How Shopify dropshipping works

Many entrepreneurs find it challenging to keep spending money and time managing their store’s inventory. As such, dropshipping is one of the most versatile ways to run your business as it has support from some of the largest ecommerce platforms, including Shopify.

Not only does using dropshipping assist you in not carrying inventory in your store, but it also allows you to focus your valuable resources and time on making more sales and growing your business.

Let us delve into this article and find out how Shopify’s dropshipping works.

What is dropshipping?

Shopify dropshipping

Generally, dropshipping is a retail fulfillment method whereby a drop shipper sells products through a supplier that holds inventory and fulfills the order of the drop shipper’s customer.

In simple terms, when a customer places an order in your online store, the drop shipper places the order with his/her supplier and is responsible for selecting how the order will reach the customer directly and in the easiest way possible.

Once the supplier ships the order, he/she gives a tracking number to the drop shipper, who, in turn, relays the number to the customer.

As a result, a drop shipper does not need to hold any inventory or ship/deliver any products from his/her online store. Their primary role is to market their products and generate sales for them.

Launching a dropshipping website on various online platforms, like Shopify, is quite simple. It only takes a few days to set up a website, establish your product niche, and sell them to a wide variety of customers.

How does Shopify dropshipping work?

Shopify is one of the world’s leading ecommerce platforms as over half a million entrepreneurs around the globe from various niches use it. Even if you do not have any technical experience, Shopify makes it extremely easy to build an online dropshipping store without any hassle.

Furthermore, this ecommerce platform provides entrepreneurs with various unique features to supplement the needs of your store.

Fundamentally, Shopify is an ecommerce platform that provides entrepreneurs with the relevant skeleton to start and design their online store. The platform offers a solid backend that allows you to run your store without any hosting fees.

The platform has several pricing plans for different types of entrepreneurs. These Shopify pricing plans assist in ensuring that your online store runs smoothly throughout as you concentrate on growing your business and making sales.

Due to the various features on Shopify, it is incredibly easy to establish a Shopify dropshipping store. Entrepreneurs have the option of either searching for a supplier for their dropshipping store using their databases or seek a supplier from a Shopify app, like Oberlo.

For instance, Oberlo is an online marketplace app developed by Shopify to assist independent business owners in locating and connecting to thousands of suppliers.

With Oberlo, you can search for suppliers on AliExpress and import products that your customers would like, directly on the app. Once a customer purchases a product from your Shopify dropshipping store, you can fulfill the order from the Oberlo app.

The owner simply checks and ascertains that the customer’s details are correct and clicks the ‘order’ button to ship/deliver the product to the customer directly.

Alternatively, the Shopify database has over one million users from all over the world. As such, entrepreneurs may choose a dropshipping supplier from North America or anywhere in the world to get the products relevant to your niche from the Shopify website directly.

Why should you use Shopify dropshipping?

How Shopify dropshipping works

Several ecommerce platforms can help in sustaining your dropshipping business with minimal up-front investment. However, Shopify is one of the most popular platforms for online merchants. Let us find out why.

User-friendly

Launching and running an ecommerce business on Shopify is quite easy, especially since you do not have to deal with physical products. The process to set up your online store is clearly defined and normally requires no expert skills.

As long as you have your store name and the product niche you would like to focus on, you will fill in the relevant information as required by Shopify. Often, it takes about one to two days to establish your Shopify dropshipping online store fully.

Unique features

Shopify offers entrepreneurs several unique features under their various pricing plans to help entrepreneurs grow their business and make sales as efficiently as possible.

The platform has online store builder features that allow you to design and set up your ecommerce business with the themes and backgrounds of your liking. It also offers entrepreneurs expert assistance when it comes to making payments, tracking shipments, marketing, view analytics, and handling sales.

Low investment and overhead costs

One of the primary reasons why many entrepreneurs look into venturing into ecommerce business is that it requires little to no initial investment capital. 

Since drop shippers do not need to stock up on any inventory, the only initial costs for establishing your Shopify dropshipping store is the pricing fee for the various plans. Since payment of these fees is monthly, that is the only recurring cost that entrepreneurs need to pay while running their business.

How to establish a Shopify dropshipping store

As discussed earlier, it is incredibly easy to begin a Shopify dropshipping store. Here are some tips to get you started on your journey.

1. Identify a profitable product niche

research dropshipping

Entrepreneurs must establish a specific product niche for their online store before launching it on Shopify. Research and find out the best possible products for your Shopify dropshipping store.

Find out what appeals most to customers so that you can increase your chances of making sales and generating adequate profits to sustain your business.

Some ways to find the best niche for your Shopify dropshipping store include finding and selling quality products that cost between $1-20. By choosing to sell products with this price, you can comfortably mark up the prices up to 60% over the wholesale price at no additional minimum capital. It is also vital to target an ideal market, like upper-middle-class customers.

Not only do they have immense purchasing power, but they also have a disposable income, which makes them more than willing to spend money on a product they want and need in their daily lives.

2. Choose a reliable supplier for your Shopify dropshipping store

Finding a competent and reliable supplier for your store is crucial in generating sales and growing your business. Luckily, Shopify has an extensive supplier database as well as unique apps, like Oberlo, that allow entrepreneurs to connect with suppliers from all over the world.

Many ecommerce analysts recommend using AliExpress to find reliable suppliers. Make sure your supplier has quality products and a feedback score of at least 95%. It is also advisable to stay away from famous brands as it is difficult to tell whether they are genuine or fake through the internet.

Since the customer receives the product directly from the supplier, it is best to play it safe by choosing a non-branded product to avoid embarrassment and inconveniencing the customer.

3. Choose a Shopify plan and register

How Shopify works

Now that you have established your product niche, found a competent supplier, and chosen a name for your online store, it is time to sign up on Shopify. The sign-up process is free and only requires the name of the store, email address, and a relevant password.

After signing up on Shopify, you will answer a set of questions to aid you in launching your Shopify dropshipping store and create a Shopify account.

Once you create a Shopify account, you need to choose a Shopify pricing plan to unlock the platform’s unique features. The platform gives you a 30-day free trial period after you select your pricing plan and fill in your credit card information.

Shopify has five different pricing plans for varying levels of entrepreneurs. If you are a fairly new entrepreneur venturing into ecommerce, it is best to use Shopify Basic, which costs $29 per month. 

Shopify Plus is best for enterprise-level businesses that focus more on large-scale sales and marketing. Once you choose and pay for your pricing plan, you can comfortably use its features to establish your store further.


Looking to start a dropshipping business but don’t know where to start? 

 Conclusion

By following the tips and steps mentioned above, you will successfully launch your Shopify dropshipping store in no time. There is no limit to the amount of money you can make from your Shopify dropshipping business.

So, why not get started making money and generating sales as soon as now, by establishing your Shopify dropshipping store?

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