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Many "successful" dropshippers simply sell success. That is, they make claims about how much money they're making, and sell courses or coaching to unwitting mar
by LargeWu 6y ago
Many "successful" dropshippers simply sell success. That is, they make claims about how much money they're making, and sell courses or coaching to unwitting marks. And if their marks' stores don't pan out, they an always offer the "advanced" course, the "super secret" formulas, just give me another $3000 please.
There might be a few bros out there doing well at this, that is, actually selling things to consumers, but mostly it's selling inessential products to indifferent consumers at tight margins. There's nothing wrong with dropshipping as a business model, per se, but there's a lot of hype and shadiness going on in these circles.
- techslave 6y agowish.com is a pretty wildly successful drop shipper. everyone else, not so much
- econcon 6y agoI am a dropshipper and average margin on products I sell is 60-100%. I don't sell course because i really doubt I could make much money by doing that when I can just keep dropshipping. I never bought any course but I had a startup so I am familiar with sales and how you make conversion happens.
- LargeWu 6y agoYeah, I mean, if you have it solved, then that's great. I just tend to see a lot of comments in some communities I'm in to the tune of "I spent $2000 setting up my store, lots of traffic, no sales, please help". It's often touted as a get-rich-quick scheme when in fact it takes a lot of hard work and an understanding of how to sell.
- voldacar 6y ago> margin on products I sell is 60-100% what kind of products do you dropship?
- tehwebguy 6y agoThis is the one question no dropshipper will ever answer.
- aesclepius 6y agoCocaine, and/or illicit substances.
- m463 6y agoI remember reading an article a long time ago... wait here it is: https://www.cringely.com/2009/03/14/parrot-secrets/ https://www.cringely.com/2009/03/14/parrot-secrets/ This guy had found a niche for an online business. I can't help but wonder how many competing cookie-cutter copies of the businesses were started the day that article was published.
- gowld 6y agoCringely is amazing. He runs his whole persona under a name that directly confessed how bad his thinking his, yet has somehow made a long career as a pundit.
- m463 6y agoNot saying he's a big fish in a small pond, but how many people consistently write about tech topics like he does? I don't mean how many people write about tech, I mean how many people write about tech - and the who, and the why... and the why not.
- TimTheTinker 6y agoActually sometimes a dropshipper will be willing to say what sold really well last year (if they're seeing poor sales on that item during the current year).
- math0ne 6y agoMy sister does this and she was a hairdresser so she mostly operates in the beauty product sector but also has had a lot of luck with things from IKEA this year.
- thdrdt 6y agoYour numbers tell us nothing. You could be selling very cheap items once a month.
- econcon 6y agoSales price is between $30-$80 max
- Stratoscope 6y ago> I am a dropshipper and average margin on products I sell is 60-100%. At the risk of being nitpicky, it sounds like you may be talking about your markup, not your margin. Markup = ( SalePrice - YourCost ) / YourCost Margin = ( SalePrice - YourCost ) / SalePrice Each is typically expressed as a percentage, and we're talking about the gross margin here, not the net (net margin takes into account other business expenses). If your gross margin is 100%, it means you got the product for free: Margin = ( SalePrice - 0 ) / SalePrice = SalePrice / SalePrice = 1 = 100% And your markup is infinite: Markup = ( SalePrice - 0 ) / 0 = SalePrice / 0 = Infinity or beyond [1] More typical examples: buy a product for $50 and sell it for $100, your markup is 100%, and your gross margin is 50%. Or buy for $25 and sell for $100: Markup is 300% and gross margin is 75%. [1] https://en.wikipedia.org/wiki/Division_by_zero https://en.wikipedia.org/wiki/Division_by_zero But what if your SalePrice is also 0? I asked our Lenovo Smart Display about this: "Hey Google, what's zero divided by zero." She replied "No one knows. It's possible that zero divided by zero is some unknown number mathematicians have yet to discover. Maybe they'll name it after you!"
- catlas3r 6y ago> I am a dropshipper and average margin on products I sell is 60-100%. Name checks out.
- buboard 6y agomany tech companies do too.
- txcwpalpha 6y agoThe article hits on this a lot, and if you look up the main subject (Mike Vestil) on Google, some of the first hits you'll see are videos from him like "TURNING $2 INTO $500000!" Ironically, even Mike himself in the article says that he hates that part of the dropship culture. But if you really want to see how prevalent it is, take a look at r/dropshipping. There's tons of posts trying to sell courses, or Shopify themes, or a new commerce platform, etc. There's an entire "get rich quick" industry that's aimed at targeting other "get rich quick" dropshippers.
- Balgair 6y agoIt feels a lot like this Key and Peel skit, but more bro-y: http://www.cc.com/video-clips/xqcrmn/key-and-peele-con-artists http://www.cc.com/video-clips/xqcrmn/key-and-peele-con-artis...
- ganstyles 6y agoOh my. I checked out that Reddit group. There are people making posts trying to sell something, and in the comments people trying to sell the original poster something different. It's turtles all the way down.
- tfehring 6y agoDo you know of any courses that could teach me how to sell dropshipping courses to wannabe dropshippers? I'll pay $$$. /s
- colinjoy 6y agoThat should be easy. You’ll find plenty of “master classes” on online marketing from the same snake-oilers. They might actually fit the bill here, because the only thing they teach you, if anything, is how to push useless, digital content to suckers. source: I know someone with a proper addiction to this stuff. Think 6-digits “invested” in “life-changing material”... ;(
- dclusin 6y agoIn sales or trading, if someone is selling courses its a strong indicator that their advice isn't any good. If it was they wouldn't be sharing it.
- bluGill 6y agoThere is a useful market for it. There is only so much you can do, so if you specialize someone can take your same tricks to a different speciality. There is a lot of scams in there though. Telling the difference is not easy.
- deleted 6y ago[deleted]
- wheelerwj 6y agoThose who can, do. Those who can't, teach.
- xwdv 6y agoUnfortunately this kind of thinking is also why I’ve never created a YouTube channel or blog to teach people software dev stuff from my years of experience. I keep thinking I’ll come across as a failed developer who now has to teach for ad money because he can’t do anything else anymore.
- wolco 6y agoMeanwhile they have become the rockstars of the dev world. Get on twitter and hashtag away.
- xwdv 6y agoHow much does a “rockstar” dev make anyway?
- Ididntdothis 6y ago
- jimmytucson 6y ago> nothing wrong with dropshipping as a business model Actually, that's the part I'm struggling to understand. Why isn't drop shipping automated? And what's stopping consumers from bypassing drop shippers altogether?
- ebg13 6y ago> And what's stopping consumers from bypassing drop shippers altogether? Situational awareness and a narrative of trust. The number of advertisements on facebook these days promoting some retail site where every single product can be found on aliexpress for less money _and_ free shipping is staggering. The only reason you would buy from them is 1) You don't know what's on aliexpress because you don't know about aliexpress, 2) You don't know what's on aliexpress because you don't trust rando chinese factory sellers without western-friendly spin.
- hnick 6y agoI suppose, depending where you live, local laws may provide more assurances if something goes wrong with the order. Here in Australia at least you are not obligated to deal with anyone other than whoever took your money. Though in my experience most AliExpress sellers are friendly and willing to refund or work through issues anyway. I've had fewer bad surprises on there than Amazon.
- wolco 6y agoNot a big aliexpress shopper but last time I checked everything is being sold in volume. You don't buy one thing you have to buy many. I am wrong? If that is the case buying one radio instead of 25 makes more sense.
- baruch 6y agoAlibaba is about volume. AliExpress does single quantities too. Except for really cheap things and then you can several items together but nothing you'd really call bulk.
- Zealotux 6y ago
- gboss 6y agoMy second job out of college, back in 2011, was as the only employee for a drop-shipper who sold fabric for upholstery, lighting, and all kinds of home furnishings. Her website was an off the shelf .NET ecommerce app she probably paid a few thousand for. I was the customer service rep and web dev for the company. She did surprisingly well, grossing $120-160k a month. Her margin was around 20% I believe. I made a pretty small salary but it was a great way to kickstart my dev career. Edit: For clarity.
- da02 6y agoDid she say how long it took to get to those sales? Did she have any exclusive distribution deals?
- gboss 6y agoShe used to have her own store in Marin County. Too much overhead. I think she lost it in 2008ish and went purely online then.
- da02 6y agoSo she built up knowledge, customer base, sales and reputation offline and was able to carry it over online?
- gboss 6y agoHer biggest success was upholstery fabric. Forgot to mention she did a decent amount of wallpaper, probably 15% of her business. Furniture was a very very small portion. I don't think there was much overlap other then both businesses being designy but her store was a furniture showroom. Her sales were nationwide. I think she took a lot of business from interior designers who would sell at a high markup to customers.
- da02 6y agoThanks for clearing that up.
- shwoopdiwoop 6y agoThere is also a tendency with these kind of businesses to happily disclose sales, but not much beyond that. Sure, making $200k a month is great for selling courses but they don’t tell you they had to spend $199k in facebook ads to get there.
- Traster 6y agoMost of these businesses would be doing great if they could make $200k for 199k in advertising, most are earning $200 after spending every last penny they had on advertising.
- TimTheTinker 6y agoDropshipping is all about arbitrage, in one form or another. If you can do just a little bit better than a manufacturer at customer acquisition, you can make money.
- hogFeast 6y agoThis is what retail and trading is about. Making contacts with suppliers, making contact with distributors, researching the market, trying to get credit, etc. I think people get very angry about dropshipping because there is this self-help industry around it...but what that really reflects is that platforms for acquiring customers have totally changed: costs are nothing, you don't need huge scale to contact customers, etc. But it is a legitimate business model, people have been dropshipping for decades (shock: most Asian manufacturers have little to no interest in working out how to market to Western consumers), and you can make billions doing this if you want - Wayfair is a dropshipper, Wish is a dropshipper, you can do this if you want.
- theturtletalks 6y agoDropshipping is a great way to test an item before private labelling. Then you can focus on building that brand and not worry about being priced out by your supplier. Even DoorDash is a dropshipper since they list all restaurants on their app, order from the restaurant when an order comes, and then handle the "fulfillment" aspect. I'm working on an e-commerce automation platform called Openship and one of our first users wasn't even into dropshipping. She sold her own brand coffee but wanted to sell coffee accessories like french presses, grinders, etc. Her buyers would get these add-ons with the coffee. She would ship the coffee and dropship the other items. Those add-ons would cover her ad costs and she eventually private labelled those items too. That is how you effectively use dropshipping to test and build out your catalog.
- dvtrn 6y agoEven DoorDash is a dropshipper since they list all restaurants on their app, order from the restaurant when an order comes, and then handle the "fulfillment" aspect. Aren’t restaurants calling DoorDash and GrubHub out over exactly this “ghost kitchen” practice though?
- thoraway1010 6y agoHave a friend doing dropshipping of real products. He mostly goes into amazon. Had a marketing background. Key things if doing the real version of this. 1) In person supplier visits to vet them (yes, you need to fly to china 2) Amazon reviews are everything to these guys. So ad copy that is not too overblown (disappointment), amazing customer service etc. FBA. 3) Stick your own brand on the product and try to build that in a niche. Lot's of seedy stuff also, but it does make really good money when its working for sure. These guys live in total fear of their accounts being banned / blacklisted (usually by competitors filing fake reports on them).
- ct520 6y agobut not all.. We have a local company - ArtFire was started by a dude that drop shipping beads. Parlayed it into an etsy basically.