The dropshipping market has emerged as a significant sector of the global economy, with an estimated value that is projected to surpass $1670.1 billion by 2031. This growth is attributed to the increasing popularity of e-commerce and the convenience offered by the dropshipping business model, which enables individuals to start a business with low initial investments and minimal risk, as they are not required to hold inventory.
In Bangladesh, the potential for growth in the dropshipping market is substantial, owing to a number of favorable conditions. The country boasts a large and growing e-commerce market, with rapidly expanding internet usage amongst people of all walks of life. Furthermore, the Government of Bangladesh has undertaken initiatives aimed at promoting entrepreneurship and supporting the growth of e-commerce businesses. Given these favorable conditions, the dropshipping market in Bangladesh holds immense potential to become a significant contributor to the nation’s economy.
What is DropShipping?
Dropshipping is a business model where a retailer purchases products from a wholesaler and delivers them directly to the customer, acting as a middleman in the transaction. This is achieved by displaying and offering products from e-commerce platforms, such as Alibaba, Ali Express, or Amazon, on the retailer’s website. The customer places an order and pays the retailer, who then submits the order to the e-commerce platform for the delivery process using the customer’s name and delivery address. It is important to note that the e-commerce platform should not use proprietary packaging.
Dropshipping allows you to earn a profit from customer purchases without having to invest in inventory. However, it is crucial to carefully evaluate the prices and quality of the products available on the chosen e-commerce platform in order to maintain customer trust. The value of the product is a key factor in building and maintaining customer trust, as customers rely on the retailer to provide a positive shopping experience.
In essence, dropshipping is similar to brokerage business, as the retailer sells products from another website and takes a profit from it. This model requires a relatively low investment, as the retailer only needs to establish a relationship with one e-commerce platform.
Benefits Of DropShipping Business
The dropshipping business model presents a favorable opportunity for aspiring entrepreneurs, particularly due to its accessible nature. Using the dropshipping approach, individuals can experiment with a variety of business concepts and minimize the associated risks. This allows individuals to gain valuable experience in selecting and promoting products that are in demand.
Dropshipping allows you to start an online store without having to spend money on buying and storing products. All you need to pay for is your website hosting, domain name, and web development. This means there is less risk of losing money and more chance of making a profit. And the best part is, you can sell your own products as well as popular items in your store.
Moreover, dropshipping is a type of business that does not require buying products or managing a warehouse, which makes it less complicated to operate. People can easily run this business from their homes with just a computer, an internet connection, and a website. As the business grows, the cost of having a website may increase, but it is still lower compared to other traditional business models. Additionally, one of the benefits of dropshipping is that there is no need to purchase products ahead of time. This can help to keep the costs lower for businesses. If a product is unavailable from one supplier, it is possible to source it from another vendor, which can enhance the credibility of the business.
Drawbacks Of DropShipping Business
The competition in the e-commerce industry is high, which is why online store owners are striving to provide quality service to customers. This intense competition can be challenging for dropshippers if they are not careful with their marketing efforts. Starting a dropshipping business is relatively easy, but it is important to provide good customer service to maintain credibility.
Some dropshippers may struggle to maintain their business due to low profits or too many orders. Running a dropshipping business requires continuous communication with both buyers and suppliers, which can be challenging. Dropshippers may also be held responsible to resolve issues with suppliers who send incorrect or damaged products. However, if done with sincerity, dropshipping can be a stable business venture.
How To Start DropShipping In Bangladesh?
To start a dropshipping business in Bangladesh, the following steps should be followed. Since this business market is still untapped in Bangladesh, one can easily start a dropshipping business by following these steps.
Niche Selection For DropShipping Business
Starting a dropshipping business in Bangladesh requires finding the right niche. It’s a balance between choosing something you’re passionate about and finding a profitable market. Evergreen niches like fashion, tech, beauty, and fitness, tend to be very popular and successful. Before starting, it’s important to research using tools like Google Trends and keyword research tools to determine the demand and competition for your chosen niche. Analyze successful websites in your niche to see how they approach their business and find popular products. Make sure the niche is profitable, with a profit margin of at least 35-40% after deducting costs and taxes. You can also look for problems in your own life that a product could solve and try to sell that solution. Finally, use an online calculator to determine the profitability of specific products.
To understand your competition in the market, you need to research who they are, what they sell, and how they sell it. Start by searching for the product you want to sell on Google and look at the top ten results to see who is selling similar products in your location. You can use tools like SEMRush or Ahrefs to gather information about search results in different locations. To find niche competitors, use websites like Alexa or SimilarWeb. These websites provide information about a website’s social media profiles, advertising, traffic, and competitors. Don’t forget to check social media to see what trends people are sharing. Use BuzzSumo to see what content is getting the most social shares and get ideas for your own content. You can also sign up for your competitors’ newsletters to stay updated on their content.
Contact The Suppliers
When selecting a dropshipping company, it is important to carefully consider all options and assess their benefits and drawbacks. You can find potential suppliers by searching online or on websites like Alibaba.com or Aliexpress.com. To ensure a successful partnership, make sure the supplier is a real dropshipper, has experience in the industry, and offers fast shipping times. Additionally, prioritize quality and test the products before committing to a supplier. Finally, compare different options by placing a sample order after considering factors such as product condition, shipping times, and packaging, to choose the best option for your customers.
Setting Up The Business Store
To start a dropshipping store, it is important to have a website or set up a shop on platforms like Shopify. Choosing a suitable domain name is crucial for building a long-term brand. You can use a name generator to help you choose a domain name with a “.com” extension, but avoid using your own name. Also, setting up a shop on Shopify is a good option as it is a trustworthy e-commerce platform with many resources and tools. If you need help, you can reach out to a Shopify expert for free assistance. To personalize your store, you can edit the images, colors, fonts, text size, menus, and borders to make it unique. Remember that your brand choices, such as the color palette, photography style, and font, will influence the way you edit your theme.
In order to receive payments from customers, it is important to have a payment gateway. This ensures that the payment is kept safe until the customer confirms receipt of the product. Two popular payment gateways are PayPal and Stripe, however, they are not supported in Bangladesh. To use these payment systems for a dropshipping business, it is necessary to register the business in the USA or UK, but this can be expensive. Using services for a PayPal account in Bangladesh may not be reliable as they often get canceled after a few days due to verification. It is recommended to not use such services.
You can use a platform called Chip Chip to avoid payment method hassles. This platform acts as both a store and a payment method solution for you. To use their service, you need to open an account on their website and sell products on their site. This way you don’t need to set up a new store. A percentage will be deducted from the sales you have made and the rest will be sent to your bank account. It is a very convenient method, and worth trying.
Promote The Business
In order to promote your store and reach potential buyers, it is important to adopt an organic marketing strategy to earn the trust of search engines. Facebook advertising is becoming increasingly difficult due to changes in the algorithm, but you can still be successful if you understand your audience and experiment with different ad strategies. Google ads are a great option for gaining exposure in search appearances and targeting specific demographics. Retargeting can help save money and increase the likelihood of making a sale. Email marketing is a valuable tool for reaching a large group of potential customers through an email list. Influencer marketing is also becoming popular and can be especially effective in popular niches by partnering with Instagram influencers. The cost of influencer marketing depends on the popularity of the influencer.
Optimize Your Business
After you have completed creating your website, brand, and marketing strategy, it’s time to check if your efforts have paid off. You may find that some marketing techniques work better than others. You can compare your prices to your competitors and see if adjusting them will make you more competitive. Use free tools such as Google Search Console or Analytics to monitor your online traffic. If you are using email marketing tools, set up automatic reports to review your data regularly. A quick look at the data from these tools can help you determine the success of a campaign.
Tips About Generating More Sales On DropShipping
When you are completely ready for business, you’ll need good marketing knowledge for product promotion, like publishing your post by carefully selecting the images, product description, target audience, etc. All in all, following a few of these tips will help you generate sales as expected.
- Try to post on a daily basis. This will increase your engagement.
- Don’t ask people to buy your product directly. First, talk about the benefits of your product then ask them to buy.
- Do not use direct links in posts. Use the link in the comments.
- Don’t post sales all the time, post something informative that is useful to people.
- When you share links on social media, create separate links for each media through link tracker and track them to see which media is getting more response.
Best Practice Of DropShipping Business Within Bangladesh
Doing dropshipping business in Bangladesh is not easy due to two main problems – regulatory and payment issues. There is no suitable platform that offers import and export support, product storage facilities, and other necessary help. As a result, you have to store the products in stock and handle the delivery yourself whenever an order is placed. One way to overcome this issue is by selling Bangladeshi products through your platform.
There are various wholesale markets in Bangladesh where wholesalers will handle the delivery for you, such as the flower business in Shahbagh or Agargaon, clothing business in Islampur, gold plated jewelry business and spice business in Old Dhaka, silver ornament business in Gausia, shoe business in Chadni Chowk, and plastic products & packaging business in Tongi. You can completely rely on wholesalers for delivery and by selling these products through dropshipping, you can earn money by just generating sales. However, as we mentioned above, you might often receive complaints from your customers about products, however, as your sellers are Bangladeshi, you can easily reach out to them as per customer demands.