As a business model that doesn’t require you to purchase, hold or handle any inventory, dropshipping requires more focus towards marketing and advertising – but not until you have decided which source you will dropship from and which platform you will sell on. For finding dropshipping suppliers, AliExpress is the obvious choice for most, but finding the right platform to list products on had been a challenge until Shopify proved to be a handy solution.
Why AliExpress and Shopify for Dropshipping?
AliExpress has a handful of competitors like Amazon in terms of global presence, and Banggood or DHgate when it comes to a supplier base. Although dropshipping is a spin off from e-retail, it brings with it slightly different requirements. Suppliers require flexibility from the e-commerce platform to work with dropshipper and here’s why AliExpress is the better alternative for them:
- While other marketplaces like Amazon tend to focus on profits, AliExpress employs the ‘business first, profits later’ strategy – giving suppliers more operational freedom to work with dropshippers
- The commission fees are lower in AliExpress compared to other marketplaces, thus lowering the product costs. For Ex. a T-shirt costing $50 on Amazon will only cost $45 on AliExpress
- Payment settlement is quicker on AliExpress. AliExpress suppliers receive payment on delivery confirmation, while Amazon suppliers only receive weekly settlements.
- AliExpress encourages suppliers to handle their own shipments (which is easier for dropshipping) rather than set up fulfilment centres. Banggood, for instance, operates its own warehouses and pushes suppliers to use them at a premium cost
- Without technical knowledge or a hassle, AliExpress listings can be replicated on other platforms such as Shopify using plugins
Marketplaces such as eBay are used by a few dropshippers to list and sell their items, but most prefer to build their own webpage and storefront to sell their items. Luckily, you don’t have to know coding to do that, thanks to service providers such as Shopify. Although Shopify has a few competitors such as Wix and WordPress, here’s why it’s the ideal choice for dropshippers:
- Shopify is a platform where you can only build online shopping websites, while its alternatives have wider yet less-focussed applications
- Even without knowledge of HTML or any other computer languages, you can create highly customized websites. In the case of WordPress, customizability beyond a certain point is only possible if you have learnt coding
- Although a comparatively expensive option starting at $29/month, Shopify is worth the cost as it specialises deeply in e-commerce and you can recover the cost from your online business
- Shopify gives you all the necessary tools and features that are required in an online store, such as secure payment options and sales channels
- On Shopify, you have a large catalogue of themes, templates and languages to setup your website, and also builds a mobile version by default
- Shopify is the only platform to cater specifically to dropshippers, by letting third-party apps integrate with it for order management and other functions
A Guide on Dropshipping through AliExpress and Shopify
Becoming a dropshipper is a simple and quick process if you already own a registered company, as there aren’t any additional legal obstacles to clear. There is an added advantage of not having to procure or stock any inventory, drastically reducing your risk. Once you have set up the operational mechanisms with a supplier, all you have to do is pass on the orders you receive to the supplier, who will then pack and fulfil them. While starting out, we recommend that you take your time and make a steady approach towards your goal. Here’s a guide on how you can do that:
Step 1 🡪 Finding products to sell
Many categories and sub-categories are becoming popular every day, and sales numbers are tipping towards online buying as compared to conventional shopping. Based on your prior experience, you can focus on products that you have dealt with before. You can search for products on AliExpress by:
- Typing in keywords of products
- Filtering based on price, materials, sizes or other variations
- Checking product descriptions and images
- Ensuring that they are not registered brands, as that would require further compliance processes
- Checking shipping options to locations based on your target audience
Step 2 🡪 Shortlisting AliExpress suppliers
Once you have found products listed by multiple suppliers, your next step is to shortlist them for setting up your dropshipping business. This is important as you need to discuss and agree terms with the suppliers you want to work with. While you do so, you can also order a few samples to test product quality. You can contact the seller by using the ‘Contact Now’ option under seller details.
Here are a few things to check while shortlisting sellers:
- Positive feedback ratings and detailed seller ratings (Ideally >95% and >4.5 stars)
- Number of years of experience in AliExpress
- Products in catalogue – suppliers who list only one or two items may not be consistent
- Response time
- Business Location
- Customer reviews and response to feedback on the Reviews section
Step 3 🡪 Agreeing on dropshipping terms
Suppliers are essential cogs in the dropshipping machine, and you should discuss terms with them in order to carry out business operations smoothly. As the boss of your own business, you are the best judge to identify each of the terms you need to put forward and agree on, as well as know which terms of the supplier to accept. Here are a few key points that you should agree upon:
- Handling time – turnaround time from time of receiving order to shipping out
- Minimum stock requirement – inventory to be kept in reserve for your dropshipping business
- Shipping partners to be used and delivery times
- Quality check – ensure that agreed product quality is maintained
- Return and refund conditions
- Payment methods
- Packaging and branding requirements
Step 4 🡪 Creating your online store on Shopify
Building a domain of your own is where you can unleash your creativity. Shopify has seemingly endless options on backgrounds and designs, so you can style it in such a way that appeals to customers. You can use your logos, fonts and background images as well. Shopify gives detailed instructions on how you can go about creating your domain. Shopify rightly uses its 70+ themes as a USP, albeit at an extra cost except for a handful of free options.
You have three subscription options available – at $29, $79 and $299 per month, and here are some of the key differences:
|Basic Shopify @ $29/mo||Shopify @ $79/mo||Advanced Shopify @ $299/mo|
|Inventory Locations||Up to 4||Up to 5||Up to 8|
|Online credit card rates||2.9% + 30c USD||2.6% + 30c USD||2.4% + 30c USD|
|Transaction fee (if not using Shopify Payments)||2.0%||1.0%||0.5%|
Step 5 🡪 Dropshipping your orders
Time is of the essence once you receive an order. As soon as you receive an order on your Shopify store, you have to place the same with your supplier. The supplier will then take up the duties of order fulfilment on your behalf, and ship out the order with your packaging, branding and business information. At this point, you and the supplier will be executing the plan as per the terms agreed earlier.
How to find genuine suppliers on AliExpress
Each seller profile has an overview of their performance, which you can easily find while browsing through AliExpress. Here are a few tips to ascertain that the vendors you are considering are genuine:
- Ensure that sellers have a positive feedback rate of at least 95% and have received ratings from a considerable number of buyers
- Go through the seller’s catalogue to check if they have listed multiple products. Most sellers have more than a few products listed under each sub-category
- Check if a seller’s products are authentic by reading reviews; many helpful buyers also post high-quality images along with their comments
- Compare prices to similar products’ listings by other sellers. Overpricing and under-pricing are both red flags that you should avoid
- Contacting a seller and checking their response time and quality will help you weed out sketchy suppliers
- Evaluate the listing quality by checking if the descriptions and images are contradictory
- Read through the return policy and guarantee terms carefully while also looking out for any mention of extra charges or taxes
Tools for Dropshipping with Shopify
Several add-ons available on the internet can connect to your Shopify store and help you manage suppliers, add products quickly from AliExpress, keep an inventory count, customize listing, manage product pricing, and track sales and orders. They can even process orders without the need for manual intervention.
Here are a few dropshipping tools for Shopify:
Which is the best site for dropshipping?
Dropshipping requires a supplier from whom you can source products and a storefront that you can create on most e-commerce websites. Most dropshippers prefer to sell under their domain name through Shopify as it is highly customizable and user-friendly.
Is dropshipping from AliExpress profitable?
In dropshipping, the commercials can be worked out well in advance and can hence be made profitable, while running a very low risk of loss as the dropshipper does not hold any inventory.
What is Oberlo?
Oberlo is a dropshipping tool that can be synced with your Shopify store to manage listings, orders and maintain sales and payment records.