“Why dropshipping?” you might ask yourself. Wasn’t that the thing that was big during the pandemic when everybody was looking for a side hustle? Surely in 2024 – when the world has opened up again – dropshipping is falling by the wayside.

Not so!

Dropshipping is stronger than ever, with the sector anticipated to hit $310 billion by the end of 2024. That’s a huge pie, and it’s about time you got your slice of it. High Ticket is where you need to be – our guide to dropshipping helps you get to grips with what the industry looks like in 2024 and what you need to do to dominate dropshipping.

Understanding Dropshipping

Before you can do anything, you need to understand what it is first. Dropshipping is no different. Let’s explain what this unique form of e-commerce has to offer.

What Is Dropshipping?

As a dropshipping business owner, you have a key advantage over other e-commerce providers – you don’t have to maintain stock yourself. The dropshipping model has no warehouses – or garage spaces being swallowed up by tons of trinkets – because it’s all about serving as the middleman.

You advertise a product on your website. Somebody orders that product. You then send that order to another party, which handles the stock and gets the order shipped. After that, your job is simple: Collect the money and handle any customer issues.

How Does Dropshipping Work?

To make dropshipping work, you need a reliable third-party supplier that can handle order fulfilment. Without that, your new business is dead on arrival. Your customers won’t get what they buy, or at least won’t get it as quickly as they should.

So, you need to find suppliers.

Usually, this means setting up a relationship with a wholesale supplier who’s willing to store and ship your products whenever you get orders. But in 2024, you also have the option of working with special apps that link you up with thousands of smaller suppliers. The process is the same – you work with the supplier to ship the products you sell – but you have far more choice when it comes to what you’re putting on your website.

Starting a Dropshipping Business in 2024

It’s 2024. Is dropshipping even relevant anymore? It absolutely is, as you’ll see from the stats below and the steps for getting this type of business up and running.

Is Dropshipping Worth It in 2024?

Head back to the intro if you need your answer – the dropshipping market is going to be worth over $300 billion by the end of 2024.

That alone should answer any questions about whether dropshipping is worth it in 2024. As for the future, the market’s only going to get bigger. Grand View Research says that global dropshipping will have a compound annual growth rate (CAGR) of 23.4% between 2023 and 2030. That means it’s not going to stay a multi-billion-dollar market for long. It’s going to hit the trillions – $1.253 trillion in revenue by 2030, to be exact.

The downside to this growth is that it brings more intensive competition. A lot of people are going to jump on the dropshipping bandwagon in the next few years, meaning you (and your products) have to be extra special if you’re going to get a slice of this huge market. High Ticket helps you nail down the right products and niches. But if you don’t have an appetite for competition – not everyone wants to fight in a crowded market – dropshipping in 2024 may not be for you.

Steps to Start a Dropshipping Business

You’re convinced! The trillion-dollar outlook probably helped, and you’re ready to start a dropshipping business. That’s where these seven steps come in, each as important as the last for when you start dropshipping:

1. Choose a Niche – With no niche comes the “throw stuff at the wall and hope something sticks” approach. That’s a surefire way to lose a ton of money in a dropshipping business. So, figure out who your audience is, what it needs, and what you need to sell to them to fulfill that need.

2. Find Suppliers – Your suppliers are the lifeblood of your dropshipping business – nothing happens if you don’t have them.

3. Build an Identity – Anybody can sell unbranded products directly from a manufacturer. You need an identity. A brand. Something that tells your customers that you’re not just hawking products – your business is something with which they can identify.

4. Create Your Store – Jump online and build an e-commerce store to sell your products. There are a ton of options out there (you’ll discover one of them soon).

5. Prepare Your Finances – You’re running a legitimate business here, which means you need to understand revenue and profit and loss reports. It’s here where you need to invest a little – get the money stuff right from the start and it won’t come back to bite you later.

6. Register Your Business – Remember the above point – legitimate business. You need to set up the appropriate structure for your dropshipping venture. An LLC is usually a good choice. Research your state’s requirements for creating one and get that structure in place.

7. Market the Business – Competition, competition, competition. You’re going to face a ton of it in such a high-growth market, so your marketing game has to be on point if you’re going to make an impact.

Choosing the Right Platform

Let’s hone in on Step 4 from the above list – getting your store set up. For that, you need a platform, and there’s only one real choice for the job.

Why Shopify Is Popular for Dropshipping

Ease of use and a huge variety of apps combine to make Shopify dropshipping such a great option. 

On the ease-of-use front, Shopify lets you set up an e-commerce business without having to worry about coding. Just pick a theme – it has more than 100 free templates – and customize it with your product and brand. Voila! You have an e-commerce storefront for your dropshipping business.

As for the apps, those cover inventory. There are a handful available that integrate with your store and give you a huge selection of products to offer.

There are Shopify alternatives, of course:

• Wix – Cheaper than Shopify but with fewer and lower quality site template designs.

• WooCommerce – Tons of customization options, but you have to get to grips with plugins and dealing with a WordPress backend.

• PrestaShop – Completely free, though also reliant on open-source developers to create features. That’s not always great – it creates limitations that you don’t have with Shopify.

Integrating Dropshipping Apps

You have your platform for dropshipping in Shopify. Now, you need apps – ones that allow you to integrate dropshipping functionality into your new online store.

Zopi

Linking you up with Temu, Ali Express, and CJ – all top dropshipping wholesalers – Zopi connects you to a ton of products. It’s also got a handy real-time order tracking feature you can use to keep customers updated on their orders.

DSers

A great choice if you’re looking for dropshipping apps that let you manage several stores at once. You can place orders for hundreds of products in seconds, all through Ali Express. Excellent if you want to create a bunch of brands under your dropshipping umbrella.

Printify

Custom labelling is vital to creating a brand, which is where Printify shines. You can choose from hundreds of products – all printable with designs and logos you upload.

Finding Reliable Suppliers

If you have a supplier that’s constantly messing up orders, you have a dropshipping business that’s going to collapse. Let’s look at how to find the right suppliers.

How to Choose Dropshipping Suppliers

Research!

It’s the only way to find a dropshipping supplier that’s going to keep up with your order volume without dropping the ball. So, when it’s time to choose a supplier, look into what other dropshippers are saying about them. Are they missing orders? Delivering late? Being uncommunicative? All of these are massive red flags – all telling you that it’s a supplier to avoid.

But even when you’re feeling confident in your choice, start small. Vet the supplier by selling a handful of their products at low volumes to see how well their system works. If you see mistakes creeping in right at the start, imagine how much of a mess the system will be when you start ramping up dropshipping sales.

Best Platforms to Find Suppliers

You need to find a supplier – or multiple suppliers if you’re going big with dropshipping – with the following three being solid choices.

Ali Express

The third-party supplier of choice for hundreds of dropshippers, Ali Express offers one huge plus – literally millions of products. The downside is that quality control isn’t always where you need it to be, so start small with any new product to get a taste of what you’ll be getting.

Worldwide Brands

Less a supplier and more a directory for other suppliers, Worldwide Brands puts you in touch with dozens of wholesalers for a $299 lifetime membership fee. But it upsells out the wazoo and doesn’t offer much more than a directory.

High Ticket

Through Supplier HQ, High Ticket hooks you up with dozens of suppliers – all vetted and well-established in the U.S. These suppliers only carry high ticket items that have better quality and faster shipping times than other suppliers. 

Managing Your Dropshipping Business

Congrats – you have a supplier and a website. How about we start looking at what you need to do to keep your dropshipping business running?

Marketing Your Dropshipping Store

Yours is far from the only online store around – there’s anywhere between 12 and 24 million of them floating around so you need to market your dropshipping business properly to get anywhere.

Social media marketing is your fastest route to success.

Just take a look at Meowingtons. Branding on social media has been huge for them, with their Instagram and Facebook channels being flooded with cute cat pics to go along with their kitty-centric branding. And it’s worked – they have about 500,000 Instagram followers and more than a million likes on Facebook.

They give you a hint on how to market your business:

Find something associated with your products that has universal appeal – such as funny cat pics – and use that universal thing to get your brand out there.

Handling Customer Service

Bad customer service – it’s the reason why 96% of people leave a brand a never come back. Don’t let failures to treat your customers well bite your dropshipping business in the behind. In the dropshipping game, you have the benefit of being able to manage your business from anywhere.

Use it.

Set up a detailed FAQ on your website and give your customers a clear way to contact you. And when they do, don’t ignore them. Set aside a few hours each day to handle incoming inquiries.

Financial Considerations

You’re running a business with dropshipping, so you need to wrap your head around the financials.

Calculating Profit Margins

You need to maintain a healthy profit margin or your business will go under. For that, you need a simple formula:

Net Profit Margin = [(Revenue – Cost) / Revenue] x 100

Let’s say it costs you $2,000 per month to run your dropshipping business and you generate $10,000 in revenue. Plug those numbers in and we get:

[(10000 – 2000) / 10000] x 100 = 80%

That’s an amazing profit margin, so don’t expect yours to look that high. The key is that your Net Profit Margin number is positive – negative means you’re losing money.

Managing Costs and Investments

You have to balance the obvious need to invest in your dropshipping business – no money being invested means no new products – and how the cost of goods impacts your bottom line. That means solid financial planning is a must.

• Understand Your Costs – It’s not just the cost of goods you have to consider here. Your platform charges a fee. You may also pay fees on transactions and you have to spend on marketing. Add it all up – one missed cost makes your profit figures inaccurate.

• Automate Wherever You Can – Anything you can automate – from payment processing to handling orders – is money saved for you.

• Plan for Tax – Depending on where you live and what business structure you choose, you’ll likely have sales, corporate, personal, or a combination of the three to pay when tax season comes. Create quarterly estimates – they’ll help you see how much money to set aside.

Navigating Challenges

It’s not all smooth sailing with dropshipping – about 90% of dropshipping businesses fail because the owners don’t anticipate the challenges they’ll face along the way.

Common Challenges in Dropshipping

Dropshipping may be a good way to earn a living, but it comes with some common challenges. Think of the below as the cons of dropshipping – issues you need to confront to make your business work:

• Building a Brand – Never underestimate the sheer volume of competition you face. Without good marketing – backed by customer service and a solid brand – you’ll get lost in the dropshipping deluge.

• Shipping Issues – As a general rule of thumb, the further away your supplier, the longer your customers have to wait for shipping. There may not be much you can do about the wait, but you can mitigate its impact by always being open about it with customers.

• Price Changes – A shifty supplier may try to change prices on you once they feel they’ve got you locked in. Don’t let that happen – set prices in a contract for a defined period and always negotiate when the period ends.

Ensuring Quality Controls

You learned earlier that 96% of customers wave bye-bye to you when they have a bad experience. In dropshipping, the root of that bad experience usually comes down to one thing – a poor product.

Product returns are part of running an ecommerce business. You’re never going to not have them, but you need to minimize them as much as possible. That’s where your quality control comes in. The simple tip here is to always get a sample of the product you’re selling before you put it out there. You want to see and feel it in your own hands first so you know what the customer’s going to get.

As for returns, you need a defined process for making them happen. That often comes down to your supplier – ask them how they handle returns and make sure they stick to that policy.

Future of Dropshipping

You already know that dropshipping has a bright future in terms of market growth. But what other trends should you expect?

Trends to Watch in 2024

The first of the future trends in the dropshipping industry to understand is TikTok – it’s becoming a big place for online shopping. Over half of the platform’s users – 55% - have bought something from a brand after seeing it on TikTok, which gives you a pretty big hint about where you should be marketing.

As for what you’re selling, fashion products are in during 2024. That’s always been a strong market, but fashion is expected to have a 35.6% CAGR between now and 2031 – amazing growth for a product type you can easily customize.

Frequently Asked Questions

You already have everything you need to know thanks to this ultimate guide. Well…almost. This dropshipping FAQ covers some of the stuff that hasn’t been mentioned yet.

Dropshipping FAQs

Can I manage a dropshipping business from anywhere?

You can – you don’t have a physical store or warehouse to maintain because your supplier handles that for you. As long as you have the right cloud-based platform – Shopify is a great choice – you can manage your business from your phone.

Do I need a business license for dropshipping?

You can’t just dropship and profit. You’re running a business, and that business needs to have an official and legal structure. A limited liability company (LLC) is usually the best choice – they’re simple to set up in most states and give you full control over how you structure your dropshipping business.

Who provides customer service in dropshipping?

You!

That’s where your time investment really comes in. Your supplier handles the product side and you market and speak to customers.

Dropship to Win Big!

Make no mistake about it – dropshipping isn’t easy due to the competition you face. But nothing good comes easy, and having an opportunity to earn thousands (even millions) of dollars through dropshipping is one you shouldn’t pass up.

Let’s help you make the most out of that opportunity.

With HighTicket.io, you join a community of 2,479 dropshipping winners on the ultimate fast-track program to dropshipping success. Give us 24 weeks of your time and we’ll give you a booming business. Discover the High Ticket Program today and start your journey toward $100k/month revenue.

Additional Resources

• HighTicket.io – Expert-led and world-class training on running a successful dropshipping business.

• Shopify Learn – The platform of choice for dropshippers also offers a ton of info on how to make it work.

• Google Trends – A great research tool – see what’s trending and you get ideas for niches to fill with products.