Dropshipping Success Tips (2024): Why 90 Percent Dropshippers Fail in the Beginning?

The internet suggests that the global dropshipping market is expected to reach $476 billion by 2026.

Yet many online sites claim that over 90% of dropshippers fail in the first month of starting their business. So, what are they missing?

The truth is that achieving dropshipping success requires MUCH MORE than just launching an online store.

Plus, many business owners ignore some of the most crucial factors and set themselves up for failure by doing what they shouldn’t do.

And for that, this blog covers all the common challenges dropshippers face, and we’ll also cover additional tips for and highlight the mistakes to avoid.

Start Your Dropshipping Journey With Cloudways

Boost your store’s speed and performance with Cloudways’ e-commerce hosting. Enjoy SSD storage, built-in caching, an optimized stack, PHP 8, and Cloudflare.

Experience Now

Is Dropshipping Lucrative in 2024?

Despite all the challenges, dropshipping is still considered one of the most lucrative ecommerce business models, as it has the potential to generate HUGE profits.

Reports suggest that dropshippers can earn over 50% more profits compared to those keeping your own stock inventory – the % alone is enough to convince anyone to start their dropshipping site.

However, success depends on understanding why many fail.  And this blog explores common challenges faced by dropshippers, some important tips for success, and mistakes to avoid.

Image source: Statista

Dropshipping Success Rate

Unfortunately, there are no official figures available online that could determine the overall success rate in dropshipping. As a medium-risk business, most expenses in this business model go towards advertisements, as dropshippers rely on paid marketing efforts to sell their products.

If you really go on the lookout, you’ll find that communities like Quora and Reddit estimate the success rate at around 10-20%. According to successful dropshippers, this is because most dropshippers dive into the business without properly understanding the risk factors involved.

How Much Money Do You Need To Successfully Dropship?

If you consume a lot of “Guru” content on social media, you would know that anyone can start dropshipping with minimal upfront investment.

Of course, there is no one-size-fits-all answer, but many believe you can start with as little as $100. However, other than your investment in the product, several other expenses are listed below:

• Business registration and license filing fees
• Domain and hosting costs
• Product sourcing costs
• Ecommerce platform and marketplace fees
• Taxes
• Marketing costs
• Supplier fees
• Shipping costs

So, the final amount to start a successful droshipping business depends on your choices. For example, weighing its pros and cons, you may or may not choose to register your business.

And then marketing is another big expense, which includes paid marketing, social media marketing, influencer marketing, etc.

Common Dropshipping Challenges

Like any business, dropshipping comes with its unique challenges. But the good news is that if you know about these challenges beforehand, you can prepare yourself better to overcome them. Some of the common challenges faced by dropshippers are listed below:

• Shipping times: Longer shipping times than traditional e-commerce models can impact customer satisfaction.
• Supplier reliability: Finding dependable suppliers can be difficult, and things can fall apart if they don’t deliver as promised.
• Low-Profit Margins: The competition is strong, and operational costs can eat into your earnings.
• Competition: The dropshipping market is highly competitive, making it hard for your store to stand out.
• Building brand trust: Since you’re not in control of the product, establishing trust with customers can be challenging.
• Product quality control: Ensuring consistent product quality can be difficult when you rely on external suppliers.

5 Dropshipping Success Tips For a Thriving Business

Now that you’re aware of the money and challenges involved with achieving droshipping success, it’s time we find out how you can become a successful dropshipper in 2024.

Here are some tips that you should keep in mind when starting:

1. Select the Right Niche

A niche is a product category that attracts a specific audience. For example, instead of selling general “pet supplies,” focusing on something like “luxury cat beds” allows you to cater to a specific group of customers.

And don’t take this step lightly because, to be a successful dropshipper, you will have to conduct thorough research to reach a conclusion. Finding the right niche means seeing what is in demand and has the least challenges. Here’s how to do it:

• Identify trends using tools like Google Trends or SemRush to analyze product popularity and search volumes in targeted locations.

• Use social media platforms like TikTok and Twitter to discover people’s preferences.
• Browse ecommerce platforms like Amazon and eBay to see what sells well. Find best-selling products.

• Calculate the profit margins of the products you’re interested in selling. You can use our free profit calculator to estimate your gross profits.

Nate Materson from Maple Holistics advises: “It may be a good idea not to jump into it so quickly. Take a couple of months to study the business first so you aren’t overwhelmed when you start.”

2. Order Samples

Just because a certain product sells well or a supplier has a good reputation does not mean you should make a decision and start selling right away. Before committing to a product, it’s crucial to order samples from potential suppliers. 

This hands-on approach allows you to evaluate product quality, material, fit, and overall appeal. By physically inspecting samples, you can better determine if the products you offer align with your brand and customer expectations.

Remember, your reputation is tied to the quality of your products.

3. Find the Right Dropshipping Suppliers

Choosing a trustworthy supplier also should be taken VERY seriously. The right partner will guarantee product quality, timely shipping, and efficient order fulfillment, which eventually leads to customer satisfaction and a positive brand reputation. Consider the following when choosing a supplier:

• Location: Domestic suppliers often offer faster shipping times and better customer service.
• Product range: A broad catalog provides flexibility and growth opportunities.
• Minimum Order Quantity (MOQ): Low or no MOQs are ideal for starting out.
• Integration: Confirm that the supplier’s system integrates smoothly with your e-commerce platform.
• Supplier reputation: Thoroughly research supplier reliability, customer reviews, and industry standing.

Image source: DoDropshipping

A Dropshipping Business Will Need Trusted Suppliers (Get Our Exclusive List!)

Dropshipping is a viable way to earn in 2024 but success depends on finding the right suppliers. Download our FREE list of 120 hand-picked dropshipping suppliers.

I agree to the Cloudways Terms of Service & Privacy Policy

Get It Now

Thank You

Your list is on it’s Way to Your Inbox.

4. Market Your Dropshipping Business

Dropshipping success depends on two main factors: a reliable supplier AND effective marketing. Without marketing, it’d be challenging for you to attract buyers.

Plus, you need a strong strategy by combining paid advertising, SEO, social media, and email marketing to drive traffic, generate leads, and increase sales. Shopify suggests dedicating at least 75% of your time to marketing in the first six months to build a strong online presence.

A living example of this is Viesso, which grew from $0 to $1 million in less than two years. The cofounder, Travis Nagle made the best use of his background in marketing and advertising to scale his dropshipping business. You can read more about Viesso’s success story here.

5. Add Value

Max Robinson of Fish Tank Bank highlights that 90% of dropshipping businesses fail because they don’t focus on providing much value  for the customer. “If all you’re doing is accepting orders from customers then forwarding the order onto a supplier for them to fulfill, then you’re not going to create any sort of loyalty with the customer,” he said, reflecting on a mistake he made early on.

Instead of solely focusing on product features, successful dropshipping go an extra mile with offers like:

• Expert advice and guidance, positioning themselves as knowledgeable resources in their niche.
• Curated product selections based on customer needs or preferences.
• Exceptional customer service, creating strong relationships through personalized support. (This is what Max did as well.)
• Educational content that provides valuable information to their target audience.

By offering more than just products, you can build loyalty and set yourself apart from your competitors.

7 Reasons Behind Dropshipping Fails

Now let’s look at some mistakes that dropshippers make which result in dropshipping failure and explore their solutions.

1. High Prices of Dropshipping Products

Most of the visitors at a dropshipping store will search for the same product at another store just to compare the prices. They may leave your store if they think they can get the same product at a low price somewhere else. So, it is better to select a market-competitive price if it’s easily available anywhere.

However, having a high price isn’t always a bad idea, especially when you’re specifically looking for high-ticket clients. You can read more about high-ticket sales in this blog post.

2. Bad Customer Support

Dropshipping doesn’t end when the customer’s product is dispatched. You must stay connected with your customers and are there for them to respond to any queries until they are satisfied. A single negative experience can drive away customers. Research shows that after more than one poor interaction, 73% of consumers will jump to a competitor. Another survey shows that a significant percentage of consumers (a shocking 52% of Americans) are willing to pay extra for good customer service.

Image source: HubSpot

3. Delayed Shipping

Consumer expectations for fast shipping have skyrocketed in the past few years due to platforms like Amazon. Dropshipping, with its longer shipping times due to international fulfillment, mostly via China, often struggles to meet these demands. The lack of reliable tracking information further ruins customer trust.

Since you cannot control the shipping times, the best you can do is be transparent. Keeping customers informed about expected delivery times and proactively addressing potential delays can reduce people’s frustration and hopefully build faith. You should also make a contingency plan with backup suppliers.

4. Unattractive and Unoptimized Website

A poorly designed or slow-loading website can negatively affect a dropshipping business. Ecommerce stores should feel good, be easy to navigate, and look exceptional. Otherwise, visitors just won’t trust them.

According to Google, “the probability of bounce increases 32% as page load time goes from 1 second to 3 seconds.” Having a slow, unappealing website essentially means physically pushing your customers away. For great performance, choose a good hosting provider, use Content Delivery Network (CDN), focus on front-end optimization, and use caching strategies.

5. Choosing the Wrong Sales Channel

Many dropshippers end up choosing the wrong sales channel. Sales channels include:

• Ecommerce platforms like WooCommerce and Shopify
• Marketplaces like Amazon, AliBaba, and eBay
• Social Commerce like Facebook Marketplace and Instagram,

Sales channels matter because factors such as target audience alignment, fee structures, competition levels, and platform policies significantly impact business performance. While popular platforms like Amazon and Walmart offer broad reach, niche marketplaces can provide specialized advantages. Careful consideration of these factors is important to optimize visibility, sales, and overall growth.

6. Selecting Too Many Products

New dropshippers often make the mistake of offering a vast product range. While you may feel tempted, focusing on a specific niche to build expertise and target a defined audience could be the right step. When you prioritize quantity over quality, you may not be able to ensure customer satisfaction. Data-driven decisions become difficult. Becoming a specialist rather than a generalist in the competitive dropshipping market could be better.

7. Lack of Patience and Persistence

Unfortunately, most dropshippers just don’t seem to have the patience to maintain a dropshipping store. Quick results are not quite common in any business. The secret behind successful dropshipping results is testing different products and experimenting with various marketing strategies and audience segments.

Plus, setbacks are inevitable. Giving up could be a big mistake. Consistency with customer service, product optimization, and marketing will eventually bring you success.

Remember, building a successful dropshipping store takes time and dedication. By developing patience and persistence, you increase your chances of long-term success.

How to Start a Successful Dropshipping Business From Scratch?

A dropshipping business takes only a few minutes to start. To launch your dropshipping business, you will need to take the following steps:

1. Select a Niche

The very first step to starting a dropshipping business is to research niches. There are various industries out there. A niche could be generic, like home-cleaning products, or specific, like large-size paper towels.

It is important to check market trends, understand customer needs, and also focus on your own passions and expertise. A product might be high in demand but you may not be able to sell it perfectly because of your lack of interest in it.

2. Analyze Competition

Dropshipping is becoming increasingly cut-throat. Therefore, it is crucial to analyze the market with a competitive eye. See who ranks on the keywords you are targeting. Using tools like Ahrefs, analyze your competitors’ traffic sources, ranking keywords as well as backlinks. Also, study their social media accounts.

3. Get a Supplier For Your Products

You need reliable dropshipping suppliers. No matter how great your product of choice is, if your supplier does not deliver quality or delivers too late, you will lose business. Make sure to check their online reviews, shipping locations, and any of your unique needs. Here is a complete guide on how to do that and a list of 120+ dropshipping suppliers. 

4. Select an Ecommerce Platform and Create a Store

There are multiple e-commerce platforms for you to choose from. Choose the platform based on its scalability, SEO-friendliness, security, and mobile-friendliness. One of the most trusted platforms is WooCommerce. Currently, almost 5 million stores are live on WooCommerce.

To create a store, you need to sign up with a high-performing, secure host. For this tutorial, I will create a store on Cloudways because it takes just a couple of minutes to set up and you can test it for free.

First, sign up for Cloudways Platform by filling out the simple form and clicking Launch Now. If you have already signed up, log in to your account.

Next, click on Add Application and add your server.

Now, simply select a Cloud provider and choose your server size and location. Then, hit Launch. Setting up the server and the application generally takes a few minutes.

I have chosen Cloudways Flexible here but if you want a host that can handle traffic spikes and scales automatically with 99.99% uptime, you should choose Cloudways Autonomous.

5. Create a proper marketing and customer acquisition strategy

Launching your store is not enough. You need to acquire customers through marketing your business online. Make sure to produce a well-thought-out marketing plan and sales strategy. Stay active on social media, focus on search engine optimization, and collaborate with people online.

6. Start receiving orders

Now that you have marketed your business, you can expect some orders. Remember, good customer support and fast delivery can make all the difference in dropshipping success

7. Repeat the whole process again

There you have it. Now you know how to start your dropshipping business and how to do it like a boss.

Launch Your Dream WooCommerce Store on Autonomous

Experience seamless autoscaling, strong security, and lightning-fast performance without any server management headaches.

Experience Now

Final Words

As a beginner dropshipper, you need to understand that dropshipping is not just another “easy money-making scheme”. It is a full-time business that requires dedication, consistency, hard work, and a lot of patience. Only then you will be able to thrive in this business.

The key to dropshipping success lies in understanding and overcoming common pitfalls. By identifying a profitable niche, building strong supplier relationships, and implementing effective marketing strategies, you can become a successful dropshipper.