How To Start a Dropshipping Business In India? [A Complete Guide]

The e-commerce industry has evolved tremendously as many people have shifted to online shopping for most products. Dropshipping has proved revolutionary for many entrepreneurs entering the e-commerce business. It is gaining popularity because the business model is a relief to the seller. Consumer trends show that most of the products handled through the dropshipping channel are always in demand.

Benefits of dropshipping business

Dropshipping is a method of business where the seller doesn’t need to stock products. This means that the seller can use the services of a third-party supplier to manufacture the product and then deliver it.

The seller is free of inventory management and does not need to manufacture the product. The seller takes the order and notifies the supplier or the manufacturer. His task is done. In most cases, the seller never sees the product that is delivered.

There are several benefits of dropshipping to the seller, but there are also many things of which the seller must be cautious. India is still learning to adapt to this type of business, but it is slowly gaining momentum. The seller must take care of the following when starting a dropshipping business in India.

Steps to start a dropshipping business in India

1. Choosing the Right Supplier

Picking the right supplier is the most important task for any seller interested in dropshipping. One must research well to determine the availability of suppliers and outline the products they supply. A seller must check if the supplier is trustworthy before establishing a long-term business relationship.

As India is still new to this trade, there might encounter fake suppliers. You must be cautious and ensure to check the credibility of every supplier you approach. Here are some pointers that can help you get the right supplier:

• You must be wary of suppliers who depend on a third-party manufacturer to procure products. Go for suppliers who manufacture the products. Managing a longer chain can make it difficult for you to keep track, and you won’t be able to account for any mishaps. In case you don’t get suppliers who manufacture, you should reach out to distributors. Take a look at their inventories and ensure their authenticity.
• Ask suppliers about their delivery times. You must go for faster shipping to beat the competition. Currently, when products are delivered within a day- you must try to get your products shipped in at least 3 to 4 days.
• When you evaluate suppliers, you must check their charges and methods of payment. You may be asked for a one-time fee at the beginning of the services, and later you will be charged individually for each order. They may also ask for a fixed monthly subscription fee. Some of them may ask for a minimum order size to check the seriousness of the seller.
• Calculate the profits you will make after paying your supplier. The profit margins may be low initially, but you must be careful to set your prices accordingly. Higher margins can lead to better profits.
• Check if your supplier can provide white-label products. White-labels ensure that your products are manufactured and packaged under your brand name. That can be a great plus point if you are trying to establish a brand. Your customers will recognise your products.
• GST laws may interfere with some businesses, but it won’t be a problem if you run your dropshipping business as an individual. If you are a registered company, you will be asked to provide your GSTIN to your supplier for each transaction. This will help you claim input credit later. You should clarify the GST requirements with your supplier beforehand to avoid getting into any legal hassles later.

2. Decide which products to sell

Once you have selected a supplier, you can finalise the product. Browse through all the products that your supplier offers. You may also discuss and identify the bestselling products. If it is an online store, you can use some simple tools and hacks to identify the bestselling products.

Make a list of products you can sell and check the variety on other online stores like Amazon and Flipkart. You will get many ideas for the product’s design, description, and pricing in this process. You will see that similar products are being sold already through dropshipping. However, there are many varieties to sell for the same products. Find your niche and check what works for you.

Hence, what can make your business stand out is good product design. After that, you must ensure good quality and considerate packaging. You should keep updating the products through different times of the year. This will take months of research and the study of consumer behaviour.

3. Design your website

A good store should have a website where customers can look up the products. A website will make you look credible. This is where you can assure your customers of your brand value and quality. As you finalise the products you will sell, you will have to acquire virtual representations for them.

Get a domain name and create an attractive and user-friendly website. It should be an organised site where customers can easily find what they are looking for. You can also create a blog that can guide your customers to make better purchases. You can list all the payment methods, and you may also receive customer feedback and comments on the website.

4. Market your products

Once you have made a website and listed the products, you must share all the relevant details with your customers. You must also make it a point that your product listing reaches the potential customer. Marketing your brand is a crucial step to gaining success in dropshipping business. No matter what type of product you have, if you have marketing skills, you will profit. The trick is to reach the right audience.

Marketing and advertising are all about making people aware of your presence in the market. You have to be creative and take some risks. Social media marketing can be a great way to start. Use Instagram, Facebook, and Twitter. Become a part of groups and societies where people might be interested in your products. Interact with people and be nice to them so that they will want to check out your product.

Run social media campaigns to get customers. Most social media platforms offer exposure to brands and services. One can easily get customers if they chose the right plans on these platforms. You can also try Google Adwords and other SEO tactics to attract internet users to your website. A  well-written SEO strategy can come in handy because it will attract customers through the right keywords and marketing.

Key Takeaways

• There are multiple benefits of starting a dropshipping business in India.
• It can start as a low-budget business, and often the risk involved is low.
• You don’t have to worry about inventory or how you will manufacture the products.
• With time as your brand grows, you can hire help to upgrade the quality of your services.
• You may get a team to handle designing and marketing, the key to expanding your dropshipping business.
• This may seem like a lazy job, but you will have to do a lot of research to hit the benchmark.
• If you are consistent, you can attain great success in your dropshipping business over time.

Also read:

1) How to start Kirana business?
2) How to start Online Grocery business?
3) How to start a coaching centre?
4) How to start a dairy business?
5) How to start online saree business?

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FAQs

Q. Is dropshipping legal in India?

Ans- There are no specific laws designed for drop shipping but since this sector falls under the Export section, you would be required to acquire Import Export Code for your business.

Q. How much can you earn from dropshipping in India?

Ans- In India's Dropshipping system income can include profits ranging from anything between 20,000 to 5,00,000 Rupees every month. These sales numbers can be counted as your monthly income in between from 4000 to 2,00,000 per month. This is a standard amount of monetary benefit you can earn from Dropshipping. It all keeps changing at intervals as your business escalates further.

Q. Is Drop Shipping profitable in India?

Ans- Dropshipping in India is a highly profitable market reason being amazing growth scopes, a huge market space for experimentation, and lower risk. The reason why this method is pretty booming is because of low loss opportunities, products in drop shipping are only created when there is a rise in demand.

Q. How much does it cost to start a drop shipping company?

Ans- It costs 0$ in reality. The perfect combinations of various starter plans and free trial packages, along with the high hope and belief in the quality of your products makes it easier. It takes only 45 minutes to start a dropshipping business in India.

Q. Do dropshippers pay taxes?

Ans- Yes, when you're in the dropshipping business you have to pay 2 types of taxes:

1. Income Tax
2. Sales Tax

Q. Who is the richest dropshipper?

Ans- Irwin Dominguez is the richest drop shipper in the world. Hailing from San Diego he managed to gain $1,000,000 in profit as a dropshipper within 8 months of getting into the business.

Q. How many dropshippers are successful?

Ans- The current success rate in drop shipping is around 10% in reality. During the first year of dropshipping business, many drop shippers get into the industry without studying and researching the risk factors involved in the same.

Q. Why dropshipping is bad?

Ans- Dropshipping business isn't bad, it's only considered unsafe due to the risks involved in the same. Hazards or problems in drop shipping include:

1. High shipping costs
2. Low-profit margins
3. Little quality control

Q. How can I start a dropship business with no money?

• Step 1- Find products to sell.
• Step 2- Find a reliable + trustable supplier for your dropshipping business.
• Step 3- Upload your products to eBay with accurate information.

Q. What companies offer drop shipping?

Ans- These are the top 6 Drop Shipping Companies of 2021:

1. Importify
2. Oberlo
3. Spocket
4. Worldwide Brands
5. Printify
6. Inventory Source

Q. What is the profit margin on dropshipping?

Ans- The standard dropship margins lies at 20% while gliding towards 15% with time. This margin comes before you pay your credit card dues and other fixed costs/charges. If you're going for wholesale purchasing then you might get the products 40 to 50% off the retail market price, that'll help you to get connected with similar vendors.

Q. Do I need a sellers permit to dropship?

Ans- Yes, a seller's permit is required for dropshipping from direct suppliers to your customers. It will also help you to avoid getting charged for sales tax on every order you place from your supplier.

Q. Can dropshipping be a full-time job?

Ans- Yes, dropshipping can be a full-time job if you commit to it wholeheartedly. It takes a little extra time but you can absolutely make drop shipping a full-time job.