6 Common Drop Shipping Mistakes

By Kate Loyola | Last Updated: August 21, 2018

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Doesn’t drop shipping sound like the world’s easiest business model? Without any inventory to manage or packages to ship, all you have to do is market your products to potential buyers.

Simple, right?

Not so fast. Drop shipping has many attractive advantages for new entrepreneurs, yes. But it’s not a guaranteed formula for success. Like any business model, drop shipping comes with its share of challenges and pitfalls, and not all drop shippers can hurdle these well.

Here, we run down six of the biggest errors to avoid as you navigate your own drop shipping journey.

Not Selecting a Niche

There are millions of products available to drop shippers, and there are thousands of drop shippers operating at any given time.

Selecting a niche helps you avoid two of the biggest issues for newcomers:

  1. A jumble of product offerings that confused and turn off potential customers
  2. Too-fierce competition from big and/or established industry players

It’s all about finding a space where you can thrive and focusing your efforts on claiming that space for yourself.

If you try to be a virtual supermarket with a huge range of items, you risk spreading yourself too thin. More niche stores will capture dedicated fractions of your audience; bigger marketplaces like Amazon will beat you out in terms of sheer breadth. On top of all that, you’re more likely to run yourself ragged coordinating with multiple suppliers at once.

Our Tip: Build a well-curated catalog that targets a specific need or caters to a narrow slice of interests.

You’re more likely to develop a passionate following (and get repeat orders!), and a focused product range also spells less upkeep and fewer management headaches for you. Check out our drop shipping product selection guide to learn more about finding a profitable niche and picking bestsellers for your store!

Not Picking Reliable Suppliers

Your choice of suppliers will make or break your drop shipping business. After all, your suppliers control your inventory and handle fulfillment for your customer’s orders.

If you get a bumbling supplier that delivers packages late or consistently sends defective products, your business will have close to zero chances of surviving past its first year. Don’t even get us started on suppliers who engage in fraud or sell counterfeit products.

Don’t spring for bare-minimum service either, though. Sure, your supplier might have decent products, but can you work with them? Do they answer your inquiries promptly? Do their sales reps know what they’re talking about?

Finding a supplier that works is only the first step; it’s crucial that you find one that you can work with.

Our Tip: Research, research, research.

Check vetted directories — big platforms like SaleHoo, WorldWide Brands, and Oberlo maintain lists of trustworthy suppliers. If you’re seeking out suppliers directly on sites like AliExpress, take the time to check their ratings (aim for at least 95% for each seller) and reviews. If you can afford it, place test orders so you can check a potential supplier’s delivery and customer support processes yourself.

Not Building a User-Friendly Site

Your customers interact with your business through your website. It should go without saying, then, that a clean, intuitive site is crucial. Make it easy for customers to:

  • browse your catalog
  • filter the selections according to categories or product types
  • find specific products
  • place an order

If it takes more than a few clicks to do any of these things, you’ll lose potential customers.

Our Tip: Remember, you’re trying to win over customers. Don’t give them roadblocks!

Focus on creating a seamless shopping experience: from product categories that make sense to payment gateways that take common payment methods like credit cards and PayPal.

Not Developing Your Brand

You’re not manufacturing your own products, but you’re still running a full-fledged business. Your name and your services are the only things setting you apart from other drop shippers sourcing from the same suppliers. If others out there can sell your target customers the same thing, you better give those customers a good reason to pick you over the rest.

A strong brand identity and a cohesive offering of value-added services will help you leave a mark on your customers. These pave the way to recurring transactions and, hopefully, lasting loyalty from your market.

Our Tip: Figure out your branding and the services you’ll offer.

Craft a good logo and/or name and place this prominently on your website, all communication sent to customers, and even the shipping labels used for your customers’ orders, if possible. You want to be known as the best option for buying certain products, and strong branding will help you achieve that.

Not Offering Customer Support

With drop shipping, it’s fair to say that customer service is the heart of your business. What you’re really offering customers is the opportunity to buy those products in the best, most convenient way possible.

It pays, therefore, to go the extra mile. If your customers see you as a helpful, responsive merchant, they’re more likely to keep buying from you, after all.

Here’s a neat bonus: good customer service can help set you apart and strengthen your brand’s value, too.

Our Tip: Send follow-up emails to ask customers about their buying experience. Give customers the option to receive product updates from you. Offer prompt and detailed assistance to any customer experiencing issues.

The exact steps you take will depend on your customers’ needs, but as long as you make an effort to meet those needs, you’re already ahead of the game.

Not Preparing for Cancelled or Returned Orders

Here’s an unavoidable fact about drop shipping: some orders will fall through.

Your customer will change their mind and cancel, or your supplier will send out a faulty product that needs to be replaced. If you don’t have a system in place from the start, you could easily spend tons of time, resources, and effort just making up for errors like these.

Remember that coordination can be more difficult for drop shippers. You’ll need to work with your supplier to address whatever issue your customer found in the product. Just one vague agreement with an uncooperative supplier could leave you with the bill for hundreds of botched order deliveries, for example.

Our Tip: Nobody wants to see cancellations or returns, but it always pays to prepare for these.

Try to get your supplier’s return or refund policies clearly outlined in your contract. Figure out your own policies for order cancellations. Communicate all of these clearly to your potential customers. Have a process in place so that you’re not always scrambling when a dissatisfied customer sends back a product (or complains about their order).

Avoid These 6 Drop Shipping Mistakes

Drop shipping is one of the more accessible business models for new entrepreneurs, but it comes with its own risks. Many aspiring drop shippers have seen their ventures hobbled by rookie mistakes — and even established businesses can stumble if they’re not careful. By avoiding these six mistakes, or at least preparing to troubleshoot them before they actually occur, you’re laying the groundwork for a stable, sustainable drop shipping business.