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7 Reasons Why Drop Shipping Businesses Fail

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E Commerce is a land of opportunity for anyone looking to make their mark on the digital world. 

It’s a wonderful way to expand your business. Like other industries, eCommerce has its version of the popular niche: dropshipping. 

Seeing the rise in digital adoption, many have started their dropshipping businesses and that’s good. 

But it is important to point out that there’s a difference between hopping on the bandwagon and going in with a clear and well-thought-out strategy. 

Hopping in just for profits is the main reason why many dropshipping businesses fail and rightly so. 

Research is the most important element in this business and if you don’t analyze other businesses and your niche, you’re cooking up a recipe that’s bound to fail. 

In this post, we’ll be discussing several reasons (seven, to be specific) as to why eCommerce businesses fail and what you can do to avoid that fate. So, let’s start, shall we?

Also Read: 5 Best Practices For Small Businesses In 2021

1. Poor Marketing

Poor Marketing Strategy: A Death Blow to your E-Business - RED SIGNAL

This is the first mistake beginners make. Not knowing what to sell, they go to the product that’s the most popular or choose the wrong niche altogether. In both scenarios, they fail to take into account the marketing effort required for selling in the first place. 

Besides making a calculated decision on what you want to sell, you should also search for a niche that’s closest to your comfort zone. It’s not just limited to raking in profits, you also need to have something you’re proficient at. To each his own, indeed. 

The reason we say that is because once you have a grasp on what you want to sell, you can sell more rather than less. 

In addition to the right niche, you should also focus on the audience you’re selling to. Selecting the right demographics for your store helps you sell to your customers more efficiently and with the right message since a marketing message for people in their 40s might not sit right with young adults. 

2. Zero Patience

Zero Patience

Patience is the key element when it comes to dropshipping and business in general. 

Most individuals get on the dropshipping train thinking they’re going to make the big bucks as quickly as possible, but that’s not the case. It’s a career and you have to be patient before the cash flow begins. 

Being consistent in your sales efforts will pay dividends in the long run. Dropshipping is not a get-rich-quick scheme. 

It’s a persistent effort and, if you’re doing things organically, you’re getting more eyes to your business. This, in turn, means more success for your business. 

A good first step towards getting eyes on your business is to use promotional material to get things off the ground. This includes lowering your price bar, offering discounts, and promotions. 

Combined with a visually appealing website, you can improve your odds or early profits.

All in all, we’d suggest you be patient. 

3. Lacking Resources 

Lacking Resources

Dropshipping is oftentimes made out to be a low-investment high-return game. 

While the number of resources required is generally less, people are misled to believe dropshipping doesn’t require any investment at all. 

If you’re looking to set your store apart from the fray you need to invest in website development, design, sales, and marketing. 

It does not matter whether you’re selling B2C or B2B eCommerce products, the more value you add to your offerings and web presence, the better your returns will be. 

Also Read: 5 Biggest Ecommerce Crisis and What to Learn from Them

4. Zero Management

Zero Management

The root cause contributing to the failure of eCommerce startups is their failure to manage things accordingly. 

As a business owner, it’s easy to get lost in your work and ignore the administrative part of your business. 

Bad planning isn’t going to take you anywhere. 

To ensure that you’re managing things correctly, you need to keep the people’s interest in your store and fix any issues that arise, regardless of whether they’re technical or not. 

At the bare minimum level, you need to provide stellar customer service. Make sure all the problems associated with your customers are resolved and there is little room for error. 

Both pre- and post-purchase activities should be seamless and should focus on making the customer satisfied. 

If you’re just starting, keep the customer in tune, you will benefit significantly. 

5. Damaged Products

Damaged products

Whatever products you have in your store, make sure that you assure them of quality. 

Ensuring that your products are quality controlled and delivered without damages or problems can lead to a higher conversion rate for your store. 

It’s not just about making that one sale. You also have to ensure that your products are of stellar quality because an unsatisfied customer is more than likely to leave a bad review on your store than a satisfied one. 

Combine those reviews and you’re becoming an online spam store with no legitimacy whatsoever, even if you think you are legit.  

6. No Effort

No Efforts

While this section might seem old-fashioned, you’d be amazed at the number of people who still have shoddily designed websites. 

When you deliver a poor user experience on your website, the more likely it is that no one will visit your store. As a result, you’re left wondering where you went wrong. 

Your store should be unique, well-designed, and kept with the customer experience in mind. This ensures that your website is customer-friendly and people will be satisfied in purchasing from it. 

Investing in a good custom-designed website is, therefore, important. This can lead to significant benefits down the road for your business. 

7. Being Too Involved

Being Too Involved

Now all of what we’ve discussed in the article usually revolved around general laziness and lack of foresight. On the other side of the spectrum, some individuals are too high maintenance. 

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They plan and plan with foresight. Their plans are impeccable but they’re too impatient and start doing everything at once. This leads to burnout which eventually causes them to lose motivation. 

Doing so many things at once is hazardous. Take things one at a time and you will, with time, succeed.  

Conclusion

So, with this article, we wrap up the seven ways in which drop shipping businesses fail. We hope you enjoyed reading! 

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