Is Dropshipping Business Dead or Still Profitable in 2022? (2023)

With the introduction of new ways to make money online, people are now raising an important question, ‘Is dropshipping dead?’ Being one of the biggest ecommerce business models and having the potential to generate millions in home-based earnings for people all over the world, dropshipping can’t just die.

Dropshipping isn’t dead, at all. Despite what many people might say, it’s important to understand that dropshipping requires careful planning and skill. And yes, you can earn through it in 2023. Here’s how.

Digital entrepreneurs are often worried about the profitability of their business models, and rightfully so. Although the fast-evolving tech industry encourages businesses to innovate and grow, it also puts pressure on them to be sustainable and stay relevant to the industry in order to survive.

Technology works like a double-edged sword for most businesses. On one end, it greatly benefits organizations and their customers with newer and more innovative methods for growth. But on the flip side, it also scraps the older ways right away. Companies who fail to keep up, end up failing to survive.

Similarly, cost per click (CPC) methods such as Google AdSense, Chitika, and BidVertiser, etc., are all outdated. They’ve now been replaced with native advertisements and content discovery platforms.

In short, most business models will be outdated by the time you decide to adopt them.

Coming back to dropshipping, we’ll have to analyze various viable dropshipping methods, look for stores that are still prospering under the dropshipping banner, and search for marketing platforms that make dropshipping easy for the users.

Is Dropshipping Still Alive: Google Trends For Dropshipping

Google Trends offer a visually comprehensive way to understand how the term dropshipping has performed when it comes to people’s interest.

As we can see above, the search term “dropshipping” has seen a significant increase over the last 5 years. What’s more important is the fact that although there have been a few lows, the overall trend is still steadily growing.

People often ask if AliExpress dropshipping is dead and here’s the answer to that. Searches for the term ‘aliexpress dropshipping’ have seen a significant increase over the last 5 years. The main reason behind this is the fact that AliExpress serves as a great platform for most dropshippers due to the high availability of products and their affordable prices.

Compared to AliExpress, the trend for ‘alibaba dropshipping’ isn’t impressive. There can be several reasons behind this low trend, the most prominent ones being that Alibaba is more B2B oriented and deals in bulk orders. Whereas, AliExpress also focuses on direct consumers and sells individual products as well. Another reason can be the fact that Alibaba has fewer payment options compared to AliExpress, which ultimately contributes to less people being interested in their services.

Is Amazon dropshipping profitable? That’s a question many people ask. Although Amazon is an amazing platform for dropshipping, the search term ‘amazon dropshipping’ still has a lower growth trend compared to aliexpress dropshipping. When we compare it to AliExpress, the dropshipping from Amazon is quite technical. Moreover, it charges FBA fees, and you also have to pay storage fees which increase further if your product is sitting in their warehouse for more than 6 months.

Is Dropshipping Worth it?

If you want to earn a decent income by starting your side business, then dropshipping is definitely worth it. However, if you want to make lots of money in a short amount of time, then dropshipping is definitely not worth it.
For dropshipping to work successfully, you will have to invest time, money, and effort.

Here are a few things that are slowing down the pace with which dropshipping businesses were growing:

• High shipping duration
• High cost of goods
• Lack of customer support
• Refunds take a lot of time
• Product quality is too low
• Unprofessionalism of sellers

A proper ecommerce business needs to satisfy the customer. But when it comes to dropshipping business, we see that customers are often neglected for profit. In fact, most dropshippers are using Shopify stores for their products. They don’t focus on maintaining high standards of their stores as they are selling the items through social media advertisements.

They only tend to sell a product to a customer only once. This leads to poor customer experience and often decreases their trust in the business model as a whole.

What is the remedy for such a situation?

The remedy is simple. Treat customers with respect. We have many stores that are selling dropshipping items at a high margin and are still thriving. These include Bluecrate.com, wish.com, and a few others.

Is Dropshipping Dead in 2023?

In one word, no. There are several stats which show that the dropshipping industry is saturated, but there’s still a lot of potential and it’s nowhere close to dying. By 2025, market valuation of the dropshipping industry is expected to reach $557.9 billion. And there’s more:

• Approximately 27% of online retailers are using dropshipping
• Dropshipping can earn approximately 50% more profit compared to keeping your own stock inventory

Every year there is a new discussion about dropshipping becoming dead. However, that is not the case because dropshippers usually don’t die but change the way they work. A few years ago, AliExpress alone was the sole king in dropshipping. With time things changed and dropshippers now directly engage with wholesalers for their products.

You can understand that dropshipping is still going strong! In fact, this is the right time to start your dropshipping business. Here is why:

• The world has embraced ecommerce
• More people are buying online than ever before
• Merchants understand the concept of dropshipping and are willing to work with them
• Sending online payments is easy
• Can help with online paid marketing campaigns
• The upfront cost is almost zero

Why Are Some Dropshipping Stores Thriving?

The reason some dropshipping stores are thriving while others aren’t is that these dropshipping businesses keep customers first. They give priority to their buyers and try to solve all their needs. Yes, they sell dropshipping products by keeping a little margin, but they compensate that to the customer by allowing him to get refunds faster or to help them with all the questions they have.

So, if dropshipping businesses want to stay sustainable, they need to give their customers a priority.

Is Dropshipping Still Profitable?

In 2023, absolutely yes. In fact, as more and more people have moved away from platforms like AliExpress, dropshipping has become all the more popular. It’s an excellent option for those looking to jump in the ecommerce space.

It is not only profitable but thriving! Ecommerce and dropshipping profits have reached over $196 billion.

Moreover, small retailers are seeing an almost 30% increase in conversion rates through smartphones.

Let’s say you want to know how to start a dropshipping store and aim to earn $100,000 per year from it. How many products should you sell?

AliExpress Dropshipping: Approximate Earnings

At this point, you must be wondering how much money can you make from dropshipping? We’ll give you an example. Let’s assume that you get a product costing $15 from AliExpress and after factoring in the shipping and advertisement costs, you sell it for $30 and end up making a profit of $10 on the product.

Therefore, if you want to make $100,000 per year using aliexpress dropshipping, you will have to sell 1000 products in a month. The calculation follows below:

$10 profit x 1000 orders = $10,000 per month
$10,000 per month x 12 = $120,000 per year

This calculation is based on assumed amounts, your profits and expenses can vary according to the amount you invest. Conclusively, this shows that aliexpress dropshipping, if done right, can be turned into a very profitable business.

Dropshipping vs Affiliate Marketing: Which One Is More Profitable?

In this section we will compare dropshipping with affiliate marketing as both business models are quite profitable and effective.
Since the affiliate marketing model is based on commissions on every product sold, we’ll assume that the commission percentage is 5% and we want to make $100,000.

Based on the calculations above, you’ll have to make $1000 per month or $340 per day, keeping in mind that you will get $5 commission on sale of $100. In order to earn at the same pace as dropshipping, your customers should buy products worth $7000 per day, if you want to earn $340 per day.

These calculations clearly show that dropshipping is more profitable compared to affiliate marketing. But the affiliate marketing vs dropshipping profitability still remains an ongoing debate. However, there are several other factors as well, one of the most prominent ones being that dropshipping requires a lot more setting up and preparation compared to earning as an affiliate. Moreover, it’s important to note that higher earnings come with higher risks.

Alibaba Dropshipping: Is It Still Worth It?

The dropshipping industry works on a retail model, therefore dropshippers don’t sell products in bulk. Alibaba mostly deals in bulk quantities, so it can be a bit more costly for dropshippers to sell directly from Alibaba.

In this regard, other platforms like AliExpress and Amazon are a lot easier to sell from. Therefore, the profits earned through aliexpress dropshipping or amazon dropshipping are also a lot higher compared to alibaba dropshipping.

Alibaba vs AliExpress – Learn Which One is Best for Dropshipping

What Are the Biggest Problems That Dropshippers Face in 2023?

Due to the highly intangible nature of the dropshipping business, there are several issues that dropshippers may face:

• Shipping delays can cause a reduction in the number of customers visiting your online store
• Merchants might not follow proper quality protocols when delivering products
• Customers might end up getting products that they never ordered
• Refunds or returns can impact your credibility in front of the payment gateway company you’ve partnered with

So, what are the solutions to these dropshipping problems?

• Build a relationship with suppliers, and only work with those who are reliable and provide quality products
• Research your target market and buy trending products that sell well. This will reduce the shipping costs, and allow you to make more profits

eBay and Amazon Dropshipping: Is It Allowed?

Many beginners think that they can’t do dropshipping from Amazon and eBay but that’s not true. Although dropshipping using these platforms might be hard due to certain platform restrictions, it’s still possible.

eBay for example, doesn’t allow products from China and users need to be residing within America. Amazon on the other hand demands that deliveries can’t take more than a week. These two are the main restrictions why most dropshippers prefer not to use these platforms. Find a solution for these and you can easily dropship from eBay and Amazon.

Is Dropshipping Legal?

Dropshipping is a retail business model that allows you to take a product from the merchant and directly sell it to the customer without actually handling the product. In simple words, dropshippers act like intermediaries.

When it comes to the legality of dropshipping, there are no laws against starting an online store for dropshipping purposes. Business laws might vary from country to country but there’s no law that points directly against dropshipping businesses.

There are however some general pointers that you should keep in mind when you start a dropshipping business:

Your Product Should Be Reliable

Deceiving customers by showing them one thing and selling something completely different is considered unethical and illegal. Doing so is a punishable crime in most countries and you will be held accountable if a customer charges you with any such complaints.

Awareness About The Home Country’s Laws

Before you start your dropshipping journey, make sure that you’re fully aware of all the laws related to all your business dealings within that country. Doing this homework is extremely important because you should be aware of all the legalities of the industry you’re operating in.

Final Words!

So, if somebody asks ‘is dropshipping dead?’ You can tell them that it’s most definitely not. Especially now, with such a high global reliance on online shopping and the ecommerce industry, the chances of dropshipping industry shutting down, are close to none.

Therefore, if you’re a prospective dropshipper, do a thorough research, pick out some trending products and start selling. Confused about which platform to choose for your dropshipping store? Read our post on the ‘Best Ecommerce Platforms for Dropshipping‘ and start your dropshipping store today. If you are not sure which products you should sell, you can read our articles on 35+ Best Dropshipping Products to Sell and 15 Best Trending Print on Demand Products to Sell in 2023.

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