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1. The advantages of dropshipping

Is dropshipping worth it in 2024? The pros and cons

When it comes to starting your own online store, the dropshipping business model comes with plenty of perks. Rather than worrying about product production, juggling inventory, or shipping customer orders, you sell products from a third-party supplier who handles order fulfillment.

In exchange for handling the marketing and selling of the products featured in your online store, you get to keep a percentage of the profits. But the question remains, is dropshipping worth it?

What kind of profit margins can you expect from opening a dropshipping store online, and is it worth it in 2024? We'll give you all the information you need to decide for yourself with a thorough overview of both the pros and cons of the dropshipping business model.

Main takeaways from this article:

  • Dropshipping allows retailers to sell third-party products in their online stores in exchange for a percentage of the profits.

  • While dropshipping comes with perks like flexibility, a low barrier to entry, and minimal start-up costs, it can also be a highly competitive market with several downsides worth considering.

  • Combining the dropshipping and print on demand business models can solve many of the cons of dropshipping alone.

The advantages of dropshipping

Google Trends data reveals that dropshipping has enjoyed a steady increase in interest over the past five years. In 2020, the estimated value of the dropshipping industry was $126.8 billion; by 2026, it's expected to reach over $476 billion.

While starting a dropshipping business isn't the get-rich-quick scheme that some websites promise, it's easy to see why it's an attractive business model. Dropshipping makes it easy for anyone to set up their own online store and start selling a wide selection of products on their schedule.

Let's take a closer look at what sets the dropshipping model apart from other ecommerce store models like wholesaling. Along the way, you'll learn why dropshipping can be a convenient and profitable business model for the right online store.

No inventory management

inventory management

Dropshipping products eliminates the need to transform half of your home into an inventory management warehouse. Other business models like wholesaling involve buying large amounts of products on the cheap at bulk discounts, then reselling them to consumers at a higher markup.

While this approach can lead to nice profit margins for the right seller, it also demands setting aside storage space for the products until they sell. Sellers who run dropshipping stores, on the other hand, never actually keep their own inventory in stock.

When you use the dropshipping model, you simply sell the products of a third-party supplier on ecommerce platforms under your own brand. When a customer makes a purchase, the supplier handles all the aspects of order fulfillment, leaving you free to focus on things like marketing, customer service, and scaling your business.

Low barrier to entry

Part of what's made dropshipping such a popular business model is that you don't need a business degree or even a great deal of money to get started. Unlike traditional retail, which often requires a sizeable overhead investment, starting a dropshipping business without investing in inventory, shipping costs, or a physical storefront is possible.

All you really need to start an online dropshipping business is a computer, an online storefront, and a solid understanding of how dropshipping works. Successful dropshippers are more intermediaries between customers and the supplier or suppliers whose products they choose to offer. 

As a dropshipper, one of your main jobs is bringing the right product selection together based on your chosen dropshipping niche. The other is to devise marketing strategies to keep customer orders flowing in.

Minimal start-up costs

It's technically possible to start an online business without having to spend money at all. This is especially true if you integrate print on demand into your business model, which we'll discuss in more detail later.

But if you really want to launch a successful dropshipping store, there are a few start-up costs you'll likely run into. For instance, if you create a Shopify store for dropshipping, you'll have to pay subscription fees to use the popular ecommerce platform.

You may also end up paying a subscription to a dropshipping supplier integration like DSers, which is available on the Shopify app store. Other top ecommerce platforms, however, forgo upfront subscription fees in favor of charging a percentage of each product you sell.

If you plan to start a dropshipping business, it's vital to do the math to ensure that any overhead costs or fees don't negate your profit margins. To make dropshipping profitable, you'll need to be able to price your products in a range that allows you to recoup any overhead costs you take on.

Flexible schedule

flexible schedule

Part of what makes the dropshipping market so attractive to many store owners is that it offers a great deal of flexibility. Since there's no need to worry about inventory management or shipping, you can set your own schedule.

Dropshippers also enjoy the freedom of working from anywhere. The beauty of running an online business is that you can do things like market research in a coffee shop, on the beach, or from your home office.

Broad product offering

product offering

Dropshipping makes it possible to start an ecommerce business that sells almost any type of product you can think of. Whether you're interested in selling products like apparel, electronics, jewelry, or wall art, the possibilities are endless.

Here are some popular tools you can use to find the best dropshipping suppliers for your store:

  • The DSers platform is geared towards Aliexpress dropshipping and integrates with several leading ecommerce platforms such as Shopify, Wix, and Woo Commerce.

  • Spocket is a dropshipping platform that features over 50,000 products from suppliers around the globe.

  • SaleHoo is a popular eBay and Amazon dropshipping solution with a competitive $67 annual subscription price.

  • Sunrise Wholesale integrates with Amazon, eBay, BigCommerce, and Shopify dropshipping stores geared toward customers in the USA and Canada.

The disadvantages of dropshipping

While dropshipping has plenty of advantages over traditional retail, it's not without its downsides. Before you put in the time and energy to start your own online business, it's important to understand what you're getting into.

Competitive market

The good news is that online shopping has become quite a trend! In 2022, global online store owners pulled in a collective $5.7 trillion worth of revenue.

The not-so-great news is that there's no shortage of online shops these days. With more people buying online than ever before, your ecommerce business will face intense competition.

This is where the importance of catering to specific dropshipping niches comes into play. A unique selling point and solid marketing strategy are crucial to ensure your store stands out from other dropshipping businesses.

No control over shipping

One of the most significant downsides of dropshipping is that it can take a lot of work to offer solid customer support regarding shipping delays or lost packages. Things can get particularly hectic if you rely on multiple suppliers for order fulfillment.

This is why finding reliable suppliers is absolutely vital. While your supplier may handle product production and delivery, you are ultimately responsible for customer support for any orders placed through your ecommerce website.

Make sure to do your research when selecting an ecommerce platform and dropshipping app to use for your online business. Placing test orders is a great way to gauge the shipping speed of potential suppliers and explore any shipment tracking solutions they may offer.

Lack of product quality control

This is yet another reason that placing sample orders for products before you start dropshipping them can be invaluable. Vetting the quality of the products you offer potential customers can ensure you build a trustworthy dropshipping business.

It can also make digital marketing a lot easier. Not only will you be able to describe each product reliably, but you'll also get valuable insights on product highlights you can use as search engine optimization or "SEO" keywords.

Ensure you also test out the customer support options of any dropshipping supplier you utilize. Being able to address any issues or concerns your customers may have is a key part of building your own business, so make sure you can get the answers you need quickly.

Lower profit margins

profit margins

At the end of the day, dropshipping allows you to open your own small business online. And the goal of any small business is to make money, right?

To make dropshipping worth it, you'll have to figure out how to generate solid profit margins. While you may not have to spend money on inventory or shipping fees upfront, you must hand over a portion of your profits to your dropshipping suppliers.

You'll also want to ensure you can afford to recoup any money you spend on ecommerce platform subscriptions, marketing, and other expenses. This means you'll need to mark up your prices enough to earn a profit without losing business by overcharging.

Dropshipping and print on demand

If you're finding it a challenge to break into the dropshipping market, incorporating print on demand services may make things go a lot smoother. Print on demand comes with all the same benefits of the dropshipping business model but allows you to offer your customers products that feature your own unique designs.

Rather than selling t-shirts with random designs from a dropshipping supplier, you can design t-shirts with custom designs or sayings. Print on demand partners like Gelato makes it much easier to stand out in a highly competitive marketplace by offering your own one-of-a-kind products.

By integrating Gelato into your ecommerce platform, you can feature your designs on products such as:

Gelato cuts out the concerns many dropshipping businesses face by printing products on high-quality merchandise and offering quick delivery from over 130 local production partners. Should you or your customers face any issues, we offer various reliable customer support options to ensure we can help you solve them as quickly as possible.

Create a successful dropshipping business with print on demand

Dropshipping can be a great way to go if you want to bring in extra money online. It offers a low-risk business model, especially when combined with custom print on demand products.

When a customer places an order in your online store, print on demand partners like Gelato handle everything from the product's creation to its delivery. By offering an extensive range of high-quality products, Gelato ensures that your customers will always receive exactly what they ordered.

Enjoy setting your own rates with our transparent pricing model, and rest assured you'll only pay for orders once they've already been sold. We also offer plenty of free resources to help you get started and even branded packaging options to help you get the word out about your business.

Ready to turn your creativity into income? Create afree Gelato account today to get your print on demand dropshipping store up and running.

Dropshipping FAQs

How profitable is dropshipping?

So, is dropshipping worth it? While no shortage of sites will assure you it's an effortless path to pulling in $100k in a year, the truth is a bit more complicated.

While there certainly are some dropshippers out there who pull in six figures, there are plenty of others who make less. The reality is that the amount of money you can make will largely depend on several different variables, including:

  • The type of products that you choose to sell

  • The prices you charge for them

  • Your ability to tap into a unique niche

  • The quality of your products and customer service

  • How much time and energy you're willing to put into digital marketing

Even where you decide to sell your products will likely come into play. One seller might find Amazon dropshipping profitable, while another may prefer selling on Etsy or their own website.

Much like traditional retail, there's no easy answer to the "average" profit you can expect, which can be quite liberating. Rather than measuring yourself based on someone else's goals, enjoy the freedom of setting your own and building on them over time.

Is dropshipping good for beginners?

Dropshipping is definitely worth exploring for aspiring entrepreneurs. Whether you want to start your own dropshipping side hustle or explore a new product line for your small business, dropshipping is a low-risk way to test the waters.

This is particularly true if you start out with a free ecommerce solution like WooCommerce or on a non-subscription-based marketplace like Etsy. Both are very low-cost ways to take your prospective online business for a test drive before you invest in a subscription service like Shopify.


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