Why and How to Start Dropshipping in India as an eCommerce Business

Want to start an online business in India, but not sure what to sell and how to get the products? Here’s a complete guide on dropshipping in India to help you get your eCommerce business up and running!

What is dropshipping?

Dropshipping is a retail fulfillment method where a store doesn’t keep the products it sells in stock. Instead, when a store sells a product, it purchases the item from a third party—usually a wholesaler or manufacturer—and has it shipped directly to the customer. This means the retailer doesn’t have to handle the product directly.

Here’s how it works: An online retailer sets up an e-commerce website and lists products for sale. When a customer places an order, the retailer forwards the order details to the dropshipping supplier, who then packages and ships the product directly to the customer. The retailer’s profit comes from the difference between the wholesale price provided by the supplier and the price the customer pays.

One of the main advantages of dropshipping is that it reduces the financial risk for the retailer. Since they don’t need to invest in inventory upfront, they can start an online store with relatively low capital. Additionally, they can offer a wide variety of products without worrying about storage space or managing inventory.

However, dropshipping also has its challenges. Because the retailer is not directly handling the products, they have less control over order fulfillment, shipping times, and product quality. This can lead to customer service issues if the supplier fails to meet expectations. Furthermore, dropshipping can have lower profit margins compared to traditional retail models, as the retailer relies on third-party suppliers for stock and shipping.

Despite these challenges, dropshipping remains an attractive option for many entrepreneurs due to its low barrier to entry and flexibility. It allows retailers to quickly test new products and market trends without a significant upfront investment.

Why start dropshipping in India?

Starting a dropshipping business in India in 2024 presents numerous opportunities and advantages, making it an attractive option for aspiring entrepreneurs. Here are some compelling reasons to consider:

1. Growing E-commerce Market

Your content goes here. Edit or remove this text inline or in the module Content settings. You can also style every aspect of this content in the module Design settings and even apply custom CSS to this text in the module Advanced settings.

2. Low Initial Investment
Dropshipping requires minimal upfront investment since you don’t need to purchase or store inventory. This makes it an ideal business model for entrepreneurs with limited capital.
3. Wide Product Range

With dropshipping, you can offer a diverse range of products without worrying about inventory management. This flexibility allows you to cater to various niches and customer preferences.

4. Ease of Entry
Setting up a dropshipping store is relatively simple and can be done quickly with platforms like Shopify, WooCommerce, and others. These platforms offer user-friendly interfaces and numerous resources to help you get started.
5. Focus on Marketing and Customer Service
Since the logistics and inventory management are handled by suppliers, you can focus more on marketing, customer service, and growing your brand. Effective marketing strategies can help you stand out in a competitive market.
6. Scalability
Dropshipping allows for easy scalability. As your business grows, you can quickly add new products and expand into new markets without the constraints of traditional inventory management.
7. Access to Global Suppliers
India has access to numerous global suppliers, especially from neighboring countries like China. This means you can source a wide variety of products at competitive prices, enhancing your profit margins.
8. Diverse Market Needs
India’s diverse population means there are numerous niche markets to explore. Whether it’s fashion, electronics, health products, or unique local goods, there are plenty of opportunities to tap into specific consumer demands.
9. Supportive Government Policies
The Indian government has been supportive of e-commerce growth, with policies and initiatives aimed at promoting digital business and improving infrastructure. This supportive environment can help your dropshipping business thrive.
10. Increasing Trust in Online Shopping
As online shopping becomes more prevalent and trusted in India, consumers are more willing to purchase a wider range of products online. This increasing trust can help drive sales for your dropshipping business.
Conclusion
Starting a dropshipping business in India in 2024 offers numerous advantages, from a growing e-commerce market and low startup costs to ease of entry and scalability. By leveraging the diverse market needs and supportive environment, you can build a successful dropshipping business that caters to the evolving preferences of Indian consumers.

How to start dropshipping in India?

1. Find your niche

The first step to building a dropshipping business is figuring out what you want to sell and who you want to sell to.

Choose a niche that you’re genuinely interested and passionate about. But at the same time, also make sure that the niche and the product are in demand in the market.

You can start off by first creating a list of products you’d like to sell and how your potential customers could be searching for them. For example, keywords like “yoga pants”, “kitchen basket”, etc.

After that, look into how these keywords are trending over the last few months. The goal is to understand if the interest in these products is sustained or tends to drop every now and then. A good way to do this is type in the keyword in Google Trends and check for the last 3 months.

2. Identify a profitable product

While dropshipping gives you the flexibility to sell almost any product on your store, it is important to find products that are profitable.

Take into account the cost of doing business (running your store), shipping fees, marketing and the cut you will need to give to suppliers/ manufacturers. Make sure that you have healthy margins of about 40-70%, if not higher.

So in general, you want to look for low-cost products that you can sell at a premium price.

3. Set up your Shopify store

You need to give your business a name, identity and an address to begin selling drop shipped products.

Set up a store on Shopify and get started with dropshipping in minutes. It provides you with an easy-to-use eCommerce platform that is packed with features.

Right from features that will help you design an impressive storefront to integration with dropshipping apps, payment gateways and more, Shopify makes it all a matter of a few clicks.