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Do you want to start dropshipping in India and make a career as a drop shipper from the comfort of home?
Yeah! It’s possible!
After all, What’s better than being at home and generating passive income?
Here’s a step-by-step guide on how to start a dropshipping business in India.
Table of Contents
What Is Dropshipping?
Dropshipping is basically an eCommerce business model where a seller does not hold the products it sells. When the item gets sold, it is directly shipped from the supplier/manufacturer to the customer.
Why start dropshipping in India?
For the last couple of years, the concept of Dropshipping business has been gaining attention among the seller community in India and more and more people are turning to drop shipping as it is a cost-effective and relatively easy way to start a business.
In this retail sales model, you make the sale and the manufacturer or supplier sends out the products directly to the customer. You don’t hold stock and so your overheads are low.
Additionally, there are other absolute benefits of the dropshipping business model as under:
- No upfront investment
- Low-risk business model
- Work from anywhere
- Part-time or full-time
- No loss if item gets lost/damaged in transit
Research and Markets report says the demand for Dropshipping business models is increasing immensely in India and various APAC countries. Its eCommerce sales are projected to grow no less than at an annual rate of 51%. It offers an abundant opportunity for dropshippers in India and is the biggest opportunity for online retailers.
Future of Dropshipping
There is yet another report published in Market Data Forecast, according to the Ministry of Commerce and Industry of the Government of India, India’s e-commerce market was valued at $ 38.5 billion in 2017 and is likely to reach $ 200.0 billion by 2026, progressing at a whopping CAGR of above 51.0 %.
Smartphones have brought a revolution in online shopping and the growing penetration of smartphones, along with the increase in disposable income for consumers, is contributing to the growth of the online market.
The report reflects the potential of the eCommerce market that gives dropshippers an abundant opportunity to foray into this segment.
This is a complete guide on how to start a dropshipping business in India that will help you start not only an online business but also run it from anywhere you want. If you are stuck with how to start a dropshipping business, keep reading on…
Is dropshipping profitable in India?
Yes, dropshipping can be quite profitable. Once your store is set up, all you would need to do is start adding new products and ensure that your orders are fulfilled correctly.
In order to make it profitable, like any business you need to find a good supplier. Negotiate with them how much they would charge for the product and delivery then put a profit margin (markup) on that product to make money.
How to Start Dropshipping in India?
The steps to start a dropshipping business in India are:
1. Identify a Winning Product (Brainstorming)
The very first step is finding a dropshipping product idea that’ll work in India. Brainstorm product ideas even before you decide on a supplier to make sure you have the right product to thwart competition and maximize profit margin. The majority of the drops shippers first find a dropshipping supplier and then sell the products they have. This is not a good strategy.
To identify a profitable product, you may list some used items (if any) on sites like OLX to test how these products sell, and based on the performance you can always choose the products and make a product strategy around them.
Remember, every drop shipper supplier is looking for opportunities to sell their products. For this reason, if you ask dropshipping suppliers to ship products to your buyers, they will readily agree to your dropshipping idea and dropship for you. However, you need not go with those products unless that is the niche you want.
The very first step is to find your niche products. The niche products are more successful. To give you a better idea, let me share that “Men’s Grooming” is a Niche. A niche product example is Beard Oil.
Niche-specific dropshipping stores have a higher conversion rate than Multi-category Dropshipping Stores
In addition, remember, products are always evolving and new varieties are coming so you need to keep on doing your research from time to time and make the changes as needed in terms of design, the technology used in the product. You can also try White label drop shipping to build your own brand.
Points to remember while picking a Niche:
- Discard seasonal niches
- Avoid low-cost items.
- Avoid items with high-return rates like clothing
- Avoid products that have brand loyalty like a Mobile phone or a laptop
- Avoid too heavy machinery
If you are unable to decide on a Niche and want to find product ideas, you could check dropshipping companies in India to find some Niche ideas.
2. Build Your Store (Shopify or WooCommerce)
Once you have made up your mind about which items to sell, the next step is building your eCommerce store and integrating a reliable payment gateway to receive payment from the customers on a secure server. A good store should be user-friendly with easy navigation that delivers a smooth buying experience to the buyers. There should be a search box that displays the results in an organized way.
To build your website, you need to get a domain name and hosting. My personal choice is Namecheap and BigRock (for Indian websites) but you can use any hosting company. You also need to hire someone to create an attractive and user-friendly website. I generally hire website developers from Fiverr. As for the platform, you should go with Shopify. They offer a free 14-day trial.
Ask your website developer to show you a few sample websites and then place an order with them. Creating a blog on your online shop to guide customers to make better purchase decisions can play a vital role. I recommend giving your customers an option to leave comments on your website which will help you serve them better.
Now, on to listing the products, the online store should be made ready with some dummy items first with the Niche products. Sometimes, suppliers may want to see your website before they approve you. Reputed suppliers do not approve of everyone and anyone.
Points to remember while building a store:
- Go for Shopify dropshipping. If the budget is tight, go for WooCommerce
- Optimize site speed
- Make your store mobile-friendly
- Offer multiple payment options
- Add a search box with accurate results
- Showcase your best-selling products on the homepage.
- Pop-up discount if the buyer has stayed for more than 3-4 minutes
For Shopify Users
If you choose Shopify, first set up a storefront, and then install a dropshipping app on your store to browse through their verified suppliers and import the products you want to sell based on price, location, and other parameters.
If your supplier is unavailable through Shopify App, you can manually list the products.
3. Choosing the Right Supplier
By now, you know what you would sell. Now, you can start searching for a supplier that has those items. We are fortunate to have a host of the best dropshipping websites in India like Baapstore, and IndiaMart to name a few even though the concept is not as popular as in Europe and the US. You can partner up with these drop shipping companies in India; however, you should remember that picking the right supplier is very important and should be a well-researched decision.
The right supplier will always be proactive and ensure customer satisfaction at any cost. Such suppliers will have plenty of stock. Most will have fast shipping services with reasonable shipping costs as well, almost the same day provided you place an order with them by 1 pm. Their standard delivery time will be 3-4 days.
While choosing a supplier, think of a manufacturer that does not force you to buy in large quantities. Look for manufacturers (where possible) or real wholesale suppliers. The real suppliers want to do business with serious online retailers only who are capable of giving them high volume business over time. So, their approval may take longer, but once you are approved, they will deliver the best supplier experience. They may offer you even some credit lines.
There are many dropshipping suppliers in India who approve anyone to sell their products within just 5 minutes without asking you a question. I call them fake suppliers. They may impact your business badly in some or another way, so choose only serious suppliers.
Here are some suggestions to help you get the right supplier:
- Pick only the manufacturers or real wholesalers, willing to offer cost-effective items. You can visit their facility, check product quality and ask how quickly they ship their items once you place an order with them.
- You must enter into an agreement with the Indian dropshipping suppliers to ship the items the same day or maximum next working day.
- The suppliers must NOT force you for a minimum order value. They should have a No Minimum policy.
- Ask your suppliers for item prices (single quantity) and compare the price with similar items being sold elsewhere to ensure you are getting the right price so that you can stay competitive.
- Speak to your suppliers to see if they can provide white-label products. White-label dropshipping in India is very successful.
- Your supplier should be able to tell you whether they partner up with an individual or a company. Some suppliers will do their business only with a registered company. In such a case, you may register a company which can be done easily by contacting any Chartered Accountant (CA) online or in your neighborhood.
Recommended Reading: Free and Paid Dropshipping Suppliers
4. Get your GSTIN
GSTIN stands for Goods and Services Tax Identification Number. It is a replacement for Tax Identification Number (TIN).
It is mandatory for you if you sell online in India. This is a basic requirement when you want to start any business in India. However, if you are selling goods that are exempted, this is not required. It may cost you anywhere between INR 750 to INR 2000 depending on who you hire to get your GSTIN.
The documents to register for GSTIN for individuals and sole proprietors are:
- Your PAN card
- Aadhar card
- Proof of address
- Bank account details
You can use your personal or business (current) account. It is a good idea to hire a CA or you can apply for GSTIN online.
6. Market your products
You can now start marketing your products. Marketing your store is a crucial step to gaining success in dropshipping business. Irrespective of what types of products you have, you need to chalk out a solid digital marketing strategy and work on it. You can go to Google Adword or use Facebook marketing campaigns to reach the right audience.
You can do social media marketing to make people aware of your presence in the market. This can be a good start. Using Instagram and Twitter is also a great business idea to advertise your products. You can also contact Instagram influencers to market your products to their followers. You need to spread the word by becoming a part of online groups and communities where people might be interested in your products.
Additionally, you can make your store SEO-friendly to attract internet users to your store generating free organic traffic. It can give you results for a lifetime for free. To start with, you can hire Virtual Assistants (VAs) to write keyword-specific blog posts for you so that your online store can rank on the first page in Google search when someone is looking for the products you are selling.
On top of all this, do not forget to offer excellent customer service to make your business a great success story.
Points to remember:
- Branding: Add a particular color tone or a logo to represent your store. Keep your website language easy to understand and should trigger emotion in visitors.
- Social Media Platforms: Use social media marketing campaigns with promotional videos, high-quality product photos taken from every angle, and customer testimonials. Such content leaves a lasting impression on customers’ minds. Use influencers for marketing your products. Ensure you keep an active social presence.
- Blog Marketing: Showcase your products on Niche-specific blogs.
- Search Engine Optimisation (SEO): Create a separate Blog page on your eCommerce store and write Keyword specific blog posts with key phrases on the web pages to generate free organic traffic to your store and keep it constant.
- Email Marketing: Email automation is still one of the most successful marketing channels. The average open rate across all industries is at 21.80%, and the average click-through rate is 2.78%. Use it effectively but send it only once every 2-3 months.
- Google Ads: Create targeted paid advertising campaigns with Google Ads PPC (Pay-Per-Click) followed by remarketing ad campaigns.
Payment Gateway in India
When building your eCommerce store, you need to integrate a payment gateway to receive online payments from customers.
A payment gateway is an application that makes the online payment process very simple and easy and connects a merchant’s store with the bank.
The payment gateway then verifies the details from the bank and the amount gets transferred from your bank account to the merchant’s bank account.
You can visit their websites to sign up to accept payment using any of these gateways.
- Citrus Pay Payment Gateway
- CCAvenue Payment Gateway
- PayUBiz India Payment Gateway
- Zaakpay Payment Gateway
- Instamojo Payment Gateway
- Bill Desk
- Razorpay Payment Gateway
These gateways accept all payment modes – debit and credit cards, internet banking, Unified Payments Interface (UPI), and even cash on collection (CoD).
Good to Know: All payment gateways perform an initial KYC review to approve merchants to accept payment.
What are the best products to dropship in India?
The taste keeps on changing and so there are no such best products. However, I have compiled a list of the top 10 products in 2022.
- Ring Lights
- Educational products
- Baby Carriers
- Yoga Products
- Face Masks
- Hand Sanitisers
- Artificial Flowers
While picking a product, try to solve a problem and prefer products for which there is no brand loyalty. An example is Rose Seeds.
Why is dropshipping better than wholesale in India?
Dropshippers are able to offer competitive rates to buyers by partnering up with manufacturers directly.
Wholesalers need to work through a distribution channel where they need to first source products from the manufacturers, manage warehouses that cost them. Even after that, they first send the products to retailers who also cut their profit margin and thus the end customer receives the item at a higher price.
On the contrary, drop shippers can sell products to their buyers at a competitive price, increasing their profit margins.
You should always try to use a manufacturer supplier. If you are unable to find one, pick only the profitable in-demand products and use real wholesale suppliers. Some middlemen pretend to be wholesale suppliers. You need to avoid them.
Top Dropshipping Stores in India
There are multiple dropshipping stores in India. I have compiled a list of the 15 best dropshipping sites that you can use to dropship from.
What are dropshipping legal requirements in India?
Let me tell you Dropshipping is completely legal.
However, in order to start a dropshipping business in India, there are certain requirements you need to fulfill.
1. A Registered Business:
To start an online business in India, you need a registered business. If you do not have a registered business, some suppliers will not agree to partner up with you.
2. GST Number:
For an online business in India, GST is mandatory. If you sell products outside India, you need to charge GST from the buyer. It will be an export sale for the buyer.
3. Import Export Code (IEC)
IEC is mandatory to sell outside of India. Additionally, the payment gateway Partners (like Stripe) you integrate with your online store to accept payment from international buyers, may ask for IEC. I had to provide my IEC to get approved for the international payment.
4. Current Account
As dropshipping is also a business, you need to open a Current account too.
Frequently Asked Questions
Can I do Amazon dropshipping?
Yes, Amazon dropshipping is allowed.
How to start Shopify dropshipping?
Shopify is a platform where you can build your online store. You can follow the above steps to start dropshipping with your Shopify store.
Is Aliexpress Shipping to India in 2022?
No, AliExpress does not ship products to India in 2022 due to a ban from the government.
What dropshipping products are the best?
The products from any Niche that have high demand, low competition with good profit are recommended. You can also opt for print-on-demand products to dropship T-shirts or similar items.
Can you dropship from India to the USA?
Yes, Indian dropshipping sites like Baapstore ship their products to the USA.
Is dropshipping legal in India?
Yes, dropshipping is legal. There are no laws around drop shipping that bans it.
How can I start dropshipping?
There are 5 steps to dropship as
1. Brainstorm Niches
2. Build your website
3. Get your GSTIN
4. Find Suppliers
5. Market your products
How much does a drop shipper earn in India?
On average, a drop shipper can earn anywhere between INR 20,000 to INR 80,000 or even more.
How much does it cost to start a dropshipping business in India?
You need no upfront investment to start a dropshipping business. You pay only for domain and hosting.
Who is the richest drop shipper?
Irwin Dominguez from San Diego who within 8 months made $1,000,000 in profit as a dropshipper, is the richest drop shipper.
How many drop shippers are successful?
The top drop shippers from around the internet estimate between 10% and 20%. Ultimately, it is the person that succeeds or fails and so your success completely depends on you only.
Is dropshipping bad?
Dropshipping is not bad. You can succeed with the selection of less competitive products with reasonable prices and targeted advertising campaigns.
What is the profit margin on dropshipping?
The average drop shipping profit margin is between 15%-20%. You can however pick specific in-demand products and use targeted marketing to gain up to 50%-60% profit.
Can dropshipping be a full-time job?
Yes, there are many drop shippers who are doing it as a full-time job. Even with full-time, you can easily manage it by working 2-3 hours on a daily basis.
In this article, I have tried to cover as much as possible on how to start a dropshipping business in India. As you progress, you will learn many other tricks along the way like automation where your can sync your inventory with your suppliers in real-time. I recommend using Live chat software as well on your online store for conversion.
Before you do launch your online store, you must speak to your Chartered Accountant for GST which is mandatory for doing your commerce business in India, irrespective of your business turnover.
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