Start Your Shopify Dropshipping Business: A Step-by-Step Guide

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Dropshipping on Shopify is one of the most popular ways people make money online. According to Grand View Research, the global dropshipping market is projected to expand at a compound annual growth rate (CAGR) of 23.4% from 2023 to 2030, reaching a valuation of USD 1,253.79 billion by 2027.  With dropshipping being one of the best passive income streams with a low barrier to entry, people are turning to Shopify to start online stores. 

Shopify dropshipping caters to a wide range of people, making it a popular choice for those looking for a side hustle. You’ll find countless dropshipping apps on the Shopify App Store that have unique specializations, such as AliExpress dropshipping, US and EU suppliers, or even a combination of them.

In this article, we’ll walk through what dropshipping and Shopify are, why you should dropship on Shopify, and how to get started with a step-by-step tutorial. So, let’s dive in. 

What is Dropshipping?

Dropshipping is a popular business model used where a manufacturer creates, packages, and ships products directly to the customer of a business. The business is responsible for marketing the product and ultimately owns the customer list. The upside to this business model is that it’s relatively low risk for the business owner and the manufacturer. 

The downside to dropshipping is that you don’t have control over the product quality and packaging unless negotiated upon with the manufacturer. Most business owners prefer dropshipping over wholesaling because you don’t need to buy inventory in bulk and upfront; you only purchase the specific products a customer chooses when they place an order. 

What is Shopify?

Shopify is an ecommerce platform that allows you to sell your products online or in person. Similar to website builders, Shopify has a whole suite of features that specialize in commerce, so you’ll get a high-converting and secure checkout, access to thousands of apps which allow you to customize, market, and grow your business, and you can even access a POS system if you own a brick and mortar store. 

If you're considering switching platforms, there are resources available for woocommerce to shopify migration, Adobe Commerce (Magento) to Shopify migration, wix to shopify migration, making the transition seamless.

Shopify’s specialty in ecommerce is what differentiates itself from traditional website builders, making the entire process of starting an online store simple and hassle-free. So, Shopify dropshipping is when you dropship products using Shopify as your ecommerce platform. 

Why You Should Dropship on Shopify

1. Dropshipping-friendly

When comparing Shopify to other ecommerce platforms, Shopify dropshipping is made possible because of how dropshipping-friendly the platform is. Some ecommerce platforms specialize in handmade goods and are less likely to encourage dropshipping on their website. 

Shopify recognizes the popularity and ease of dropshipping and actively promotes it on its website. You’ll find tons of content, such as blog posts, webinars, and more, that help dropshippers succeed on their platform. You can check out the top ecommerce platforms for more options.

2. High quality dropshipping apps

In addition to being dropshipping-friendly, Shopify dropshipping is also made possible with the many apps available on the Shopify App Store. You’ll find apps specializing in AliExpress dropshipping, US dropshipping, and even EU dropshipping. 

If you’re looking for an app that covers all the above, look no further than Spocket. Spocket one of the only dropshipping apps that allow you to choose which region to dropship from. You’ll have access to millions of products from every popular niche, allowing you to start a business in any category. 

3. Great for beginners

Shopify is a no-code-friendly ecommerce website builder allowing you to set up your online store without needing any development skills. You’ll be able to set up your business with ease. You’ll be able to purchase a domain name, get instant access to hosting, and even choose a theme all on Shopify. 

With all steps of the store-building process in one place, setting up your store couldn’t be easier. You’ll also have access to help docs, blogs, webinars, and other educational content on Shopify in case you get stuck. Plus, Shopify has 24/7 customer support with live chat so that you can get help along the way. The ecommerce giant is merchant-focused making it ideal for those looking to start dropshipping on Shopify. 

How Much Does It Cost to Dropship on Shopify

Building a business has various costs that depend on your plan and where you purchase different products. For example, you’ll need to buy a domain name to start Shopify dropshipping, which costs an average of $10 per year. A Shopify subscription can cost anywhere from $29 to $299 each month and includes the cost of hosting. To dropship on Shopify, you’ll need an app like Spocket, which can run between $39.99 to $99.99 a month. You’ll also need to pay for a theme, though you can find free ones on the Shopify Theme Store. And finally, you’ll have marketing costs associated with your business. 

If you ever need to manage or cancel your Shopify subscription, it's essential to understand the process and any implications.

Additionally, consider exploring various Shopify payment gateways to find the best option that suits your business needs.

Is Shopify Dropshipping Legal?

Yes, Shopify dropshipping is legal. Dropshipping is simply one of many possible business models. Regulated products like firearms, paraphernalia, etc., aren’t allowed on the platform. Fortunately, popular dropshipping apps like Spocket remove restricted products from their platform, so there shouldn’t be any issues. 

How Profitable Is Shopify Dropshipping?

As a Shopify dropshipper, you can make between $500 and $3,000 a month. Some store owners even bring in more than $100,000 a year. How much you earn depends on a few key factors.

What you pay for products and how much you sell them affects your profit. If you choose high-quality items, they might cost more. This means you need to sell them at higher prices to keep your profit up.

Dropshipping means you don't have to pay for making products, storing them, or keeping a lot of inventory. This cuts down your costs and lets you focus on making your store better and getting more customers. 

Getting the word out through email and social media can really help people get to know your store. And, if you find and sell products people really want, your store could become very popular and make even more money.

Shopify Dropshipping Step by Step Tutorial

1. Choose a domain name

The first step is to choose a domain name for your Shopify dropshipping business. One thing to keep in mind is the long-term future of your domain name.

For example, naming your store after your name could result in you losing the rights to your name if the business is sold down the road. In addition, choosing a brand name such as “Simply Beauty” could limit you down the road as people will only expect you to sell beauty products. However, if you plan to stick with a singular niche, you could use the Business Name Generator to come up with a domain name.  

Selecting a name that’s generic or has no meaning works best long-term, but no one understands what your business is about in the short term. However, many Shopify dropshipping stores choose generic names for their domain names. 

2. Create a Shopify account

Next, create a Shopify account to gain access to all the essential tools required to start, including a store builder, various themes, and other helpful resources.. 

If you're not ready to fully commit, Shopify offers a 3-day free trial, letting you explore the platform. Most likely, you'll find Shopify's ease of use for dropshipping convincing enough during the trial period. Next, pick a pricing plan that suits your needs and budget. 

Shopify has three plans to choose from. The Basic plan is the most budget-friendly, offering simple reports and allowing for two staff accounts. On the other end, the Advanced plan caters to more established businesses with features like a custom report builder and support for up to 15 staff accounts. 

Create an account and include the name of your store in the sign-up process. Shopify will then ask a series of questions, such as “Are you already selling?” “What is your current revenue?” and “What industry will you be operating in?” These are just for Shopify’s information, so there’s no wrong answer. 

In Shopify’s back-end, you’ll need to fill in details about your business, such as payment methods, adding your domain name to point to your Shopify store, and other crucial information.

3. Design your Shopify store

The next step you’ll want to do is design your Shopify store. This tends to be the most popular part of signing up for Shopify. However, it’s crucial not to overspend time designing your store, as it’s the marketing of your business that leads to your success. 

You can choose any theme from the Shopify Theme Store or you can shop for Shopify Themes on a theme website like ThemeForest. You can customize your store’s colors, fonts, and copy. If you’d like to add elements that aren’t available with your theme, such as an email opt-in form, you can reach out to Shopify Experts, who will make unique customizations for you for a fee.

To give your store a more professional appearance, you might also want to remove powered by Shopify from your store's footer.

Additionally, consider incorporating advanced features like shopify augmented reality to enhance the shopping experience by allowing customers to visualize products in their own space before making a purchase.

4. Install Spocket to browse products

Once you have access to Shopify, open the dashboard and then head over to the Shopify App Store. There, you’ll find various Shopify apps that specialize in dropshipping and more. If there are things beyond dropshipping that you need, such as sales channels, you can also add those while browsing the App Store. For your Shopify dropshipping app, you can use Spocket, the highly-rated dropshipping app. 

The cool thing about Spocket is that you’ll find suppliers based in the US, EU, and AliExpress. So, if you’re looking for American-made products, you’ll find countless US suppliers that ship to Americans fast.

However, if you’re looking to build a store with millions of low-cost products, you might want to add AliExpress products. Fortunately, Spocket offers the Chrome Extension, AliScraper, that’s free for users on the forever free plan. 

AliScraper allows you to add AliExpress products to your Spocket account in only a couple of clicks. Having all the suppliers on one app makes Spocket the preferred dropshipping app for many dropshippers. Spocket also allows you to add order inserts into your packaging with your logo and customer product details. 

5. Choose a niche

After browsing a few Spocket products, you might find yourself excited about all sorts of business ideas. However, most people choose to stick with a singular niche. A niche is the broad product category you’ll sell on your online store.

For example, you can start Shopify dropshipping in the women’s clothing niche. Alternatively, you can create a general store like Amazon that has a bit of everything. However, it’s essential to remember that Amazon didn’t start as a general store but as a bookstore. 

Starting with a niche and then expanding into other verticals is key to succeeding. Being known for a specific thing helps people think of you when they’re looking for that item. Then, you can expand into other verticals to fill out your collection line. 

For example, if you started a women’s clothing store, you begin by selling clothing. You could then introduce footwear, beauty products, jewelry, and possibly some home decor as you expand. It’s a natural progression without alienating your original customer base. You can find various niches to choose from under Dropship on Spocket’s homepage. 

6. Do product trend research

Once you’ve narrowed down the niche you’ll be selling in, it’s time to do some product research. With millions of products at your fingertips on the Spocket app, choosing the right products to sell requires some work. Fortunately, Spocket keeps product research simple. When you click on “Premium” in the product search tool, those are all the best-selling products for Shopify dropshipping right now. 

For non-premium products, you can use Google Trends to determine whether the product is trending upward or downward. Most people make the Google Trends settings “Worldwide” and “2004-Present” for an easy-to-read understanding of the product. 

For example, if you search “women’s blazer” on Google Trends, you’ll see that it’s growing in popularity. So that would be an excellent product to add to your store if you own a women’s fashion store. 

You can also search for products on Amazon to read customer feedback, analyze positive to negative reviews, and determine if the product is the right fit for your business. Finally, add the products you think customers will love based on reviews, current data trends, etc.

7. Edit copy and descriptions

Once you’ve added some products to your Import List, take some time to edit the title and descriptions. Keeping the original copy is called “duplicate content” and is a penalty that Google can strike on your website, which prevents you from ranking in search engines. 

Considering how search engine traffic is free, writing SEO-optimized descriptions could mean a lot of free traffic for your website. Avoid naming your products after people’s names, such as “Amelia dress,” and focus on describing the product itself, such as “Black V-Neck Cut Out Dress,” since that’s how your customers would search for the product instead. For guidance on optimizing your store for search engines, check out our detailed Shopify SEO guide.

8. Edit copy and descriptions

Finding the perfect price for your products requires careful thought. Your prices must be low enough to draw in customers and get them interested in your store, yet high enough to keep your profits strong. 

Avoid getting caught in a price battle with other dropshipping stores. This could shrink your profits to the point where your business can't survive. Remember, having the cheapest price isn't a must. When prices are close among competitors, customers often look at other things like how ethical your brand is, the quality of customer service, and the overall shopping experience.

Also, make sure to consider extra costs like shipping when you're figuring out your profit margin.

9. Optimize your store

With your products ready to go in your Shopify store, you're on the brink of launching your ecommerce business! But first, you need to sort out a few key settings. Set up your payment options and decide on your shipping methods and costs within Shopify's settings. Don't forget to draft a refund policy for your customers, covering exchanges and returns. 

Once your store goes live, think about how you'll handle customer support for purchases. This can really improve the shopping experience. As time goes on, keep a close watch on your Shopify dashboard. It's where you'll track how well your business is doing. Look at your conversion rate, sales, average order value, and how much customers are worth over time. Use this info to tweak your strategy as needed. For tips on optimizing customer trust and engagement, learn more about how to add reviews to your Shopify store.

Consider expanding your payment options to include cryptocurrencies. Find out how to accept crypto payments in Shopify to appeal to a broader audience of customers.

To enhance the customer experience, consider adding innovative features like a shopify virtual try on.

10. Launch and promote

Now that you’ve added products and done some design work, you’re ready to start promoting your Shopify dropshipping store. There’s no one way to get sales. You can generate sales on any platform you market on. The difference, though, depends on the speed. If you’re building a social media following from scratch, it’ll take time to build up an audience to promote to. However, if you’re running ads, you’ll get sales immediately, but it’ll cost more upfront. 

Advertising, in general, is the fastest way to generate sales. Whether you choose Facebook, Google, or TikTok depends on what makes the most sense for your business. You can also go the free but slow route of building your own followers, starting a blog focusing on organic traffic, or growing an email list. Building your own audience is key to your long-term success; it just takes longer. 

11. Scale

After a few sales on your Shopify dropshipping store, you’ll want to scale your business. Keep in mind that scaling is never 1:1. Conversion rates tend to drop once you start getting bigger numbers. 

For example, if your website traffic increases from 1,000 to 100,000 monthly visitors, the conversion rate will be lower for the 100,000 visitors. Same with ads. If you get four sales from $100, you will likely not get 40 sales when you spend $1000. The ad will “break” or, in other words, not convert as well. 

You’ll need to focus on conversion rate optimization on your website to increase conversions for organic traffic. And you’ll need to create another similar ad to convert ad traffic with a higher budget. 

Tips for Successful Shopify Dropshipping

1. Diversify your supplier base

Having multiple suppliers acts as a safeguard for your store. If one faces issues, you have others to rely on. This strategy ensures your shop always has the newest and best products, keeping your inventory appealing to shoppers.

This method is also beneficial for managing sales spikes or quickly stocking up on in-demand products. By collaborating with various trusted suppliers, you can ensure your customers always get what they want, when they want it.

2. Tackle product issues professionally

Choosing the right products is key in dropshipping. You need to make sure your customers get quality items from you. If there's ever a problem, fix it fast. 

Customers who are happy with what they buy and the service they get often come back. They do this because they trust you to give them good products and solve any issues quickly. 

When customers know they can rely on you for great products and fast help with any problems, they're more likely to shop with you again, which helps your reputation and your profits grow.

3. Create an order fulfillment plan

In dropshipping, while you don't directly fulfill orders, you can still make the process efficient: 

• Match orders with nearby suppliers: Aim to assign orders to suppliers closest to the customer. This reduces shipping times.
• Implement automation for efficiency: Utilize automation software to ensure orders are directed to suppliers with available stock. This should speed up your order processing.
• Use sales volume to your advantage: As your store's order volume grows, leverage this to negotiate better terms with suppliers, potentially increasing your margins.

Ready, Set, Dropship with Shopify

Shopify dropshipping is a great way to build an online store with low entry barriers, low risk, and ease of getting started. Using Spocket, you can find millions of products to add to your online store to get started. Anyone can be successful with Shopify dropshipping. However, you’ll need to invest a lot of time into marketing your business to grow a big audience. Fortunately, there are a lot of free methods for promoting your business, from social media to content marketing. With some effort and experimentation, you can build and grow a successful Shopify dropshipping store that allows you to earn passive income for years to come.

How to Dropship on Shopify FAQ

Is Shopify dropshipping still worth it?

Shopify dropshipping comes with its perks but also some challenges. One issue is shipping can get tricky when dealing with different suppliers, as each has its own shipping costs. However, with thoughtful planning and strategy, you can overcome these hurdles and work towards growing a successful Shopify dropshipping store.

Where can I find dropshipping suppliers on Shopify?

To find dropshipping suppliers on Shopify, visit the Shopify App Store. It's filled with resources for finding suppliers. Apps like Spocket can help populate your store with quality products. Select suppliers known for their quality and dependability to enhance your store's reputation.

Can you dropship on Shopify without inventory?

Yes, dropshipping on Shopify without inventory is possible. Shopify enables you to list products you don't physically have. When a customer buys something, your supplier ships it directly. This method is convenient for selling without dealing with inventory, ideal for launching or expanding your business.

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