How much can you earn from dropshipping?

 by Lisa W. - May 7th, 2019 | Last Updated on June 6th, 2020

You can earn anywhere from $0 to over $10000 per month by doing dropshipping. The more you invest, the more you can earn. However, if you are not careful you can also lose money.

How much you earn from dropshipping will vary greatly depending on the number of products you sell in a particular month and your profit margin per product.

For eg - Let's assume, in a particular month you bought 100 products worth $20 each and sold every one of them for $30. That means you made a profit of $10 per product. Thus, you were able to earn $1000 in that month.

This is your gross profit. In order to find out your net income, you have to minus the defective product returns, money refunds and the marketing cost associated with selling your products from the gross profit.

For eg - Based on the previous example, if it takes you $2 to advertise and sell each product, you are left with a net profit of $8 per product. Also, suppose you had to refund products worth $100 in that particular month. According to the calculations, your net profit for that particular month will be $800-$100 = $700.

How can you increase your earnings from dropshipping?

Dropshipping is an easy business model to get into, but it’s not a guranteed one. If you are not careful, you can incure some losses. However, if you play your cards right, you can find a very good sustainable source of income.

In order to increase your revenue from dropshipping, you have to do the following -

• Recognize products that have the potential to sell(evergreen products) well but which has low competition.
• Learn how to market your online store or products in a way that will maximize your return on investment(ROI).
• Research thoroughly about your target customers in order to satisfy their needs and wants.
• Refine your ability to find and penetrate new market segments.
• Differentiate your brand from the rest of the competitions.
• Provide value to your customers in order to build brand loyalty.

You also have to research your competitors in order to see how they are approaching their business and adopt their strategy in order to keep up with them or beat them at their own game.

Is dropshipping viable in 2019?

Dropshipping is a high-risk vs high-reward type of business model. Many people try dropshipping without any knowledge, lose their money and claim that dropshipping is hard or it is dead. However, that is not true at all.

People are still making plenty of money through dropshipping. You just have to understand the art of doing dropshipping and forget trying to get rich quick.

In the beginning, you may only earn about $100 per month. However, as you get better at researching products, finding new markets to sell and learn how to properly market your products, you can keep reinvesting money and generate more profits.

Just remember, every viable business model requires effort, investment in both time and money, and some skill in order to generate profit.

Conclusion

There is no sure way to tell how much you can earn from dropshipping as it depends on a number of factors. With some luck on your side, you can generate some profits right from the start and keep reinvesting a part of it in order to scale your business. As you gain experience, you will develop the necessary skills and gain the knowledge to earn more, build a brand image and leave your competition in the dust.