Dropshipping has proven to be one of the most efficient businesses strategies for starting a profitable venture. Over the last several years, more and more people have begun establishing e-commerce enterprises thanks to this accessible business model.
This type of business can be started anywhere and targeted at buyers of any demographic and location, South Africa included. And this shouldn’t come as a surprise, since with a population of almost 60 million as of 2020, South Africa is a rather large and growing market to target for a dropshipper. Furthermore, the e-commerce market revenue in this country is projected to reach $4,057m in 2020 with an annual growth rate of 10.1%.
So, in this article, we will uncover what is dropshipping and how to start a dropshipping business in South Africa.
What is dropshipping? Can it work in South Africa?
First, let’s make sure you understand what dropshipping is and what makes it an accessible and attractive business model.
Dropshipping is a type of e-commerce selling method where the business owner does not have to physically possess the products or even manage the stock. The dropshipping entrepreneur has several key responsibilities he is in charge of creating an online store, picking and promoting the goods, finding and cooperating with a reliable dropshipping supplier. In return, the dropshipping supplier handles other aspects of the business such as managing the stock, packing and sending the products in the name of the business owner and providing tracking information.
Essentially, the dropshipper simply manages the transaction process. When an order is placed on the online store, the dropshipper transfers the customer’s order details to the dropshipping supplier and pays the original product price. When the supplier receives the order details, he packages and ships the order directly to the customer, leaving the dropshipper only responsible for customer support. The difference between the supplier’s original product price and the marked up price paid by the end buyer is the dropshipper’s profit.
Sounds pretty appealing, doesn’t it? From this, you can see why dropshipping can be such an attractive and accessible business.
The dropshipper does not need to pay upfront for stock or storage of the goods. Neither does he have to be concerned about the delivery, as this is the responsibility of the supplier.
What’s more, a dropshipping business can be launched and maintained from absolutely anywhere in the world! The flexibility of this kind of business is one of its many beneficial aspects. And anyone can try their hand in it, from ever-busy moms to first-year college students, to regular everyday workers. That’s why it doesn’t really matter where you’re from, as long as you have access to the internet and a computer, you can sell to anywhere in the world! And South Africa is no exception!
With that said, let’s look at how to start a dropshipping business in South Africa.
How to start a dropshipping business in South Africa
Starting a dropshipping business in South Africa is similar to starting it anywhere else. Here is what you have to focus on:
- Thoroughly research the niche you want to take
- Find quality products and reliable suppliers
- Establish an online store where you can sell your products
- Attract potential customers to your website
Now, let’s look at each aspect in more detail.
Research the niche
Regardless of your geographical location and whether you want to focus on the South African market or any other market, niche research is the most important step in creating a successful dropshipping store.
Knowing exactly what your potential customers want and what the trends are in a particular niche, you will help your business a long way. But the trick in niche choice that can help your store be successful is not trying to cater to all people at once. Instead, you should focus on a specific group of people and supply them with products that they have limited access to.
Find trustworthy dropshipping suppliers and quality products
When you have found what it is you want to sell and who your target market is, it’s time to look for reliable suppliers who offer quality products.
Luckily, the Internet is full of supplier databases, both free and fee-based. You can try to find them or you can try to find suppliers on your own on various online marketplaces, like AliExpress.
The key to differentiating a reliable supplier is their store history and their reviews. Basically, the longer the store is operating, the more trustworthy it is. Furthermore, usually large online marketplaces have store rating systems that can help understand how the customers view and rate the store. And finally, the reviews left by the store’s customers will do wonders in terms of understanding how reliable the sellers are.
As for the quality products, since one can’t physically touch or feel the goods without ordering them, he will have to rely on other options. For example, the number of times the item was ordered will signal its demand level. Moreover, the review section will also help with quality evaluation, as customers tend to share their opinion on the purchased products. Some even share pictures of the product, which will help you determine how it actually looks in real life.
When it comes to selling products online, the constant challenge is to make sure the shipping times are as low as possible. Let’s face it, no one wants to wait 2 or 3 months for the goods to arrive. So to minimize this inconvenience you can look for suppliers near the location you are going to target.
In this case, if you wish to dropship to the South African market, you need to find suppliers near that country. One of the platforms that can help you with this is Dropstore. There you can find South African suppliers with lots of different products.
Establish an online store to sell your products
Now, when you know your niche and what products you are going to sell, you need to create an online store.
There are several ways to get an online store. You can create one from scratch, purchase a ready solution, or turn to a store development service.
Thankfully, there are plenty of services where you can benefit from all these options. To build a website from scratch you can use WordPress. It is the most popular service for website building in the world. Additional plugins will help create a fully functional dropshipping store. Or, if you don’t have any technical experience, you can turn to such services as AliDropship, BigCommerce, Shopify, etc. There you can purchase a store based on your needs. Though each has different pricing plans, you should explore each option yourself to find what suits you best.
Finding potential customers for your online store
For many dropshipping entrepreneurs, the real challenge lies in attracting potential customers to their store. Exactly for this reason it is important to research and choose the right niche. If you have found a niche with demanded products at a reasonable price, then you shouldn’t experience much of a challenge.
You have a few options to drive traffic to your store. The first is through paid advertising. With platforms like Facebook and Google, it is as easy as ever to reach your target audience. Another way is to use Search Engine Optimization strategies. Here you will need to adjust all of your website pages according to SEO to drive organic traffic when someone searches for your products. Another way to drive traffic is to create content such as writing blog posts, making YouTube videos, etc. The key here is to make content that will be valuable to your potential customers.
Notable aspects of dropshipping to consider
- The regulations
When selling products to customers from a different country, it is important to understand the laws and restrictions within that country. Additionally, there are various rules when it comes to importing and exporting products. For example, import costs could amount to almost half of the item’s costs. And this is important to specify to your customers. So, you should do your best to research this topic.
We heavily recommend consulting local law advisers about certain aspects of your business. Thus, not only will you be able to protect yourself and your business, but lower the number of unhappy customers and customer complaints.
- Payment gateways
To establish a proper dropshipping business, one has to be familiar with the most popular local payment gateways. Payment gateways are needed to process online payments. Here are the most popular International payment gateways and gateways within South Africa:
- Payfast
- PayGate
- Payment Express PxPay
- BitPay
- GoCoin
- PayPal
- Stripe
- 2Checkout
Final takeaways on how to start a dropshipping business in South Africa
South Africa has a large and flourishing market that spends sufficient amounts of money in the e-commerce segment. And the numbers are set to grow even more in the coming years. This makes it a promising country to start a dropshipping business.
So, how to start a dropshipping business in South Africa? Dropshipping Is a low-cost and low-risk business model that provides a unique opportunity to absolutely everyone, regardless of your geographical location. Though, there are some common procedures that one needs to follow to create a successful business. These include finding a lucrative niche and finding a way to cater to its audience, and searching for a reliable dropshipping supplier who will ship the products without any inconveniences. And of course, an attractive website is also required to sell the products.
Taking everything into account, one can create an e-commerce business of their liking at a low cost.
Hopefully, this article was informative and insightful and now you have an understanding of what is dropshipping and how to start a dropshipping business in South Africa. Good luck to you in your future endeavours!
By Staff Writer.
