Deciding What to Sell

 

Step 2

Finding a Product to Dropship

The key to starting a dropshipping business is finding the right product to sell.

What makes a good dropship product?

A good dropship product doesn’t need to be perfect. In fact, there are no perfect products, as you’ll soon come to realize. Furthermore, if you spend all your time trying to find this elusive “perfect product idea,” you’re likely to get frustrated and give up your search.

Instead of spending all that time searching for the perfect product, keep a list of potential ideas and compare each of them to the following criteria. You’re going to lose a big chunk of your list in this process, and that’s OK—we want to boil down that huge list of 30 products to 3–5 solid ideas.

Without further ado, here are the criteria you should look for during your product hunt:

Retail price of $10 to $150

When dropshipping products, it’s important to keep in mind retail price (as well as your wholesale price).

Having a fairly low-priced product means you’ll sell high volumes. This gives you more chances to get customer feedback, which is extremely important to dropshipping success. (I’ll cover customer feedback in greater detail in the “Day-to-Day Operations” section of this guide.)

However, if you choose a product that sells for too low of a price, your margins will suck and you won’t make any money unless you sell tons of them. And if you sell a product priced too high, refunds really sting, customer service becomes an issue, and you will have a hard time selling a large volume.

The $10 to $150 price range seems to be a great sweet spot. Of course, this varies slightly depending on who you’re asking, but here’s what really matters with price:

You must able to make a healthy margin on the products you sell.

I recommend making at least 20–40%, but it’s not unheard of to see margins of 100% or more if you find the right niche.

For example, jewelry can see incredibly high margins—but I’ll give more examples later.

When you can go higher than $150

The only time I would recommend going higher than $150 is if you’re able to sell products with a minimum advertised price (MAP) or minimum retail price (MRP).

An MRP means you can’t price a product below a certain price set by the manufacturer. For example, Apple enforces a very strict MRP on their products. As you may have noticed, no retailer has a better deal on iPhones than any other.

Note: MAP only refers to advertised pricing, meaning paid and organic promotion. Once a customer is in the (virtual) door, you’re able to give them a coupon or sell at a lower price as long as you’re not advertising it. MRP, on the other hand, refers to a strict price you can never go below, even in hidden deals.

MRP products are great for dropshippers because they allow you to avoid competing on price and instead compete on value and added benefit to your customers. However, you should still be cautious about going past this price point if you’re a complete beginner.

Small and lightweight

The smaller and lighter your product, the more affordable it will be to ship. If you have lots of low-shipping-cost items, you have the potential to make higher profit margins.

Of course, there is money to be made on big, awkward, heavy items most retailers avoid—but I would avoid those if you’re just starting out. Once you’ve got some experience, then you can try to tackle them. Our Online Selling Tactics series has a lesson on how to do it well when you’re ready.

Requires multiple components or accessories

Dropshipping stuff that requires the user to purchase more than one item—like a fishing pole needing lures and a tackle box, for example—increases your average sale size.

Let me give you a perfect example:

Best Buy sells computers that go for upwards of thousands of dollars. But guess what? They only make about a 10% profit on those high-ticket items.

However, they also sell keyboards, mice, headphones, webcams, and a million other accessories to go with it…

…on which they charge a huge markup of 100% or more. In other words:

  • High-ticket items = ~10% markup
  • Accessories = 100% to 1000% markup

So, they might only make $100 on that thousand-dollar desktop computer you just bought. However, they make $25 on that $30 HDMI cable you bought, $20 on that $25 mouse, and so on and so on...

You can see how this quickly adds up. The more accessories you’re able to sell, the more opportunities you’ll have to upsell your customers and increase your average order size.

Pro Tip: You can also utilize the “loss leader” pricing tactic. You find an item (like a fishing pole) that has a lot of accessories. Then, you price that item very low (perhaps even taking a loss on it) in order to get people to your online store in the hopes they’ll also buy all the accessories from you. Just be careful when trying this tactic, as it can be risky.

Is highly confusing or requires a complicated installation

Confusing products are great for dropshipping! The more confusing a product is, the more you can leverage content like guides and videos to help them understand it.

This type of premium content helps you stand out from your competition and also gives you some leverage to be able to charge a premium price.

Similar to confusing products, products with a complicated installation can be great as well. You can create and leverage step-by-step installation guides that you can include with a purchase to warrant a higher price.

Disposable or renewable

Disposable and renewable products are excellent for dropshipping because they increase your chances of getting repeat customers.

In fact, you can offer a subscription service, allowing customers to keep receiving the product every month. This guarantees repeat customers (which are the best kind) and incentivizes them by offering a discount.

Low turnover

As we’ll discuss in the “Day-to-Day Operations” section, one of the most important things you can do for your dropshipping business is invest in high-quality images and excellent product descriptions.

Because this takes a lot of time (or money) to do, you want to get the most out of your investment. Products with high turnover (meaning they are discontinued or changed every year) aren’t a great choice because they add the headache and expense of updating your website once a year (or more).

Extra tips for choosing a dropshipping product

Use quality manufacturers

As you’ll discover in the section on finding a dropship supplier, choosing only high-quality suppliers is an absolute must for your business.

Not only do you need to find suppliers who are timely in their delivery (and response), you also want to make sure they only purchase products from top-quality manufacturers.

Alternatively, if you’re lucky (and you do some digging), you’ll be able to get those high-quality manufacturers to dropship directly for you!

Either way, you’ll want to ensure the products you’re selling are of excellent quality if you plan on building your brand. Word-of-mouth marketing is the absolute best advertising, and the easiest way to get it is by selling great stuff.

Don’t pick a product based on your passions

Choosing a product or niche based on passion is a huge mistake many first-time business owners make.

Now, I shouldn’t say that if you’re passionate about something, you shouldn’t sell it. What I really mean is this:

Don’t let your passion for an industry blind your decisions.

You could be very passionate about photography, but that doesn’t mean you should sell expensive cameras. On the flip side, you could be passionate about fishing, and that might be a great niche.

Regardless of how you feel about the niche you choose, check it against the criteria outlined above to see if it would be a good fit.

Think about it this way:

Would you rather have a business you’re passionate about making $300 a month, or a business selling phone cases making enough to allow you to work from anywhere in the world and achieve financial independence?

I think I know your answer.

Besides, passion can be created as you learn more about your product.

It may suck reading about the industry at first, but as you become more knowledgeable about it, you may find you become passionate! Passion is bred by knowledge, after all.

There are no perfect niches

Don’t count a product out if it doesn’t fit every single criterion.

Picking something good enough and actually starting your business is more important than trying to find a perfect product and never actually starting.

3 common mistakes when choosing a product to dropship

When it comes to choosing a product to dropship, it’s not uncommon to make a few mistakes along the way. Like anything, experience and practice makes you better.

That said, you can still learn from the mistakes of others so you don’t make them yourself. Here are a few mistakes I see people making when they decide to start dropshipping:

Mistake #1: Thinking name-brand or designer products are the best choice

Many people believe that because name-brand and designer products are expensive, you can make a lot of money on them.

Unfortunately, this is false. Similar to the high-ticket computers Best Buy sells, most name-brand goods make a very small margin.

Additionally, it can be hard to find dropshippers willing to sell name-brand items for this exact reason.

Mistake #2: Thinking knockoff products are a good way to make money

I probably don’t have to tell you this is a bad idea, but I’ve seen it before.

Knockoff products can get you in some serious legal trouble. Just stay away from them.

Also, be aware that certain suppliers will try to sell you knockoffs. However, I’ll cover more about how to choose a supplier and avoid fraud in the next section of this guide.

Mistake #3: Thinking a product is profitable just because everyone is selling it

You might go on Amazon or eBay and see tons of people trying to sell certain products. While that probably means it’s a popular product, it doesn’t mean you should try to sell it.

The reason is pretty obvious: You see all those people selling that product? They’ll become your competition. That competition is likely going to push you out very quickly.

I’ve said it before, but it’s worth repeating: competing on price is a loser’s game.

Researching your target market

Once you’ve chosen a few potential products, the next step in vetting them is doing some market research.

Measuring demand for your product

There are lots of ways to measure the demand of a product, but I’ll go over three simple ways to get you started:

Google Keyword Planner

Go to the Google Keyword Planner and type in your product to see how often it’s searched for on a monthly basis. The keyword tool will also show you how expensive it would be to purchase ads for that keyword, as well as how much advertising competition there is.

Going back to the fishing pole example, let’s see how often that term is searched for:

As you can see, “fishing pole” gets 10,000 to 100,000 searches per month—that’s a lot!

However, you can also see that competition for that keyword is “High.” This signifies there are tons of people purchasing ads for the keyword “fishing pole.”

Of course, you ideally want a competition rating of low or medium, but don’t let high competition deter you (at least until you do your competitive research in the next section).

For now, just take note of the search volume. You’ll want to see at least a few thousand monthly searches for a product or niche before basing your business around it.

Google Trends

Now head over to Google Trends to find out when people search for your product on Google.

Continuing with fishing poles, let’s see when people search for them:

While it may be hard to tell, the chart above shows that the term “fishing pole” gets spikes in traffic from May until August every year, with mini spikes in December. As you probably guessed, that’s likely due to the fishing season and Christmas.

Knowing whether your product has peak search seasons can help you better understand if it will be great as a year-round product or if you’ll struggle to make sales at certain times of the year.

Amazon competition

A third way to measure market demand is by searching for your product on Amazon and eBay and seeing how many reviews and sales your competition is receiving from the product you want to sell.

Let’s start with the Amazon Best Sellers List.

This list won’t tell you the exact number of sales a product receives, but it will give you a rough idea of how well it’s doing as well as how much competition you’re up against.

When you have a product idea, search for it in this list. Continuing with the fishing niche, let’s see how the competition is doing:

Looks like there are plenty of fishing rods for sale on Amazon (no surprise there). However, how well are fishing rods selling in general? Let’s click the first one in the image and find out.

Scroll down to the product details section so we can see the “Amazon Best Sellers Rank”:

Looks like this pole is #8,538 in the Sports & Outdoors category.

While this doesn’t tell you the exact sales it’s gotten, anything ranked at under 10,000, and maybe even 15,000, is going to be a very popular product.

I checked out the other two top sellers, and they ranked 12,000 and 13,000, respectively. So, fishing rods could be a good niche.

However, you’ll also notice these rods have a lot of reviews—all in the high double digits and even triple digits. Starting out brand new with no reviews is going to make it very difficult to rank in this niche.

Ideally, you want to find a niche ranked lower than 15,000 and with fewer than 20 reviews on the top products.

Better yet, they have poor reviews, giving you an opportunity to improve the product and get better ratings. Your success at dropshipping on Amazon will depend on your ability to get a lot of great reviews, and that’s much easier to do when the competition isn’t already way ahead of you.

Pro Tip: You can also use this list to search for product ideas! Just dig deep into the categories and look for products with a low Best Sellers rank and low or bad reviews. More on this later!

eBay competition

There’s an awesome eBay tool called “Watch Count,” which you can use to see exact sales numbers!

Just head over to Watch Count, type in the name of your product, and review the results:

It looks like a pocket pen rod did well (2,387 sales), but the standard telescoping fishing rod didn’t sell quite as much at 871 sales. There is potential to sell rods on eBay, but not as much as on Amazon.

Gender

While not highly important, it’s still a good idea to know what gender you’re selling to when choosing a product to dropship. There are some known shopping differences between the genders, which you can see in the infographic below:

Age

Age is another important factor to consider. If you’re targeting the younger crowd (18 to 24), you may want to reconsider, as they tend to spend the least of any age group online.

Additionally, if your items are targeting older people (60+), you may also want to reconsider, as many of the older generation are still wary about buying on the Internet.

Demographics

Demographics like income, job title, family size, and geographic location are good to know when determining how big your audience is.

In fact, I recommend creating a buyer persona to get an idea of the kinds of people you’ll be marketing to and how big the demographic is.

Businesses and Government Agencies

If your product is targeted at businesses or, better yet, government agencies, you may have hit a sweet spot. While businesses may be a little more price sensitive, they also care more about solving their problems and will typically order in bulk.

Government agencies, on the other hand, are much less price sensitive and order in bulk. It’s typically not their money they’re spending, so they care more about solving a problem and less about avoiding premiums.

Hobbyists

Hobbyists are another excellent niche to target.

Think about it: Hardcore fishing enthusiasts are known to spend small fortunes decking out their boat with the best gear. Golfers are known to spend a lot of money on the right golf club set.

If your niche targets hobbyists, you’re doing it right.

People with a specific problem

One of the best ways to ensure a strong dropshipping business is by selling a product that solves a specific problem a lot of people have.

Take these waterproof notepads, for example. They allow you to take notes in the shower, when people tend to have great ideas!

Of course, finding a product like this to dropship won’t be the easiest task in the world. You may have to work with suppliers to create something entirely new.

Researching Dropshipping Competitors

Once you’ve found some products you like, it’s time to see how tough the competition is. Remember: it’s a good sign if a product has a few established sellers, but too many competitors can make it very difficult to sell.

Find dropshipping competitors and test their process by ordering from them.

Ordering from your competition is one of the best ways to see how strong their business is. If they take a long time to process and ship orders, or if the packaging is weak or the product has some kind of flaw, you can capitalize on that to improve your own business.

Pro Tip: Sometimes you may even be able to figure out who their supplier is if their packaging isn’t completely white labeled (meaning the packaging looks entirely like it came from the business you purchased from instead of a separate supplier). Alternatively, you can search for the product name and description on Google to find the supplier, or even do a reverse Google image search—but more on that in the next section of this guide.

Use a tool to find out how strong their website is

Tools like the Moz Open Site Explorer (OSE) and CheckPageRank help you see a website’s strength via Domain Authority and Page Authority.

Basically, these two ratings show you how likely these pages are to rank on Google and other search engines for their categories, as well as how many links they’re getting from other websites.

For example, let’s take a look at tackledirect.com:

They have a Domain Authority of 42 and a Page Authority of 51—pretty good, but still beatable. Basically, 40 and up is good, 60 and up is great, and 80 and up is in the top 20% of websites on the Internet. For comparison, Amazon has a Domain Authority of 98.

You’ll also notice they have 218 root domains. This means there are 218 unique websites linking to the TackleDirect website. That’s nothing to scoff at—but it can still be beaten with enough effort.

Pro Tip: If you’re serious about beating your competition, you can check which websites linked to your competition via the “Linking Domains” tab. From there, you can potentially reach out to the linking websites to see if you can get a backlink as well. More on this tactic in the advanced section of the “Day-to-Day Operations” part of this guide.

Actually go to and size up their website

Few things can tell you more than visiting a competitor’s site. When checking it out, ask yourself (and write down the answer):

Does the experience feel inviting and welcoming, or is it old and outdated?

Looking at the TackleDirect website, it definitely looks a bit older.

However, it’s still very functional. They also use many eCommerce website best practices:

  • Showing their support number front and center where it’s easily visible
  • Making the search bar easy to find
  • Advertising their free shipping offer

Checking out a competitor’s website like this also gives you some insight into other things they’re doing. You may notice they have a “Google Trusted Store” badge, a live chat option, and a subscribe & save feature. You could potentially borrow those ideas for your own store.

Check their social media following

This is a great way to find another area in which you can potentially beat your competition. You’ll be able to find out which social media channels are doing well for your niche, and which kind of content your target market engages with.

Looking at TackleDirect’s Facebook page, you’ll notice they have over 100,000 likes:

However, most of their posts only get 7 to 14 likes, no comments, and maybe one or two shares. I’d guess it’s because they only use social media as an advertising channel to share their products.

To beat them on this front, you can find out what fishing fanatics engage with on social media, and add that to your social posting. It could be fishing videos on how to tie a lure to your line, blog posts about types of fish, or even a podcast about fishing. More about that strategy in the “Day-to-Day Operations” and “Scaling Your Store” parts of this guide.

Check their site on the Better Business Bureau

Checking your competitors’ reviews on the Better Business Bureau is a great way to see if they have good or bad customer service (and if you can use customer service as a competitive advantage).

Looks like TackleDirect hasn’t received any complaints (or reviews) on the BBB website.

You won’t always get good info from here, but it’s still a good idea to check. I’ve seen websites deliver horrible customer service; sometimes customers won’t receive a refund for several months, and sometimes they never even receive their package.

Use custom search parameters to see Google results from other countries

Let’s say you’re setting up your business in the UK, but plan on selling to the US. Google’s regular search results won’t help you find your competitors in the US because they factor location into your results.

To get around this, you can use Google’s AdPreview Tool. Select the country, state, city, Google domain, etc. you want to view results from. As an added bonus, you can also view by device, which will show you mobile versus desktop.

How to find products to dropship

Now you know what to look for. Let’s look into some ways to actually find products to dropship!

Pro Tip: For the most effective product research, keep a spreadsheet and mark down every product you find while searching around. The longer you can get this list, the better the chance you’ll find a few that fit the bill. Don’t start checking out each product in detail until you have a nice list of at least 10 products to research, preferably more.

Google products

Autocomplete

Google’s autocomplete feature is a great way to find things people are searching for. For example, if we start typing “jewelry”...

It looks like people are searching for jewelry boxes, armoires, stores, and meanings. We can take this a step further and type in “jewelry meaning”:

Now we get “jewelry meaning as a gift,” “jewelry meaning strength,” and “jewelry meaningful message.”

We’re narrowing down our search to a specific niche—jewelry with a meaningful message. This isn’t necessarily a great niche, but now you see how the autocomplete feature can help you get specific about what to sell.

Related searches

Similar to autocomplete, related searches show you high-volume search phrases related to whatever you typed in. Just search whatever word or phrase you want, then scroll down to the bottom of Google.

Continuing with jewelry, here’s what I got:

Let’s take “jewelry for men” and see what comes up related to that:

We can continue to drill down to get more and more specific. Let’s search “mens hip hop jewelry.”

Now we’re started to find some potential niches—iced out jewelry, custom hip hop jewelry, etc.

I’m not saying this will be a great niche, but you can use this process to find potential products to add to your running list for research at a later time.

Keyword Planner

You can also use Google’s Keyword Planner for finding products as well as scoping out competition. While it isn’t the best tool in the world for finding products, it’s still worth mentioning.

Let’s go a bit further on the “iced out jewelry” idea.

It gets a good number of monthly searches (1K – 10K), but competition is high. If you scroll down, you’ll notice “iced out watches,” which could be another potential product, also gets 1K – 10K monthly searches.

Looks like the amount of competition in this niche might be a bit too much, but I hope you see my point about how you can use this tool to find other niche products.

Trends

Google Trends is the last Google tool I’ll mention. We already talked about how to use it to determine if a product is seasonal—now let’s look at how we can use it to find other product ideas.

Let’s go back to the bigger “jewelry” trend:

Looks like over time, the interest in jewelry is going down a bit. We also see spikes around the holidays, which is to be expected.

However, if you scroll down to the “related queries” box at the bottom of the page, you’ll notice some potential niche products. Jewelry candles, for example, could be worth exploring.

See how can you use this to find a niche?

Consumer product review sites

While a somewhat more advanced tactic, consumer product review sites are an interesting way to find unique dropship products. Basically, they showcase a bunch of cool items for anyone to review. The more popular the product, the higher it ranks on the page.

Here is a list of the top review sites:

As an example, let’s take a look at Uncrate. After sniffing around the “etc.” section, I found this Sansaire Steak Aging Sauce:

While finding this exact brand to dropship may be a challenge, you can probably find another brand. This would sell to a unique market of steak connoisseurs.

To really find a way to stick out, go to the Amazon sales page and check out the reviews. There, you’ll find the good things about it you should copy, and the negative things you should make better in your own product.

For example, this steak aging sauce is loved by some, but others feel it’s overpriced and too fishy:

The Easiest Way to Find Dropship Products: SaleHoo’s Market Research Lab

You may have heard of Amazon’s Best Sellers List, Watch Count for eBay, or AliBaba and AliExpress’s popular and bestselling products list.

All three of these resources are excellent to find products with—but, they take a lot of time and effort to sort through individually.

That’s why SaleHoo created a tool called the Market Research Lab. This sweet little program pulls products from all the places I listed above and categorizes them based on price, successful sales rate, amount of competition, and category!

So it takes all the work out of finding a product AND doing competitive research. For example, let’s take a look at popular jewelry with a 100% sales success rate:

Look at that—the third item has low competition, sells for a nice $20, and has 3 successful sales. Worth a look, is it not?

If that’s not enough for you, it also lists suppliers who sell the item, and categorizes them based on whether they’re a wholesaler, dropshipper, or manufacturer!

10 Great Products to Dropship in 2017

You may be reading this and thinking, “Can’t you just tell me what to sell? All this research is too much work!”

We sure can. However, these products may quickly become overly competitive, and I can’t guarantee you’ll see success selling them.

But, without further ado, here they are (in no particular order):

#1: Custom T-shirts

T-shirts have long been a great product to dropship because it’s easy to make and sell a unique design, and people will always buy new T-shirts.

You can easily create and dropship T-shirts using:

Pro Tip: If you need help coming up with unique T-shirt designs, you can always hire someone to create it for you using:

  • Fiverr – A place to get your T-shirt designed for as little as $5.
  • DeviantArt – While these people aren’t directly T-shirt designers, if you find a design you like, you can contact the artist and ask them to create something for you.
  • Designious – A place where you can buy premade T-shirt designs.

#2: Custom phone cases

Similar to T-shirts, people love buying new phone cases with unique designs. In fact, you can use some of the same suppliers to print phone cases as you can to print T-shirts:

#3: Custom mugs

Mugs are another great, easily customizable and dropshippable product.

#4: Jewelry

If you haven’t already guessed it by my examples, jewelry is a great product niche to dropship in 2017. It has excellent margins if you find the right vendor, and people are always looking for unique ways to express themselves.

Some ideas of items you can dropship include:

#5: Fitness equipment

Because of its popularity and huge range of products, the fitness niche has great dropshipping potential. You can dropship equipment like:

#6: Camping equipment

Outdoor gear is another great dropshipping niche because hobbyists spend a lot of money in this category, it’s very popular, and there are tons of products that fit most of the criteria above.

#7: Phone parts

Screens, chargers, cases, mounts, stands … there’s a lot to be sold here. I wouldn’t necessarily sell the phones themselves, as retailers don’t make much money on them. However, accessories are easy to make a great margin on, as we discussed!

#8: Skin care products

Every person on Earth wants to be attractive—which is why there’s such a huge demand for skin care products. Cosmetics alone totalled $55 billion in sales in 2014. Some great skin care products to sell include:

#9: Baby products

Who’s more passionate about something than a parent is for their child? Baby stuff has always been, and likely will always be, a top seller. Some great baby products to dropship include:

#10: Superfoods

Ahh, superfoods—as people become more educated on the foods they’re putting in their bodies, they’re beginning to buy more “superfoods.” Superfoods you can dropship include:

Best items to dropship on Amazon or eBay

If you’re selling specifically on Amazon or eBay, any of the categories I mentioned above should work just fine. However, supplements have been cracked down upon quite a bit by Amazon, so keep that in mind (you can still sell them, but some can’t be sold there).

Also, talk with your supplier about whether or not you can dropship their products on Amazon or eBay. They’ll be able to tell you right away whether it’s allowed or not.

When in doubt, double-check your product against Amazon’s restricted products list and eBay’s prohibited items list.

For more tips about dropshipping on Amazon or eBay, see the “Day-to-Day Operations” section of this guide.

So, now you should have a great understanding of what goes into finding and vetting a product to dropship! In the next section, we’ll cover how to choose your business’s most important partner: your supplier.

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