Dropshipping is a preferred method of sellers as compared to the wholesale or retail. It is because dropshippers don’t have to keep things in stock to earn cash. In this article you’ll learn how to begin an online dropshipping business in Nigeria.
Table of Contents
What is dropshipping? And how do you use it?
Dropshipping can be a great alternative to retail businesses where the seller ships an item to the consumer without the product being in inventory.
We aren’t able to sell anything we don’t own So how do we make this happen?
It’s possible. Actually, that’s exactly the whole point of dropshipping. This is how the entire process works.
- A seller is a person who promotes a certain product
- A buyer who is interested places an order
- The seller will ask for an upfront payment (like 30 percent)
- The buyer is responsible for 30percent of the cost
- Seller will add their own funds to the upfront cost
- The entire amount will be paid to a wholesaler with the item on hand
- The wholesaler will ship the product to the customer.
- Once the item is received The buyer must pay the remainder of the money to the seller.
Simple, right? This is how dropshipping is described in a few words.
Can dropshipping work in Nigeria?
It is indeed possible. Indeed, lots of youngsters are already in dropshipping. It’s not going to be any stressful work, since you’ll be outsourcing logistics and inventory to a third-party instead of making it all yourself.
Instead of storing and managing your inventory, you’ll only make an order once the customer has asked for the item.
Wholesale vs. Dropshipping Which is the better business
This is contingent on how you interpret it. It’s also dependent on the amount of start-up capital you have.
If you’ve got a significant sum of money, a few investors, and a registered business, then a wholesale business can be an excellent option.
If you’re beginning with less than N50,000, then dropshipping can be a viable alternative.
This is due to the fact that you’ll need to purchase your stock once a buyer has made a reservation and paid a fee upfront (that’s when you request it). Your client could be a final buyer or a different retailer.
Dropshipping is it worth it in Nigeria?
We’re unable to provide a specific solution to the question. We’ll however list the benefits and drawbacks of dropshipping in Nigeria. This will assist you make the right choice before launching an enterprise that involves dropshipping.
Dropshipping’s advantages in Nigeria
1. In contrast to its retail and wholesale competitors, dropshipping company has very low initial costs.
It is possible to start starting as little as N20,000 or even less according to the type and amount of goods that you’re droppingshipping.
2. There is no requirement to purchase or upgrade your inventory until the buyer places an order.
3. You are able to cooperate with multiple suppliers (wholesaler) and offer a variety of kinds of goods at your customer’s expense.
4. Your supplier will handle the logistics of shipping and delivery. All you need do is persuade prospective customers to purchase the item to receive an order, and send it off the order to your vendor.
The disadvantages of dropshipping in Nigeria
1. Your (and not the supplier) is the sole responsibility for the customers you sell to. If there’s a defect in the product, all blame will be pointed at your company.
2. Customers could be extremely upset with you if a delivery of your product is not made by the date of delivery.
The customer may begin to think that you’re a fraudster which could impact your credibility up to the point when the product is finally delivered.
3. There is no way to determine or verify anything regarding the quality of the product because you’re not possessing the item. The best way to ensure its quality is to locate a reputable supplier.
4. In contrast to wholesale businesses dropshipping typically yields lower profits. But, this isn’t really an issue since it’s relatively inexpensive to begin a dropshipping company at all.
How do you begin your dropshipping business
These steps will help you establish droppingshipping as a business
1. Decide on which product(s) to offer
This is the very first time for any dropshipping company. Most newbies love selling whatever they think of, which often result in low sales.
Remember that dropshipping is akin to any other kind of business. You must conduct market research and product studies regularly. It is possible to use tools such as Google Trends as well as social media platforms such as Instagram or TikTok.
2. Find a reliable and trustworthy supplier
The supplier plays the most important part to play in any dropshipping venture as he or she is the owner or manufacturer of the product you wish to dropship.
The supplier also decides on the quality of the product, which then determines the level of satisfaction of your customers. You can identify a good supplier by analyzing their rating and reviews.
3. Choose a platform on which to sell your product
It is recommended to make purchases online through sites like Amazon, Jumia, Konga, Jiji and many more. Be aware that you may be present on several platforms. Be sure to go through each one regularly, in order to find out whether a customer made an purchase.
4. Advertise your company
This is another crucial process for dropshipping. It isn’t enough to just sit back and hope that buyers will find them. You must engage them and market your company.
You should make use of social media platforms such as Facebook, Instagram and TikTok to market your products. You can also share the items to the status of your WhatsApp status, however sales will be limited to your list of contacts.
5. Make a plan for how your payments will be handled
Dropshipping is a business that involves paying and sending money on a regular basis. The frequency of your payments will be determined by the amount of sales you’ve had.
It’s still advisable to have a secure payment system that you are able to utilize in order to make payments to your suppliers, and also accept payments from customers.
The most effective ways to pay a seller who is in the dropshipping industry are given below. They can be used to settle your payments in and out of Nigeria.
So far, so good We’ve talked about the steps to begin an online dropshipping company in Nigeria. If you’re just starting out the dropshipping business could provide you with the opportunity of entrepreneurialism.
You don’t have to register your company or pay taxes, or to adhere to the guidelines set by a regulatory body. You are free to offer many different products to your customers you choose to decide on your own pricing and advertise your own brand.
The best of everything starts with a small start!