Have you been considering starting an AliExpress dropshipping business, but you’re not exactly sure what it means or what’s involved? Starting your own dropshipping business is an amazing option for entrepreneurs who want to sell products but don’t have a ton of capital to invest. Dropshippers can run an eCommerce business while working from home, making it more accessible than ever to become an entrepreneur.
In this article, we’ll get into the details of what dropshipping is, the pros and cons of dropshipping with AliExpress, and walk you through how to start your own retail business.
What is dropshipping?
Dropshipping is a retail fulfilment method where the business selling a product doesn’t hold any physical stock or fulfil orders. In other words, when someone makes a purchase through a store that uses dropshipping suppliers, the seller places an order with a third party who is in charge of production, packaging, and shipment. This means that the seller never comes in contact with the products they sell.
There are many benefits to starting a dropshipping business, including a lower upfront investment than typical retail businesses. When you dropship products, there’s no need to spend your money on minimum order quantities (MOQ) of inventory, since you will simply submit and pay for each order as they come in.
That probably sounds simple enough, but there’s a big difference between deciding to start a successful eCommerce business and actually making it happen. Since you’ll need to source quality products from reliable sellers, let’s look at how to use the popular platform AliExpress to start your new career as a dropshipper.
What is AliExpress?
AliExpress is an online marketplace offering hundreds of millions of products from various AliExpress suppliers. They sell a huge variety of items, from clothing to jewellery to motorcycles and everything in between. While AliExpress sells to dropshipping businesses and individual consumers alike, they also have relatively low prices, making them an ideal source for different types of produce-based businesses.
Why should I use AliExpress for my online business?
You understand the basics of dropshipping and what AliExpress is, but why should you use AliExpress for dropshipping? Here are several reasons that so many businesses choose AliExpress to find suppliers.
Low prices
With such a wide price range on AliExpress, you can choose low-priced products so that you will be able to earn a higher profit margin.
Wide range of products and supplies
Since AliExpress is a marketplace, there are many suppliers that you can choose from. It’s important to strike the right balance between cheapness and product quality.
No need to deal with shipping
Packaging and shipping products can be a real headache for busy entrepreneurs. With dropshipping, you never have to come in contact with the products you are selling.
Product reviews
The extensive product reviews will help you choose high-quality products without having to order samples. Plus, they will have ready-made product images and basic product descriptions that you can repurpose for your online shop.
These are just a few of the reasons that many dropshippers choose AliExpress as their source for finding product suppliers.
Why would a customer buy from me when they can get the same product from AliExpress?
One of the defining characteristics of AliExpress is they sell to both retailers and individuals at a wholesale price. This means that customers can get the exact same products they’re buying from you at a lower price. So why would someone pay more to buy through your shop when they could order directly through AliExpress?
When you sell AliExpress dropshipping products, you’re not going to be able to compete with AliExpress on price or shipping time. That means to run a successful dropshipping business, you need to offer something your customers don’t get when they order directly from AliExpress.
There are a number of ways to differentiate your business, whether through impactful business branding, amazing customer service, or a uniquely curated aesthetic. It all comes down to the way you present what you’re selling.
If you’re able to create a memorable brand that people trust, consumers will start to look to you for products that fit your specific brand identity. In this way, you’ll be able to save them time browsing through millions of products to find the ones you have already carefully selected. In addition, you’ll be able to help customers find things they didn’t even know they wanted. When you’re selling products that customers can get for a lower price elsewhere, you need to make the overall customer experience worth the price increase. That includes things like acing your social media presence and choosing the right business name.
How does dropshipping with AliExpress work?
You may feel overwhelmed about everything that goes into starting your own dropshipping business, but don’t worry! Adding dropshipping products to your store is extremely straightforward.
First, you’ll need to choose your products and gather product photos and descriptions for each one. Then you’ll simply create a new product in your online store, add the photos and description, and set your price with a markup. Then, when you receive an order, you can place the order through AliExpress, inputting your customer’s name and shipping address. That way, the products are sent directly to the buyer.
It’s also a good idea to set up a simple spreadsheet of the products you’re selling, what they cost you, what price you sell them for, and a link to their AliExpress product page. This will help you keep track of your products and profit margins, and you’ll never have to search through pages of search results to place an order.
Keep in mind that many suppliers will include their own order invoices and promotional materials in their shipments. Since you are dropshipping, make sure to put a note in with your order asking them to leave these out.
Pros and cons to an AliExpress dropshipping business
If you’re still on the fence about using AliExpress for dropshipping, let’s look at some of the pros and cons so that you have a complete understanding of what you’re getting into.
Pros
The pros of dropshipping with AliExpress include:
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- Low startup costs – Since you don’t need to spend any money up front for inventory, you’re taking on less risk and financial commitment than a traditional retail model.
- Work from anywhere – Your entire job can be performed online, meaning that you can work from anywhere in the world as long as you have a stable internet connection.
- No inventory – You won’t have to worry about spending money on inventory or storage space since you will never come in contact with your orders.
- Less work – You’ll be able to focus on the big picture since packaging and shipping are taken care of.
Cons
While there are some positives to using AliExpress, there are some cons to consider:
- Less control – Your orders won’t come through you, meaning you have no control over product quality or fulfilment and delivery times. You will have to trust your product supplier and be sure to clearly communicate to your customers about the expected shipping times for products coming from overseas.
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- Low profit margin – While you can set your profit margin at whatever you like, pricing too high when both AliExpress and other retailers are offering lower prices can lead to a customer losing trust in you and choosing a lower-priced competitor.
- No branded packaging – Product packaging is one of the best ways to remind your customer about your store and give them an incentive to keep buying from you. With dropshipping, you cannot use your company branding in the packaging.
- Competitive market – Retail is competitive to begin with, but especially so when what you are selling is available to everyone else, including individual buyers, at a lower cost.
- Complicated return and refund policy – Your suppliers will likely have different policies for refund requests, making the process more complicated. Make sure your return and refund policy is very clear to customers before they make a purchase to avoid complications.
How to set up your AliExpress dropshipping store
We’ve already covered what dropshipping is and the basics to using AliExpress to fulfil customers’ orders. Here are the five simple steps you need to take to get your online store set up for dropshipping.
1. Choose your niche market
If you’re new to entrepreneurship, you may think your best bet when starting a business is to appeal to as many people as possible. In reality, it’s much better to get as specific as you can about your niche market. This will make it easier for you to communicate with your audience in a way that converts them from passive observers to paying customers.
Your niche will determine not only the products you sell, but the type of person you want to sell to. Start with something general by using the AliExpress categories. For example, you could choose women’s fashion, hair and beauty, or home decor as your main category.
Next, you’ll want to narrow it down further. If you chose women’s fashion, you can now choose if you want to offer formal wear or athletic apparel. Once you’ve chosen your subcategory, start thinking about your target audience. What type of person is shopping for the products you want to sell? Think about their demographics, values, shopping habits, and preferred social media platform.
Then choose products that fit your niche and what your ideal client is looking for. As a curator of products, it’s better to choose high-quality items that apply to your brand and niche market than to clutter up your online shop with unnecessary filler products. You can always add more products later or remove items that aren’t performing well with your clientele.
2. Find a reliable supplier
Since AliExpress has such a wide variety of products and suppliers, the product quality can vary greatly. Here are some important features to look for when you are choosing your products and suppliers.
High order numbers and ratings
The best way to weed out the low quality products is by looking for a product with over 300 orders and a star rating of at least 4.5 and up. A higher amount of orders shows there is a demand for that product, and if the reviews are positive, you’ll know that people actually received what they ordered and it meets their expectations.
Low-cost item with potential for high profit margin
Not all low-cost items can be priced much higher, depending on the industry and niche they fall into. As a general rule, keep your purchasing price between $1 to $20, and charge $20 to $50 to ensure you end up with a good profit margin.
Good product photos
Unfortunately, AliExpress has been known to have some fake products. Make sure that they are actual photos and not stolen product images from another retailer. You can do this by performing a reverse image search. It’s also always in your best interest to order a sample product to test the quality before you add it to your online store.
3. Set up your online dropshipping store
If you don’t have a dropshipping site, you can start one by creating your own website and adding an online store. Once that’s set up, head to your eCommerce shop and create a new product.
Here’s everything you’ll need to include in your product listing:
Product description
Even if the product you’re selling has a decent product description on AliExpress, it’s a good idea to write your own description, which includes keywords based on your niche market and what your ideal client is searching for. Use the description to explain what your product is, what it’s for, and why your customer needs it in their life.
Product photos
While you can use the product images on the AliExpress listing, if you really want to match your photos to your brand, it may benefit you to order sample products and create your own branded photoshoot. This will provide you with an opportunity to test product quality as well as original product photos that set you apart from your competition, even if you’re selling the same item.
Price
When you set your price, aim for a profit margin of 50 per cent or higher. This is to cover your other business costs that aren’t related to inventory, like marketing, website hosting, and customer service.
4. Automate your business
If you want to simplify your dropshipping business even more, you can automate the process of adding new products to your online store by using a third-party tool like Oberlo or another AliExpress dropshipping plugin. To make sure that your customers feel well taken care of, you can introduce other helpful automations like email marketing and an email autoresponder.
5. Be clear about your return policy
An important step in starting your dropshipping business is ensuring you are very clear about the delivery times and return policy. This will help prevent misunderstandings that could lead to negative reviews. Many AliExpress products are shipped from China, meaning that customers may wait for their orders for up to two months at a time, and some suppliers don’t offer returns or refunds.
If your customer’s order never arrives, you’ll need to take charge of the situation by contacting the supplier and attempting to resolve the issue. If the product arrives damaged, have your customer take photos which you can then send to the supplier. You can also pay more for AliExpress buyer protection.
On the other hand, if a customer is unhappy with the quality of the product they receive, you can choose to provide a full or partial refund, or no refund at all. Just make sure that your policy is made clear in the product description ahead of time.
Now that you know everything there is to know about dropshipping using AliExpress, it’s time to start brainstorming your brand new venture. Ownr is here to help turn your vision into a viable business!
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