Are you curious about possibly starting a dropshipping business in the Philippines? Or you may be looking for ways to expand your current e-commerce venture and make more money with less effort. Dropshipping is an attractive option that can offer both flexibility and profitability—but what exactly is it? This article will discuss the basics of drop shipping in the Philippines, including its advantages, challenges, and where to get started. Read on to learn more!
Thanks to advanced computer technology and the internet, you no longer need a brick-and-mortar physical store to start a retail business. You no longer have to worry about handling a large sales staff and operational expenses. The digital age now allows business startups from the comfort of a home and even if you’re working alone. However, some online business owners are put off by product inventory if they sell products from other suppliers. So, instead of buying and selling from a supplier and doing inventories, you can go into a dropshipping business. With drop shipping, you don’t need to worry about stocks.
What Is Dropshipping, And How Does Dropshipping Philippines Work?
With just one or two computers and a strong internet connection, you set up your online shop website or social media platform and advertise what products you’re selling. Customers then place their orders for products they like. You process their orders and relay this to your supplier. Your supplier accepts the orders and delivers the products to your customer’s address.
This is the basic premise of drop shipping Philippines business. However, before diving into that mouse and keyboard to create your startup, take a look and study all the aspects and details first.
Advantages of a Dropshipping Philippines Business
It Can Be Profitable (If Done The Right Way)
Like any startup business, a drop shipping business in the Philippines carries risks and has no guarantees of earning an early profit and the company’s success. However, choosing the right niche for your area, getting the right products from a reliable e-commerce supplier, and using the correct marketing strategies can attract many visitors to your online shop. And when these visitors are converted to orders, you can boost your sales further. How much you can earn will vary monthly and depending on the season.
As mentioned earlier, since dropshipping doesn’t involve physical inventories, it eliminates the need for a complicated logistical system. You don’t have to do inventory, you don’t need storage space, and you certainly don’t need a warehouse because you’re neither manufacturing products nor ordering them from suppliers. Also, you don’t need to partner with a shipping company since the supplier delivers the products directly to the customers.
Lower Startup Costs
Since you don’t have overhead operational and logistics expenses, you don’t need such significant capital to start the business. There are no costs for manufacturing and development, shipping, security, warehousing, staffing, and inventory.
Efficient Business Operations
It would help if you only focused on invoicing and cash flow to make your dropshipping Philippines business efficient. Operations are concentrated more on the linear flow of your customer’s money because as soon as they pay you, you forward the payment to the supplier, who expedites the delivery.
You can do so without additional capital if you expand and sell more products or offer newer products outside your niche. You only need to look for a new supplier or try out new product lines from your existing supplier.
Disadvantages of Dropshipping in the Philippines
Very Competitive Market
Going into dropshipping in the Philippines is so easy that you’ll soon discover that many other people can do it, which means you’ll have plenty of competition. The market becomes saturated, and getting customers to visit your online shop will become challenging. The saturation worsens when competitors sell the same products sourced from the same suppliers. To stand out, you will need all your marketing wits and strategies.
No Quality Control
You have no control over quality issues because the products are delivered straight from the supplier to the customer. Some customers may receive faulty products. Being the go-between, you will also need to handle delivery errors. Any unsolved problems or lack of countermeasures on these aspects may damage your sales.
Due to immense competition and attempts to keep prices low, potential profit margins can be relatively low. This means to make large profits, and you need to focus on selling in large quantities.
Little Or No Branding And Customization From The Drop Shipper
Another manufacturer or supplier sells the products you are selling. This means you don’t have control over the product branding, quality, or customer customization requests. Some brands may also demand that you sell a minimum number of orders to make production more affordable for the manufacturer.
How to Start a Dropshipping Philippines Business
1. Choose a good business niche based on your area
To start an excellent dropshipping business anywhere in this country, you need to choose a particular business niche that is unique or needed in your area and not based on a general category. For instance, instead of just selling sports apparel, why not sell sports apparel for women in your area because of the large attendance for yoga, Zumba, and aerobics? The smaller the niche, the more confined to specific persons and specific needs, and the less trial and error with marketing methods.
2. Create an excellent dropshipping business plan
Like any business, no matter how easy it seems, you must create a good business plan. To build a good plan, remember to focus on the following points:
- What items do you plan to sell?
- What niche are you targeting? Who are your potential customers?
- What is your estimated profit margin?
- How much will be the initial capital?
- Are you fully aware of the dropshipping business and its pros and cons?
- What suppliers are you targeting, and are they reliable?
- Who is the competition, and can you beat them?
- Do you need a website? If you do, how much are you willing to pay for the site to be made?
- Instead of a website, can you do your dropshipping with just social media platforms?
- What is your potential SWOT (Strengths, Weaknesses, Opportunities, Threats)?
3. Finding a dropshipping Philippines supplier
When you’ve decided what to sell, you must find a supplier for your business. There are hundreds to choose from online, but you must also choose based on reputation, reliability, product type, and budget. The most common suppliers you usually hear of that can supply the Philippine market are:
- Alibaba / AliExpress
4. Build up your platform
At this stage, you must build up your unique and user-friendly platform, emphasizing the latter. Often, the best way to influence buying decisions is to make a site super fast and easy. Also, the easier it is for customers to understand the product and to order, the higher the chances of more conversions. As your business becomes successful, try having more than just one platform; try having one website supported by a few blogs and two or more social media platforms.
Dropshipping in the Philippines is an attractive option for those interested in starting or expanding an e-commerce business. Not only does it offer flexibility and profitability, but it is also much less risky than traditional e-commerce. However, there are challenges to running a successful dropshipping business, such as finding and sourcing reliable suppliers, overcoming shipping delays, pricing challenges, dealing with customer service issues, and more. With the right tools and commitment to success, drop shipping can be lucrative in the right environment. Suppose you want to start or expand your online business in the Philippines and need guidance. In that case, many resources are available to get you started, including forums and online groups devoted to helping entrepreneurs succeed in drop shipping. It’s worth looking into if you have the interest and ambition to take on this exciting venture!
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