Last Updated on April 6, 2022

Today, the one who wants to lower the overhead while stepping into the eCommerce industry may follow an ideal approach, namely dropshipping. But the dropshipping market is rapidly going high in recent years, so the competitors are also growing alongside.

Dropshipping is the best way to expand your product line, manage your inventory, and kick off an online startup. It offers entrepreneurs a chance to invest less and get more.

In dropshipping, the store owners import the products from 3rd-party sellers and list them on their eCommerce stores. This strategy assists in reducing the costs of stocking the inventory. You can manage the dropshipping process easily and ship products to your customers with a few clicks only.

With the assistance of dropshipping, there is no need to manage heavy inventory requirements for running an eCommerce store. You can outsource your inventory management and order fulfillment to 3rd-party suppliers.

Today, in this post, we will discuss dropshipping in detail, top dropshipping plugins, the statistics, trends of dropshipping, and a lot more.

What Is Dropshipping?

A business model that helps in running an online store without any inventory is dropshipping. With this business model, you can sell your products directly from wholesalers to your customers. Being a retailer, you just need to keep your product catalog up without even holding any inventory.

Process Of Dropshipping

How Dropshipping Works on an online ecommerce store


Let’s talk about the process first.

  • Whenever a consumer places an order, the retailer forwards it to its supplier.
  • Next, the supplier ships the products directly to the customer.
  • Ahead, the retailer gets the full details of sold products from his wholesaler to his eShop.

This process proves to be easy and hassle-free for the retailers as there is no need to worry about inventory, packaging, or shipment.

Let’s take an example to get it more perfectly:

Suppose a customer places an order costing $100.

  • You just need to pay $60 to the supplier, which is a wholesale price.
  • Next, the supplier directly ships the product to your customer and you keep the rest $40, the profit amount.

Also Read: Magento Review for eCommerce Website Development

Benefits Of Dropshipping – Why To Choose A Dropshipping Business

eCommerce merchants get some significant benefits from Dropshipping. Let’s check them out:

Scalability

A dropshipping retailer may scale up rapidly as order fulfillment doesn’t rely on the size of a physical space or the number of workers required to ship an order. Because of this only, retailers can reap tremendous benefits from dropshipping as they experience varying sales due to other reasons and seasonal factors.

Broad Product Offerings

Dropshipping comes with various product opportunities. With dropshipping, merchants can provide a wide range of products to a small business.

Reduced Startup Costs

Businesses with a dropshipping strategy don’t have to invest in managing an inventory or paying for a location to store the inventory. Moreover, they don’t need to spend much time organizing their inventory or hiring a team to meet the orders.

It means dropshipping is best for the one who is a newbie to the eCommerce industry. One who lacks the required funds to start a traditional retailing business may opt for a dropshipping business.

Lower Inventory Management

By diminishing the need for maintaining physical inventory, dropshipping lowers the overhead of management that retailers face. They don’t have to spend their time tracking the inventory, handling the infrastructure that stores it, or managing shipping outsourced to suppliers.

Flexibility

Dropshipping brings flexibility to various faces of a retail business. You can operate your dropshipping business from anywhere, offer distinct sorts of products, and quickly change its offerings with the changing market preferences.

Also Read: How To Develop A Custom Shopify Dropshipping App

Why Choose Magento For Your Dropshipping Business?

Magento plays a vital role in the eCommerce business. It is developed especially for the eCommerce industry only. It holds the caliber to support all sorts of online stores. Magento arrives with varied features that offer outstanding support. Such innovative features of Magento make it the most preferred eCommerce platform compared to other eCommerce development platforms in the eCommerce industry.

Chief reasons to choose Magento eCommerce platform for dropshipping over other CMS(s):

  • Magento charges no commission for any order.
  • It offers transparent billing.
  • It is a self-hosted platform.
  • There is no limitation on the number of orders.

Well, dropshipping is a tricky process of implementation. That’s why it would always be beneficial to choose Magento 2 development company. It will help you with all the necessary steps to start your dropshipping business.

Benefits Of Choosing Magento for Dropshipping

Let’s check out the benefits of choosing Magento for Dropshipping.

  • With Magento, there is no need to worry about storing and handling the product inventory.
  • It leads to less overhead expenses that finally save you from paying for rent and maintenance of inventory for stocking your products. It leads to enhanced conversion rates and ROI.
  • With Magento for Dropshipping, you can list different types of products. It assists you in expanding your product line and serving your niche market.
  • It is pretty annoying to deliver the ordered items outside the country because of time constraints, high shipping rates, and extra charges. So, one can agree with various vendors closer to the buyers for delivering the items faster.
  • It becomes more accessible for the eCommerce store owners to roll out an eCommerce business in no time with various advantages of Magento for Dropshipping. You can set up your online store with a small investment and start selling locally and globally.
start dropshipping with your own Magento Store

How To Dropship With Magento – Process To Follow?

Starting a dropshipping business is the very first step for merchants to step into the eCommerce market. Now, we will check out the steps to dropship with Magento to build dropshipping eCommerce business and make your brand stand uniquely.

1. Finalize A Dropshipping Business Idea

business idea for dropshipping

First, it’s essential to pick a dropshipping business idea. For that, you should analyze all the concepts related to the things you need to sell and list them out. Apart from that, you may conduct market research that may also help you identify trending products and in-demand products.

As you know, numerous merchants have already started their dropshipping eCommerce journey. So, choosing a niche as per your interest would be best here. Merging deep research and your passion will assist you in winning the market quickly.

Tools to Use: Well, you can use these tools available on the internet, like Google Keyword Planner, Ubersuggest Keyword Tool, or Google Trends. Using such tools, you can explore all the trendy things that the users search on the internet.

2. Analyze Your Competitors, The Products They Sell, & Their Way Of Selling

competitor research for dropshipping

Next, to know the possibility and profitability of your idea, the merchants should analyze their competitors. Besides knowing what they sell, you should also observe their way of selling products. This analysis will ensure the competence of your store with the others.

Tools to Use: Again, you can use different tools here. The two most popular digital devices, namely Ahrefs and SEMrush, will help you search for your competitors’ web traffic and learn how they rank so high. You can start by exploring the products on Google that you want to sell. This way, you will know which names of your products are coming on the search engine result pages (SERPs).

3. Choose Test Samples & Reliable Dropshipping Suppliers As Per Your Business Needs

choose dropshipping suppliers

Next, you need to select dropshipping suppliers whom you find reliable. For that, you need to search for suppliers who offer the products you want and the options that fulfill your requirements the most.

As per your market research, you may want your suppliers to be overseas or domestic. Ahead, check if their products’ quality, delivery time, policies, and services are ideal. All such aspects are crucial as this will make your business run smoothly.

Further, you should contact the suppliers who meet your needs the best and suggest a relationship. You need to have at least two or three suppliers, and then you may start testing their products by ordering some samples yourself. It will let you know whether they are reliable in the long run or not. Additionally, you can ask for custom services like custom labeling to improve the packaging and promote your brand.

Some of the top spots where you can find the products for dropshipping are Alibaba, Alidropship, and Spocket.

4. Develop Your Online Store To Offer Varied Items To the Customers

After you pick your dropshipping suppliers, next, it’s time to invest in a website. On such a site, you can offer many items you want. Generally, eCommerce web development demands an eCommerce platform such as a website builder or Magento to host your eStore, a domain name, and a perfect theme.

You may hire a leading eCommerce development company to complete all such tasks. Look for a reliable development team holding experienced and certified professional web developers who have successfully delivered varied projects. The company you choose should become all set to customize its services as per your business requirements, regardless of your industry and business size. It will offer you a fantastic eCommerce experience that will drive expected sales.

A domain name also matters a lot as it makes the online users understand what your site is all about and how they can remember it. That’s why you should choose an understandable, short, and related domain name. A “.com” domain name is highly recommended

5. Promote & Optimize Your eCommerce Store To Start with Selling

When we reach this step, you will find your eCommerce store almost complete. Now, you should promote your eStore and optimize it to get its first orders so that your brand can start growing.

Well, here, you may think about some advertising ideas as per your budget, like display ads, Facebook ads, influencer marketing, and more.

Some merchants usually ignore the inbound factors, but they matter a lot. You should pay attention to SEO performance and working of your content as this is an economical way to enhance your website’s ranking.

Moreover, be sure that you use free marketing channels to approach potential customers, such as email marketing and social media marketing.

Top Magento Dropshipping Plugins

As there are hundreds and thousands of Magento 2 Dropshipping plugins available in the market, it becomes tough to pick the most suitable and best one for your brand.

That’s why to ease you; we are here with a list of top Magento 2 dropship extensions. Let’s learn about them:

Magento 2 Dropship Extension By Unigry

Unirgy

One of the most reliable Dropship extensions, Unigry permits users to sell products from various suppliers and handle inventory quickly.

Unigry Dropship Extension automatically follows the entire process between stores and dropshippers and updates the orders and shipments whenever needed. Moreover, it provides the customers with top and rich features and is relatively reasonable.

Top Features

  • Support various shipping sources for orders.
  • Perform well with all 3rd-party suppliers.
  • Cooperate with various suppliers for a product.
  • It delivers the notice to suppliers automatically.
  • Allow pre-order shipments for specific suppliers.
  • Price: $950
  • Support: 1-year free Tech Support
  • Compatibility: Magento 2 and beyond.

Magento 2 Aliexpress Dropship By Webkul Store

magento-2-dropship-webkul

A reliable and effective shipping method, Aliexpress Dropship for Magento 2 is best for those looking for a stock dropshipping extension for their eCommerce stores.

With this Magento 2 Dropship Extension, users can easily import products from Aliexpress into their online stores and start their business. Moreover, they can track the orders more efficiently through various warehouses, and again the credit goes to Aliexpress Dropship.

Top Features

  • Organize limitless warehouses.
  • Generate price rules for inventories.
  • Import the products from Aliexpress.
  • Separately log in to the warehouse manager.
  • Support various inventories.
  • Choose the shipping methods for specific warehouses freely.
  • Price: $199
  • Rating: 5
  • Support: 3 months free support
  • Compatibility: Magento 2.0.x – 2.1.x – 2.2.x – 2.3.x

Magento 2 Dropship Extension by Xtento

Magento 2 Dropship Extension by Xtento

An ideal choice for those who face difficulty in foreseeing the orders and shipments, Xtento Dropship is best suitable for all types of dropshippers and suppliers.

When you use the Xtento Dropship extension, you may save lots of time and effort as it comes with a trustworthy and speedy integration process.

Top Features

  • It works perfectly with any dropshipper and stock supplier.
  • Provide auto-order export.
  • In Magento 2, it keeps tracking order status.
  • This extension features the four individual modules, including Product Export, Stock Import, Tracking Number Import, and Order Export.
  • Download and install easily.
  • Price: $686
  • Rating: 5
  • Support: 6 months free email support
  • Compatibility: Magento 1 and Magento 2

Magento 2 Dropship Extension By Boost My Shop

boost-my-shop-drop-shipping

The Dropship extension from Boost My Shop is associated with the Embedded ERP Extension Suite, the most potent Warehouse Management System. It allows the customers to import products and stock for items.

Top Features

  • This plugin offers the suppliers a reasonable cost.
  • Import faster supplier stock and price.
  • Track the status of the Dropship workflow.
  • It offers information about supplier email, including client packing slips.
  • Price: $349
  • Rating: 5
  • Support: 3 months free support
  • Compatibility: Magento 2.2.x & 2.3

Shipper HQ by WebShopApps

shipperhq-th

WebShopApps Dropship Extension for Magento 2 arrives with all the essential features of the Dropship solution that smoothen the whole shipping process from many locations.

You can even download and install this Magento 2 Dropship extension easily at free of cost.

Top Features

  • It integrates with the ShipperHQ module.
  • Provide different selections (place, carrier, and email address) for all warehouses.
  • Allow various suppliers to log in to a warehouse.
  • Choose the shipping modes flexibly.
  • Auto-send the notice to emails of shoppers when they order for items.
  • Price: Free
  • Rating: 5
  • Support: 30 days free trial
  • Compatibility: Magento 1.6+

Magento & Dropshipping Business – Stats & Trends

  • About 12% of all eCommerce stores use Magento.
  • On the internet, there are approximately 250,000 and more Magento eCommerce stores running successfully.
  • About 11,000 of the total Magento online stores chosen Magento 2 for the development of eStores.
  • Per day, Magento receives about 5,000 downloads.
  • In the last year, approximately 7,500 online stores have migrated to Magento from other eCommerce platforms.
  • The dropshipping’s global market size was valued at $102.2 Billion in 2018 and is likely to register a CAGR of 28.8% until 2025.
  • As per a survey in the year 2017, India’s eCommerce market was holding $38.5 billion valuations. Ahead, it is likely to reach $200 Billion by the end of the year 2026, at a CAGR of 51%.
  • Moreover, according to the Global System for Mobile Communications Association (GSMA), it is likely to reach 3,900 million by 2025.
  • In 2019, North America laid an impact on dropshipping business with a share of 35.6%.

Cost For Developing Dropshipping Business With Magento

Technically, you can start dropshipping with $0.00 also. With a perfect combination of starter plans and free trials, along with 45 minutes of extra time, you can create your dropshipping store. And if you are struggling with setting up your online store with Magento then you should thing about hiring a Magento developer.

How To Hire A Magento Developer For A Dropshipping Business

After you are all set with the needs of your dropshipping store, you can start with the process of hiring Magento developers for developing your dropshipping business. You may follow the below steps:

Reviews and Ratings

These days checking reviews has become a trend, and it’s worth doing so. Checking reviews will offer you an idea about the potential Magento development company, its past projects, and its working proficiency.

Credentials and Work Portfolio

It’s essential to look for the company’s previous work you think would be the best choice for your project. Its experience, certifications, proficiency, and services will showcase its portfolio. It would help you in emerging with the best selection of a Magento dropshipping business development company.

Location and Communication

After reviewing the portfolio, you should check its location and target communication first. You should keep a check on the communication of the potential companies you choose. Moreover, you need to ask them for pre-and post-development services also. The location also plays a vital role while choosing a company as timezones may also create a hindrance.

Top Quality At Best & Affordable Price

Besides, you should also check the quality of the services your potential company is offering. Check if you are getting the best quality within your pre-decided budget. Moreover, discuss a flexible strategy with your chosen Magento development company and check how that works.

Conclusion

So, launching a successful dropshipping business relies on the eCommerce platform you choose. Magento arrives with various features that ease the tracking of inventories, even if you don’t stock the products. Moreover, Magento offers a robust system for tax calculation, permitting the merchants to factor in all the variables when working with dropshipping suppliers. Furthermore, analytics and reporting features assist the retailers in tracking orders and maintaining profitability at any scale. It is essential for the businesses that depend on the dropshipping model to attain a high sales volume while maintaining a limited staff.

Author

CTO at Emizentech and a member of the Forbes technology council, Amit Samsukha, is acknowledged by the Indian tech world as an innovator and community builder. He has a well-established vocation with 12+ years of progressive experience in the technology industry. He directs all product initiatives, worldwide sales and marketing, and business enablement. He has spearheaded the journey in the e-commerce landscape for various businesses in India and the U.S.