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Why Did I Quit Dropshipping and Is It Still Profitable in 2022? (Updated)

Dropshipping is the business model that revolutionized the eCommerce world and made many people millions is becoming a thing of the past. – Or is it?… Let’s find out if you can still make money from dropshipping!





Entrepreneurs are on a constant search for the next profitable business trend, but since the dropshipping business model required less effort and resources to make huge amounts of money, it is hard to let go.

My Dropshipping Journey

Note: This is not the type of post where I will showcase my $300K fake net income. It is a realistic post about how dropshipping works in the real world.

Unfortunately, I encountered dropshipping in the late phase back in late 2017, and at that point, the market was already crowded as many people started years before me.

At first glance, I thought that people were familiar with AliExpress, and they would notice the price difference in my store.

Rather pessimistically, I started to dig deeper, going through a lot of research until I finally decided to launch my own dropshipping business.

I went through a lot of trouble building the right system just because it was tough to find an available payment gateway for my country. (most people did not face such problems)

The initial cost of my dropshipping business was meager since I did most of the things myself:

  • Shopify Subscription – $29 per month;
  • Pre-made Website Theme – $69;
  • Domain Registration -$15;

I planned to enter the dropshipping business with a budget of $5,000. This means that I still had $4,887 after finishing my website to spend on product orders and advertising.

The Mistakes I Made

I thought to myself, if I will enter the dropshipping business, it is going to be a general store, where people can choose from a variety of products.

Little did I know the huge mistake I was making.

The trouble with a general store is that you will need a lot of money to advertise your products, and customers will only buy the things they’ve seen in your ads.

Additionally, when you build a store, it has to be based on interests. So, if a person is interested in fishing gear and you bring the person to your store through ads, he or she will not browse your clothing category.

I was going for a model where people will search for different product categories. That is where I didn’t know the difference between niche vs general store.

My goal was to increase the size of my potential customers, and after a few months with no results, I ended up ditching that project and starting over with a more specific niche website.

I choose the jewelry niche since there are a lot of cheap and good-looking products on AliExpress that can sell for a lot more money! The name of the store was Bling Maze and it gained popularity just because after a while I started to see other websites with my logo.

Now when I go back, I should have started an even more specific niche like bracelets or earrings, and probably I would have had much better results.

Another HUGE mistake that was unfixable was the payment gateway. The only available payment gateway in my country was 2CheckOut, which redirected people to their website every time they want to make a purchase.

Redirecting people away from your website is a massive no-no when it comes to eCommerce stores.

Dropshipping Advertising

I’ve built a professional-looking website with excellent product representation and user-friendliness.

When I started advertising my website on social media, it was hard to go for attractive markets like the United States, Canada, or Europe. I also tried promoting the site globally, which boosted the results on my Facebook posts getting 3-5K likes, but absolutely no purchases.

You need to understand that there is no secret ingredient in Facebook ads, and various products perform differently. I learned the process through trial and error, and things finally started to work out.

I got my first purchase! It’s been long three months since starting with the idea for a dropshipping business. Even though I knew that I had a long way to go to reach my goal of $1,000,000, I was still unbelievably happy.

Note: I went through the process of learning dropshipping by myself and mostly through trial and error. I didn’t know the base product margins that I should put, face trouble with payment gateways, and much more. So for other people, the first purchase came much quicker.

Once I got the hang of targeting in social media advertising, there wasn’t anything that can stop me. However, I still had trouble covering advertising expenses with the profit from my eCommerce store.

When Did Started to Go Down?

After a couple of months, I reached $10,000 in revenue from the beginning of my business. The business model was promising until I hit a few major setbacks, such as:

  • High Shipping Duration Which Increased Disputes
  • Refunds Take a Lot of Time and 2Checkout Charges Additional Fees for Refunds
  • Low Product Quality

Since you are not managing your shipping and you don’t necessarily know the quality of the product you sell, you are swimming in a rough sea without knowing what to expect.

After customers were not satisfied with the quality of some products and a massive increase in return rate, I was forced to change some of the winning products, which changed the whole strategy for advertising.

The sales dropped since I slowed down with ads since I had more significant problems to deal with.

Don’t get me wrong, this business model at that time had potential. All comes down to choosing the right products that have low return rates and high-profit margins.

Unfortunately, I decided to close my dropshipping business. The truth is I didn’t see the light at the end of the tunnel, and I thought that this model is not going to last, so the best thing was to step down and not waste any more money.

Is Dropshipping Dead in 2022?

After I decided to abandon the drop shipping business, we can see many discussions if dropshipping becoming a thing of the past. However, there are still many people that make a tremendous amount of money per month with dropshipping.

One way to determine if dropshipping is dead is by using Google Trends. As we can see from the results, the numbers suggest that it is very much alive and it is at its peak.

Obviously, with time things change, but that doesn’t mean that you cannot optimize the dropshipping business to work today!

Margins are a lot smaller nowadays, and there is serious competition on social media that you have to beat.

On the other hand, the eCommerce business is growing rapidly. Experts predict that 95% of all transactions globally will be going digital by 2040.

Additionally, there are more possibilities nowadays, and people can send payments easily. Couple that with the fact that the number of internet users is multiplying over the years, and you have a recipe for success.

New Marketing Tools for Dropshipping

More and more Dropshipping store owners avoid the traditional marketing tools like Facebook and Google ads that used to work like a charm a few years ago. Instead, business owners are focusing on organic marketing that can bring them a lot of sales without investing too much money.

The new system which seems to work much better than before takes advantage of the organic traffic of not-so-new mediums like TikTok.

Dropshippers have seen amazing success advertising their products on TikTok or any other social media that have short-form videos like Instagram and YouTube.

The idea of focusing on creating viral videos that can get millions of views in a day thanks to the progressive algorithm of TikTok can result in making a lot of sales.

So, if you are new to dropshipping and want to create a successful store, try utilizing organic marketing through short-form videos. Many dropshippers have achieved incredible success without spending a dime on social media advertising.

In other words, this is a better time to start dropshipping than few years ago, thanks to the power of organic reach through social media.

The Power of One Product Stores

As the competition in eCommerce grows, dropshipping store owners need to optimize their stores in order to succeed. Dropshipping went from general stores to niche stores and now one product stores get the most success.

There are advantages and disadvantages to one product store, but it seems like this is the most profitable way to enter the dropshipping business.

Focusing on one product lets you thoroughly review all the advantages and disadvantages of the product, come up with a marketing plan, and make sure that your customers are satisfied.

On the other hand, finding a winning product is much harder than you think.

One product store means that you need to find a product, build an entire website about the product, and start selling. If the product is a miss, you need to start the entire process from the beginning which is time-consuming.

However, with one product dropshipping store you stand a better chance of breaking the barrier of entry end surpassing your competitors.

So, if you are starting a dropshipping store now, it is best to create a one-product store.

Is Dropshipping Still Profitable?

The short answer is Yes! Dropshipping is steadily increasing on average by 7 percent a year for the last ten years. This year so far, the profits of eCommerce and dropshipping store owners have reached over $4 billion.

Experts predict full eCommerce digitalization in 20 years, but with the latest COVID-19 situation, we expect eCommerce capable stores much sooner.

When it comes to Dropshipping, even though the margins are lower than before, you can still make tons of profits by increasing your quantity sales.

Let’s do the math!

If your goal is to make $100,000 per year, how many products you should sell?

If you get your product for $20 from AliExpress you should sell it for $35-$40.

When you deduct the shipping costs and costs for advertising, you will reach an actual profit over the product of $12-$15.

$12 x 800 orders = $9,600 per month

$9,600 x 12 months = $115,200 per year

This means that your goal should be to sell 25-30 products per day to earn $100,000 per year.

Do you think you can find 30 people to sell your product?

The answer is Yes! It is very much achievable, and after you’ve set your eCommerce system, that number is going to go much higher.

Of course, this math doesn’t include advertising costs, which can be a lot, especially in the beginning when you cannot even cover the costs from your sales.

However, by using the benefits of social media platforms you can achieve great success without spending thousands of dollars on advertising.

Final Words

So, after all, my explanation you probably are wondering why I quit the Dropshipping business.

In all fairness, it was one of my biggest business mistakes, which is why a few years later, I started the process again. Can you imagine the size of my Dropshipping business after three years if I continued to pursue my dream?

Nowadays, you can still build a profitable dropshipping business and even reach a six-figure income, but it will be much harder than in the past since there is a lot of competition.

Even though Dropshipping might sound like a zero-investment opportunity, you will still invest a lot of time and effort in the process.

Time is money!

You cannot expect overnight success, so if you are looking for a fast income, you should probably look somewhere else.

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