How to Start a Profitable Dropshipping Business@2x-8

How to Start Dropshipping for Free and Make Money?

11 min read

Dropshipping is an ecommerce order fulfillment solution that enables online retailers to sell products without storage or shipping expenses.

The dropshipping model has become extremely popular in recent years. Businesses have sought new ways to increase profits in light of the shift toward online shopping. The principal advantage of dropshipping is that it allows for extremely low overhead costs.

But, if the companies are only paying for items they will eventually sell anyway, there is essentially no cost at all. Nice! This idea led many entrepreneurs to ask how to become a dropshipper for free.

This guide will explain how to start a drop shipping business with no money, or very little money.

Is Dropshipping Free?

One of the biggest questions people ask about dropshipping is, “Can you start a dropshipping business with no money?”

The answer is both yes and no. In many cases, it is possible to use dropshipping services at no additional expense to you. Some dropshipping services either don’t charge direct fees, or charge fees based on each product you sell. In these cases, the only direct expense is the inventory you buy wholesale from your dropshipping provider. And if that inventory is then being resold at a marked-up price, there is ultimately no cost to you.

However, there are two things to know before diving into dropshipping with the expectation that it will be free money. For those wondering how to start a dropshipping business for free, there are factors to consider.

First, there is no guarantee that you will sell your entire inventory.
And second, there may still be other business expenses not directly tied to dropshipping. For instance, you may still have to pay for product research and marketing, depending on your business.

Starting a Dropshipping Business for Free

However, if you do everything strategically, dropshipping can be free for you. Here’s a step-by-step guide of how to dropship for free.

Step 1: What are you selling?

Perhaps the biggest mistake novice dropsellers make is believing they can sell any old product and make money off it. This, unfortunately, is not always the case.

Once you understand how to start a dropshipping business for free, you’ll see that it has a low barrier of entry. This means a lot of businesses can use dropshipping as a fulfillment strategy. As a result, there is extremely high competition in some markets for certain products.

Some of these products will always be in high demand, and may seem like safe options to sell with dropshipping. But if you only sell the most popular dropshipping items, you will have extremely low-profit margins. This is due to the nature of dropshipping itself.

When you resell items bought in bulk, you are doing so at a markup. That means you are only making a small profit on each individual item sold. The most popular items, with the heaviest competition, typically have a smaller markup. When customers have several options to choose from, they will almost always pick the most affordable product.

What does all of this mean for dropshippers? It means the first key to understanding how to do dropshipping for free is conducting research into what to sell. The best products to sell with dropshipping are items that are in high demand, but with lower competition. Many of the most profitable dropshipping businesses seek to fill a specific niche in the market. Low-competition products can be sold at a higher markup, with a greater percentage of the market share.

Your first step toward dropshipping for free should always be figuring out what niche item(s) to sell. It could be a specific type of clothing item, a niche kitchen appliance, or a particular everyday item. Try to identify products that are underrepresented in online marketplaces based on search trends and other metrics.

Step 2: Choose the right suppliers

Once you have an idea of what you’re selling, you’ll want to find the right supplier. There are a few different factors that you’ll want to take into consideration when choosing a supplier.

First and foremost, you want your dropshipping provider to be reliable and reputable. When you enter a dropshipping agreement with a company, they will be handling all of your inventory and shipping. Those things will go a long way toward determining your brand reputation and seller rating.

What does a reputable dropshipping provider look like? They will be highly rated, have a wide inventory of quality products, and have a reliable order fulfillment plan. Spend some time researching dropshipping providers to determine their reliability before making any decisions.

Also, you want to make sure that the dropshipping provider you work with has the products you want to sell. Do you plan to sell hiking and camping gear with dropshipping? Then you don’t want to work with a dropshipper that doesn’t have an extensive inventory of those products. You should also read reviews of the products themselves to make sure they are high-quality before agreeing to sell them.

Step 3: Create your online store

If you are simply adding dropshipping to an existing business, you can skip this step. But if you’re here to learn how to start a dropshipping business for free, creating your store is the next step. There are a lot of options for doing this, and it can be done for free. Building your own website from scratch may take a bit of investment, but there are free alternatives.

For instance, sellers can use dropshipping while selling on major platforms like Amazon and eBay. Selling on these platforms can come with built-in fees in some cases. However, if you take the right steps, you can set up your Amazon or eBay store without additional expenses.

eBay, for example, allows businesses up to 250 free product listings per month before charging listing fees. Amazon, meanwhile, has multiple selling plans available. The basic plan charges $0.99 per item sold. This means, as long as you are making a profit of at least $1 on each item sold, you can make a profit. However, you should factor that small fee into your product prices if selling on Amazon.

Amazon’s other popular payment plan charges a flat $39.99 monthly fee for sellers. This option is more profitable for businesses that know they can sell at high volumes each month.

However, if you’re just starting out or unsure about sales, the individual payment plan may be safer at first.

Step 4: Create product listings

Once your store is set up, you also need to make your product listings. This includes setting the price, providing product images, and creating item descriptions. Product listings are an often overlooked part of selling anything online. It requires at least a basic understanding of SEO as well as your market competition. To learn more, read Ecwid’s guide to product page setup.

Determining your prices is also hugely important. When selling with dropshipping, you will be buying all your products in bulk and selling at a markup. This means you want your price to be high enough that your profits will be worth it.

But, depending on your competition, you can’t set the prices too high, or else no one will buy from your store. Dropshipping tends to come with relatively low-profit margins. However, finding the sweet spot that allows you to maximize your profit margins makes a huge difference.

Thankfully, if you handle the rest of your dropshipping business properly, this is a very low-risk endeavor. So even if your profit margins are not optimized, you won’t lose money. But, of course, you want to make as much as you can as well.

Step 5: SEO, research, and growth

Once your dropshipping business is off the ground, you should turn your focus on expanding. One of the advantages of dropshipping is that it is very easily scalable. There are significantly fewer obstacles to expansion when it comes to running a dropshipping business.

Continue to conduct research into products and marketing opportunities, and stay on top of the latest ecommerce trends. This way, you can continue to increase profits with very little risk to your business.

Closing

So that’s everything you need to know about how to drop ship with no money. It can be done, but it’s not as easy as some people might assume. But, if you know what you’re doing, dropshipping is a low-cost, low-risk way to make money selling online.

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Dec 8, 2022

About the author

Max has been working in the ecommerce industry for the last six years helping brands to establish and level-up content marketing and SEO. Despite that, he has experience with entrepreneurship. He is a fiction writer in his free time.