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  • Joseph Klas

Why Do Most Dropshipping Businesses Fail In The Beginning?

Updated: May 15, 2021

Do you know that almost 90% of dropshipping businesses fail and shutdown in the first month of their operation?. The main reason for this is the frustration of not making money they thought, they will be able to make with the business. Most people in the world are emotional and don't have the risk-taking ability. They see someone else making money online and believe that it's easy to do so. They simply jump on the bandwagon without doing any kind of research or understanding the operability of the business. And when in the first few months, they don't make money, they make themselves believe that the business idea isn't for them and move to something else complaining that dropshipping is not a viable business and doesn't work for anyone.

In this post, we are going to talk about the reasons why most of the dropshipping businesses fail and how you can avoid them or overcome them.

Common Reasons For A Dropshipping Business Failure

Dropshipping is usually considered as a medium-risk business. The core of the dropshipping business revolves around marketing, therefore, most of the money in this business is spent on advertisements to sell the products.

Many successful dropshipper believes that dropshipping business success rate hovers around the 10% mark during the first year of operation and the majority of the business fails because they jump into the world of dropshipping without understanding the risks involved in the business.

Why Do Most Dropshipping Businesses Fail?
Why Do Most Dropshipping Businesses Fail?

Are you interested in the dropshipping business?. If yes, then let's jump into the list of the reasons for dropshipping business failure, so that you can avoid them as you jump into the business.

1# Selecting The Wrong Niche

As a dropshipper, it's very important for you to understand that not all niches/domains are equal. Some niches have good potential to generate income while many others may have no potential for you. A lot of new dropshippers select whatever niche they think is good for them without any research, which is a big mistake.

As a dropshipper, you need to dig deeper into whatever niche and demographics you want to target and gather some kind of proof of concept or signal that people are ready to spend money in that niche.

2# High Pricing Of Products

Customers are now more aware and smart then they were before. Most of the customer who visits your online dropshipping store will try to look for the same product at other alternative online stores so that they can compare and get the same product at a lower price and if that happens they will leave your store without making any purchase.

Therefore it is very important for you as a dropshipper to be thoughtful with your pricing and price your product in such a way that the price of the product is not high while still making a profit out of the sale of the products.

3# Lack of Persistence & Patience

As a human race, we all love instant gratification and it's the same for most dropshippers. We love the idea of overnight success but the truth is that there is no overnight success. Persistence and patience are the most important aspects of running any kind of business and dropshipping is not different.

So you need to persistent and patient while running your dropshipping business. You might face some bumps but you have to keep on moving.

4# Unpleasant Customer Support

As a business owner, you need to understand that customer is king. Many dropshipping businesses fail because they suck at the job of customer support and helping customers. Remember, dropshipping doesn't end when the customer's product is dispatched. You will still have to be ready for their queries, listen to them, and stay connected with them until they are satisfied with their products.

Nobody likes to buy from a business who don't know how to manage their customers and

help them.

5# Lack Of Capital & Resources

It's true that dropshipping doesn't require a lot of capital upfront still you need to have some budget in mind. If you are starting your first dropshipping business, you need to keep at least $500 for running advertisements. If you don't have this amount then it's better to save and then think of getting into the dropshipping business.

6# Lack Of Business Management

This world is full of people who just do things for the heck for it. The same thing happens in dropshipping, many dropshipper just want to start a business and have not idea or intention of keeping it going. In other words, they are what we call wantrepreneurs, they lack the consistency and dedication that is required to run a business. According to Forbes, 80% of businesses fail in their first year and one major reason for the failure is the lack of planning and consistency. So to run a business, you need to inculcate the skills that are required to run a business and keep it going.

People need to understand that dropshipping is not just another easy money-making tactics. It's a full-blown business that requires a lot of time, consistency, hard work, and a lot of dedication.

So this is our list of reasons, why a dropshipping business fails?. We hope that this post has given you some insightful information that might help you in your journey of becoming a master dropshipper.

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