Selling items online, working freely and with flexible timetables, validating your business idea in the most economical way and with the least amount of risk. Sounds attractive, doesn’t it? You might even be wondering ‘what have I missed? I want to know what you’re talking about so I can do it right now!’, or at least that’s what I thought when I learned about this subject.
The three possibilities I just mentioned are made feasible by a form of eCommerce called Dropshipping, which makes it possible to sell products through the Internet without having a physical store or an inventory. You’re in charge of reselling what other providers make and gain profit off it. You don't even need to have contact with the product; you just manage the logistics that connect the supplier, the transport service and final client.
In this post we won’t get into too much detail about how it works, so if you want to start there, I’d recommend you read this article.
Below, we’ll specifically talk about the marketplaces where you can find suppliers and/or start up your dropshipping business. I’ll explain: there’s two ways of doing it, one of which is entering a site, such as AliExpress, where they sell products and you can resell them in the same platform at a higher price; the other one is simply buying them through there and reselling them initially on social media sites such as Facebook and Instagram, or eventually, through your own online shop, similar to the ones you can create with Jumpseller.
AliExpress is the retailer branch of Alibaba, company that connected people from the entire world with Chinese providers. Known as the Asian Amazon, it was founded by Jack Ma.
The great difference between Alibaba and AliExpress is that the former was made for wholesale purchases. On the contrary, its sister platform was made for small shipments. What’s the disadvantage of this? In AliExpress, you’re not necessarily negotiating with the maker but with another reseller, which in turn means you may encounter higher prices.
What’s the ideal course of action? Trying with different products bought on AliExpress, and when you find the best-sold one in your particular market, you can think about larger orders through Alibaba.
You can find numerous categories, which allows you to try out different products and suppliers.
Costs are low, so you can have interesting margins.
The client is protected in all of the buying stages.
On AliExpress, you can create your account for free.
It’s easy to order, you just have to buy the product and add the address to which it will be sent.
To facilitate the creation of a dropshipping business, AliExpress launched AliDropship, a personalized complement. Here I’ll explain it to you:
Two ways of benefiting off this:
Hiring the services from the team to create a personalized online store for US $299 or you can create one with Jumpseller. They will also help you find a rentable market.
If you are using WordPress, you can use a plugin from AliDropship, it lets you quicken the connection process between the products you buy from the providers on AliExpress and your online store.
There’s a lot of competition. Millions of people buy Chinese products to resell them at their stores.
The critical matter of buying on AliExpress is the transportation from China to Latin America. How has this been solved in different countries? With ePacket, an accord between the Chinese and the US postal service, wherein they agree to accelerate the delivery processes from 60 days to 12-15 days, and lower the costs to US $0-$2. Mexico is the only country from this region on the list of beneficiaries.
What do the rest of the countries do? They search solutions that have good tariffs.
In addition to the challenge of delivery time frame, which can take up to 60 days, there’s a risk the products get lost in the journey.
Another disadvantage is that if a client buys three items from different providers, you can’t assure they’ll arrive at the same time. In this case, the key is clearly stating your terms.
Also, when you start selling, keep in mind that when you set up your account, the credit card may take a few days to be verified.
Finally, the other challenge is that the supplier’s English may not be the best. This can complicate the negotiation.
Alibaba.com is the lead international wholesale selling and buying platform of the world, capable of connecting millions of buyers and sellers. In Latin America, Brazil is the only country with suppliers.
As previously stated, the main difference with AliExpress is that Alibaba is meant for wholesale purchases. You can also acquire products by units, but they generally require orders from 10 to 100 units minimum.
This marketplace is ideal for those who want to develop white-label products. For instance, if you have a cosmetics store, you can search for a provider with convenient prices that sells beauty products without branding so you can put your own on them. There’s even some sellers who offer the additional service of printing the brand upon the products and design others tailor-made.
Creating an account on Alibaba is easy and free. All you need is an e-mail and a password.
The price is negotiable according to the amount of products you’re buying.
If you already validated the products for your dropshipping business, you can achieve larger margins if you negotiate with high quantities through this marketplace.
You can read the reviews and see the rating the provider has. Each company has a profile where they show how many years they’ve been in the business, annual income, markets that buy from them the most, etc.
They have a service called Trade Assurance –safe commerce-, which covers Alibaba buyers with a 100% protection as long as orders are to suppliers who are part of this program. They guard buyers in case a provider doesn’t send the merchandise in the stipulated time or if the products don’t meet quality standards.
They have another service called Secure Payment, where they protect both sellers and buyers by retaining money from transactions until both parts confirm the order has been completed.
You can find someone who provides dropshipping services, transporting merchandise from China, by typing “Dropshipper” into Alibaba.com’s search bar. Products have very thorough and comprehensive information.
You may encounter suppliers who don't speak English.
Most of the shipments are made directly from China to the United States by sea, which can cause higher costs and increase the delivery time to other countries.
There’s another complication: you must know about trading terms, and on most cases you need to be capable of dealing with customs and logistical issues by yourself.
This business is very attractive if you have a market in Canada or the United States. It’s not ideal if your business sells mostly in Latin America.
In order to have appealing prices, it’s common that suppliers sacrifice quality and labor conditions of their employees.
Since it’s such a faraway country, it’s very difficult to physically visit providers to verify the quality and work practices.
Alibaba doesn’t require providers to verify if they’re makers, merchants or distributers, so many of them may just be traders but identify as something else.
Etsy is a marketplace specialized in selling handmade products, vintage, personalized or one-of-a-kind items. 33 million people worldwide use this platform.
How does it work for a dropshipping business? You can use Etsy as a selling channel or a place to search for products to be sold in your store.
In the first scenario, there’s people who find products on Alibaba or AliExpress and then resell them on this platform. This is the case of ThreeBirdNest, store that has already made a million dollars by selling on Etsy, with a profitability of 65%. How do they do it? They buy clothes by bulk, they modify them to add value, and then they sell them at a higher price.
If, instead, you wish to use Etsy to find small suppliers, you’d have the advantage over Alibaba, since they generally don’t have orders with small amount of items, and due to it being a small business marketplace, they are more empathetic with other entrepreneurs.
Opening a store on Etsy is free. You pay in three types of tariffs: to post (US $0,2 by ad), for transactions (they charge 5% over the selling price), and another one for the payment procedure (for example, Etsy Payments charges 4% + 0,3 when the product is sold).
You don’t need a credit card to open the store.
This is how it works: to set it up, you just have to create it, choose a location and currency, name it, generate an ad, establish a form of payment and select a form of billing.
If you are using it as a platform to find suppliers, you have more possibilities of setting your store apart by offering original products.
Generally, those who sell on Etsy don’t have much experience when it comes to digital marketing. So, if you seize the opportunity and know how to fill that particular void and manage to increase their sells, you can achieve interesting negotiations.
One of the keys here is that you communicate from the beginning with your providers and tell them you intend to resell their products, that way you save time and open up the possibility of getting a better fee.
Etsy’s philosophy is to provide visibility to unique products not massively made. If you don’t manage to differentiate yourself from these original designs, it’s not the ideal place for you to do dropshipping.
Since it is a place with artisanal products, prices may be higher than on AliExpress and Alibaba and you may not get a good profit margin.
Tips to sell on these marketplaces and have success with a dropshipping business
Stay away from the obvious: do not sell on overly saturated markets like traveling, pets and babies.
Focus on sub-niches: ideally hobbies. Passionate people gladly spend large amounts of money on things they love.
Learn English: the majority of worldwide commerce happens in this language.
Add value beyond the product: remember that it’s not the buying act that satisfies us, rather the feeling this produces. Take this into consideration and create a brand that transmits values and represents a lifestyle.
Build a community: people love feeling part of something. If you find and form a group of people with similar passions, it'll surely be easier to sell.
Choose merchandise that leaves you large profits: if you sell highly demanded products too cheap, it’s going to be hard to gain money.
Learn about Facebook and Instagram Advertising: this will make the difference for your online store’s business. It’ll specifically be useful to learn about copywriting, photography and video editing.
Try it out: this might be the most important advice to start up a dropshipping business, because it’s in its nature to not force you to take high risks by buying certain products. You can begin by simply uploading pictures to social media, this way you can determinate what the public you chose is seeking. The same thing applies for suppliers. Before you marry one of them, experiment with several and compare each of them.
How to begin
Find a niche: How? It may be a combination of something you enjoy selling (so the business is fun and fluent) with a trendy market where people spend lots of money, and an industry you know of. This is the most complex part but it’s also the best way to start a successful enterprise.
Identify a problem: use your social media to ask the community about issues they’re facing. Afterwards, find products that can fill those voids.
Look for suppliers: coming back to the marketplaces I previously mentioned, you can search for products on AliExpress and Etsy. I do not recommend starting with Alibaba if you are uncertain about your niche and haven’t tested out the product.
Once you have a combination between niche, issue to solve and supplier, begin your experiment on social media and other digital marketing sites.
Test the quality of the providers: make small orders, check out the materials, research as much as you can so you can inspire confidence in your clients regarding what you’re selling.
Build a brand: do not underestimate the creation of a brand with soul. In a world where every day it gets easier to become an entrepreneur and eCommerce is taking such a strong hold, if you want to succeed, you need something beyond product pictures online.
Use Importify to start your dropshipping business with Jumpseller
Create your online store taking advantage of the 14 days of free trial. You don’t need a credit card.
After you set up your store and acquaint yourself with the platform, you must import the products you wish to sell. To do this Jumpseller has an integration with Importify that allows you to bring the best-sold items from various marketplaces.
Importify is a Jumpseller app that lets you import products from the popular markets previously mentioned to your Jumpseller store. All you need to do is install Importify and create an account with its service.