7 steps to profitable dropshipping store: Full guide

In today’s post-global lockdown world, more and more people are looking for ways to work online or quit their 9-to-5 jobs altogether and build their own profitable online business. One of the most affordable and scalable business models to accomplish this goal is dropshipping store, and Shopify is the perfect a newbie friendly platform to get started.

Dropshipping allows you to sell goods online without having any inventory, office, employees, or logistics issues. Instead, your supplier handles the storage and shipping, which means you can focus on marketing and customer service.

This is an article in our great “how to get rich on the internet” series.

In this comprehensive guide, we’ll walk you through the steps needed to set up a profitable dropshipping store, as well as provide helpful tips and Pro tricks, real-life examples, SEO strategies, and back them up with data to set you up for success.

Why dropshipping?

Dropshipping has seen a huge surge in popularity over the last few years. According to Grand View Research, the global dropshipping market size was valued at $162.44 billion in 2023, and it is expected to grow at a compound annual growth rate (CAGR) of 28.8% from 2024 to 2030. This growth is driven by the rise of e-commerce, digital marketing, and a shift in consumer purchasing behavior toward online shopping.

So, what makes dropshipping so appealing?

1.  Low start-up costs: Unlike traditional retailing, there is no need for significant capital for pre-purchase of inventory, renting offices and paying salaries to employees.
2. Location independent: You can operate your business from anywhere there is internet.
3. Scalability: Since you don’t have to manage physical inventory, it is easier to scale your business, the more effective your advertising, the more sales you make. Very simple.
4. Diverse product offerings: You have access to a wide range of products and niches, while minimizing risk, since you don’t keep leftovers in stock, you can test different products to find the best one.

Let’s dive into the step-by-step guide on how to build a profitable dropshipping store using Shopify.

Step 1: Choose a niche

One of the most important steps in creating a successful dropshipping store is choosing the right niche. A niche is a focused area of the market that targets a specific group of consumers. Choosing the right niche will determine everything from product offerings to marketing strategy.

Factors to consider:

• Personal interests: Choose a niche that matches your hobbies or expertise. This will make it easier to market and promote the products.
• Market Demand: Make sure there is a high demand for your niche. Tools like Google Trends and SEMrush can help you gauge the popularity of certain topics over time.
• Profit Margin: Look for niches where products have a good profit margin (usually above 30-40%).
• Competition: Analyze your competitors by finding the best stores in your niche using Shopify Inspector or SimilarWeb.

Pro Tip: Did you know that there are services to analyze competitors, their promotional strategies and the winning products? In order not to waste time and money on finding the best niche and quickly launch your store with products that are in demand, use the service SellTheTrend!

Example of a profitable niche:

One successful Shopify store is Warmly – a home decor dropshipping store that has seen tremendous success by focusing on stylish and affordable home decor items. This store taps into a popular and evergreen niche (home decor), benefiting from the ongoing demand for aesthetic living spaces.

Stat: The global home decor market was valued at $616.6 billion in 2022, with a projected CAGR of 6.9% from 2023 to 2030 (Fortune Business Insights).

Step 2: Find a reliable supplier

Your supplier plays a crucial role in the success of your dropshipping store. They are responsible for product quality, order fulfillment, and the shipping process, so their reliability is paramount. Carefully research the company’s history, ratings, reviews, and product range. Don’t be afraid to contact the supplier by email or phone and get a better offer, many sellers give good discounts if you promise a large volume of orders. You will also get a better deal on the speed of processing your orders and sending them to customers.

Where to look for suppliers:

• AliExpress: One of the most popular dropshipping platforms, offering millions of products in various categories. You need to choose your supplier carefully, as we said above.
• Oberlo: Oberlo, integrated with Shopify, is a dropshipping app that connects you with trusted suppliers. This app is used by thousands of store owners and you don’t need to do your reliability research, it’s already done for you.
• SaleHoo: A supplier directory with over 8,000 suppliers, offering more quality control than AliExpress.
• Direct manufacturer: To better control product quality and customization, you can contact manufacturers directly, especially when your store is already established. Moreover, many manufacturers can produce products under your brand name, which will differentiate you from your competitors.

Case in point: GymShark, a successful Shopify brand, originally started with a dropshipping model, but then switched to working directly with manufacturers. They have achieved tremendous growth by focusing on quality and branding in the competitive fitness niche.

Vendor screening checklist:

1. Product Quality: Order samples before you put them on sale to ensure product quality.
2. Delivery time: Check the delivery time by placing orders at different locations.
3. Reputation: Check reviews and ratings on platforms such as AliExpress and SaleHoo.
4. Customer Service: Good communication is crucial to resolve any order problems or delivery delays, as well as returns of low-quality goods.

Step 3: Setting up a Shopify store

Once you’ve decided on your niche and vendors, it’s time to set up your Shopify store. Shopify is user-friendly and offers customizable templates, making it easy to create a professional-looking store.

Key customization features:

– Customizable themes: Choose from over 70 free and premium Shopify themes. Make sure the design fits your niche: minimalistic themes are good for tech, while more colorful themes are good for fashion.
– Payment gateway: Shopify supports a variety of payment gateways, including PayPal, Stripe, and Shopify Payments. Choose the one available in your target market.
– Shipping options: Customize shipping zones and rates based on your suppliers’ location.
– SEO optimization: Use keywords in product titles, descriptions, and meta tags. Shopify makes it easy to change these settings.

SEO Best Practices:

1. Keyword research: Tools like Ahrefs or Ubersuggest can help you find relevant keywords.
2. Page speed: Make sure your Shopify store loads quickly; page speed is a ranking factor for Google.
3. Mobile optimization: More than 50% of online shoppers use mobile devices, so your store should be mobile-friendly.
4. Structured data: Use rich snippets to display star rating, price, and product availability in Google search results.

Pro Tip: Enable the Shopify SEO Booster app to automatically track and improve your store’s SEO performance.

If you don’t know what search engine optimization is, how to properly set up product cards and add descriptions, you can contact professionals to set up a turnkey store on Fiverr.

Step 4: attract traffic to your store

Setting up a store is only half the battle; you need traffic to generate sales. There are many strategies for attracting visitors to your website, and combining them will lead to the best results.

Traffic generation strategies:

• Social media marketing: Platforms like Instagram, Pinterest, Facebook and TikTok can provide a significant amount of traffic, especially through paid advertising and influencer marketing.
• Google shopping ads: Running Google Ads is effective for high-interest shoppers who are already looking for products.
• SEO: Organic search is a long-term strategy. Regularly publish blog content that answers shoppers’ questions and solves their pain points. Tools like RankMath can help with on-page optimization.
• Email marketing: Use tools like Aweber and other to set up abandoned cart reminders, newsletters, and sale promotions.
• Influencer marketing: Partner with micro-influencers in your niche to introduce your products.

Case study example:

BlendJet, a Shopify store selling portable blenders, used Instagram influencers and paid advertising to grow quickly. They gained millions of followers and achieved viral success by partnering with fitness and health influencers.

Step 5: Optimize for conversions

Simply attracting traffic is not enough – you need to convert visitors into paying and loyal customers who will come back and recommend the store to their friends. Optimizing your store for conversion is a crucial step to making your store profitable.

Basic tips for conversion optimization:

1. Persuasive product descriptions: Write text that emphasizes the benefits of the product, not just its features.
2. High-quality product images: Use professional images or videos, preferably from multiple angles. Ask for a photo from suppliers or take one yourself on your proofs.
3. Customer testimonials: Adding reviews and testimonials builds trust. Tools like Loox can help display customer photos along with their testimonials.
4. Checkout Process: Simplify the checkout process by removing unnecessary steps. Shopify’s One-Click Upsell can increase the average order value.
5. Discounts and Promotions: Offer limited-time promotions or free shipping to incentivize purchases. There are stores offering an item for $1 but with paid shipping, which is what they capitalize on. This is a working marketing tool that works in many areas.

Statistic: Adding customer reviews can increase conversions by 270%, according to a Spiegel Research Center study.

Step 6: Fulfill orders and provide excellent customer service

Once you start generating sales, accurate order fulfillment and excellent customer service will be key to building a base of loyal customers. Engage with customers on social media, answer questions, and stay in touch.

Order fulfillment process:

1. Automated order fulfillment: Use Shopify apps like Oberlo or DSers to automate your vendors’ order fulfillment process.
2. Tracking information: Provide customers with tracking numbers as soon as their orders are shipped.
3. Handling returns: Develop a clear return policy. Customers can easily return or exchange items if necessary.

Customer Service:

• 24/7 support: offer live chat support through an app like Tidio or Gorgias.
• Fast response time: strive to respond to customer inquiries within 24 hours.
• Complaint handling: Respond to negative feedback promptly and offer solutions.

Step 7: Scaling your store

Once your store is profitable, focus on scaling up through marketing, expanding your assortment, and streamlining operations. Reinvest profits into paid advertising, influencer partnerships, and website modernization. Or create another store in a different niche, diversification can be helpful to increase your market presence.

Example:

“Fashion Nova” scaled through influencer marketing, transforming from a small store to a global fashion holding company.

Statistic: Fashion Nova made $291 million in 2022, largely due to its social media strategy and quick response to fashion products.

Conclusion

Creating a profitable dropshipping store requires careful planning, constant optimization, driving traffic and customer focus. If you follow our advice and manage your online business wisely, a 6-figure income is just a matter of time, and with proper scaling you could see 7-figure amounts in your sales stats. Take action now!