Today I’m going to be answering a question that we hear at least every single day. That is “Is dropshipping dead?” Now, we’re going to go through some common misconceptions, and ways that it can be, to be quite honest. We’ll go through ways that it actually still does work very well. You know, that question was popular in 2012 too, it is still popular now.
So, in this article, let’s get into the real answer and how dropshipping is still alive and well if you choose to do things the right way. So, the first thing that people ask about is competition. Which leads to saturation, right? Dropshipping is not new. So, the misconception is, you know what? This has been around for a long, long time aren’t there just so many people doing it now that there’s no space for new stores.
Short answer is: No, that’s not true. When you’re using this model when you’re dropshipping, you goal should always be to work with new suppliers and new brands and get the newest and the best products that come out.
So, the products that were popular in 2012, are not still popular today. While some of them are, the majority are not.
What do I mean by this?
The industries that we sell in, they are still getting sales, they are still selling strong. But the top brands, the top SKUs, the top products, they are now in their, going back what, 12 years? In their 12th iteration, some more than that, right? Products get updated. New brands come out. Brands release new product lines.
So a big part of this is to always be that person that’s out front of your industry. And I’m not saying to only sell trending products, but if you’re in the office furniture space then make sure every year you’re working with the best brands that make office furniture. Make sure you’re getting all of their new SKU numbers on your website. Make sure you’re promoting them. Because then all that competition you’re thinking about.
All those people that have been doing it for so long, guess what? Some of them are lazy, some of them don’t update their sites. Some of them are comfortable making what they’re making with stuff they haven’t updated in the past five years. So as long as you’re willing to do the work And stay on top of your business, which I hope you would be, if you’re really planning on doing this. Then, no, it’s not too saturated. They’re literally new opportunities popping up every single day when it comes to products and suppliers. And I use the word suppliers interchangeably with brands.
But, again, always new opportunity there. Do not worry about this being too competitive, because it’s really not. And the other thing I’ll say about that is competition. You do want some, if nobodies selling what you want to sell, that’s probably your red flag. So keep that in mind.
I heard Trump is having all these tariffs and we’re in a trade war with China and everything is going to be more expensive. Is this worth my time starting?
Couple things on that. First, we do not drop ship from China, so if I was directly in that business, would I be worried right now, if I was dropshipping from China?
Honestly, I probably would. I would definitely be looking a lot closer at it than I’m looking at what we do. What we do, and what I recommend you do, is work with domestic brands.
So, for me, that means suppliers in the States. If you’re reading this from Australia, that means suppliers in Australia. If you’re in the U.K., That means suppliers in the U.K.
Now, with this whole tax and tariff thing, right?
Even if products that come from China to suppliers in the States get more expensive, you know, it might happen. And then maybe suppliers raise our product costs. But guess what? Then the product cost to the customer goes up and everything kind of works itself out. I’m not worried about it. You shouldn’t be, either.
If you are relying on dropshipping from China, maybe re-evaluate your business, anyway.
Dropshipping dead because Facebook ads are so expensive now and Google ads are so expensive now?
Listen, they’re really not. If you wanna say that things are expensive now because 10 years ago they were dirt cheap. Well, guess what? Ten years from now people are going to say, “in 2019 things were so cheap.” Yes, ad costs go up. Yes, as more competition goes to different platforms, bids get higher and higher and higher.
Does that mean there’s not a market?
Absolutely not. What it does mean is that you can’t just be someone who’s trying to game the system. Someone that doesn’t want to learn anything. Someone that believes that they can click a few buttons, and Google and get rich. Guess what? That’s dead. Maybe if you were one of the first advertisers on Google, that was a real thing. But that mindset, that business, has been gone a long time.
Now, if you’re a real business owner, you get into this because you actually want to build something of value, that serves your customers and you. Then guess what? Ad costs are still ridiculously under-priced. Yes, on Google. Yes, on Facebook. Of course you have to run them the right way.
Just wait ten years. People are going to say, You had so much opportunity back in 2019. I can’t believe you didn’t do, you know, everything. Start a business and build it. Don’t look back with regret. Do this now and look back and be like wow that was an amazing ride. Okay, so that covers that one.
Dropshipping is this dead, every niche is taken?
I hit on this briefly before. But, you want to be involved a niche that other people are in. If you have some idea for a product that nobody is selling, that’s a not a good thing.
That’s not how this business model works. You want to find markets that has competition, you want to identify their weaknesses, your future competitors, and then you want to start competing with them. Okay so that’s a good thing if other people are selling the products types that you want to sell.
Now, that kind of leads into the next thing that we get sometimes. Like why would a supplier work with me? I’m brand new and there’s established websites that have been doing this for so long.
That’s true, but if you’re actually a real player here. Meaning you’re trying to build a real business with Shopify. Again, you’re not trying to game any system or get in for a quick buck, if you’re trying to build something real, then the good suppliers are more than willing to work with you.
They want partnerships like the ones they have with me, and my students, and you, if you follow a proven system. And, again, if you focus on building a real business. If you’re trying to, again, say hey can I drop ship this this this this this? Can I put up a website real fast? Then yeah, guess what? The suppliers that won’t work with you now, they wouldn’t have wanted to work with you ten years ago either. So, yeah, the thing that maintains is if you have integrity and you’re building a business for the right reason. You will be rewarded, in many different ways. Even speaking of that, that leads into the next two points that I have written down. One of them being, hey I heard that Google ads, right?
Formerly AdWords, doesn’t like dropshipping. And you know what? It’s in their terms of service that they don’t like drop shipping, and guess what? It’s been there, again, the past ten years. I have never had a problem with Google Ads accounts for that. Neither have any of my students that use this system. What they don’t like is the model of trying to get into arbitrage deals like buy something on eBay and sell it on Amazon. And drop ship from Amazon and sell it on Etsy and all that stuff.
Dropshipping is dead because Google doesn’t like them to advertise with them?
I wouldn’t say it’s dead, but it’s not a real business. But, again, it never was, okay? It was just a little way to try to have a hack and get some easy money. But, no, don’t do that. And, is it dead?
Maybe, maybe not, but it’s not what we do here. Another one, Stripe, same thing. You might see in different Facebook groups you’re part of. “Hey I’m dropshipping and Strip closed my account.” They didn’t close your account because you’re dropshipping.
The reason Stripe closes accounts is because there’s too much risk. And they see that there’s risk when there’s a ton of refunds, a ton of charge backs. And you know what type of stores get a ton of refunds and a ton of charge backs?
Ones that don’t care about their customers. Ones that take three weeks to ship items. Ones that don’t answer support tickets. So, is that model dead? Yes, but that’s the model of ripping people off, right? And that has been dead, again, since before there was even a little window to try to game the system. That’s not sustainable. So, yes, that model of not taking care of your customers and hoping you get rich, guess what? That form of dropshipping is dead. Oh no, right? Doesn’t matter.
The model of having a real business that provides real value to your customers, though. When you ship them products. When the customers get them in three to five days. When you have customer support. Then, not only will you thrive, on all of these platforms. On Shopify, with Stripe, with Google, with Facebook.
But you’ll be rewarded in terms of customers coming back to you, sending more people your way, and seeing your business grow.
Hey, I heard Amazon doesn’t allow dropshipping, is dropshipping dead?
Amazon’s never liked dropshipping. And it doesn’t matter. Again, you don’t want to be in the arbitrage model. You don’t wanna sell something on your site and have it shipped from Amazon. You don’t want to sell something on Amazon then find somebody on eBay to fulfill the order. That’s not a good way of doing business, whether it’s dropshipping or not.
So just don’t do it, and it doesn’t matter. That’s always been dead. Now, hope that answers the question. No, dropshipping is not dead, if you do it the right way, if you actually care about building a business that provides real value to your customers. You will be in business. You will be rewarded in terms of profits, in terms of an asset, which is your business, in terms of people coming back to do more business with you. There’s no end in sight for building legitimate businesses online with the dropship business model.
I do believe that the model of dropshipping from China with three week lead times with bad support, I believe that has been dead for a very long time. And I believe that a lot of these kids you see popping up, telling you hey buy my thing. They are not doing well with their business. Surprise, surprise, right? So, that’s my thought on that. It’s not what I would recommend doing at any point in my e-commerce career over the past 12 years. I do think there’s ways to do it right.
But I think most people that you see out there, when you get flooded with a million people saying, Hey buy my thing. I think, a lot of them don’t have a thing besides that. And I think the reason is because, again, they’re not trying to dropship the right way, They’re trying to use a model that maybe had a small window where it worked, where they were gaming the system, by basically just trying to sell as much crap as possible, and not caring what customers thought about it. So, never did that. Never recommend doing that.
If you stick with real, quality products from quality brands, And focus on your business, you’re not gonna have that issue. You’re going to see a lot less people that actually do this the right way.
But, hey, that’s a good thing for you, right? So, with that being said, don’t look for loopholes. Look for building something real, work with quality brands, care about your customers. Use those ingredients. And if you do, dropshipping is far from dead.