Myths about dropshipping: what is true and what is fiction?
Dropshipping has become a popular way to run an online business due to its simplicity and low initial costs. However, there are many myths and misconceptions surrounding this business model. In this article, we will dispel the most popular ones and find out what is fiction.
A successful dropshipping shop knows its customer, focuses on him and pays attention to details. Halla Systems helps him with the rest. We connect partners, verify the cleanliness of transactions and quality of goods, find decent suppliers, and build relationships with manufacturers.
Myth 1: It is possible to start a dropshipping business without any investment
Truth: Dropshipping requires less initial investment than traditional retail shops. But you are unlikely to start a business without some investment, much less grow it. First of all, you will need money for creating and promoting a website, advertising, paid tools for analysing and managing your business. Halla System dropshipping helps to optimise costs and offers ready-made pricing solutions.
The average profit margin of a dropshipping business is currently around 15-30%. And that's only if the dropshipper has good control over their overheads. With a profit margin of less than 10%, the dropshipper will most likely be operating at a disadvantage. Pricing is directly related to what product or service the business is promoting. A dropshipper's biggest overheads are promotion and advertising costs.
Myth 2: Success in dropshipping is guaranteed if you choose popular products
Truth: Popular products may attract attention, but successful dropshipping requires much more than that. Not only is it important to choose products, but also to set up advertising, analyse the market and deal with customers properly. Business will not move without thorough market research, constant competitor analysis, optimised advertising and improved customer service.
Halla System company helps dropshippers in real time. The company's specialists analyse incoming data and track sales and partner networks, as well as networks that are jointly managed by several suppliers.
Myth 3: Dropshipping is a risk-free business
Truth: It seems that the risks in dropshipping are minimal. The buyer orders the goods, pays for them, and only then does the supplier start shipping them and working with the documents. But this is not the case. In dropshipping, the supplier is the backbone of the business. Lack of goods in the supplier's warehouse, quality issues, delivery errors, problems with returns and many other factors can negatively affect the dropshipper's reputation. You need to choose your partners carefully, monitor the quality of goods and be prepared for possible difficulties. In the role of direct delivery retailers, dropshipping suppliers can be scammers.
A wrongly chosen niche and an unpopular product are major risk factors and possible points of failure throughout the sales chain.
Halla Systems verifies supplier integrity and product quality. A robust internal control system allows for due diligence of all supply chain participants.
Myth 4: Because a dropshipper doesn't keep goods in stock, they don't have inventory management problems Truth: Prompt and reliable delivery of goods is something that customers appreciate. In practice, poorly organised dropshipping can lead to problems with delivery, quality of goods and overall customer experience. The following points should be discussed with suppliers in advance: stock alert system, delivery times to certain countries and tracking technologies. Halla systems negotiates directly with suppliers, differentiating product items for the target audience.
Myth 5: Dropshipping can be fully automated
Truth: A dropshipper is looking for a balance between the price of a product and its quality. It is impossible to fully automate a dropshipping business. Processes such as managing customer enquiries, solving problems and developing new strategies require direct involvement and constant monitoring. It is quite easy to automate order processing and marketing management processes.
Halla Systems' Marketplace allows you to automate routine operations. Halla Systems experts participate in negotiations and help reduce product costs and improve business processes.
The truth from Halla Systems
Dropshipping offers many opportunities for aspiring entrepreneurs, but it's important to realise that it's not a magic wand to get rich quick. Debunking the myths will help you more realistically assess the requirements and expectations of this business, and prepare to successfully launch and manage your dropshipping shop. If you already have your own shop, dropshipping can be a good addition to your existing business.
The myth that dropshipping is a hassle-free business goes from one promotional article to another. Creating a pretty picture. Dropshipper can spend a lot of time and money to create and promote his shop. And it will not guarantee him success.