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Top 8 Mistakes That Cause Dropshipping Failures

Top Mistake Dropshipping

Table of Contents

Reading Time: 10 minutes

Has dropshipping “dropped the ball” for you?

If you are not familiar with dropshipping, setting it up can be an undertaking. Cutting corners and taking shortcuts when setting one up has consequences. Ultimately, it can fail on you.

Are you ready to be the ultimate dropshipper through a flawless system? 

Let’s review some of the most common dropshipping beginner mistakes made by others and how you can dodge the bullet on them. 

Want to know how to harness the power of dropshipping in just one step?

dropshipping beginner mistakes

Mistake 1: Failing to Do Necessary Research

Have you ever visited a website that has an ambiguous feel to it? You’re not quite sure what type of business they are. They might sell plumbing products, blankets, and cosmetics in one place. 

It’s like walking into a garage sale. To make matters worse, the customer experience with the online storefront is less than desirable. After taking a single glance, the customer exits and goes to another website to shop.

Entrepreneurs must do their homework before setting up shop. A successful, solid business model reflects thorough research with specific goals.

You’ll succeed when you sell products that have value to you personally. Your product is the solution to solve the problems that consumers have. 

Choose the Right Product: Sell Something You Are Passionate About

A great example is how Gaston Frydlewski and Marquel Waingarten built a business selling lace-free shoe laces known as “Hickies”. These entrepreneurs recognized the frustration of knotted shoelaces. They knew that consumers share their same frustration. So, they started selling Hickies. 

Narrow Down Your Niche: Market to the Right Audience

After you decide on the product you want to sell, you must decide on a specific audience to market to. Hickies entrepreneurs have a specific niche (audience) they market to, which is footwear. 

Choose the right product and market that product to the right audience.

dropshipping beginner mistakes

Mistake 2: Failing to Properly Design a Website

One of the most crucial components of building a successful online business is your website. The customer experience begins the moment they enter your website. The goal is to keep them on your website to explore your products. A website is the first impression and a lasting one. If it’s not positive and pleasant, the customer exits and goes elsewhere.

Provided that you have done your research and know exactly what and to whom you will sell, the website is another element in building your “bridge.”

Build a Website That’s Inviting, Engaging, and Professional

Pay attention to every little detail. 

Website Climate

  • First and foremost, your website is the threshold where customers gain the first impression of your business. It’s vital that it be inviting and appropriately designed and optimized to get customers past the landing page. 
  • Content should be written in native language, free from errors (grammar, spelling, syntax) SEO-friendly, and up to date.
  • The overall impression should be reflective of current trends and not appear outdated.

Customer Conversion Strategies

  • The landing page should have a strong header that captivates and makes the user want to know more.
  • The overall design and feel of your website should reflect your branding. Everything from the color to the imagery impacts just how far a user will advance into your site. Colors drive customers to buy. Using the right colors in branding, website design, and marketing encourages customers to engage, explore, and convert.
  • Foster trust by including customer testimonials. Adding personal stories, videos, and photos of yourself are powerful ways to gain a customer’s trust.
dropshipping beginner mistakes

Mistake 3: Failing to Optimize the Website to Load Quickly

There’s nothing more frustrating than investing your time and money into designing a website to have it load at the pace of a snail. A website not only functions as a source of information, but it also funnels and converts. 

Your website needs to perform in line with the current usage trends. Over 47% of eCommerce transactions are done through mobile devices. To stay current, your website needs to function flawlessly on mobile devices. 

  • It takes 22 seconds for the average website landing page to load.
  • 53% of shoppers will wait up to 3 seconds before they abandon the website and go on to another.
dropshipping profit margin

Mistake 4: Failing to Take into Account That Dropshipping Yields a Lower Profit

The purpose of using a dropshipper is to cut out the middleman between customers and suppliers. Entrepreneurs don’t have to handle, store, inventory, and ship products when you have a dropshipper on board. When another entity assumes those duties, it comes at a cost to you, the business owner. 

  • Dropship suppliers charge you more for wholesale products to cover handling expenses.
  • Your profit margins are lower.

Wholesale Purchasing on Your Own

  • Suppliers charge you less.
  • You are responsible for handling (storing, inventory, and shipping) products.
  • Your profit margins can be higher as well as your risk.

You can leverage your online storefront and dropshipping to make a passive income. However, to do so, it requires a lot of hard work to get it going. There’s a lot of other people like you out there fishing the same waters you are. 

dropshipping beginner mistakes

Mistake 5: Not Having Reputable and Reliable Suppliers

It’s very discouraging to have a supplier that fails to hold their end up. Your dropshipping success depends on suppliers fulfilling orders from your customers in a correct, timely, and appropriate manner. Everything from the time the order is placed to the way the product is packaged and shipped is scrutinized by customers. One mistake, and it falls on you as the business owner. You lose money. Far worse, you lose respectability and trust from customers.

Although you don’t necessarily have control over your supplier’s business practice, you do have control over who you choose as your supplier. Do your homework and read up on anything and everything about them. This includes reviews and ratings. Don’t be timid about asking them questions.

Key Things to Ask Potential Suppliers

  • Do they furnish product catalogs?
  • How much do they charge business owners?
    • Get a complete breakdown of the cost of every product.
    • Know what your profit margin will be per product.
  • How do they maintain their inventory?
    • Do they keep product stock updated to ensure availability? Suppliers that lack a closely supervised inventory system will drop the ball on your customer orders. This is something that will make or break your business!
  • How do they handle returns and refunds?
    • Suppliers that don’t accept returns or issue refunds are a big red flag! Guess who absorbs the cost and the hassle of these? You!
  • What shipping methods do they use?
  • What kind of packaging is used for shipping?
why dropshipping fails

Mistake 6: Having the Attitude “Not My Business, Not My Problem” Towards Dropshipping

Anything related to or connected to your business is your problem. Own it just like you own your business! Be proactive with every little detail in dropshipping. Don’t assume your dropshipping is functioning perfectly and sit back and relax. 

You have to invest yourself in doing a little work to ensure it’s working for you. Pay close attention to orders being placed, and how quickly and efficiently they are being fulfilled.

why dropshipping fails

Mistake 7: Failing to Market Yourself and Your Business Correctly

It’s rare today to find someone going belly-to-belly marketing their product. We live in a day and age where online presence reigns. The days of perusing catalogs and calling in your orders are gone. Our culture wants shopping to be as effortless and fast as possible. 

To effectively market your products, you have to be current with trends. Currently, social media is the platform to reach the crowds. If you don’t have your foot in the door with Facebook, Instagram, Twitter, Pinterest, LinkedIn or YouTube, your success will be very limited. You reach a wider audience through social media. The cost of advertising on social media is minimal compared to the traditional methods of advertising.

Effective Marketing / Advertising on Social Media

  • A/B testing will give your business a great advantage when it comes to social media. 
  • Know your target audience.
  • Try different formats when it comes to your ads. This helps you to find out what works best.
  • Don’t use the same lingo on all posts. Change it up.
  • Images are powerful, so be sure that you use the right ones. Some platforms prefer certain formats.
  • Always include a “call-to-action” and make your advertisement stand out.
  • Depend on analytics to give you feedback on what’s working and not working.
why dropshipping fails

Mistake 8: Not Taking into Consideration That You May Have to Pay for a Product Up-Front

As a dropshipper, you may have to front the money for products your supplier ships out. The bank then comes in behind and processes the payment and any associated fees for each transaction. Up-front payment is nothing more than guaranteeing the supplier gets paid.  Always remember that you have to “float” the money until the bank steps in.

Dropshippers who have an e-commerce dropshipping platform such as Shop1 don’t have to worry about paying these upfront product costs. The dropshipping platform (Shop1) pays that for them.

The One-Step Way to Harness the Power of Dropshipping!

Is dropshipping successful? Absolutely!

Now you have arrived at the meaty information! Let’s show you how to take hold of dropshipping and forge it in a way that gives you results.

Are you ready to create a phenomenal customer experience to keep people engaged to the point of conversion? Dropshipping is a powerful tool. 

So, is it possible to achieve success by taking just one step? Yes, it is.

A Dynamic Personalized Online Marketplace

Try and imagine walking into one of Chicago’s luxury department stores. You’re overwhelmed at the sensory overload that meets your eyes. Wall-to-wall products beautifully displayed beckons you. 

The minute you stepped into the store; your customer experience began. It continues as you browse, select, and pay for a product. Even the bag your purchase is placed in has attention to detail. You exit the store feeling content and with the desire to return again.

Let’s transfer all of those “good feelings” to your online marketplace. Will customers have a positive and pleasurable experience?

Shop1 is your resource that will help you create your online marketplace that will give your customers that great experience. We are in the background creating the sublime ambiance of your web store all the way to processing your customer’s payment. Shop1 doesn’t stop there because we go beyond payment processing by sending out occasional automated email marketing campaigns to your customers. In addition to all of these amazing amenities in our platform, we’ll also handle order-related customer relations.

Recently we have noticed articles written by people who are calling dropshipping a scam and how they lost tons of money. This simply is not always true though.  Oftentimes the reason dropshipping fails is because dropshipping is a business, and that requires people to treat it as such.

The majority of money spent on dropshipping is advertising when using a platform like Shop1 which handles all of the back end items for you or a lack of your items selling to cover that cost.  What does this mean when you are losing money with this being the biggest expense? We’ve covered a few previously, but we want to bring up a few possibilities again because your success is our biggest priority.

An unpopular or too popular niche was selected for the current market

This is pretty much the business equivalent of “Goldilocks and the Three Bears”.If you choose a market that is too popular then you are late to the party and will have a hard time breaking into the market when other more established sellers dominate said market.

Too unpopular of a niche and no one buys from you either. While this may seem like it is common sense, if you don’t do a thorough market analysis you could fall into this trap.

it is ok to start over

No re-targeting or advertisements

If you are not getting traffic to your store, then it is quite possible that your advertising is not reaching your target audience or its content is not inspiring your target audience to shop your store.  

The first thing that should be done is to revisit the advertising content to see if the content matches the audience’s interest and the location of the advertising reaches that demographic. If not, the next step is necessary.

incorrect

No or incorrect market analysis on current customer habits and competitor actions

Sometimes it is necessary to redo the market analysis.  If you aren’t hitting the target audience then it is possible that there was a mistake in the analysis.   The market may have suddenly shifted as content was created, or perhaps there was just user error during the process.

This happens sometimes and is just a part of business. Remember, when someone’s everything is given into a project, failure is just a learning lesson on the way to success.  All major success’ are built on lessons learned from failed attempts


Time Management

Inefficient time management

If you find that you are spending too much time on something, or that you know you have not put the amount of time into the project you are working on and your deadline hits, time-management could be the issue.  

This can be a life situation issue, a personal trait, or a variety of reasons . This needs to be analyzed and new tactics must be employed to ensure good time-management. There are only so many hours a day someone can work and every minute counts. 

And sometimes, the lack of actually doing the work

The cold hard truth of the matter is that sometimes people just don’t put in the work, for whatever reason.  If this is the case, then a decision needs to be made on whether this is something that a person wants to do.  If not, then don’t waste the time and money on the advertising. Having your own business is a big commitment and some people just don’t like being their own boss.  It is perfectly normal to prefer one or the other, and something to decide on so you make a solid decision for your future.  

Dropshipping is not a get rich fast process and it is not a scam.  But it is a business and if people treat it as such, normally they have success.

Shop1

What you get from Shop1

An Online Marketplace Designed Just for You

  • An online storefront that is specifically designed around your business and product. The beautiful design carefully includes the necessary elements to reach a specific target audience.
  • Your storefront will be optimized to run efficiently and quickly.
  • Handling of customer payments
  • Handling suppliers and supplier relations (U.S. based only)
  • Handling inventory and keeping stock up to date
  • Handling of returns and refunds
  • Handling post-sale customer relations

Coverage of Up-Front Payment Floating for Products

  • No need to worry about where your money ends up.
  • No need to wait a lengthy period of time for payments to move from one account to another.

We Help You Build Your Bridge to Success!

You’ll no longer have to ask “Why do dropshippers fail?” because now you know how to avoid common mistakes and achieve SUCCESS! 

We want you to succeed, and it’s our mission to provide you with tools to grow your online business in a way that works with today’s shopping culture. You never have to roll the dice in finding suppliers that won’t bail on you because we provide those for you. 

Shop1 is a strong and reliable all-in-one platform that bridges the gap between your business, suppliers and customers. We provide reliable service that will give you the power to be a successful dropshipper!

Are you ready to take your dropshipping to a new level?

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Laurel Price
Laurel Price