Is Dropshipping Worth It? | Is Dropshipping Still Profitable in 2024

Low overhead budget. No product storage. Minimal risk. Is dropshipping worth it? Yes, it is an excellent option for eCommerce beginners. But is dropshipping still profitable in 2024? We’ll see.

Since the explosion of the COVID-19 pandemic, dropshipping has become popular among online merchants. With little to no overheads, it’s the go-to choice for eCommerce beginners looking to make bread and butter from the internet. Nevertheless, with the world returning to normal, dropshipping businesses are facing upcoming challenges.

Can you still make money dropshipping in 2024? Let’s find out as we delve into the following points:

• What is dropshipping?
• Is dropshipping profitable in 2024?
• Top 3 advantages of dropshipping & dropshipping challenges
• How to start a dropshipping business
• Tips for a successful dropshipping business
• and best eCommerce platforms for dropshipping.

Without delay, let’s get right into it!

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Is Dropshipping Profitable in 2024?

To determine whether drop shipping is profitable, let’s first look at the trend over time.

As shown in the graph above, the number of people searching for the term “dropshipping” increased drastically from 2021 through 2022. Although the trend went down significantly since the beginning of 2023, it climbed up slowly and stayed constant to this day. This implies that saturation is practically complete, and the market is steadily approaching scalability.

So how popular is dropshipping in 2024? According to research, global dropshipping observed a profitable result when reaching $276,71 billion in 2023 and is projected to grow at a CAGR of 23.20% by 2032. Interestingly, more than 30% of eCommerce stores use dropshipping to fulfill orders, and dropshippers contribute about 34% of sales on Amazon.

All of the above, dropshipping is still profitable and full of opportunities! Some might find their own answers to “Is dropshipping worth it?” by now! Nevertheless, it’s crucial to stay vigilant, adaptable, and customer-focused to maximize your chances of success in this competitive market. Conduct thorough market research, monitor industry trends, and evaluate the viability of your chosen niche before launching your dropshipping business (We will go into detail later in this section of this article).

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What Is Dropshipping?

If you are unconfident about our answer to the question, “Is dropshiping worth it?”, let’s get back and learn about its fundamentals. Dropshipping is a retail business model in which you outsource the processes of procuring, storing, and shipping products to third-party providers. Indeed, the most noticeable difference between dropshipping and other fulfillment methods lies in who manages the inventory and who does not. In this case, suppliers are the ones totally in charge. You, instead, only need to focus on duties such as marketing and customer services.

Here’s a brief explanation for those who are unfamiliar with how dropshipping works. When a customer places an order on your dropshipping store, the order details are sent directly to the suppliers. You don’t need to prepare anything; instead, your providers will deliver the parcel to your customers with the given information. You’ll make a profit when your customers receive the orders.

How popular is dropshipping? The dropshipping market observed a profitable result when reaching $128 billion in 2020 and is forecasted to reach $200 billion by 2026. Interestingly, around 30% of Amazon retailers are dropshippers. In the same report, Asia Pacific businessmen know for sure whether is dropshipping worth it or not when this is the most promising area for dropshipping.

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Is Dropshipping Worth It: 3 Distinct Advantages

Compared to the traditional model, dropshipping generates more than 200% profit. Nevertheless, this is not the only reason more merchants adopt this business method. In the following lines, we will show the 3 most noticeable advantages that will help you figure out the answer to “Is dropshipping worth it?”.

#1. Lean operation

Lean operation is a must for any start-up. From the beginning, any business should focus on a high-level strategy and avoid unnecessary expenditures.

When running a dropshipping business, merchants don’t have to think about physical products. Additionally, there is no need to spend money on the warehouse or the store’s physical presence.

That’s why many successful dropshipping businesses only start with a laptop at home. Compared to brick-and-mortar stores or traditional businesses, dropshipping is absolutely more budget-saving and helps the business reach the break-even point quickly.

#2. Product diversification

Merchants choosing the conventional business model start-up will have difficulty varying their product lines to test customer demand. They will likely have trouble with inventory management and face an unsold surplus. Meanwhile, dropshipping allows businesses to present a vast array of products during the initial period. This way, startups can easily define

#3. Scalability

When the store receives a higher number of orders, it’s time to expand the business size. If traditional retailers want to scale their business up, there are hundreds of problems, such as hiring more storage space or recruiting more sales assistants. This requires much more effort to complete.

Scalability is absolutely more effortless with dropshipping as it nearly does not make any changes to the current situation of the business. Of course, there is more workload and spending. However, it is inconsiderable compared to that of traditional businesses.

So, is dropshipping worth it? Yes. The three above features clearly demonstrate the answer. However, keep reading to make the final decision.

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Is Dropshipping Worth It: 3 Biggest Challenges

With the range of benefits mentioned above, dropshipping is obviously an attractive business model, especially for those with a tight budget. However, it is of utmost importance for store owners to consider the downsides of this format and determine whether they can afford the price.

Read the dropshipping challenges below and consider them carefully before puzzling out is dropshipping worth it or not.

#1. High competitiveness

Is dropshipping easy? Of course, any merchant can start a dropshipping business with ease.

While this is a plus point for eCommerce beginners, it can also be a huge drawback with more and more to-be-merchants choosing this business model. As previously stated, Google Trends data reports a threefold increase in “dropshipping” searches over the past five years. This proves the explosive growth of dropshipping interests, and you’d better prepare to encounter high competitiveness.

Too many players in one market will make it harder for new merchants to find their dropshipping niches. With the predecessors covering nearly all segments and product lines, new merchants need to put a lot of effort into market research to stand out in the crowd.

#2. Fewer products control

While some may find it a huge advantage for dropshipping suppliers to handle the entire product storage, packaging, and shipping process, that’s not true for everyone. Indeed, you’ll have no chance to approach the products and ensure the product quality. Therefore, you will be solely responsible for any issues that arise with the products (e.g., expiration date).

It’s not to mention that dropshipping nearly prevents you from product customization and quality enhancement. Suppliers design and manufacture products, so you can not add or eliminate any ingredients. The lack of product customization ability will restrict you from having any product unique selling points (USPs).

#3. Enormous supplier challenges

When running a dropshipping business, you might have to work with a range of suppliers to get the best price and product quality. It’s also necessary to manage multiple sources and contacts, which leads to another issue in that you have to spend a longer time checking whether a product is available or out of stock.

After reviewing both the upsides and downsides of dropshipping, it’s your turn to decide for yourself is dropshipping worth it and is dropshipping profitable. Does its range of benefits deserve your effort to accept the challenges?

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How to Start a Dropshiping Business?

You may have figured out “Is dropshipping worth it?” by now and decided to start a dropshipping business. It’s clear that dropshipping is still worth it, and from the looks of it, it will be for a couple of years.

If you haven’t got an idea of how to start a dropshipping business, follow the link for a detailed guide. In case you are in a hurry, below are the main steps you should keep in mind:

Find a suitable niche & products

First off, you should decide on a suitable niche. With 33% of store owners running a dropshipping business, it’s crucial to focus on a specific product category or target a particular audience to differentiate yourself from competitors.

Below are some possible methods to pick your dropshipping products:

• Utilize tools like Google Trends, Google Keywords Planners, Facebook Audience Insights, Ahrefs, etc.
• Check marketplaces: Top-selling niches on Amazon, eBay, or Etsy are a great source to find profitable products with high demand and low competition.
• Consider seasonality: Seasonal trends and holidays can affect product demand greatly. Hence, it’s best to pick products that have year-round demand or at least.

Understand your customer

Next, it’s time to create customer personas to understand their demographics, interests, pain points, and purchasing habits. This way, you can adapt your product selection, marketing messages, and entire business strategy to your customers’s needs and preferences.

Conducting surveys, interviews, or social media research helps you collect direct feedback from your target customers. It’s also a good idea to study your competitors’ offerings and customer interactions. This can give you insights into your target market and industry landscape.

Select a dropshipping supplier

Once you’ve determined your dropshipping products, the next step is to find a suitable dropshipping provider. When conducting extensive research on potential suppliers, you should consider their product offerings, delivery options, order processing time, and customer feedback. These factors will have a significant impact on product quality and customer satisfaction.

Don’t forget to request sample products to assess product quality before committing to a provider. You should consider working with several suppliers to broaden your product selection and reduce the risk of supply chain disruptions.

Build an eCommerce store

Eventually, you’ll need to create a professional eCommerce store to promote your products and reach your target audience. This will also help you gain customer trust and increase conversions for your dropshipping business.

Shopify, WooCommerce, and BigCommerce are some of the most reputable eCommerce platforms for dropshipping. Once you’ve picked the right platform for your dropshipping needs, it’s best to optimize your product pages with high-quality photos, detailed descriptions, and convincing content to convert your customers. Likewise, seamless navigation, mobile responsiveness, and secured payment processing also contribute to enhancing customer experience, which eventually increases your conversion rate.

Market your business

You’ve found amazing suppliers for your business, and your store is ready to launch. Nevertheless, with the high competition in the marketplace, there won’t be a product that sells itself.

For that reason, promoting your dropshipping business is crucial to success. Suitable marketing strategies can help you attract the right customers and convert sales. Accordingly, you should adopt a mix of digital marketing channels and tactics to find out which has the perfect approach for your customers. Don’t forget to utilize social media platforms and continuously analyze your marketing efforts to optimize your strategies for better results over time.

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Tips for A Successful Dropshipping Business

Once you have an up-and-running dropshipping business, it’s time to maximize its benefits. We’ve picked the process’s most difficult challenges and recommended several tactics that store owners should adopt to increase revenue quickly.

#1. Master your marketing efforts

Since dropshipping allows you to exclude physical stores from the budget plan, your online presence will decide the revenue. In the beginning, one of the first problems that dropshipping merchants deal with is the lack of traffic to their websites. The problem may last about the first 6-12 months when customers do not know who you are, so you will primarily invest spending and effort in Marketing at this time.

#2. Automate your eCommerce store

Several eCommerce platforms allow the store to proceed automatically, but if yours does not, don’t worry. There are a number of user-friendly plugins that automate your dropshipping business operations. These plugins help you to automatically process the customer orders (by checking the inventory situation, confirming that customers have ordered successfully, and sending the estimated shipping time to customers.

#3. Focus on customer service

As mentioned above, it is hard to find the USPs in your product. However, since you’re totally responsible for the entire customer care, try to maximize its efficiency. Being available 24/7 or customized service can become your store’s highlight, making customers choose you over competitors.

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Bonus: Best eCommerce Platforms for Dropshipping

Is dropshipping worth it? 100% Yes. To make the most out of it, you should first choose a suitable platform for your dropshipping business. There are several aspects to consider when shortlisting eCommerce platforms. However, this article will analyze the platform types (open-source and hosted) to give you an overall insight.

#1. Hosted eCommerce platforms

If you do not possess any technical knowledge, a hosted platform is perfect to use. These platforms only require you to “drag and drop” in order to design a website from scratch. Here are several best host solution recommendations for this type of platform:

Shopify

Shopify ranked first in the popularity of hosted platforms. It is also reported as one of the biggest eCommerce platforms with 4,6+ million active online stores.

Unlike open-source platforms, merchants don’t find it challenging to use Shopify as it doesn’t require advanced technical knowledge. If you are looking for a dropshipping platform, Shopify is the right choice!

For a comprehensive analysis of Shopify, visit our thorough Shopify review.

Now, let’s have a quick glance at some prominent strengths below:

Store Themes

Shopify has 120+ themes available on the theme store. They are tailor-made for eCommerce, with a nice appearance and full of built-in features. The Shopify team ensures that their themes are strictly evaluated before being uploaded to the store.

Apps

You can easily find suppliers on Shopify, import their products to your store, and sell with a dropshipping app. There will be different apps to choose from, but we recommend Dsers and Spocket are the best choices. These top Shopify apps are proper for newbies who have dipped their toes in the dropshipping playground.

• Dsers

This is the best Shopify dropshipping solution for merchants to find suppliers and import products from AliExpress – one of the biggest retail marketplaces. It is easy to use and has a lot of tailor-made resources for beginners

Ịn Dser’s dashboard, you can easily navigate and find the best dropshipping products from suppliers on AliExpress. The app also recommends ‘winning products’ with impressive sales to help you sell and generate profit. Within a few seconds, you can import products from AliExpress to your Shopify store, which is really fast!

When you contact the Dsers team for support, you only have to wait a few seconds for a response. They are professional and very helpful.

Dsers receives over 12,000 5-star reviews on the Shopify App Store for its excellent features and customer support. You can try the app without paying any fees for 14 days to see how it works.

• Spocket

If you want to start dropshipping in the EU and US, Spocket is the ‘go for’ app. Like Dsers, this app is user-friendly, as you won’t find it difficult to search for dropshipping products from reliable suppliers. All you need to do is a few steps to source items and import them from Spocket to your Shopify store. The app helps you find and sell high-converting items with huge discount rates to generate the most sales.

Currently, Spocket has a 4.6/5 star rating, which is relatively high on the Shopify App Store. Within a 14-day free trial, you can test Spocket and see if it is a good fit for your dropshipping plan

Pricing

Regarding pricing, Shopify offers three main plans that are Basic Shopify, Shopify, and Advanced Shopify. Each plan has its benefits, but we suggest you choose Basic Shopify to begin your journey. It has all the features like order & inventory management, marketing, and reporting for a small store to grow its dropshipping business.

Especially, Shopify only charges you $1/month to use their Basic Shopify plan in the first month.

Customer Support

Shopify is well-known for its excellent customer service. If you encounter any difficulties in building your store, you can seek advice in the huge community and help from Shopify’s 24/7 customer support team.

BigCommerce

Another commonly used hosted platform is BigCommerce.

BigCommerce gives you every opportunity to improve your SEO performance. You can change the page titles, meta descriptions, and alt tags. The platform also helps extract and generate essential keywords from the information you enter into your product pages. When you change a product’s name, it generates 301 redirects automatically. Remarkably, BigCommerce SEO includes its own built-in analytics. It provides you with the statistics you need to track your SEO performance.

Like Shopify, this platform includes an abandoned cart recovery feature that lets you send three automated emails to entice shoppers to return their purchases. You may also personalize your email, send it more frequently, and include discount codes. This capability, however, is not available with the Standard plan.

Although this website builder does not have an email marketing feature by default, BigCommerce interfaces with various email marketing software, including Constant Contact, iContact, Mailchimp, and Interspire.

#2. Open-source platforms

If customization is a top priority, the open-source type is better for your store. Nevertheless, you need technical expertise to self-edit the back-end code, which means you have the total ability to design and customize the website. WooCommerce and Magento are mostly mentioned examples of the open-source type.

Magento (Adobe Commerce)

Open Source and Magento Commerce are the two versions available and are vastly different. Magento Open Source is a free edition for store owners with a limited budget. Meanwhile, Adobe Commerce (formerly Magento Enterprise) is the premium version with more sophisticated features and outstanding customer support. If you are wondering about the cost of these two versions, check out our detailed article about Magento pricing. Now you can fulfill orders in only 3 steps. By utilizing the Magestore dropshipping module of the Magento order management system, the process of sending dropship requests to suppliers can be completed in less than a minute. Subsequently, vendors gain the ability to conveniently create shipments or cancel requests directly on the front end.

Magento is a feature-rich platform, but it is not for newbies. Magento is a wonderful platform to work with if you already have technical skills. Thus, if you are still finding the answers to is dropshipping worth it, it is not ideal to spend time on Magento.

WooCommerce

WooCommerce is a free WordPress plugin that turns your WordPress website into an online store by adding eCommerce features. This platform is now the most popular platform in the market, with 30% of online shops using it as of October 2020. As a result, there are various specialist communities on this site where you may get solutions to technical questions.

WooCommerce, like Magento, is an open-source platform – which means it is completely adaptable and configurable. One of its advantages over Magento is that it is far more user-friendly, particularly for individuals already familiar with WordPress.

Discover WooCommerce pricing and a WooCommerce setup tutorial to determine whether this platform is for you.

We also provide an insightful article about WooCommerce dropshipping plugins review and a detailed guide to set up WooCommerce for you. Don’t forget to check it out.

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Is Dropshipping Worth It: FAQs

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Bottom Line

Is dropshipping worth it? Is dropshipping still profitable?

Yes! Dropshipping is undoubtedly a stress-free experience for anyone who wants to start their business in 2024. By providing the most updated information on dropshipping, I hope that you have decided “Is dropshipping worth it” by now. Let’s start your business right in 2024!

If you are currently using an eCommerce platform and realize it is unsuitable, let the experts from LitExtension give you advice. With 200,000+ successful migrations for 100,000+ worldwide customers, LitExtension – the #1 Shopping Cart Migration Expert can automatically, quickly, and accurately transfer all your data.

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