Having a side hustle is a great way to diversify your income. I’ve been dabbling in dropshipping as a side hustle lately and really love it. When I opened my first shop, I was so eager just to get started that I missed a lot of crucial steps. Taking a slower approach, like I recommend in this post, would have saved me both time and money. There’s been a lot to learn since opening my first Shopify store, but it’s been a fun process. Plus, nothing quite beats getting the feeling of your first sale while you’re kicking back watching Netflix!
What is dropshipping?
Dropshipping is a form of eCommerce where you, as the shop owner, do not actually have your own warehouse or inventory. Your orders are fulfilled by an entirely different company, and you earn either a percentage or set dollar amount that you’ve set as your markup. One of the main downsides of dropshipping is the lack of control over the customer experience. However, it’s a great first step in eCommerce and requires very little capital to get started. There are a few different companies that do dropshipping fulfillment, but I currently use AliExpress, a website that I already shop on regularly.
What tools will you need?
The post will walk through how to start a dropshipping store in the easiest way I’ve found, which is AliExpress dropshipping. I use the Shopify eCommerce platform to manage and host my shop, and the Oberlo app to add and manage inventory. Oberlo fulfills directly from sellers on AliExpress, a shopping website that is kind of like the Amazon of China. It’s a super easy way to get started and lets you test if dropshipping is for you.
Although I use dropshipping as a side hustle, it really is an online business. Unlike a marketplace website like Etsy, you’ll have to do the leg work in finding your own customers. There are two main approaches that you can take to doing this:
- Going niche
In any online business, having a narrow niche is always a good strategy. You have the opportunity to dominate in a smaller market instead of having to compete for a larger one. If you’re someone that’s great at SEO and you’re comfortable taking a bit of a longer approach, this could work well for you. It also makes it easy to narrow down a very specific audience on platforms like Facebook. Do some keyword and audience research at this early stage to make sure there are enough people out there interested in what you want to sell. I like to use Google’s keyword planner for my keyword research simply because it’s free.
- Going broad
If you know you’re going to use online advertising like Facebook advertising, it can be more difficult to target a niche market. In this case, you might be better off selling something that appeals to a wider audience. There are quite a few people already being successful with dropshipping women’s apparel from AliExpress, but I’d recommend choosing a niche within that topic (for example, just swimwear). Otherwise, you’re going to paying a lot to compete with those other stores on Facebook.
You also want to think about things like price point. Cheaper products will give you instant gratification, but more expensive products with a longer buying cycle can often give you more profit for less effort. A longer buying cycle also means it’ll take longer to see results from your marketing efforts and longer to test your product and audience. If you want to test dropshipping quickly without paying for months of Shopify, try going for something cheaper.
Step 2: Find your products
Your next step to starting an AliExpress dropshipping store is researching what products you will sell. It’s tempting to choose things that you like, but that’s not always the best approach. Open your AliExpress account if you don’t have one and start browsing around different categories and sellers. This is the fun part. Start window shopping and filling up your wishlist!
If you find something that you love, go to the store and see if they have other products that would work well for your store. You can also ‘follow’ the store to get their updates on new inventory. This is also a good place to double check the seller’s rating, and also the reviews on the item itself. Higher ratings for the product and the seller mean there’s a better chance your customer will be happy.
- Sort by orders to see what items are top selling.
- If you find something you like, see if another store has it for cheaper or if it’s on another store with better reviews.
- Read some product reviews. See if the seller’s photos match the buyer photos, and see if there are regular mentions of shipping time. You want a seller that ships orders quickly.
- Start thinking about different product categories that items will fit into on your store.
- Look for items that ship cheaply (or for free) and always choose ePacket if it’s available. ePacket shipments will arrive faster than other shipping methods like China Air.
- Look for great photos. If you’re not going to buy each product yourself and take your own photos, you’ll have to rely on the photos provided. Even if you find an amazing product but it has a terrible photograph or a giant watermark, it’s not going to work in your shop.
- Find more items than you think you need. Sometimes inventory can sell out quickly, or already be low. You won’t know until you import the product into your store.
Step 3: Find your buyers
Now that you know what you’re selling, think about who your buyer is going to be. Do some digging and find your products on Instagram. Follow these people and start collecting the hashtags they use. Look at their profiles: Where do they hang out? What are their hobbies? What other stores do they shop at? What other products are they using with yours? All of this information is going to help you pick better products, write better copy (read: use better keywords), and create better ads.
Step 4: Define your marketing strategy
What’s your budget for starting a dropshipping store? If you wanted to take a leaner and longer-term approach to building your online store, SEO could work well for you. If that’s the case, you’ll want to spend the time up front researching keywords and niches to make sure your products are going to be competitive on search. Don’t underestimate the importance of keyword research and optimizing both product titles and listings. My very first sale came from SEO and I was least expecting it.
If you have some budget for ads and want to test your idea quickly, you’ll get the most bang for your buck on Facebook or Instagram. Still, if you’ve never run a Facebook ad before, you might want to do some research or save your money and focus on building up a social following organically. It might also be better for you to invest that money into approaching a few ‘influencers’ on Instagram or YouTube and sending a sample product to review or promote.
Step 5: Pick a name and buy your domain
Having your own domain isn’t mandatory on Shopify, but it’s going to make your website look a lot more legitimate (or, hey, like a real business). Try to find a .com if you’re targeting the US or globally, or choose something country-specific if you’re looking to target a specific location (but keep in mind this will make it more difficult to expand globally later on).
If you’re from outside of the US, one thing to note is that Shopify will by default always display your local currency. There are ways to let buyers change the display currency, but they’re always going to get charged in your currency at the checkout. It will be easier for you to target your home country, but the trade-off is that the traffic will be much lower.
When you’re choosing your name, try to find something that is also available on Instagram if that’s going to be a part of your marketing strategy. I use GoDaddy for all of my domains, but I honestly wouldn’t recommend them. I would search around for another domain provider! The good thing is you won’t need any hosting like you do with a WordPress website because everything is hosted by Shopify.
Step 6: Build an online presence
When I opened my first AliExpress dropshipping store on Shopify, one of the biggest mistakes I made was not building up my social media presence before running Facebook ads. My goal was sending traffic to my products listings, but I noticed that people were liking my Facebook page… that was completely blank. In hindsight, having somewhat of a presence already on Facebook would have given me more authority and helped my build up an audience that I could use later on to market to ― either paid or not.
Before you even open your store, build out a complete Facebook page and Instagram account that makes your business look trustworthy. Spend a month posting to both of these profiles, and start building an audience on Instagram by following other accounts and researching hashtags. Get some early feedback and see what is sticking with people.
This is also a good time to start building Facebook ads, Instagram ads, and AdWords campaigns if these are a part of your marketing strategy. You don’t have to push them live quite yet, but you’ll be able to play around with the different audiences available and get an idea of audience sizes.
Step 7: Open your Shopify store
2: Password protect your store
You don’t want any busy-bodies poking around your store until you’re ready to launch. Or worse, making a purchase before you’ve sorted out your prices! Under Sales Channels in the left column, click Online Store and then Preferences. Save your changes.
3: Add your domain, Google Analytics, and Facebook Pixel
On the same page, you can input your Google Analytics and Facebook tracking code. If you don’t yet have a Google Analytics account for your store, you can set one up here. Now toggle over to the Domains page to add the domain that you purchased back in step 5.
4: Set up your store details
- Under General, make sure you change your personal email address to be one you want to use with your store. This is the email address customers will see when they get their order confirmation.
- Under Shipping, edit the different shipping prices. With AliExpress, the easiest thing to do is include the shipping cost in the item price. I then charge a flat fee for countries outside of North America. How much you charge for shipping will depend on your products. In the product page on AliExpress, play around with the shipping country to get an idea of what you should charge.
- Under Notifications, customize and modify your automatic emails. Infuse your brand into the communications your customers get!
6: Design your store
Under Online Store > Themes, you’ll be able to pick a template and modify it to fit your brand. There are plenty of free themes to choose from, so no need to pay for one just yet! Remember we’re trying to keep your startup costs low.
Step 8: Connect Oberlo & import your products
Click here to add the Oberlo app for free. This is what’s going to turn your shop into an AliExpress dropshipping store. Next, you’ll want to install the Oberlo browser extension for Chrome. It took me so long to discover this, and it will save you a ton of time when you’re importing products.
Remember all those products you saved to your wishlist? In AliExpress, you’ll now see the Oberlo logo next to items. Click the button to instantly import the product into Oberlo. It couldn’t be any easier!
Now when you’re in Oberlo, these items will show in in your import list. This is where you’ll edit the product name, description, prices, and more before officially pushing them live to your dropshipping store.
I like to add a markup manually to all of my products. The reason for this is that Oberlo shows prices in USD, but I’m presenting prices and charging customers in CAD (because I’m Canadian!). This gives me extra control to make sure I’m actually making a profit. If you’re in the US, you would be find simply setting global pricing rules. These pricing rules automatically add a markup for you and can be found in your Oberlo settings. Here’s an example of what these look like:
Step 9: Drive traffic to your store
Congratulations! You now have an AliExpress dropshipping store that is set up, full of inventory, and ready for customers. Hopefully by now you’ve built up a small social following and can start plugging your store. Instagram, Facebook, and Pinterest, are all great places to reach eyeballs for free.
A lot of AliExpress dropshipping success stories talk about people who made huge investments into Facebook ads or other paid platforms. Personally I don’t believe in paying for a ton of ads, software, or other startup costs until you’ve proven that a side hustle works for you. On a side note, if you haven’t yet read Chris Guillebeau’s book The $100 Startup, I highly recommend it!
Step 10: Keep optimizing
The work of a dropshipper never ends, just like any other eCommerce business. You need to constantly be trying new things, reaching out to new people, and finding your buyers. Once you’ve made a few sales, it’s a good idea to buy some of your own products (weird, right?) and take some original photo and video with them. This will give you more freedom to post great content without having to give the photo credit to someone else.
And most importantly, have fun with it! I started AliExpress dropshipping because I was getting burnt out from freelancing. Although it takes a lot longer to build a business like an online store, to me it’s worth the work. I believe it has a lot more growth potential than freelancing, and I’m looking for more of a business than a service-based hustle.
Ready to open your store? Click here to start your free trial of Shopify.
Did you open a store? How did it go? Tweet me at @budgetunder!