10 Things You Should Know Before You Start Dropshipping

Hello Aspiring Entrepreneurs! In this article, I’m going to guide you with the 10 things that you need to do before you start dropshipping with AliExpress.
If you implement these 10 things, then you will be able to overcome some of the common road blocks that I see new Dropshippers often face.

 

Let’s Start with the First Thing.

1.     Look for quick shipping times: Check shipping times before choosing which countries to ship to. A big mistake that new Dropshippers make is when they see an item on Aliexpress having worldwide shipping, and so they’re like, “Oh, yeah. I’ll put that item in my store, and I’ll ship it out to a global audience.”
Amazing, right?
What could possibly go wrong? Well, I’ll tell you, when it comes to shipping, not all countries are equal. For instance, shipping to the United States is really great, as they have a fantastic shipping option. For just an extra one to two dollars, you can get an item shipped out from China to the USA via Epackets, and it will take only 14 to 20 days.

 

On the other hand shipping from China to the UK is dreadful. The best you’ll usually find for low cost shipping options is an estimated delivery time of 20 to 40 days. That means that it can take over five weeks for an item to arrive in the UK. So the much better option is to check for different shipping options that your supplier offers to different countries.

 

Make sure to sell only to countries where it will take no longer than four weeks for the product to arrive. Quite honestly, as a beginner, I’d try to focus on countries where it is more like two to three weeks maximum.
This way, you’ll have far happier customers, which will make dropshipping a lot more fun. You can leave the more challenging countries to when you’ve got more experience.

 

 

2.     Create your own store:
Do not dropship on Amazon or eBay. Many newbies want to start out by dropshipping products on Amazon or Ebay, because it means that they don’t have to spend money setting up their own Shopify or WooCommerce store.

 

This is a really a terrible thing to do, because the competition is insanely high on those platforms for AliExpress products, as the barrier to entry is so low. In fact, it’s probably the worst plan to be selling Aliexpress in on Amazon, because people aren’t even dropshipping there any more. Instead, what they are doing is they are shipping items in bulk from the Alibaba supplier to the Amazon FBA warehouse, and selling them at minimal margin.

 

For Example: The Self Stirring Mug, an AliExpress product, is currently selling on Amazon for $9.99, and, again, it is being fulfilled by Amazon. The current top AliExpress supplier is selling it for $6.47 including shipping to the USA. Well, if you calculate their profit after the super high Amazon fees, you’ll see that they are actually barely selling at profit. Also, the customers on both of these platforms have extremely high expectations when it comes to shipping times. So you are going to risk them leaving negative reviews even if you were super upfront about the shipping times. But, if you sell on your own store, then unlike eBay and Amazon, your competitors cannot come and create a listing on it, and then get into a pricing war with you.


So, I would you to not try dropshipping on eBay and Amazon if you are thinking of long term success. Instead start your own Shopify dropshipping store, and focus on driving your own traffic to it. This way you can learn a whole lot of things like, copy-writing, email marketing, social media marketing, and many more.

 

3.     Protect yourself and set up a company:
A super common question that we get asked is whether you need to set up an LLC, or in other words, a company when you’re dropshipping.
The answer to that is no.
You don’t need to. You could start dropshipping right now. You will be considered a sole proprietor, and there is no legal paperwork required to become a sole proprietor. It’s just what you are by default if you don’t form a partnership or a company.

 

But while it’s not required, it is a good idea to do so, especially if you live in the
USA. You see, if you don’t set up an LLC, then there is no legal distinction between you and your business. So if you get super unlucky, and let’s say the self stirring mug that you were dropshipping starts to explode and hurt people, well, you’ll risk getting sued. If that happens, you will wish that you had set up an LLC, because the fact then that the company would be liable for the lawsuit and not you personally.


Another common question we get asked is if you’re selling to customers in the USA, but you live in another country, for example, Australia, should you set up your company in Australia or in the USA? The answer here is pretty simple.
Register your company at the local country of residence and not the USA.
Now, there will be some fees for setting up a company. It’s around $250 to $500 to set one up, so I understand that not everybody will be able to do that, but if you can afford it, it’s well worth it.

 

4.     Create happy customers experience by making shipping times very clear:
Be very clear about their shipping disclaimers on your product page. I can tell you now that most of the beginners do this mistake knowingly. They think that if the customer gets to know about long shipping time, then they won’t purchase. But, the fact is you will loose customer trust in the long run. It doesn’t matter if you’ve got a shipping policy page somewhere on your website that customers could find and read.
It is not okay.
I stress this to all my students, don’t be afraid to advertise that there’s going to be a two to four week shipping time period on your product page. It’s going to hurt conversions less than you might think.
If you are not upfront about it, then you are going to upset customers. Not only will that stop them from buying from you again, but you’re going to risk that they’re going to ask for refunds, do PayPal disputes, and chargebacks.
So don’t try to hide it. I recommend putting a disclaimer in bold in your product page. It’s also a good practice to put it in your cart page, and to also include the disclaimer in your confirmation email.

 

If you do this, then you’re going to have happy customers who won’t feel cheated and ripped off. Plus, there’s another good bonus to having happy customers. If your customers have a good buying experience from your store, it’s more likely that they’re going to come back and buy from you again. So don’t upset your customers. Let them clearly know about shipping times.

 

5.     Have a rock solid refund policy:
When you’re setting up your refund policy page, make it very clear that you will only
give refunds for products that are broken or faulty.
Don’t give refunds simply because people have changed their minds.
A lot of big retailers have very generous return policy, but as a small retailer, you do not have to do this. In fact, for small online retail store, it’s a standard practice that the customer has to ship the item back to you at their own expense before you will give them a refund.

 

If you think it’s too harsh, then you can set your own rules around this.
For example, requiring that the customer give you photographic proof that the item was broken or faulty. But no matter what you end up doing here, be sure to include a link for your refund policy page in the footer of your website so that it is on every page in your website so that customers have no excuse for not having seen it.

 

6.       Keep customers happy with for follow-up emails:
Now, the reason why most people are interested in collecting customers’ emails is because of the fact that they want to send out newsletters promoting other products in their store so that they come back the store and spend more money.
You know what?
That is a fantastic thing to do, but this should not be the only purpose of sending out emails. What you should be doing is setting up a 2-3 weekly email sequence where customers gets support emails from you after the sale.

 

It’s good practice to send out 3-4 emails during this period. In these emails note the following things. Firstly, remind them that when they purchased from you they agreed to the shipping times of two to four weeks. A really great excuse for this is saying that it’s due to high demand. Secondly, tell the customers that you care about them, and that if they are having any problems, that they are free to email you. Thirdly, in these emails, remind them that they can always track the orders online, and include a link to a website that they can use to track their orders.

 

What these emails will do is they will encourage opening a dialogue between you and unhappy customers, so that you can then go in and turn them into a happy customer. Plus, it will greatly improve the buying experience that they have with you, which means that they will be more likely to come back and buy from you again in the future.

 

7.     Run a page like campaign to your Facebook fan page before testing products:
If you’re running ads on Facebook, then it’s a really good idea to run a simple three day like campaign first.
Spending an extra $20-$30 will give your fan page more authority, which means that
people are more likely to trust you. By increasing trust, you will have better changes of getting higher conversions, which means you make more money.

 

8.     Add minimum 20 products to your general or niche store before testing products:
A really common mistake that I see Dropshippers make is that they’ll get really impatient, and they’ll add a handful of products to their store, and then start running tests.
Again, creating trust is very important when you’re converting sales, and quite honestly, a store with only a handful of products does not look very trustworthy at all. Some customers won’t bother flicking through your store. Instead, they’ll just buy immediately from the product page, checkout and exit, but some customers are going to go through your store to check out and see if it’s legitimate.


If they see only a few general products, it make them feel skeptical about your store or make them feel like your store’s still in development. Now, you don’t have to have 20 products exactly. There’s no fixed number, just a good number to aim for. So don’t just jump ahead and start advertising. Add plenty of products to your store so that it will increase the trust between you and the potential customers and finally make them click that add to cart button.

 

9.     Have either a credit card or money set aside to pay for the items that customers buy:

Remember that when you get a sale, you aren’t going to instantly get the money in your bank account. PayPal often hold this money for 1-3 weeks, and Stripe pays you on weekly basis. So if you solely rely upon this money to fulfill or pay for the items that the customer has purchased from you, then you are sunk.
So make sure that you either have a credit card or a few hundred dollars savings on a debit card so that you can fulfill the orders that the customers have bought from you and not waiting for their money to clear.
Don’t make the mistake that I see a lot of new Dropshippers make where they spend all
of their startup investment on setting up the store and marketing and end up running out of money to pay for other stuffs. Make sure that you’ve got a plan on how you’re going to be able to maintain cash flow.

 

10. Be prepared to spend money to make money in the   business:
Finally, before you get started, if you have planned to go for paid traffic in the form of ads, then be prepared to spend money to make money. Dropshipping is all about testing. You add a bunch of potential winning products to your store. Make creatives and run ads for them. See which ads make you money, and which ones don’t. Then take the profitable ads and scale them way up. There will be cases where the items that you think are going to be profitable, may turn out the be flops and the products that you least expect turn out to be huge winners that by themselves earn you $10,000 a month.


People rarely admit this, but the truth is that most people go into dropshipping with the hope and expectation that the first product that they’re going to advertise and test is going to be a huge winner. When it isn’t, they get so disappointed that they declare dropshipping doesn’t work and give up, which is a real shame, because, hey, perhaps the next product that they had been planning to test would have turned out to be a $10,000 a month product, but they are never going to find out because they gave up too soon.

 

The people that succeed in this industry are the ones that don’t see a fail product as a bad thing, and instead choose to embrace them. They embrace them because of the fact that they know that each failed product they test makes them one step closer to finding their golden winner.

 

Thanks for reading the article. If you learned something, I’d love it if you could share and leave us a comment or share your views.

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