Dropshipping has been maybe the biggest trend in ecommerce over the last few years. And lot of people have made lot of money doing it. And some also by selling training for doing dropshipping. However there appears to be some fundamental changes coming that might mean that lot of dropshipping practitioners might find it harder in the future to make money. Let’s take a look at few fundamental changes that are taking place and might impact the future of dropshipping.
1: The increase in conscious consuming
The fact is that much of the products dropshipped, are not exactly of the highest quality and also not such that people actually absolutely need to have them. And I don’t think anyone is disputing it that there is certainly room for that type of products.
However, there is an increase in how conscious people are with their purchasing. And this in turn will likely mean that we will see an increase in people looking to buy durable high-quality products that they actually need, rather than “trinkets”.
2: The increasing prices of Facebooks ads can cause issues for dropshippers
Many of the more successful dropshippers do much of their business by creating a rather simple online store and then trying to do cheap advertising on Facebook, after which the ad costs are covered by the margins on the products sold via the online store. The issue is that there are indicators that the ad prices are increasing on Facebook, and naturally if your business relies on being able to buy cheap FB advertising, this is going to be an issue.
3: The shipping rates from China are likely going to increase
Much of the success of dropshippers is made possible by the fact that at the moment the shipping costs from China to, for example, EU countries are very low. And they can actually be lower than the postal rates within countries. It now looks like there will likely be some increase in the case of many dropshippers who deal with small packages. And this can obviously make it much harder to stay competitive – especially as often the main reason people buy from a dropshipping e-commerce business is the low cost total cost of the purchase.
What should someone who sees their dropshipping business as under threat do?
For starters, it would probably be good idea to start building an actual brand that you want to work on for a long term. This opposed to simple stores that exist for the purpose of being marketed on FB until the fad related to a specific store runs out and then it is time for a new store.
The long-term point of view also means that it is highly advisable to spend a good amount of time, for example, on picking the best ecommerce platform for your individual use case. As well as doing proper market research and thinking about what type of products are likely to be good sellers even if 5, 10 years from now. So, even when the purchasing patterns of consumers might start differing quite heavily from the present day.