Dropshipping 101: A Beginner’s Guide to How it Works

Edwin Anthony

Founder & Business Strategist

Have you heard about dropshipping in the world of eCommerce? It’s definitely something worth learning about if you’re interested in starting an online store. But what exactly is it? Is it still a viable business model or just a passing fad?

Don’t worry, I’m here to give you all the details on dropshipping and how it works. By the end of this article, you’ll have a good understanding of whether it’s a good fit for your business goals.

In this article I’ll cover:

What exactly is Dropshipping?

So, what is dropshipping exactly? It’s a way for stores to sell products without keeping them in stock. When a customer buys something, the store buys it from a different company and has it shipped directly to the customer. This way, the store doesn’t have to worry about storing or shipping the products themselves.

So why would a business choose to use dropshipping? There are several benefits to using this model. First and foremost, it saves on the cost of inventory and storage. Since the store isn’t responsible for physically stocking the products, it can offer a wider variety of items without incurring the expenses associated with carrying inventory. Additionally, dropshipping allows for flexibility and scalability as a business can easily add or remove products from its offerings without the hassle of dealing with excess or obsolete stock. Finally, dropshipping enables a business to focus on marketing and customer service, as it doesn’t have to worry about the logistical aspects of fulfilling orders.

Overall, dropshipping can be a cost-effective and efficient way for businesses, both big and small, to sell products online.

How Dropshipping works

Here’s a simple breakdown of how the process works:

  • A customer places an order on the store’s website.
  • The store receives the order and places the same order with the supplier.
  • The supplier ships the product directly to the customer.
  • The store earns a profit from the difference between the wholesale price they paid to the supplier and the retail price they charged the customer.

One of the key benefits of dropshipping is that it allows stores to offer a wide range of products without having to worry about the cost and logistics of storing and shipping inventory.

However, it’s important for stores to carefully research and choose reliable suppliers to ensure that orders are fulfilled accurately and on time.  Once you’ve done your research, now its time to become a Dropshipper.

How do I become a Dropshipper?

If you’re interested in starting a dropshipping business using Shopify, here’s how you can get started:

  • Set up a Shopify account. You’ll need to sign up for a Shopify plan and set up your store by adding your products, choosing a payment gateway, and setting up your shipping rates.
  • Find a supplier. You’ll need to find a supplier that offers the products you want to sell. There are a few ways you can do this: you can use a wholesale directory, reach out to manufacturers directly, or use a dropshipping supplier marketplace like Oberlo or SaleHoo.
  •  Import your products. Once you’ve found a supplier, you can import their products into your Shopify store using a tool like Oberlo. This will save you time by automating the process of adding products, descriptions, and images to your store.
  •  Set up your payment gateway. Shopify offers a variety of payment gateway options to choose from, so you’ll need to choose the one that best meets your needs.
  •  Start marketing your store. Now that your store is set up and ready to go, it’s time to start driving traffic and making sales. You can do this through social media marketing, content marketing, email marketing, and other tactics.


Managing a Dropshiping Business

Many people think dropshipping is a set it and forget its business structure when in fact it’s quite the opposite. It involves taking care of several key tasks, including order fulfillment, handling returns and customer complaints, and staying up to date on industry trends.

One important task is order fulfillment, which means getting orders to customers quickly and accurately. You’ll need to work with your suppliers to make sure orders go out on time, and keep track of inventory levels so you don’t sell products that are out of stock.

Another important task is handling returns and customer complaints. If a customer isn’t happy with a product, you’ll need to have a plan in place for how to handle the situation.

Finally, it’s important to stay up to date on industry trends. This means keeping an eye on what’s happening in your niche, including new products and competitors, and being ready to change your business if needed. By taking care of these tasks, you can build a successful and sustainable dropshipping business.

Tips for Success in Dropshipping


In overall summary, I want to share some tips to help you succeed in the world of dropshipping:

  • Choose the right products: It’s important to choose products that are in demand and that have a good profit margin. Look for products that are unique or hard to find, as these tend to sell well.
  • Provide excellent customer service: Happy customers are more likely to buy from you again and recommend your store to others. Make sure to respond to customer inquiries and concerns promptly and be proactive in solving any issues that may arise.
  • Stay organized: With so many different tasks to keep track of, it’s important to stay organized. Use a tool like Trello or Asana to keep track of tasks and deadlines, and make sure to keep your inventory and orders up to date.
  • Stay up to date on industry trends: Keep an eye on what’s happening in your niche, including new products and competitors, and be ready to adapt and make changes to your business as needed.
  • Experiment with different marketing strategies: There are many different ways to market your dropshipping business, including social media, content marketing, email marketing, and more. Try different strategies and see what works best for your store.

By following these tips, you’ll be well on your way to building a successful dropshipping business.

Edwin Anthony

Founder & Business Strategist

Presently, Edwin is the Founder and Lead Design and Development Director of Rezolutions Design, a full-service digital agency based on Aventura Florida which works with fortune 500 companies.

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