Is the concept of dropshipping dead? As far as I can tell, there are few chances of this being true. Why? With the new normal in view and the abundance of eCommerce transactions made every day, I am sure you can't think otherwise.
But, has there been a dip in the dropshipping business from China in 2021? Hang around as we discuss the various aspects of this. In this article, I am going to take you through the good and bad side of the idea of dropshipping from China and how beneficial it will be in 2021.
What is Dropshipping?
Dropshipping is an order fulfillment method that eliminates the need for a business to keep items in stock for the customer to order. So, since you don’t have to hold and manage inventory, you can concentrate more on sales, marketing, and other essential tasks.
The dropshipping supplier, in turn, arranges for the goods and delivers to the customers. I think that this one of the most brilliant business models in eCommerce as anybody who is low in the capital can actively get started with the business with no entry barriers!
Start your own Shopify dropshipping business with the least minimum cost from anywhere in the world!
Dropshipping from China
So, what is it with dropshipping from Chinese suppliers? How has dropshipping from China profoundly made its mark in the best of Shopify dropshipping stores worldwide?
Legitimately speaking, you can dropship from any global supplier. Nonetheless, people mostly choose to buy from Chinese suppliers. Why?
There is probably only one answer to all these questions and more. Cost-effectiveness. Of course! Yes, China produces some ridiculously cheap products.
So, by dropshipping from China, you can quickly set up your Shopify Dropshipping store or website and run it while also lowering your financial investment. But wait- there is more to it than that, trust me!
Advantages of Dropshipping from China
I strongly think that you can use the popular supply chain management system of dropshipping to the best extent if you are to collaborate with worthwhile partners. China is a popular destination among retailers and startups for the dropshipping business for the following reasons:
- China has made massive economic success in the dropshipping business for the last few years. The country has made some crucial modifications to its legal structure that regulates the procedures of foreign trade. That means if you were to import products from other countries, you might have to go through the tough turmoil of legal formalities to be completed and the impending expenses you end up with.
- Chinese companies are famously known for the large-scale machinery and low labor cost that they are associated with. These suppliers are thus able to offer a competitive discounted price on their production. So, if you are looking for affordable options for filling up your Shopify Dropshipping store, then you can always keep your options open for Chinese dropshipping suppliers.
- China has evolved in terms of business capabilities and technological sophistication over the years. So, the quality standards and efficiency of the products have also improved. I know you can’t disagree with the fact that the products manufactured in China can compete in the market in terms of the best global standards.
- The Chinese market has an incredibly large and unlimited product portfolio. Through the Chinese Wholesalers and manufacturers, you have undoubtedly quick access to a wide range of products. You name it and they have it!
- China is famous for its strategic location near the most commercially active Asian and European markets. Besides, it is bordered by 14 countries and has a great logistics network of land, marine, and air transportation. This makes it easy and convenient for shipping products to any part of the world.
- Chinese dropshipping suppliers are well versed in the production, packing, and shipping methods in business. So, that means that you can devote your attention and time solely to developing your Shopify Dropshipping business, rather than worrying about and investing in these prospects.
So basically, if you are to make a clever decision and invest in the right dropshipping company from China, you are sure to see some returns from your Shopify Dropshipping store. As simple as that! (Or so you think!)
But you better not see the idea of dropshipping from China only through rose-tinted glasses- there are some downsides to it too.
Disadvantages of Dropshipping from China
If you have a dedicated Shopify Dropshipping business that relies on a Chinese dropshipping partner, then you better get prepared for some risks too.
- Products manufactured in China; especially electronic products are always at the risk of low product quality. So, when you are launching your online Shopify Dropshipping store, make sure that you carefully choose the kind of products that you would be selling to your customers. I say products like textiles are a safe buy from a Chinese supplier. You could find out more options if you keep your eyes wide open and do some research into the field.
- Another major problem that you could face with a Chinese dropshipping supplier is the long delivery time and delay. This further worsens if backorders arise and the supplier is short of the requested product. The longer the time it takes for the customer to get the products that they ordered, the riskier is your reputation on the line.
- You could face severe competition with other Shopify Dropshipping businesses overtaking yours. Simple because dropshipping from China has little or no barriers and almost everybody is doing the same!
- If you are dropshipping from China, better keep aware of the fact that they charge fat commissions too! Yes, if you are on the notion of expecting high margins from the sale of products on your Shopify Dropshipping business too early- hold it! You might have to wait for a while to make some decent profit from the sales.
- If you have a Chinese supplier in hand, I say you work more on your customer support services. With the long shipment duration on the line, you could expect to be pressurized from all sides from anticipating clients! Moreover, you will be billed for the defective products returned by the customers. So, watch out!
Dropshipping (especially from China) is a crowded industry and has a few downsides. But considering the far-stretching and efficient advantages and the opportunity to boost your reputation in the business, it is indeed worthwhile dropshipping from China.
But you can’t expect to make a whole lot of money from it in the short run. Nonetheless, you can keep the startup costs at a minimum and continue to build up your Shopify Dropshipping store from the comforts of your home!
But are you wary of the trending news (or myth?) of the dropshipping business coming to a standstill? Is the pandemic seeing the worst of dropshipping from China? Is this business model still worth in 2021?
Should you invest in a Shopify dropshipping business in the coming years? I want you to get to the root of these questions! So, keep reading!
The Coronavirus Era and Dropshipping from China in 2021
When the outbreak of the coronavirus outbreak started in China, entrepreneurs like me (including drop shippers) were in a dilemma. Customers rendered a stigma for the products outsourced from China and deliberately stayed away from them.
Let alone dropshipping, any company that conducted business with China during this time felt the brunt of the situation.
However, China being the major business power it is, succeeded to overcome the hurdles and reconnected its supply chains also. So, if you are a drop shipper and source your products from China, then I would suggest you continue to do so as sourcing from China could do much benefit for your Shopify Dropshipping business during this pandemic.
- The virus will not survive the journey from China. If you were ever worried about contracting the virus from contaminated goods coming from China (many of my customers thought so!), you got to think again. Medical research now shows that the virus even if has latched onto products, can only live for about 3 days on polypropylene plastic or steel.
- Deliveries from all around the world have slowed down; not just from China. With online sales shooting up like anything in recent months, the eCommerce business has flourished with online transactions increasing every minute. Deliveries from all countries are being delayed owing to customs delays and other restrictions.
- Many Shopify Dropshipping stores are in a dearth of essential products as the online orders have increased many folds in recent months. I have been surprised to see the massive supply of protective gear, masks, and other security gear being supplied from China. The country is churning its factories to produce essentials like personal care products, groceries, household staples, and many more like never before!
So, I think that the coronavirus pandemic era is advantageous for Shopify Dropshipping stores, especially for that sourcing from China.
But, is the world seeing the same trend? Are drop shippers from China making use of the situation? Let us see more of it.
The Trend of Dropshipping from China in 2021
In the early months of 2020, quite around the time of the outbreak, researchers predicted that online sales would take over brick and mortar stores. Not much to a surprise now, online sales have grown by 52% than earlier.
So, what does this mean to a drop shipper? You are pretty much to face some serious competition and risk in your Shopify Dropshipping business, as simple as that!
Yes, my research on the topic shows that dropshipping from China is here to stay, and very much alive in 2021!
This graph is an indication that the idea of dropshipping is trending over the last 5 years. You can notice that there was a drop in dropshipping at the starting of the year 2020.
Nonetheless, the strong upward spike after that is a clear-cut indication that dropshipping is here to stay! It is neither dead nor stagnant I would very much say that it is alive and kicking!
But, if you have a Shopify Dropshipping store and are looking to reap benefits in 2021, I have some advice for you.
There are some points that you should look into when you are dealing with a Shopify Dropshipping business, especially in 2021. Here are some:
- The first thing I would ask you to do is to optimize your product line. In the year 2021, what you are going to see is a lot of niche products stealing the show. Yes, the sale of home fitness equipment and desktop accessories has increased dramatically. With remote working and quarantine restrictions in place, you couldn’t think that this trend would reduce shortly! Besides, online sales of groceries, toilet paper, and home cleaning accessories have increased drastically.
- If your dropshipping supplier is from China, it's not mandatory to ship the products from China! Many Chinese suppliers and manufacturers have warehouses in countries like the USA. So, check with your Chinese dropshipping supplier and see if products can be sourced from someplace nearby.
- Use effective marketing strategies for your goods. I have tried my ways in email marketing and found out that this is one of the best means to sell, promote business, educate customers, and inspire loyalty.
- Up your game in the dropshipping business. Watch out for the trend in customer buying and see if you can bulk order some goods in advance. This would help you to cut the cost further and result in greater profit.
So, by the looks of it, I would say that dropshipping from China is here to stay in 2021. The business may have seen a descent at the starting of 2020, but that is pretty much it.
But, my suggestion for the dropshippers in you is to invest in a great deal of effort and research into it before plunging right in.