Dropshipping does not require large costs and risks on the part of a "young" business, does not need complex calculations and does not require huge capital investments at the start.
Without the need to purchase goods to your warehouse, organize storage, pay employees, it is easy to protect yourself from failure and a sharp peak in the red from the first days.
Saving money, time and nerves makes dropshipping a universal means of earning money with a huge number of advantages over other options.
But is it so versatile? At first, it may seem that thanks to dropshipping, you can sell EVERYTHING, any goods will fly out instantly, and if not, you can always "change your shoes" and start working in another category.
In general, this can even be called close to the truth, but there are several very important "buts". Of course, each product category has its own pitfalls.
In this article, we will not review the whole world of dropshipping and touch upon every product, because for this, a lifetime is not enough, I suppose.
Better to talk specifically about such a category of goods as oversized. Everything big and bulky can be included in this category: wardrobes, sofas, beds, garden furniture, tables and armchairs, and much more. And I will speak specifically about this category, since I have accumulated a lot of experience in this area and now I am not averse to sharing it.
After a year of active work on the dropshipping system (namely seasonal goods), it was decided to acquire at least a relatively permanent and stable business, selling home furniture (sofas, armchairs, beds and everything similar / accompanying this furniture).
The choice fell on this category for one simple and key reason for such a business: the demand for such furniture is relatively constant and stable, with minor fluctuations.
For myself, during my work and active analysis of dropshipping large-sized home furniture, I brought out a lot of interesting and important things. Undoubtedly, there are a lot of advantages in such a business. But, specifically in this article, I highlight 5 main reasons why it should still be left until better times and not start looking for yourself in sales from this category. TOP FIVE Reasons NOT to Dropshipping Bulky Items:
Expensive delivery
To get a good amount of revenue by working with a drop, you first need to reach a good audience, that is, a wide GEO (if you are going to work locally, go straight to step 3). I gained my experience in this field by selling sofas and beds in Ukraine. In terms of area, this country is not the largest in the CIS, but the problem was already critical. Initially, there were attempts to launch advertising campaigns throughout the country in order to reach the maximum audience, but due to lack of experience at that time, the moment with delivery was not fully thought out.
The advertising result was wonderful: calls came regularly, clients were absolutely satisfied with the conditions, price, etc. (we were ready to wait 2-3 weeks without any problems, which the supplier needed to manufacture). But, the stumbling block was the cost of delivery: the enthusiasm in the client's voice disappeared and the conversation rested on the standard and dry: "Thank you, we will think about it!", Which, as every salesperson knows, does not bode well. The client, of course, did not get in touch anymore (and if he did, he quickly refused the order). And the reasons for these failures are quite clear to anyone: for example, a sofa costs 5,000 hryvnia (13,700 rubles), the amount is affordable for everyone and quite low for this segment. And then it turns out that delivery at a distance of 400 km was 2,000 hryvnia (5,500 rubles) - 40% of the cost of a sofa!
It made no sense for customers to buy from us with such a cost of delivery, since it really was cheaper for them to go to the nearest furniture store and buy a sofa there, which is immediately available and delivered for free (or for a minimum amount) immediately home. As you can see, at such a delivery price, everything is not in favor of the dropshipper ...
By the way, we have carried out a full analysis of the 5 most popular delivery services in Ukraine. The hope was that after comparison it would be possible to find a service with more favorable conditions.
It has been hypothesized that certain delivery services may be cheaper over short distances than others. or vice versa: some service could be cheaper over long distances. But, unfortunately, the hypothesis was not confirmed.
Non-unique product
As it is not difficult to guess, selling a unique product is always more effective and profitable than selling something that is everywhere and everywhere.
If the uniqueness of the product is high, and even more so, if you can make it according to the individual wishes of the client, he will be ready to survive the production time, and the delivery cost will take calmly, and, in principle, anything (of course, in moderation)).
If your product is similar to what is sold in many offline stores, then there is a high probability that the client will go to buy furniture there, rather than ordering the same sofa in the online store.
Lack of physical stores and showrooms
When, faced with a delivery problem, we realized that without reducing the cost of this service we had no chances to sell throughout the country, we decided to sell furniture in one specific area of the region from a supplier located in Dnipro (regional city). Accordingly, we started selling in the Dnipropetrovsk region. After the launch of advertising, active applications were gradually sent. Their number was, of course, not the same as when working throughout the country, but, nevertheless, they were enough.
As a result, we got a new problem that needs to be solved: about 50% of people refused to buy due to the impossibility of going to our store / showroom. The request was clear: the client wants to "feel", to understand the quality of the material, to make sure that we are a real company. But, we did not have a physical point, we could not send them anywhere, therefore we were actively losing customers. I would also like to clarify that people can buy 2-3 sofas at a time in the store, because this is a significant blow in the form of lost profit.
Availability
Although this problem is not a key and rather critical one, it is necessary to indicate that it happens that customers really like the product, they are delighted with it, but they need it today or tomorrow, or at most the day after tomorrow.
In this situation, they are ready to take, there would be availability. And, as a rule, you will not wait for large-sized goods in stock from the supplier (working on dropshipping).
Low margin
Everything is simple here: money solves 90% of your problems both in life and in business. Having a high margin, it would be possible to solve key issues: pay part of the delivery cost for people, or even pay for it in full. But, we had a margin of only 15-20%, which did not allow us to pay for delivery even partially.
Outcome
The most basic reason the success of such a business is minimal: expensive shipping. Although there are other troubles, this one is still more significant than the rest. Until shipping costs drop, selling bulky items via dropshipping is unlikely to be a profitable business, so turn your attention to small items in your niche.
PS: The project for the sale of home furniture was eventually closed due to unprofitability.