Give yourself the best chance of success with these 10 essential dropshipping tips for 2024.

Dropshipping offers inexpensive startup costs, flexibility in operating your business from any location, and a low barrier to entry, making it a desirable business model for would-be entrepreneurs.

Between now and 2030, the global dropshipping market is projected to expand at a rate of 22.8% annually. However, dropshipping’s accessibility makes the market extremely competitive. To maximize the chances of success for your dropshipping business, you should take care of everything.

Read on with interest: the 10 dropshipping tips in this post might just help your business to flourish.

10 dropshipping tips for 2024

1. Own your supplier’s mistakes
2. Manage your inventory levels
3. Fulfill orders intelligently
4. Implement security best practices
5. Handle chargebacks quickly
6. Write an effective return policy
7. Adopt simple shipping rules
8. Provide great customer support
9. Consider phone support
10. Focus on marketing

1. Own your supplier’s mistakes

Even excellent suppliers occasionally make mistakes, and using a dropshipping business model makes delivery failures inevitable. What should you do, therefore, if your supplier sends nothing at all or the incorrect item? Here are three potential choices:

1. Take the blame. Under no circumstances should you blame your dropshipping supplier for the mistake. It will only cause confusion and make you look like an amateur. The customer has no idea the dropshipper even exists. Instead, you need to own the problem, apologize, and let the customer know what you’re doing to fix it.
2. Make it up to the customer. Depending on the level of the mistake, you may want to proactively offer the customer something for the error. This could mean refunding the shipping fee (a personal favorite of ours) or an upgrade if the customer needs a new item shipped out.
3. Have the supplier pay to fix it. You may have to assume responsibility for the error, but that doesn’t mean you need to cut into your profit margin. Any reputable supplier will pay to fix its own errors, including paying for shipping costs to return items. However, it probably won’t pay for any freebies or upgrades you gave the customer. You need to consider those public relations and marketing expenses.

Again, even the finest dropshipping providers will err from time to time, but you should be very suspicious of a provider who consistently processes your orders incorrectly. In the unusual event that you can persuade the supplier to alter, your company’s reputation will suffer. You should definitely start looking for another supplier if this is the case.

2. Manage your inventory levels

The largest obstacle to operating a profitable dropship company is maintaining inventory among several vendors, as most seasoned dropshippers can attest. If you perform this poorly, clients will be informed repeatedly that their order is out of stock, which is not a good way to build a devoted following and encourage repeat business.

It’s a complicated procedure to manage inventory across your distributors and suppliers and reduce the amount of out-of-stock items you sell. You may sync inventory on your Shopify store with the aid of Shopify apps like Syncee and DuoPlane or a web-based solution like Ordoro. Although suppliers don’t always provide real-time data streams, this is a terrific choice when they do.

The following inventory management dropshopping advice should significantly lower the quantity of out-of-stock items you sell:

Use multiple suppliers

Having access to several suppliers with overlapping inventory is one of the best ways to increase your order fulfillment percentage through dropshipping. There’s a good probability Supplier B has the item in question if Supplier A does not.

Furthermore, it’s dangerous to get your product exclusively from one supplier. Your online store may not survive if they decide to raise their prices, stop working with you, or go out of business.

Even while two suppliers won’t provide the identical goods, if they serve the same dropshipping market or sector, they will probably both carry the best-selling things, which should be your top priority.

Pick your products wisely

Try to sell mostly the products that you are certain all of your suppliers carry after you have validated your product. In this manner, for any product you carry, you’ll always have two possible fulfillment choices.

Use generics to your advantage

It is possible for two providers to carry nearly identical, interchangeable products, even if they do not carry the exact same item. This is especially valid for minor add-ons and accessories for products. If you can verify that two products are almost the same, create a generic product description that enables you to work with either supplier to complete the order.

Don’t forget to provide the model numbers of both vendors in the model box. In this manner, you can send an order invoice to any provider without requiring adjustments.

Check on item availability

An item is not always carried by a dropshipper just because it is listed on its website. Speaking with your sales representative about the products you are thinking of selling’s availability is a smart move.

Do you have these things in stock at least 90% of the time? Or does the dropshipper just have a little quantity on hand and frequently struggle to persuade the manufacturer to restock the product? It is best not to have the latter kind of merchandise in stock.

Dealing with out-of-stock orders

Even with the greatest of planning, there will unavoidably be orders from customers that you are unable to fill. When a product is out of stock, provide a complimentary upgrade to a better, comparable option rather than informing the customer of this. You’ll be able to keep the client relationship going forward, and your customer will probably be overjoyed.

It’s possible that you won’t make any money from the order, but that’s okay too—you wouldn’t have either if your buyer had canceled.

3. Fulfill orders intelligently

As we’ve already covered, using numerous suppliers has several advantages, including a higher chance that items will be in stock, geographical diversity for quicker delivery, and the ability to avoid being dependent on any one source for your products. But how can you decide which provider is best for you when there are so many possibilities available to satisfy an order? There are several approaches to think about:

Route orders to a preferred supplier

If you have a single supplier that you deal with well (excellent selection, outstanding service, etc.) and stocks the majority of your items, you can set up a default order route that goes via that provider only. This is especially simple to set up; all you have to do is add your supplier’s email address to the recipient list for every new order confirmation, which will automate the entire process.

Route orders based on location

You can easily route the order to the provider nearest to your consumer if you work with numerous suppliers who each carry the bulk of your products. This reduces transportation costs and speeds up delivery to your consumer.

Route orders based on availability

In the event that your extensive product catalog is distributed among multiple suppliers, you will probably have to assign each order to the dropshipper that carries the item in question. If you choose this choice manually, it will take more time; however, if your suppliers give data feeds, it can be automated using a service like eCommHub.

Route orders based on price

This is fantastic in theory, but it might be challenging to immediately identify which supplier will be cheapest unless one has much better price. Potential drop fees, real-time supplier pricing, and real-time shipping rates must all be taken into account in any automated system. Therefore, while it’s not impossible, putting in place a precise automated system to do this might be challenging.

4. Implement security best practices

There is no justification for operating an internet business in the modern world with inadequate security or fraud protection procedures. Here are some dropshipping pointers to protect your clients’ private information when they shop online.

Storing credit card numbers

Keeping track of your clients’ credit card details facilitates easy restocking and could boost revenue. However, the security risks and responsibility are usually not worth it if you host your own website.

You must adhere to stringent PCI (payment card industry) compliance regulations and security audits in order to retain credit card data. You may also be held accountable for the card information that is taken if your server is compromised or hacked.

Storing credit card information about your customers is not the greatest solution. Offering one or more third-party payment alternatives, such as Shop or PayPal, can expedite checkout times, lower cart abandonment rates, and free up time for you to concentrate on customer support and marketing rather than security checks.

Dealing with fraudulent orders

When you first start out, the risk of fraudulent orders can be unsettling, but the majority of losses resulting from fraud can be avoided with a little prudence and common sense.

The AVS, or address verification system, is the most popular and extensively utilized fraud protection technique. Customers who have enabled AVS must input the address linked to their credit card in order for the transaction to be authorized. This makes it harder for thieves to make successful online purchases using just the credit card number.

Orders placed fraudulently through e-commerce almost always have various shipping and billing addresses. In these situations, a thief inputs a different shipping address for the products and uses the address of the card owner as the billing address.

Fortunately, fraudsters typically follow patterns that make it simpler to identify fraudulent orders before they are shipped. These indicators won’t help you identify a fake order on their own, but if you notice two or three of them, you should look into it:

• Different billing and shipping addresses. Again, more than 95% of all fraudulent orders will have different billing and shipping addresses.
• Different names. Different names on the billing and shipping addresses could be a red flag for fraudulent orders. That, or a gift purchase. 
• Unusual email addresses. Most people have email addresses incorporating some part of their name, allowing you to match part of an email address to a customer’s name. But if you see an address like dfssdfsdf@gmail.com, there’s a good chance it’s a made-up address and is one sign of fraud.
• Expedited shipping. Since they’re charging everything to someone else’s card, fraudsters will often pick the fastest—and most expensive—delivery method. It also reduces the amount of time you have to catch them before the item is delivered.

Pick up the phone if you see an order that you think is fake. Almost never do con artists provide their actual phone number on an order. You should have a 30-second conversation with someone who clarifies everything if the order is valid.

If not, you will receive a dead number or a caller who is unaware that she placed an order for a 25-foot boat that will be delivered the next day. By then, you can avoid chargebacks and other issues by canceling the order and issuing a refund.

5. Handle chargebacks quickly

You’ll get a “chargeback” if a customer disputes a charge you made by calling their bank or credit card company. In addition to temporarily deducting the disputed charge from your account, your payment processor will require documentation proving that your dropship company actually sent the goods or services to the customer.

You will forfeit the disputed amount and be hit with a $25 chargeback processing fee if you are unable to produce documentation. You can potentially lose your merchant account if you receive an excessive number of chargebacks.

Fraud is typically the main reason for chargebacks, but consumers may also contest a charge if they didn’t know who you were, didn’t remember doing the transaction, or just didn’t like the item they received.

You must take immediate action because you frequently have a few days to reply after receiving a chargeback. You’ll probably need a wholesale packing slip that lists the products you bought and sent, proof of the initial order, and tracking information proving delivery if you want a chance at getting your money back.

Sadly, you’re probably not going to succeed if the chargeback relates to an order that has different shipping and billing addresses. The majority of processors will only pay you back if your card is used to ship fraudulent orders to the billing address.

6. Write an effective return policy

Make sure you know how each of your suppliers handles returns before creating a return policy for your dropshipping business. Should their return policy be as loose as 45 days, you can afford to be more lenient with your terms. You may need to reassess the terms you can afford to have in place if one provider has a rigorous return policy.

When a customer needs to return an item, the process will look like this:

1. A customer contacts you to request a return.
2. You request an RMA (return merchandise authorization) number from your supplier.
3. The customer mails the merchandise back to your supplier, noting the RMA # on the address.
4. The supplier refunds your account for the wholesale price of the merchandise.
5. You refund the customer for the full retail price of the merchandise.

It’s not always this straightforward, however. The following variables can complicate returns:

Restocking fees

Restocking fees are imposed by certain vendors and are simply an additional cost associated with having to return an item. We strongly advise against charging your customers these fees, even if your supplier does charge them, as they will make your online store appear archaic and unwelcoming.

Even though you might occasionally have to pay a fee, the more clients you attract will more than make up for that outlay.

Defective items

Having to spend more for postage to return a damaged item is the only thing worse than receiving it. For damaged items, the majority of dropshipping vendors won’t pay for return shipping. They contend that since they did not produce the product, they are not accountable for any flaws.

However, if you want to establish a respectable firm, you should always reimburse your clients for the cost of returning defective merchandise. This is just one of the expenses involved in managing a profitable dropshipping company.

It frequently makes sense to just mail the customer a new product instead of asking them to return the defective one if it is a reasonably priced one. When compared to requiring them to return the previous item, this provides several benefits. These include:

• It can be cost effective. It doesn’t make sense to pay $10 to return an item that only costs you $12 from your wholesaler. You’ll get a $2 net credit, but it’s not worth it for the hassle to your customer, supplier, and staff.
• The customer is blown away. By offering the convenience of a replacement without the hassle of a return, you’ll increase customer satisfaction and even drive repeat sales. The customer will also get the new product much faster than they would if the old one had to be returned to the warehouse prior to shipping a replacement.
• Your supplier may pay for shipping. Suppliers won’t pay for return shipping on a defective product, but most will pay to have a replacement sent to the customer. Because they’ll be paying for return shipping anyway, most suppliers can be talked into covering the shipping on a replacement product that you simply purchase separately. 

Most businesses require the buyer to cover return shipping costs when a consumer wishes to return a non-defective item for a refund. Offering free returns on anything will make you stand out; businesses like Zappos have included this into their distinctive company strategy.

Nevertheless, universal free returns can get pricey, and the majority of buyers will realize that they shouldn’t have to pay for return freight just because they ordered a product that they later decided they didn’t want.

7. Adopt simple shipping rules

For owners of dropshipping businesses, figuring out shipping costs can be very confusing. It is challenging to determine shipping costs for orders with accuracy because there are so many distinct products that are shipped from different locations.

You can select one of three shipping fee types:

• Real-time rates. With this method, your online shopping cart will use the collective weight of all items purchased and the shipping destination to get an actual real-time quote. This is very accurate but can be difficult to compute for shipments from multiple warehouses.
• Per-type rates. Using a per-type method, you’ll set flat shipping rates based on the types of products ordered. So all small widgets would ship for a flat $5 rate, while all large widgets would be $10 to ship.
• Flat-rate shipping. As the name implies, you’d charge one flat rate for all shipments, regardless of type. You could even offer free shipping on all orders. This method is the easiest to implement but is the least accurate in reflecting actual shipping costs.

Current rates. Using this method, an actual real-time quote will be provided by your online shopping cart based on the combined weight of all things you have purchased and the delivery destination. Although fairly exact, this can be challenging to calculate when shipping from several different warehouses.

rates by type. You can set flat delivery prices according to the kinds of products you order by using a per-type method. Therefore, shipping for all tiny widgets would be $5 flat, while shipping for all large widgets would be $10.

shipment for a fixed charge. It sounds like there would be a single, flat fee for all shipments, no matter what kind. You may even provide free shipping for every order. Although this approach is the simplest to use, it represents actual freight prices with the least accuracy.

Would you really want to implement a system that passed along additional shipping fees based on the location of your suppliers, even if you could? The majority of clients object to high shipping costs, particularly if they believe their product is coming from a single place.

Instead, make an effort to reduce the number of shipments by choosing suppliers who have overlapping inventory and selling only a limited number of products. This is a long-term option that is far more doable and straightforward.

International shipments

Although it has gotten easier, sending internationally is still more complicated than shipping domestically. When shipping abroad, keep the following in mind:

• Different weight and length limitations for different countries
• Additional charges from suppliers for processing international orders
• The added expense of resolving problematic orders due to higher shipping fees
• Excessive costs for shipping large and/or heavy items

Does the trouble make sense? It is dependent upon the margins you make and the market you are in. The greater market reach you can get by selling small things with larger profit margins might justify the trouble and cost of providing international shipping. For others, the increased benefit won’t be worth the cost and difficulty, particularly small business owners that sell heavier or larger items.

Choosing a shipping carrier

Choosing the correct carrier can save you a lot of money, so it’s crucial. The biggest choice you’ll have to make in the US is between the US Postal Service and UPS/FedEx.

• UPS/FedEx. These privately-run giants are great for shipping large, heavy packages domestically. Their rates for big shipments will be significantly lower than those charged by the USPS.
• US Postal Service. If you’re shipping small, lightweight items, you can’t beat the rates offered by the USPS. After dropshipping fees, the cheapest UPS shipping fee you’re likely to see is around $10, while you can often ship items for $5 or less through the post office. The post office tends to be a better choice for sending international shipments, especially smaller ones.

When setting up your shipping options, consider categorizing them by shipping time (“Within 5 Days” or “Within 3 Days”), as this gives you the flexibility to pick the carrier that’s the most economical for each order and delivery time.

8. Provide great customer support

Running a dropshipping company and keeping track of all the emails, requests, and returns from customers in an Excel spreadsheet is not ideal. Similar to this, handling support with a single email inbox quickly becomes problematic and causes issues and service lapses as your team and organization expand.

One of the greatest dropshipping strategies to guarantee top-notch client assistance is to put in place a support desk and create FAQ articles. Although helpdesk software takes many different shapes, it all offers a single spot to host a FAQ page and handle customer support inquiries and problems. The majority of desks make it simple to assign problems to team members and keep track of previous correspondence between all parties involved.

A few popular options to choose from include:

• Help Scout. Less cluttered than other desks, Help Scout treats each issue as an email and removes all the traditionally appended ticket information that customers see with support requests. Instead, support tickets appear like standard emails to customers, creating a more personalized experience. Plans start at $15/month.
• Zendesk. Highly customizable and powerful, Zendesk offers a variety of tools and integrations and is one of the most popular help desks available. It takes some customization but is very powerful once it’s tailored to your company. While the app is free to use, it does require a subscription to the Zendesk Support Team Plan, starting at $19/month.
• Gorgias. Built specifically for your Shopify store, Gorgias manages all of your support queries in one place, helping you reduce response time and increase the efficiency of your customer support. Gorgias has automation tools to personalize responses to your most frequent questions. Plans start at $60/month.
• HelpCenter. Access all customer inquiries from email, Live Chat, and FB Messenger in a single platform and save time. It’s easy to create an FAQ page from scratch to help customers self-serve and find answers to their issues. A free plan is available.
• Richpanel. See order data next to each ticket. Send tracking info, edit orders, and issue refunds without leaving the help desk. Create self-service scenarios in the help center and instantly answer common repeat questions. A free plan is available.

9. Consider phone support

You probably won’t be able to set up phone support for your dropship company if you’re bootstrapping it while working a nine to five job. However, it could be a viable alternative if you’re dedicating your entire time to your e-commerce firm.

Think about the kinds of dropshipping goods you plan to sell when choosing phone support for your online store. For a diamond shop selling jewelry priced between $1,000 and $5,000, a lot of your consumers might feel uneasy placing an order that size without speaking with a live person.

If you do choose to provide phone support, do it with thought. Placing a big 800 number at the top of every page may result in an excessive amount of unimportant calls that are more expensive to handle than they are beneficial. Instead, think about placing your number in strategic places where you know the visitor has a good chance of making a purchase, such as the contact and shopping cart pages.

Thankfully, there are lots of outside services available to assist you in setting up a sales line and toll-free number, such as:

• Grasshopper. Grasshopper offers phone services and is geared toward smaller businesses and entrepreneurs. You can get a toll-free number, three extensions, call forwarding, and voicemail for a reasonable monthly fee (around $26).
• Aircall. Aircall offers an essential plan that gives you phone, email, and help center, effectively making it basic help desk software. It allows you to have a toll free number and unlimited calling in the US and Canada (international rates apply). It also integrates with other popular help desk software, like Zendesk.

10. Focus on marketing

The final step in making sales is getting buyers to locate your dropshipping store online. Here are some dropshipping pointers to get you started as a new dropshipper and enhance website traffic.

Start with SEO

Optimizing your website to improve its chances of appearing highly for relevant keywords is known as search engine optimization (SEO).

Your product pages should ideally rank for relevant keywords so that users may find them on their own via search engines. Although the majority of keyword searches are two- to three-word short-tail inquiries, they are more crowded and competitive, which makes it difficult to rank for.

Try concentrating on long-tail keywords, which are three words or longer, as an alternative. Long-tail keywords have fewer searches, but because there is less competition, it is much easier to rank for them.

Using resources like keyword.io and Google Ads, you can find these. When you enter the name of your product into the tool, a list of relevant search terms will appear that you can include in your product descriptions.

Use Facebook Ads to leverage social media

Making Facebook advertisements gives you direct access to a community of engaged and active social media users.

Through targeted adverts, Facebook advertisers may access extensive user profiles created by all of the likes and connections established by users. One benefit of Facebook advertising is that it allows you to target social media users based on their demographics, interests, and actions.

You can increase the possibility of contacting the ideal client in your target market by matching the products in your dropship store against a huge list of social media users’ interests, characteristics, and behaviors using Facebook’s Ads Manager tool.

After that, you can place a bid to show a user your product. For your Facebook offers, experiment with various ad formats (picture, video, carousel, or collection) to determine which paid campaigns result in the highest conversion rates at the lowest cost.

Target customers with Google Ads

With Google Ads, you can target potential customers directly on Google and YouTube, the two biggest search engines. Similar to most other ad networks, Google advertising allows you to set a daily budget and maximum expenditure. It also offers pay-per-click advertising, which mean you only pay when a user visits your website. It’s a fantastic platform for entry-level ads because of these qualities.

The potential of Google Ads to reach customers in three different ways—through YouTube, Google Display Network, and search ads—is what makes them so alluring. The true allure of Google Ads is its ability to target users based on a variety of characteristics, including demographics, interests, and past interactions with your business or website (such as visiting a certain page or leaving their basket).

Combining some of these features, you could try using Google Display Network to “retarget” people who have recently viewed certain products in your online store. As they explore websites that use Google’s display ads network, these users will see the products they checked out previously, giving you more chances to convert them into customers.

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