Dropshipping, a growing trend
Dropshipping is a supply chain management technique and an e-commerce modality. In it, the reseller does not keep the products in stock but offers products that are in the supplier’s stock anywhere in the world.
As long as the e-commerce market expands, the facilities to trade international goods also evolve. Today, it’s possible to purchase products from any country, with fewer taxes than years ago. Not only are big retailers profiting from it, but independent entrepreneurs too. One aspect that makes dropshipping grow, is exactly the fact that they do not need to stock and store products. This reduces their work with logistics, their costs, and their risk on investment. However, it doesn’t mean this is an easy business, without challenges. On the contrary, it takes to study and research to catch good opportunities and elaborate sales strategies.
Here, we list the main actions you need to take, to plan and execute your dropshipping business with GitScrum:
Plan and Manage a Dropshipping Business
1. Define Your Niche and Target Buyer Personas
Before you consider partnering with a big e-commerce retailer or select the tool for your virtual store, define your market. The kind of thing you want to sell. You can, and should, do some online research, checking the potential growth of the demand for certain products. Consider a medium-term horizon for your decisions. Think of macro analysis and do not reduce your business and brand identity to a few items that could no longer exist soon. At this first moment, it’s enough for you to decide the product category you will sell.
According to Forbes (2021), these were the top 2021 selling niches in dropshipping: beauty, survival gear, pet supplies, women’s clothing, baby products, health supplements/herbal remedies/vitamins, gadgets, sporting goods, leggings, and sports attire, jewelry.
Other common examples of product categories in dropshipping are electronics, mobile phones, computers & accessories, gifts, toys, decor items, general clothing, household items.
By defining the kind of product, you will have a good hint of your target buyer personas. That will be essential to elaborate all the necessary strategies for your business to succeed. Gather detailed data about them: main age range, average monthly income, behavioral information, consumption habits, all you can discover. You can obtain this kind of background with online search, specialized institutes, social media groups, or run your own surveys with free online forms.
If you want to work with more than one kind of product(s) and group(s) of buyer personas, you can use GitScrum Mind Mapping to design a portfolio plan of your business, which can expand gradually in branches.
2. Create a GitScrum Project
As there will be many aspects for you to manage, like any other business, it’s important to organize your activities. It would be a mistake to just start creating a website and selling. Be conscious that you are running a business and it needs to be planned and managed. With GitScrum, you will be able to take all the important steps and keep track of their progress, independently of the sales tools you can test and change at any time.
After creating your project, you set and customize your workflow. The GitScrum Board will help you visually manage all your weekly and daily tasks. It brings the ultimate version of Kanban boards, that will look like this:
|TO DO||IN PROGRESS||TESTING||DONE||BUG ISSUE|
|Include 10 new products (11 to 20)||Activate payment methods||Create Website for Virtual Store||Open digital
|Documentation approval||Include 10 new products (1 to 10)||Domain register||Transfer domain ownership|
3. Select and Diversify Your Suppliers
Dropshipping is a modality in which the store does the sales, marketing, and CRM (customer relationship management), and a big retailer supplies the products that are cross-sold and directly delivered to customers. Consequently, the supplier’s selection is a key stage to make your project viable and successful. Besides that, diversifying is also important. Depending on only one supplier can ruin any business, since they can lack products, raise prices, or even close. For each item, you sell, check the market availability, evaluations by other dropshippers, and the percentage you can get from buying and reselling from them.
You can compare all this data by doing some online research and creating a GitScrum Spreadsheet to compare taxes and profitability inside your project. Include the contact data of each supplier, if they offer support, and order them by quality and profitability, to make your daily decisions on displaying and promoting their items.
Research which companies are available for this modality and look for the experience of those who already invest in it. Understand how the delivery works, the quality of the items, if there is a tracking code available.
4. Create and Test Your Virtual Store
There are thousands of options of tools you can use to build your store. You can hire the service of a hosting provider with extra benefits (compare their offers), use a platform like WooCommerce, Shopify, AliDropshipping, and others, or even use Facebook Marketplace. Think of how complex and big you intend to make your project. If you’re willing to make it big, it’s probably a good idea to hire a service with your own hosting and good bandwidth.
Note: So far, only e-commerce businesses in the US can list their product offerings on Facebook Marketplace.
Before you include all your numerous products into your store, do some tests with it yourself, and ask some volunteer customers to do so, too. This way, you will validate the platform, payment method and make sure you made a good choice to start.
Something very important you must include there is a strategic field to catch user data. In the purchase stage, shopping cart, post-sales form, and/or contact form, include text fields so that shoppers send you short reports. They may write to you about how their experience was, and how it could be better. You will order all these forms and transform them into GitScrum User Stories, managing the priorities to implement improvements in your store.
5. Marketing and Sales Strategy
Elaborate your Marketing and Sales project with GitScrum, where you will add and manage tasks, manage subtasks and task checklists to execute all your marketing and sales activities. Create Gitscrum Sprints to associate your sales and marketing goals weekly, monitoring your store performance daily and comparing it to the ideal one.
Create a Mind Map with all the tools and strategies you can use – paid traffic (Google Ads, Facebook ads), Native Ads (Taboola, Outbrain), inbound campaigns, search engine optimization (SEO).
6. Empower Your Branding Actions
Succeeding in this market involves conquering trust from suppliers, partners and even big customers that have the potential to buy larger amounts of products. So, besides preparing your website, consider that you must have a cool logo, and you can also customize your project management tool, to invite your partner companies to interact with you there. Create an exclusive environment where you can display reports, samples, documents, mind maps, graphs and spreadsheets – everything you need. Use your own domain and subdomains and create an exclusive VIP experience that will demonstrate you are a professional entrepreneur. This is possible with Gitscrum White Label, which enables you to show your project management tool like you had developed it for your store.
7. Work with Transparency
Working with clear principles means displaying delivery and payment rules, and a clear returns policy. Developing customer loyalty is what makes a business profitable in the long term, so it’s preferable to miss a few sales and preserve the customers, offering a positive experience. Don’t make them wait too long for the returns, otherwise, they might never come back, and still burn your reputation. On the other hand, if you work honestly, and be agile, promptly returning, they are likely to try again to buy from you. You can use GitScrum Task Checklists to control and monitor your customer returns.
8. Train your Team
Invest in training the people who work with you, so they can provide the best customer experience. Use GitScrum Wiki to publish working guidelines and instructions, and write clear task descriptions while delegating tasks.
As you saw, dropshipping is not “much easier” than traditional e-commerce. It has plenty of challenges since you need to build strong relationships with your suppliers and hold responsibility for their work, too. However, it presents many advantages and opportunities, as no stock and profitability. If you take it seriously and manage it like a business from the start, you multiply your chances to succeed.