Dropshipping For Beginners – Top Mistakes To Avoid


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Transcribe of “Dropshipping For Beginners – Top Mistakes To Avoid”

Hi guys, Neil Waterhouse. As the host and founder and of the four largest eBay and Amazon mail drop groups in Australia, there with 4,000 members, I get to see a lot of mistakes that people new to dropshipping make, and they’re all easily avoidable. So, here goes.

Number one, do not use overseas suppliers

Number one, do not use overseas suppliers. Yes, I know there are tons of books and courses out there, saying to use overseas suppliers, like AliExpress, etc. However, the reality is, if you sell on eBay, Amazon, Shopify, your own independent website, or all four, and the item takes weeks to arrive, it is your Amazon or eBay account or website, that cops a negative feedback and defect scores. A lot of people think that to get around this, they will just sell on their own independent website, or Shopify site. But, the reality is, if you consistently accept orders and upset people with long shipping delays, buyers get upset, and then they can cancel orders, etc.

Problem with dropshipping using overseas suppliers

The problem with dropshipping using overseas suppliers is, there are so many different reasons. You know, shipping can get delayed. It can be customs in China, or whatever country you’re using. And can be customs in your own country. It can be a volcanic ash. Or a holiday in China, or some, you know, an earthquake, or whatever. You know, a multitude of reasons. Over the years, I’ve seen a tons of reasons.

There are people out there who use successfully overseas suppliers for their dropshipping business

Now, I know there are people out there who use, well, successfully using overseas suppliers for their dropshipping business, but that’s fine, but personally, I’ve been selling online now, for over 20 years, and I simply find it way too risky to use overseas suppliers. But, you know, everyone’s got their own choice.

Great things with dropshipping

Now, one of the great things with dropshipping is, you can build a business in almost any country, from any country. In fact, eBay’s in 27 countries and Amazon’s in 16 countries. But, you know, if you’re building a business, let’s say in Australia, and use Australian suppliers. Or if you’re building a business inside the U.S., whether you’re based in the U.S. or based in another country, only use U.S. suppliers. Also, only use suppliers who can dispatch within two business days.

Second mistake is to not have a methodology in place

Now, the second mistake I see beginners make is, to not have a methodology in place. To continually check supplies inventory. So, if your supplier runs out of stock, you do not accidentally oversell an item. And today, we’re blessed with multiple ways to check supplier inventory. Now, the first method is of course, to manually check your supplier’s inventory, each seven days a week, yourself. But the next step up, is to pay a virtual assistant, one to two dollars per hour to do so, or do the task for you.

Use software like Scarcity Manager to check supplier inventory

And a third option is to fully automate the process, using software like Scarcity Manager, which will automatically check your supplier’s inventory for you, 24/7, 365. If an item’s out of stock, it’ll automatically make your listing zero. Hey buffers. Didn’t know those guys were behind me, you know. Um, went and lose my train of thought. You know, I put a link on the screen to Scarcity Manager.

Third mistake is to not leverage their time

The third mistake I see beginners make, is to not leverage their time. Again, there’s no excuse for this. It’s never been easier and cheaper, to help get low-cost, overseas virtual assistants.Back when I started using virtual assistants, I use to continually fly over to Cebu in the Philippines. And there, I trained the staff. But, back then, we simply didn’t have the tools we have available today, to train them, and to train them online. You know, it always used to cost a lot of money.

Learn to let go, and leverage your time

Not just in flights, but back then, I was paying $895 US per person, per month. And of course, today, you can get staff, one to two dollars per hour. Learn to let go, and leverage your time, is one of the quickest ways to turn a six digit dropshipping business into a seven or eight digit business.

The third mistake I see newbies making is selling low quality products

The third mistake I see newbies making is selling low quality products. And again, this is so easy not to do. One of the great things about dropshipping is, you can just sell proven products. In other words, products which are already selling at a profit. When items are already selling at, sorry, should say when an item’s already selling, you can look at the feedback from a seller, to see if there’s any negative feedback about that particular product. And if there is, simply don’t sell it.

In dropshipping, by law they have to honor a 12-month warranty

You know, also when you’re dropshipping, most countries, like Australia, your supplier, if you use Australian suppliers, by law they have to honor a 12-month warranty. So, if you have any items that are faulty, you just send them straight back to the supplier. By law, they have to take them back, repair them, or replace them, whatever.

The fourth mistake is to sell products which create buyer confusion

Now, the fourth mistake is to sell products which create buyer confusion. You should never use suppliers which either put invoices in boxes, or the supplier makes the boxes with their brand name. For example, let’s say you sell an item for say $500. If the box turns up to the customer, and the invoice is in the box from the supplier, made out to you, for say, $300, and showing obviously, you made $200 profit, the buyer gets upset.

Do not use suppliers who put invoices in boxes

The buyer can also get upset if I purchase from you, and the item rocks up in say a Kmart box, or if you’re selling on eBay, it rocks up in an Amazon box, this simply creates buyer confusion. The solution is to not use suppliers who put invoices in boxes, or if they do, ask the supplier if they can ship it as a gift.

The fifth mistake is that over 90% of dropship sellers use what we call, best guess marketing strategies.

The fifth mistake I see beginner dropship sellers make, is that over 90% of dropship sellers use what we call, best guess marketing strategies. They just guess it all. You know, that is, that just guess, titles and — I won’t go into that, the 74 things to don’t do on a listing. But, again, today we’re so blessed with the tools, that are available out there, that there is no reason to ever guess anything. In fact, we don’t allow our virtual assistants to guess anything at all. Because if they do, there’s a greater than 50% chance, they’ll screw it up.

Guessing it’s simply not allowed

Guessing it’s simply not allowed. For example, when creating a title, you can use tools like Terapeak, and you can use the eBay auto suggestion tool, which is their search box, to show you the most popular key words, and that’s free.

The sixth mistake is they forget about the basics

Sixth mistake I see many people make is they forget about the basics. The difference between a six digit business, and a seven or eight or nine digit business, is simply how many proven items are listed. So many people get caught up in all the new shiny, new objects, and the latest ninja tricks, that they forget about the basics. It all comes down to research, listing, optimizing, tuning. And then you simply hit the repeat button. Of course, things come up like lack of time, but again, this is where it’s critical to leverage your time by using VA’s and allocating 10% of your profits to virtual assistants.

The seventh mistake they usually make is they guess which products to sell.

The seventh mistake I see beginners make is they guess which products to sell. Again, there is no need to guess. Only sell products which are consistently selling and consistently selling at a profit.

The eighth mistake is they chop and change, from one shiny new object to the next shiny new object

Now, the eighth mistake I see beginners make is they chop and change, from one shiny new object to the next shiny new object. Life does not reward us for being a jack of all trades. The Life rewards us for what we master. The last mistake, which I see over and over again, is procrastination, due to perfection. I’ll just repeat that.

Procrastination due to perfection

Procrastination due to perfection. And I’ve been really guilty of that over the years. So many people want to get it 100% right before making their business live. The reality is, it’s impossible to get any business 100% perfect. It’s simply not an obtainable goal. For most things, 80% good enough, is good enough. Now, I don’t mean listing items with a ton of spelling errors.

Version one in better than version none

I just mean, version one in better than version none. Version one can be measured. And if you can measure it, you can improve it. That’s all this week. No matter where you’re watching this, please scroll on down, leave me a comment below. Until next week, list more, sell more. This is Neil Waterhouse.

Please leave me a comment below and let me know what you think.

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6 Responses to Dropshipping For Beginners – Top Mistakes To Avoid

  1. Prab says:

    Thanks Neil! As always another great video with tons of practical tips and its full of inspiration – including the scenic settings of your recordings!

  2. Abraham says:

    Neil
    Thank you. Very useful and effective tips. If I am buying from a supplier for dropshipping who is not a dropshipping supplier I boldly instruct ” Please do not send hardcopy invoice. Thank you” and it has worked 100%. I even use the same note when buying from fellow ebay sellers to be drop shipped.

  3. Good Afternoon,

    How can I find reputable dropshipping suppliers in Australia. Do I use Salehoo or just google the product with wholesaler.?
    Thank you

  4. Zak Radev says:

    Thanks, Neil,
    Very helpful video. Short and right to The point.
    Looking forward to work with you.
    Zak

  5. Hi Neil,
    Great information here.
    Really love your work and the content you put out related to drop shipping

    Cheers,

    Adam

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