tep 1. Business research

We started our journey with an analysis.

Can we run drop shipping business?

Who will be our suppliers?

Will we find customers?

What do we need to launch this business?

What technologies we need to learn?

These questions are crucial. Without them, it is impossible to understand where to go next. You will need to do a detailed research. As a result, you should get a clear view of your goals, opportunities, and challenges.

Step 2. Learning from competitors

This is tricky because not all the ecommerce store owners openly say they are drop shippers. Still, any online store is a source of knowledge. Understanding how the store is designed and advertised can help beginners a lot.

We were inspired by the experience of Zappos. This is the biggest shoe and clothing webstore on the globe with great profit margins. It was an ordinary drop shipping store at first, but in 10 years Amazon said it would buy Zappos for $1.2 billion.

Looking at others, you can learn a lot. For example, you can use someone else’s experience to improve your product page. Or, you can learn how someone promotes their store in Instagram and other social networks. This type of information helped us a lot. It is important to rely on it when you have no experience yourself.

Step 3. Understanding the legal part: registering a company

Most of businesses should be registered. For drop shipping business, this is not always necessary. It all depends on the country where you run this business. As a beginner, you can start selling online with no registration.

We learned it when we talked to AliExpress sellers. We wanted them to be our dropship beauty products suppliers. They don’t mind if you are a private individual and not a business.

As a rule, buyers also don’t ask about it. But it is important that you provide them with money back guarantee and free shipping worldwide. These options should be offered by your suppliers, so check if they can do it.

Step 4. Understanding the legal part: taxes

Taxes are a vital part of every business. Drop shipping taxes exist in the form of custom fees. Custom fees are added to the cost of item, and it is a buyer’s responsibility to pay them.

Custom fees are different in every country across the globe. This is why you need to notify your buyers about it. Ask them to check what are the custom fees in their own country. Your potential customers must be aware of the local laws and regulations, and they must pay custom fees if necessary.

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