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Is It Worth It to Start a Dropshipping Business in 2022? - Velocitize

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srcset="https://velocitize.com/wp-content/uploads/2022/05/pexels-tima-miroshnichenko-6169033-1100x734.jpg 1100w, https://velocitize.com/wp-content/uploads/2022/05/pexels-tima-miroshnichenko-6169033-400x267.jpg 400w, https://velocitize.com/wp-content/uploads/2022/05/pexels-tima-miroshnichenko-6169033-768x512.jpg 768w, https://velocitize.com/wp-content/uploads/2022/05/pexels-tima-miroshnichenko-6169033.jpg 1279w" sizes="(max-width:1100px) 50vw, 1100px"/></noscript> </picture> </div><article class="post-50646 post type-post status-publish format-standard has-post-thumbnail category-digital category-marketing category-recommended-reads category-website tag-content-marketing tag-dropshipping tag-e-commerce tag-retail tag-suppliers tag-website entry" aria-label="Is It Worth It to Start a Dropshipping Business in 2022?"><header class="entry-header"><h1 class="entry-title">Is It Worth It to Start a Dropshipping Business in 2022?</h1> <p class="entry-meta"><span class="author"><a href="https://velocitize.com/author/john-hughes-2/" title="Posts by John Hughes" rel="author">John Hughes</a></span><span class="date">May 16, 2022</span></p> <div class="social-share"> <p>Share</p> <ul> <li> <a href="https://www.facebook.com/sharer/sharer.php?u=https%3A%2F%2Fvelocitize.com%2F2022%2F05%2F16%2Fis-it-worth-it-to-start-a-dropshipping-business-in-2022%2F" target="_blank" class="facebook"> <i class="fa fa-facebook"></i> </a> </li> <li> <a href="https://twitter.com/intent/tweet?text=Is%20It%20Worth%20It%20to%20Start%20a%20Dropshipping%20Business%20in%202022%3F%20-%20&amp;url=https%3A%2F%2Fvelocitize.com%2F2022%2F05%2F16%2Fis-it-worth-it-to-start-a-dropshipping-business-in-2022%2F&amp;via=velocitizepub" target="_blank" class="twitter"> <i class="fa fa-twitter"></i> </a> </li> <li> <a href="https://www.linkedin.com/shareArticle?url=https%3A%2F%2Fvelocitize.com%2F2022%2F05%2F16%2Fis-it-worth-it-to-start-a-dropshipping-business-in-2022%2F&mini=true&title=Is%20It%20Worth%20It%20to%20Start%20a%20Dropshipping%20Business%20in%202022%3F" target="_blank" class="linkedin"> <i class="fa fa-linkedin"></i> </a> </li> </ul> </div> </header><div class="entry-content"> <p>With the many ways you can make money online today鈥攕uch as affiliate marketing, <a href="https://velocitize.com/2021/07/16/from-browse-to-buy-how-to-optimize-your-woocommerce-store/" target="_blank" rel="noreferrer noopener">e-commerce</a> and <a href="https://velocitize.com/2021/03/03/3-tips-to-keep-your-quality-content-consistently-updated/" target="_blank" rel="noreferrer noopener">content marketing</a>鈥攜ou might wonder if dropshipping is still a lucrative option. The simple answer is <em>yes</em>, dropshipping remains a worthwhile way for digital entrepreneurs to earn big. However, this strategy doesn鈥檛 come without its challenges.&nbsp;</p> <p>In this post, we&#8217;ll explain what dropshipping is and discuss its pros and cons. We&#8217;ll look at the cost, competition, suppliers and marketing, and then explore what it looks like to launch this type of business in 2022. Let鈥檚 dive in!</p> <h2 class="wp-block-heading">What Dropshipping Is</h2> <p>Dropshipping is an order fulfillment business model where sellers act as middlemen between customers and wholesalers. The factor that makes dropshipping unique is inventory. In traditional retail, shops (either brick-and-mortar or online) stock their products and store them until they鈥檙e all sold.</p> <p>Dropshippers, on the other hand, don&#8217;t have any inventory. Instead, store owners market products that are stored by third-party suppliers, who then handle the packaging and shipping.&nbsp;</p> <figure class="wp-block-image"><img decoding="async" src="data:image/svg+xml,%3Csvg%20xmlns='http://www.w3.org/2000/svg'%20viewBox='0%200%200%200'%3E%3C/svg%3E" alt="" data-lazy-src="https://lh3.googleusercontent.com/llAu-URWGPScIL-cgc332Y9Fq-7p2PXxuYcZHsVDVjf3jkVavm-J3neS0PrkyhWV1_1ADJ-dm0undvRb-7bVb6cm3-Au3hby22qCyIK6Xvh2o-ek9wTdhK6uydZyKIRNVUOevPulMi_B0zxjwA"/><noscript><img decoding="async" src="https://lh3.googleusercontent.com/llAu-URWGPScIL-cgc332Y9Fq-7p2PXxuYcZHsVDVjf3jkVavm-J3neS0PrkyhWV1_1ADJ-dm0undvRb-7bVb6cm3-Au3hby22qCyIK6Xvh2o-ek9wTdhK6uydZyKIRNVUOevPulMi_B0zxjwA" alt=""/></noscript></figure> <p>That鈥檚 why dropshipping is so attractive鈥攔etailers don鈥檛 have to handle storage, packaging or logistics. All of that is managed by the supplier. Dropshipping stores can also be particularly appealing to digital entrepreneurs because they鈥檙e flexible and relatively easy to launch.&nbsp;</p> <p>In addition, dropshipping is a growing market that shows no signs of slowing down. According to AppScenic, the industry is expected to reach <a href="https://appscenic.com/dropshipping-and-ecommerce-key-statistics/" target="_blank" rel="noreferrer noopener">approximately $558 billion by 2025</a>. That means there鈥檚 never been a better time to consider if this strategy is right for your needs.</p> <h2 class="wp-block-heading">The Pros and Cons of Dropshipping</h2> <p>While dropshipping is a great way to get into e-commerce, it鈥檚 important to note that it鈥檚 not a get-rich-quick solution. A successful business will still require hard work, strategy and startup costs. Challenges such as competition, low profit margins, and muddled supply chain connection can also be discouraging for beginners.&nbsp;</p> <p>In other words, dropshipping comes with its opportunities and obstacles. Let鈥檚 start with the pros and then touch on the cons.</p> <h3 class="wp-block-heading">Pros</h3> <ul class="wp-block-list"><li><strong>Inventory.</strong> As a dropshipping entrepreneur, you don鈥檛 have to worry about inventory鈥攖he storing, packing and shipping is done for you by the supplier.&nbsp;</li><li><strong>Setup. </strong>Getting a dropshipping business up and running is relatively easy and quick. In most cases, it鈥檚 inexpensive and low-risk, which makes it appealing to people who are looking to launch a business with little overhead cost.&nbsp;</li><li><strong>Flexibility.</strong> Like any online venture, schedule and location are extremely flexible. Dropshipping can be done from anywhere in the world, and there are no fixed hours.</li></ul> <h3 class="wp-block-heading">Cons</h3> <ul class="wp-block-list"><li><strong>Competition</strong>. Getting your foot in the door can be difficult as a beginner. Larger and more experienced companies usually have an established presence in niche markets. If you鈥檙e selling the same products for a higher price, you鈥檒l lose some potential customers.</li><li><strong>Low profit margin</strong>. There are relatively low returns, especially upfront. Profit margins are typically <a href="https://www.bluecart.com/blog/dropshipping-profit-margin" target="_blank" rel="noreferrer noopener">between 15-20%</a>, but you鈥檒l have to factor in additional expenses on your end and price cuts for products in order to remain competitive.&nbsp;</li><li><strong>Disconnect between you and your customers</strong>. It鈥檚 very difficult to address customer complaints because you don鈥檛 have any control over the supply chain. If a buyer has an issue, you have little power to do anything but contact the supplier while reassuring the customer.&nbsp;</li></ul> <h2 class="wp-block-heading">What It鈥檚 Like to Start a Dropshipping Business in 2022</h2> <p>Launching a dropshipping business requires certain elements in order to make it successful. Let鈥檚 take a look at what it鈥檚 like to start a dropshipping business in 2022.&nbsp;</p> <h3 class="wp-block-heading">Costs</h3> <p>There is a perception that it鈥檚 absolutely free to start a dropshipping business. While technically it<em> is</em> possible to launch your business using only free trials, the truth remains that you should invest at least a bit of money upfront if you want to see success in the long run.&nbsp;</p> <p>According to Oberlo, you can <a href="https://www.oberlo.com/blog/startup-costs-dropshipping" target="_blank" rel="noreferrer noopener">prepare to invest around $63</a> your first month, and then $49 for the following months for a supplier subscription and a domain name. This is the recommended bare minimum to get you started, with more options you can add if you want. The costs are still relatively low, considering that the average brick-and-mortar boutique <a href="https://www.lightspeedhq.com/blog/how-much-does-it-cost-to-start-a-retail-store/" target="_blank" rel="noreferrer noopener">startup costs around $48,000</a>.&nbsp;&nbsp;</p> <h3 class="wp-block-heading">Competition&nbsp;</h3> <p>As we mentioned earlier, competition between beginners and veteran dropshippers can leave the former feeling pretty discouraged. Larger companies usually take the biggest share of the market because they can offer the lowest price for any given product. It鈥檚 important to keep this in mind when starting your business.&nbsp;</p> <h3 class="wp-block-heading">Sourcing Products&nbsp;</h3> <p>If you鈥檙e new to dropshipping, it can be a challenge to find the right suppliers for your products. There are many to choose from, and deciding on the right one will depend on your specific goals and niche.&nbsp;</p> <p>You can do research <a href="https://ecommerce-platforms.com/ecommerce-selling-advice/killer-places-to-find-products-to-dropship-and-sell-on-your-store" target="_blank" rel="noreferrer noopener">to compare suppliers</a> and weigh the pros and cons of each option. It鈥檚 also important to do your research while choosing your products. Factors such as seasonality and popularity will play a role in whether your goods sell or not.&nbsp;</p> <h3 class="wp-block-heading">Marketing</h3> <p>There are some best practices when it comes to marketing your dropshipping business. The good news is that the best approach looks a lot like successful marketing for any e-commerce endeavor. In general, it鈥檚 a good idea to focus on the following:</p> <ul class="wp-block-list"><li>Find a target niche to hone in on.</li><li><a href="https://wpengine.com/ecommerce/" target="_blank" rel="noreferrer noopener">Create a website</a> to drive traffic.</li><li>Implement SEO best practices on your site.</li><li>Create social media channels to showcase your products.</li><li>Invest in high-quality product images.</li><li>Join and be active in groups in your niche.</li></ul> <p>While a dropshipping business is relatively quick and simple to set up, you鈥檒l still need to invest plenty of time, effort and resources if you want it to grow over time.</p> <h2 class="wp-block-heading">Is It Worth It to Start a Dropshipping Business in 2022?</h2> <p>As with any business venture, there鈥檚 a lot to take into consideration if you want to launch a dropshipping company. It鈥檚 an inexpensive, low-risk, and easy way to start a business anytime and from anywhere in the world.</p> <p>With that being said, it鈥檚 important to consider the challenges as well. Time, competition, startup costs and marketing all play an important role in whether or not this kind of business model is for you.&nbsp;</p> <p>Before you begin, ask yourself a few questions: Are you motivated to take on a new project? Are you relatively business savvy? Are you willing to put in the time needed to do thorough product and supplier research? If the answer to any of these questions is <em>yes</em>, then it may be worth your time to start a dropshipping business in 2022.&nbsp;</p> <h2 class="wp-block-heading">Conclusion</h2> <p>While launching a dropshipping business might not be the cake walk some claim it is, it c<em>an</em> be a profitable way to earn money online with the right tools and information. Weighing the pros and cons, researching suppliers, and coming up with a killer marketing plan are all aspects of dropshipping, and it鈥檚 important to consider the steps you鈥檒l have to take carefully before you begin. Ultimately, starting a dropshipping business is like anything else in life鈥攜ou鈥檒l get out what you put in.&nbsp;&nbsp;</p> <p>Do you have any questions about how to launch a dropshipping business? Let us know in the comments section below!</p> <p></p> </div><footer class="entry-footer"><p class="entry-meta"><span class="entry-tags"><a href="https://velocitize.com/tag/content-marketing/" rel="tag">Content Marketing</a> <a href="https://velocitize.com/tag/dropshipping/" rel="tag">dropshipping</a> <a href="https://velocitize.com/tag/e-commerce/" rel="tag">e-commerce</a> <a href="https://velocitize.com/tag/retail/" rel="tag">retail</a> <a href="https://velocitize.com/tag/suppliers/" rel="tag">suppliers</a> <a href="https://velocitize.com/tag/website/" rel="tag">website</a></span></p><section class="author-box"><picture data-del="avatar" class="avatar pp-user-avatar avatar-90 photo"> <source type="image/webp" data-lazy-srcset="https://velocitize.com/wp-content/uploads/2016/11/john-hughes-150x150.png.webp"/> <img data-del="avatar" src="data:image/svg+xml,%3Csvg%20xmlns='http://www.w3.org/2000/svg'%20viewBox='0%200%2090%2090'%3E%3C/svg%3E" height="90" width="90" 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