and effort. It’s not a get-rich-quick scheme and you certainly won’t generate instant profits. Only those who put in the hard work and effort will get results with dropshipping.

How much do I need to start a dropshipping business?

Although dropshipping is a very lucrative business model with very few start-up costs, you will still need some money to get started. The amount you will need depends on which selling platform and software you’re going to be using.

For example, you will need to pay upfront listing fees to sell on eBay or Amazon. You will also need to pay for dropshipping software to manage inventory and prices. If you want to open an ecommerce store, you will need to pay for an all-in-one platform such as Shopify or purchase a domain name and hosting separately.

With that in mind, you will need at least $100-$200 to start a dropshipping business. This will cover any general expenses and allow you to launch a store or sell on marketplaces.

Is running a dropshipping business legal?

Yes, running a dropshipping business is perfectly legal. In fact, there are no specific laws or regulations that prevent you from dropshipping in most countries. Dropshipping is also generally allowed on third-party marketplaces including eBay and Amazon.

It’s important to keep in mind that dropshipping is simply a method of fulfilling ecommerce orders. It’s no more illegal than buying and reselling products for profit. Thousands of businesses including some well-established retailers use the dropshipping model.

How long does it take to make money with a dropshipping business?

There is no guaranteed time frame to start making money with dropshipping as it depends on how much effort you put into the business. However, you can expect to start making money within a few months if you stay consistent and keep growing your product range.

That being said, it usually takes a bit longer to start making money with dropshipping when selling through your own store. This is because it requires more work to advertise and drive traffic to your website. That’s why it’s recommended to sell on multiple ecommerce platforms including eBay to start making money as soon as possible.

How much can I earn from a dropshipping business?

Typically, you can earn anything from $500-$10,000 or more per month running a dropshipping business. In fact, some successful dropshipping businesses generate millions of dollars in revenue. There is no limit to the amount you can earn from a dropshipping business.

However, results will vary depending on your niche and how much time and effort you spend on the business. Your profit margins and the amount you spend on advertising and marketing will also determine how much you earn with your dropshipping business.

How do I start an eBay dropshipping business?

To start an eBay dropshipping business, you must first choose a popular niche and create a brand name. The next step is to find a wholesaler or dropshipping supplier to source products. Once you have a supplier, you can start to create listings on eBay.

For more information, please refer to our comprehensive guide on eBay dropshipping. Here we discuss the pros and cons of eBay dropshipping, as well as provide details on how to open a seller account, create listings, and manage the day-to-day operations of the business.

Is starting an eBay dropshipping business allowed?

Yes, starting a dropshipping business on eBay is allowed. However, you should carefully review the guidelines before deciding to start dropshipping on eBay. To summarise, the policy states that you must be sourcing the goods from a wholesale or trade supplier.

Dropshipping products from other retailers such as Amazon is not allowed on eBay. The guidelines also state that sellers are responsible for the safe delivery of items, as well as returns and refunds. That’s why finding a reliable and trusted eBay dropshipping supplier is so important.

How do I start a dropshipping business with no money?

To start a dropshipping business with no money, it’s recommended to use a free online store builder such as Ecwid or Wix Stores. Other ecommerce platforms including Shopify and BigCommerce would be suitable as they both provide a free trial.

The next step would be to find dropshipping software that is free to use. As mentioned previously in this guide, dropshipping software will provide you with an all-in-one solution for finding suppliers, listing products, and managing the day-to-day operations of your business.

Please refer to our article on the best dropshipping software. Here you will find a list of the best programs, many of which have a free plan or free trial. For example, DSers is one of the most popular tools for dropshipping from AliExpress. It has a free plan for importing up to 3000 products.

Alternatively, you can find a trusted dropshipping supplier with no membership fees, without having to use software. Simply search on Google or use a free supplier directory. Once you have a supplier or software to use, you can start building your store and adding products.

How do I find suppliers for my dropshipping business?

As previously discussed in this guide, it’s recommended to use dropshipping software as most provide a complete solution for finding suppliers, listing products, and managing inventory.

However, if you would prefer to source items directly from suppliers without the help of software, please refer to our guide on the best dropshipping suppliers in the UK, as well as our post on the best dropshipping suppliers in the USA.

You may also want to browse our blog where you will find a growing number of curated lists of the best suppliers in various categories and niches. Alternatively, you can search on Google or use a dropshipping directory to locate genuine wholesale and trade suppliers for dropshipping.

What are the disadvantages of starting a dropshipping business?

Although starting a dropshipping business has many benefits when compared to traditional ecommerce, it does have some disadvantages to consider. The biggest disadvantage is not having control over product quality, dispatch times, and order packaging.

This makes it difficult to ensure orders are dispatched on time and delivered in inadequate packaging. It also means you’ll be unable to include any paperwork or promotional materials with the orders.

The best way to combat this disadvantage is by choosing a reliable supplier and building a close relationship with them. If you can generate enough sales, you can even ask your supplier to send custom shipping invoices with orders or add your own company logo to the packaging.

Another disadvantage to starting a dropshipping business is the higher prices you will pay to source the goods. Most wholesale companies sell in bulk, allowing them to offer low trade prices. When dropshipping, you will often pay a slightly higher price as your supplier will need to ship the goods in single pieces.

That being said, sourcing from a genuine wholesale or trade-only supplier means you will still pay below retail prices, leaving you with plenty of room to generate a healthy profit. However, it’s unlikely you will be able to dropship single pieces for the same price as buying in bulk.

Final Word

That brings us to the end of this guide on starting a dropshipping business. Whatever your current situation or level of experience, hopefully, you have managed to discover some insightful tips and tricks.

Be sure to browse our other blog posts to find more valuable content on dropshipping and ecommerce. We regularly post guides on everything related to building a successful online business including how to increase conversion rates and boost sales using digital marketing techniques.