Is Dropshipping Worth It in 2023? An In-Depth Analysis

There’s no question that it’s a popular business model. But with so much competition, is dropshipping still worth it?

The answer is yes – but not the way many people go about it.

Is dropshipping worth it in 2023 1

Dropshipping is still worth it in 2023. If you choose high-quality products, maintain profit margins, and partner with domestic suppliers, it’s a viable and low-cost business model. The best strategy is to create your own Ecommerce site, tapping into existing demand for high ticket dropshipping products in a targeted niche.

Low ticket dropshipping, which is what most people have heard of, to us, just isn’t worth the headache.

Before we go any further, let’s define high ticket dropshipping as selling items worth $800 or more. You’re also using local suppliers, so you know that your products meet the standards in your country, and shipping to customers won’t take forever.

This is in contrast to low-ticket dropshipping, where most items are cheaply made and shipped from foreign suppliers. Customers often receive their orders after weeks of waiting, and it’s not uncommon for said items to be low quality.

Not ideal, right? That’s why we’re breaking down whether or not dropshipping is worth it in 2023, with an emphasis on high ticket. That’s the strategy that has been – and still is – worth it for us!

In this in-depth analysis, we’ll cover everything you need to know to make an informed decision about whether dropshipping is the right choice for you.

So, whether you’re considering starting an Ecommerce business or you’re already in the game and wondering if you should stick it out, keep reading. We’ve got you covered.

Watch it on YouTube Or Listen To The Podcast

Advantages of Dropshipping

In the last few years, dropshipping has gained in popularity. It’s an attractive business model with numerous advantages. But there’s a lot of hype to sift through online, and it’s hard to find reliable information about the results people are really getting.

It’s important to note that dropshipping is not a get-rich-quick scheme. It requires hard work, patience, and a willingness to adapt to changing market conditions. Just like any other business!
That said, here are some real benefits of dropshipping, compared with other business models:

Low Startup Costs

One of the biggest advantages of dropshipping is the low startup cost compared to other types of Ecommerce and brick-and-mortar businesses. You don’t need to worry about manufacturing, inventory costs, warehouse space, or shipping expenses. 

All you need is a laptop and an internet connection to get started.

In fact, we came up with a rough estimate of how much it would cost to start a dropshipping business in 2023, and it was less than $500! That’s not a whole lot to get the ball rolling on your own business.

No Need to Hold Inventory

You don’t need to hold inventory, so you don’t have to worry about managing and storing products, which saves you both time and money.

You only need to order the products from your supplier when your customers place their orders.

This also eliminates the financial risk of buying and storing inventory before you have customers lining up to buy.

You Can Sell Whatever You Want

Dropshipping gives you the flexibility to sell whatever you want. You can choose to sell products you’re passionate about or in high demand. You’re not limited to a specific niche or industry, and you can easily add or remove products from your store as needed.

However, if you opt to do high-ticket dropshipping, it’s better to choose a specific niche. And don’t worry – there are tons to choose from!

Works From Any Country With an Established Ecommerce Market

One of the biggest advantages of dropshipping is that it can be done from anywhere, as long as there’s an established Ecommerce market. You don’t need to have a brick-and-mortar storefront or proximity to customers.

If you live in a country in which most people regularly purchase products online (which is too many countries to name!), you can safely assume there are dropshipping businesses making money there.

Flexibility to Work From Anywhere

With dropshipping, you have the flexibility to work from anywhere. You can do whatever you need from your favorite coffee shop, while traveling, or on the beach.

As long as you have an internet connection, you can manage your business from anywhere in the world. For us, this freedom is one of the best parts of this Ecommerce model.

So you can run your business from the comfort of your home or while crossing things off your bucket list.

Opportunities for Higher Profits

Low ticket items are cheap (around $100 or less), and their profits are pretty small, meaning you have to sell a lot to make a worthwhile profit. But if you focus on a high ticket niche, you don’t need a high volume of sales to make it worth your time.

And that’s not even taking into consideration that low ticket dropshipping means your suppliers are in other countries. It’s common to get customer complaints about poor-quality items that arrive weeks or months late.

If people don’t return them (eating away at your profits), they’ll associate you with a bad product and never order from you again (again, eating away at your profits).

Easy to Scale: Taking Advantage of Demand Capture

Dropshipping is an easy business model to scale – if you pick the right niche. You can easily add products to upsell or expand your offerings as your authority grows.

To do this effectively, you need to know where the demand is and capture it. (Hint, it happens on Google – not on social media.) This allows you to grow your business quickly and easily.

To give you a quick summary of what we mean – demand capture means tapping into existing marketplace demand and targeting people looking for what you’re selling. This is an ideal way to build a real, long-term business because you don’t have to spend time and money convincing people they need your product.

how to start a high ticket dropshipping business.

Want to start your own high ticket dropshipping business?

Watch this FREE, on-demand training session that will uncover the exact steps you need to take to launch your first high ticket dropshipping business in the next 30 days.

Disadvantages of Dropshipping

As with any business model, dropshipping isn’t perfect. Though we still think it’s the best!

So, here are some of the disadvantages you should keep in mind if you’re thinking of starting an Ecommerce business.

High Competition and Saturation in the Market

As dropshipping rises in popularity, the market is becoming more competitive and saturated. It can be challenging to stand out from other dropshippers and attract customers to your store. You’ll need to invest time and effort into marketing and building a brand to differentiate yourself from competitors.

However, the high ticket dropshipping market is not too competitive if you take the time to pick a viable niche. Of course, some niches and products will fluctuate, either becoming more or less competitive. For example, electric bikes, just no – don’t do it.

Another reason we think competition isn’t an issue, is that it can be used as an excuse – a mental barrier. People can say, “Oh, everyone’s talking about dropshipping, so it must be competitive. I’m not gonna do it.”

Reliance on Third-Party Suppliers

Dropshipping involves relying on third-party suppliers to fulfill your orders. So you have no control over the quality of the products, the packaging, or the shipping times. If your supplier is unreliable or provides poor-quality products, it can damage your business’s reputation and result in lost sales and low profits.

This is why high ticket dropshipping is the best model. You can partner with known, recognized, and trusted brands with an established reputation for providing fantastic products.

Also, your suppliers are local to your customer, so the quality standards will meet country-specific requirements, and shipping time is not an issue.

Factors to Consider Before Starting a Dropshipping Business

Before you start a dropshipping business (something our course can help with), there are several factors you need to consider. Here are some key considerations:

Market Research & People Selection

One of the key factors in the success of a dropshipping business is selecting the right products to sell. This requires thorough market research and analysis to identify profitable niches and products with high demand.

At least, that’s what you’ll read everywhere else.

But really, the trick is to identify the people behind the screen. Who is it that you want to sell to? You can have a great product, but it doesn’t do you any good if you have no idea who wants it.

So take the time to identify who you want to sell to. Who is on the other side of the screen looking for products? Once you know that, it’ll be easier to choose a product.

Ultimately, the key to success is knowing your customer better than anyone else and having an insatiable desire to solve their problem (your products).

Developing a Brand Identity & Marketing Strategy

When you’re low ticket dropshipping items, especially on third-party platforms like Amazon or eBay, it’s nearly impossible to build a brand and long-term business.

That’s why we recommend high ticket dropshipping on your own Ecommerce site (like Shopify). That way, you can use marketing channels to tap into existing demand in your niche. For example, you could try:

  • PPC: Pay-per-click ads will draw people already looking for your products to your website. We recommend Google Shopping Ads specifically. Don’t sleep on Bing either!
  • SEO: My goodness, we do love SEO around here! It’s another way to tap into existing demand, and draw the right people to your website.
  • Email marketing: Sure, our email inboxes are full of junk. But email marketing works! With your own Ecommerce site, you can start building an email list of interested, primed potential customers.

The goal is to build your brand and online presence – becoming a source of information and high-quality products in your niche.

Choosing Reliable and High-Quality Brands

When it comes to dropshipping, choosing reliable and high-quality brands is crucial for the success of your business.

This is where many dropshippers go wrong – trying to sell low-quality, cheap products from suppliers like Alibaba, etc. The better approach is to source products made in your country (for reasons mentioned already – quality and fast shipping).

It’s also important to consider the supplier’s communication and customer service. You want to partner with a responsive, transparent supplier willing to work with you to resolve any issues.

Once you’ve found a reliable supplier, make sure to maintain a good working relationship with them. A good supplier will also be willing to negotiate margins with you (once you prove to be a good retailer for their products).

By choosing reliable and high-quality brands, you’re ensuring your customers receive products that meet their expectations, ideally leading to positive reviews and repeat business.

Customer Service & Returns

While dropshipping can be a profitable business model, it’s important to understand that customer service and returns are crucial elements that can make or break your business.

When customers have a positive experience with your store, they’re more likely to buy from you again and refer others. However, if they have a negative experience – that means negative reviews and not-so-great word of mouth.

To ensure a positive experience:

  • Have a transparent and easy-to-understand return policy
  • Communicate this policy clearly on your website and in your order confirmation emails

Additionally, be responsive and courteous when handling customer inquiries or complaints.

  • Respond to emails and messages promptly and professionally
  • Address any concerns or issues that arise

Keep in mind that providing excellent customer service can help build a positive reputation for your store and increase customer loyalty.

How Competitive Is Dropshipping?

Dropshipping is highly competitive in the obvious niches. But it can still be challenging to stand out and attract customers.

However, there are several strategies you can use to find profitable niches with low competition.

Here are some key tips.

Look for Untapped Niches

Finding a unique niche can be the difference between success and failure in dropshipping.

While it may be tempting to go after popular niches with high demand, such as ebikes and standing desks, these niches are often oversaturated.

Dig deeper to find niches with less competition but still have a strong demand. It might require more extensive market research, but it pays off in the long run.

Look for emerging trends, hobbies, or specific interests that have not yet been fully capitalized on. By identifying and catering to a niche audience, you can establish yourself as a topical authority.

That way, you can build a loyal customer base – and a long-term business that pays off.

Differentiate Your Brand

If you want to stand out from the competition – differentiate your brand! Create a unique identity that resonates with your target audience and sets you apart from other Ecommerce sites.

Here are some tips for differentiating your brand:

  1. Develop a unique brand story: Your brand story should convey your values, mission, and what sets you apart from competitors. Use storytelling techniques to make your brand more relatable and humanize your business.
  2. Create a distinct visual identity: Use design elements such as a logo, color scheme, and typography to create a memorable and recognizable visual identity. It will help customers associate your brand with a specific look and feel.
  3. Offer personalized customer experiences: Go above and beyond to personalize the customer experience, from personalized product recommendations to targeted marketing campaigns. It will help build a loyal customer base that values your brand.
  4. Focus on quality: Emphasize the quality of your products, customer service, and overall brand experience. It will help build trust with customers and establish your brand as a reliable and high-quality option in the market.

By differentiating your brand, you can create a unique position in the market and attract customers who value your brand identity and what you have to offer.

Is Dropshipping Right for You?

Dropshipping can be a great business model for those looking to start an Ecommerce business – with low startup costs, high potential, and the ability to scale.

It’s also an opportunity to learn marketing and gain valuable skills that can be applied to any other business you decide to get into. While you learn how to make money in Ecommerce, you’ll get the hang of Google Ads, SEO, conversion rate optimization, copywriting, and email marketing.

In 2023, dropshipping is still a viable business model, but it’s important to approach it with a realistic and strategic mindset.

It takes time and hard work to get up and running. But if your goal is a flexible, profitable online business, high ticket dropshipping is worth it.

how to start a high ticket dropshipping business.

Want to start your own high ticket dropshipping business?

Watch this FREE, on-demand training session that will uncover the exact steps you need to take to launch your first high ticket dropshipping business in the next 30 days.

Ben Knegendorf about me

Article by Ben Knegendorf

Ben Knegendorf realized at 29 he needed to find another career path. Since then, he’s:

  • Successfully exited a high-ticket drop shipping business that he helped take from $1 to $11M annual revenue in just 2.5 years
  • Eliminated $40,000+ of personal debt
  • Joined Dropship Breakthru as co-owner in 2021

© Dropship Breakthru 2021