The short answer: YES.
But there are a lot of other questions that go along with whether a profitable drop shipping store is possible through bootstrapping.
How much do you really need to start? How will cash flow affect supplier and product choices? How can I provide all the related services? How long will it take? How much profit can realistically be expected?
That’s a lot of how’s. But the big question is whether it’s POSSIBLE to build a PROFITABLE drop shipping store when you don’t have a lot of cash to start off with. We’ll get into how below, but first, let’s look at what bootstrapping is.
What is Bootstrapping?
By definition, bootstrapping is about using existing resources – lifting yourself by your own bootstraps, as the saying goes. Bootstrapping a business means that you build that business using only what you have right now. A few hundred bucks? Zeal and dedication? A thirst for knowledge? Time you can commit? All that jazz.
The concept of bootstrapping is also closely related to that old adage about strapping on your boots – and whatever else you’re going to need to get through a tough time. Building any business is not easy. But if you’ve got a pair of boots, you’re already halfway there. And the rest of building a profitable drop shipping store is up to you.
Bootstrapping is not something that a lot of entrepreneurs think about doing unless they don’t have much money to spare. It’s unglamorous. It’s hard. But don’t knock the concept. There’s a lot to be said about the priceless things you can gain from rising above. And I won’t kid you, bootstrapping a profitable drop shipping store is something of a climb.
How Do I Bootstrap a Profitable Drop Shipping Store?
And now we finally get into the really good stuff. This is how you buckle down – or strap up, in keeping with our metaphor – and get to work. That being said, the first thing you need to do is, obviously, decide that you’re going to work at it. Don’t even go to the first item below this paragraph if you’re looking for the easy way out. Bootstrapping a profitable drop shipping store requires at its very foundation an entrepreneurial spirit, the characteristics of which are strapped together by industriousness.
(1) Build Your Store
Ok, so this might sound strange because you don’t have anything to actually sell yet. Hear me out.
The best suppliers are not going to partner with you unless you can prove yourself. They will want to know that you as a seller are as legitimate and reliable and stable as they are. Fair enough, since you are going to be needing that same proof from them.
Proof of legitimacy in the online world comes from seeing that store with a real business address attached to it. Reliability and stability come later, but this is where you should start. If you have product that you have been retailing through other channels, put it on your store to get it off the ground. If this is your first eCommerce venture, at least you’ll have a store that you can show suppliers is ready, lacking only the actual product to launch. (And you’ll want to make a big deal out of that launch when you speak with them later on.)
It’s also important to choose what eCommerce platform you are going to use to sell your products – whatever items you have determined are best to help you build a profitable drop shipping store. And of course, what platform suits your tight budget.
Before you have anything else, you have to have all this worked out. Know what platform will work best for you. Be confident in the tools and services that it provides. If you can’t choose, then that’s a great indicator that you need to go back to the research phase. Figure out if the model is right for you. Identify the products that you are going to sell. Learn about what platforms can best help you bootstrap a profitable drop shipping store.
(2) Find Your Suppliers
So the next action step that you want to take is to find suppliers for your products. I assume here that you already have a few products in mind. You’re drop shipping, so the costs of the products are not a concern. Reach for the sky. What you want to focus on is who can provide each of those products, and reliably so.
Luckily, you only have to worry about spending a few hours a week and paying for your internet connection – and possibly a few long distance calls. Yes, you may have to call to show good suppliers that you are legit. A profitable drop shipping store depends heavily on your suppliers, so you have to invest in making these relationships happen.
Look for suppliers who are legitimate, and have a drop ship track record. Stay away from directories. Do your own research and really look into who they are and what they can offer. You want to build relationships with suppliers who can, with integrity, provide enough stock to meet your sales volumes and get them shipped to your customers on time and in good condition. Then your profits won’t be hindered by sub-standard products and services and you won’t get bogged down by customer service issues.
And don’t forget to seriously crunch those numbers so that you can ensure a reasonable profit margin. A profitable drop shipping store depends on the actual profit that you are locking in. It may not be a lot to start, but it will quickly grow if you diligently work at all the steps.
When you have a good few top options, work on maintaining those relationships. This is where you prove your reliability and eventually, stability. You also want to do this because you need to have more than one supplier for each product. You don’t want operations to stall if anything goes wrong.
(3) Learn Your Targets
You should have at least an outline of your ideal customer after going through product research. Now it’s time to build a clearer customer profile related to the focus of your value proposition. Again, the internet is pretty much all you need to do your research, plus a good chunk of time.
Follow your targets around the web and learn as much as you can about them from where they hang out, what they want to know, and what they talk about. Keep the important questions in mind as you trail and observe.
First: What market segment does your product offering appeal to? Why would they want to buy this or that item? When are they likely to purchase?
Going deeper: How are you going to communicate your value proposition to them? Who do they rely on for advice before making purchase decisions? What is the tipping point and how do I slide them off the fence and into my cart?
These types of questions will help you form a solid profile that you can work on targeting as you take the next steps. Wherever you find any blanks, ask the discerning questions and fill in the blanks.
(4) List Your Products
I say “your” products because the next step requires a preparatory phase. You may not care about these products personally, they are just there to make you a profit. Your chances of realizing a profitable drop shipping store are increased, however, by an equivalent factor to how passionate you are about not just eCommerce but all of its components. Own those products. Know them and be confident in their value. Then you can list to sell.
So now you can get to the actual action step of listing on your new store. Bootstrapping means that you’ll probably have to do all of this yourself, which means more time invested. But it’s essential for a profitable drop shipping store that you know the process first-hand. As you grow and have the budget to pas tasks off, you will need to know exactly what works and what deson’t.
Don’t be too concerned about getting product information and materials from suppliers. Many of them will not be overly concerned about the details of what they are manufacturing or distributing. Take this information from your competitors and remake it as your own with improvements.
Your target here is to provide customers with the information that they need to make a decision about your product – a positive one – and take action by checking out. If you haven’t worked out your funnel yet, now’s the time to get that figured out. The actual marketing is the next step, but the quality of your listings will depend a lot on how this goes. The awareness and interest from your marketing must flow comfortably to decision and action.
(5) Market Your Offering
The whole point of this fifth step is to get customers. If you brushed off the third step, please go back and get that done. You can’t get people that you don’t “get” – get it?
So you have your customer profile and your sales funnel process. Now you need to outline your marketing strategy to take care of the wide end of the funnel. For this step, you can start with the many available free channels and your own talents to get started. Post clean graphics on social media. Upload a few cool videos. If you do have a few extra dollars, you can go for paid advertising.
Basically, use all that you have learned about your products and your targets to plan this strategy, and fiercely tug at those boot straps to execute it. You want to get the two to meet and start a meaningful relationship together. This is your goal. Match them up good and your customer will be raring to go on that date that you’ve set up on your product page.
If you’ve molded your listings to take care of the narrow end, you can be sure that they’ll be holding hands in no time. Just watch as they cross the cart threshold.
So, is it possible to bootstrap a profitable drop shipping store? Ultimately, it is you who has to answer this question.
Bootstrapping a profitable drop shipping store depends on your ability to throw yourself into it. Drop shipping is great for bootstrappers because you can pay for product only when you’ve already made the sale. But making the model work for you is just that – MAKING it WORK.
Are you ready to strike out on this journey?
A profitable drop shipping store also depends on profit. It may be slow going because you’ll have to build up your cash reserves. Once you have some profit, however, you can invest part of it back into the business to help it grow. The bigger and stronger you get, the more profitable you’ll become.
At this point, you’ll have more wiggle room. If you don’t want to spend your time doing all the work yourself, that’s actually a good sign. It means you want to focus on growth, which you need for a profitable drop shipping store. You can hire a virtual assistant at reasonable rates to help you out. Many of them even have platform-specific VA experience so you won’t have to spend much time making sure they do a good job.
You can bootstrap a profitable drop shipping store and not end up tugging those straps for the rest of your life. Conquer the mountain slow and steady. Reach deep within yourself to pull out what you need to carry yourself the top. Then you can take the load off and. I promise you, you’ll be able to look back and reflect on how much you actually appreciated the climb.