Hi guys, it's Mark.
So a couple of months ago,
I started my own Shopify dropshipping store from scratch.
And I've had lots of messages from you guys
asking for an update.
Therefore, I thought it was about time I told you the truth.
Dropshipping is often said to be one
of the best ways to make passive income.
You can theoretically be anywhere in the world,
with an internet connection,
and be making money from your laptop.
If you haven't seen my last video,
here's a quick recap.
Basically, I made a website called cozeecomfort.com,
and when someone purchased an item,
I would then order these oversized blanket hoodies
from AliExpress,
and get them delivered straight to
my customer's door without even touching the item myself.
Although they're so fluffy.
We actually sold 12 items,
which meant we paid for the building of the website
and all the adverts.
After uploading that video,
I was looking forward to pushing it forward, even more,
making some more sweet profit.
It looked like I was onto a winner
because I was even getting offers
to buy my website.
However, it wouldn't be right of me to pretend
everything has been going smoothly.
I'm honest about everything on this channel.
So we need to discuss what's really been going on,
so that you can avoid these issues in the future.
Honestly, I can see why dropshipping is so popular,
and my aim, isn't to bash it.
I just want to share some of the problems I faced,
and also in my opinion, a much better way of doing it.
By the way, if you like these kinds of videos,
then make sure to subscribe to the channel
for new uploads every Monday and Wednesday.
The thing that makes dropshipping
so appealing in the first place
is you don't have to handle the product yourself.
However,
this also means you might unknowingly be sacrificing
the quality of your products that you're selling.
This makes sense, as in order for the supplier to stand out,
then they need to be able to offer really low prices.
This is because dropshippers need to be able to
charge more for the item,
so they can make a profit themselves.
As there are so many suppliers competing,
they often choose to take shortcuts
in the manufacturing process,
or lower the quality of the materials
so they can drive down the price.
Quality control was definitely an issue for me,
as I did get a few complaints about the hoodies.
Some said they were made from a much thinner material
than expected,
and others found it was missing the cozy lining.
On the flip side,
you'll never get a customer complaining
your quality is too good.
Of course, my customers who were angry at me,
as all they knew was that they had ordered a product
from my website and it didn't meet their expectations.
They were completely unaware,
the issue was to do with the manufacturer and not me.
At the end of the day,
I know from running multiple businesses,
that it's my responsibility
to provide my customers with the best quality experience.
So I just refunded anyone who wasn't
a hundred percent satisfied with the product,
and I took the hit.
Another thing to consider is the shipping times,
as most suppliers are based in China,
this can mean up to a 90 day wait for your customers.
Now, I admit, this is a little on the high side
and you can get products delivered closer to 15 days,
but as you can probably imagine
with a world that is used to Amazon Prime next day delivery,
this just isn't good enough.
I got emails every week from people asking me
where their hoodies were.
And all I could do was email them back
with their tracking number
and reassure them that they were on their way.
It's a bit like waiting for Christmas presents as a kid.
It feels like Christmas Day takes forever to arrive.
And when it finally does,
the presents are never really that great.
Thanks mum and dad.
I know I was joking there,
but the reality is,
the longer you have to wait for something,
the more anticipation you have for when the item arrives,
the higher the standards it has to live up to.
And a lot of the time,
this is bound to lead to disappointment.
The slow shipping times were probably
a lot to do with the size of the hoodies,
as small items are often shipped much faster.
I really understood the complaints I received
because when I was waiting for the sample hoodie,
I was emailing the site almost every day.
To address this issue,
I did adapt my website to include the
exact shipping estimates
so that it wasn't just left as a bit of a mystery.
Now its important to note your biggest advantage over
normal businesses is also your biggest problem.
Your suppliers.
I say this as one of the issues I had
was when the item completely ran out of stock.
This led me to have to refund orders
and all the money I'd spent on advertising,
effectively going down the drain.
Most people buy items from dropshipping stores
on the spur of the moment.
It's an impulse buy.
If you were unable to take that order,
then it's a lost sale.
As they're probably not going to be coming running back
anytime soon.
The moment will have passed,
and they will be on their way to the next new shiny thing.
On top of this,
these items are only relevant for a brief period of time,
as they're driven by hype,
which means that every day you're unable to take orders,
it's a precious day, wasted.
- My precious.
- It can be really frustrating
when you have your website
and your adverts working really well.
And then you're forced to stop trading until you can find
another supplier with a suitable item in stock.
I personally ended up spending much longer
than I should have trying to find a new supplier.
I eventually found one,
but it was more expensive per unit.
So I could either choose to pass that cost onto my customer
or take the loss myself.
I decided on the latter,
as I didn't want to negatively impact my sales.
As you can imagine, because of these first three issues,
charge backs can be a huge problem.
The customer could demand their money back
if they don't think the item is of a high enough quality,
it's taking too long to arrive,
or they could be just trying to scam you,
as they might know
that you're just a small business
and you probably don't have a plan
to fight back against fraud.
The real issue here
isn't necessarily the customer wanting their money back.
That could certainly be frustrating,
but most of the time their concerns are legitimate.
It's more that every time a chargeback occurs,
the payment provider charges you an additional fee,
as if they aren't making enough, anyway.
This means you don't just lose the sale,
but you also have to pay more money on top,
which can really start to impact your profits.
If this happens more than 1% of the time,
you can be fined even more.
Luckily I only experienced one charge back for my hoodies,
as whenever possible,
I would always choose to give the customer
a full refund as it was much cheaper for me to do that,
then deal with any other extra fees.
The final problem I often hear people talk about
is that dropshipping is too saturated,
but I don't agree with this.
Dropshipping is just another method of selling a product,
saying it's saturated is a lot like saying
everyone has purchased everything
they're ever going to want.
At the end of the day,
the whole aim of a dropshipping store
is to look the same as any other online retailer.
And for the method of sending the products
directly from the manufacturer to the customer
to be kept a secret.
The problem is that
a lot of people use the same photos and videos,
which means you have to be constantly adapting.
If you want your adverts to be successful.
It's a bit like when I always tell you about
the free stocks available from free trade and public.
So I won't mention them in this video.
I'll just leave the links in the description below.
After posting my YouTube video,
I noticed a lot more people trying to sell the same hoodies
as me with a very similar brand name.
This made it much harder for me to secure sales.
As my ideal target market was seeing the same product,
absolutely everywhere.
A big part of dropshipping is to
shock your customers with a product they never knew existed,
but they always wanted.
This surprise just isn't possible
with a saturated product.
I ended up creating a completely new advert
with my own photos and videos
in order to get around this issue,
but it never really had the same effect
as when I first launched the store.
I thought about moving on to a new product
for the purpose of this video,
but then I realized,
there was a much better way to use dropshipping
to sell products and avoid all these issues.
Although dropshipping has lots of
issues and ethical concerns.
Even after this experience,
I do think it can still be a great tool,
especially if you're just looking for a side hustle.
Finding and marketing a winning product
can teach you so many great lessons.
Firstly,
you learn which products people want to buy
without spending any money up front.
And secondly,
you learn some extremely valuable marketing skills
that are transferable to any business in the future.
I think a lot of people get stuck dropshipping,
and that's really where they go wrong.
If you found a great product,
the demand is strong,
and you know exactly how to sell to your customers,
then what's stopping you from putting in a bulk order and
dealing with the shipping yourself?
But my main business,
I have to order a great big containers.
The one we've just had is a 40 foot high cube container
and it's full of stock.
And we do that, so we've got plenty of stock
for all our customers.
This stock takes around about 21 to 30 day to arrive.
So I take the hit on the delivery,
but the great thing is it gets it to my customers,
nice and quick.
It takes quite a while for my guys
to get all this off the floor and onto the shelves.
It's a lot of stock.
You can also get an agent out in China
to check the quality of the products
in your container before it's sent,
which comes in really handy, believe me.
I'm not saying you have to purchase huge containers.
I just started out with small bulk buys.
As I grew my business, I was able to afford more.
This gives you far more control over quality,
delivery times and stock levels,
which just makes everything run a lot smoother.
The other added benefit of buying in bulk
is that you're able to create a brand around your products
and get even lower prices.
There's actually a guy called Davie Fogarty,
who launched a similar hoodie dropshipping business
with just $500.
And by using this strategy
he's grown his company
to an epic $250 million by building his brand Oodie.
This is the perfect way to beat saturation,
as people started to want an Oodie
and not just a generic cozy hoodie,
because at the end of the day,
he was the only one that could supply them
with that brand because he created it.
This is the same reason
why many people go for branded products
over the cheap supermarket ones.
They're not necessarily better.
They are just more appealing to us
because they promise a consistent level of quality.
I'm sure Davie was quaking in his boots
after I entered the hoodie industry.
But as of today,
I'm officially announcing my retirement
from my Cozee Comfort business.
So I'm going to leave the next video right up there,
but don't click on it just yet.
Make sure to subscribe to the channel
if you want to grow your wealth.
And don't forget to pick up your free stocks and Bitcoin
with the links below.
Okay, I'll see you over there.