Every business has a positive side as well as a negative side, and dropshipping is no exception. It would be unjust if we keep on talking about positive points and ignore the negative ones. Comprehensive research on advantages and disadvantages will help you in understanding whether the particular business model is right for you or not. In case, you are not satisfied with dropshipping, you can work on minimizing the disadvantages of dropshipping or choose the other model.
Our main purpose is to bring truth in front of the people, so we are going to put the list of cons of dropshipping in 2021, and hopefully, it will sound awesome to you. The best part of this comprehensive guide is that you will also get to know about the tips to minimize the disadvantages or convert them into advantages.
Sounds great? Let’s get straight to the point.
What Are The Cons Of Dropshipping In 2021?
Every business model has a fair share of disadvantages and dropshipping is also one of them.
Having a closed look at the disadvantages will help you to move towards the solutions.
1. Over-reliance On Manufacturers
You are dropshipping, which means you have never physically seen the product that you are sending to the customer. This over-reliance on the suppliers can sometimes create a lot of problems. You may get negative reviews on your website based when the buyer faces shipping problems or find any kind of defect in the product.
Moreover, whenever you receive a complaint from the buyer, you have to forward it to the supplier company and wait for their reply. If their customer support is not fast enough, you may face a lot of issues due to delays in the response. Some buyers cannot wait for your reply for more than a day and leave negative comments.
Being at the mercy of the manufacturers is something that is considered a big negative point of this business. However, you can solve this problem by choosing reliable manufacturers that have good customer reviews and are well-reputed in the online market.
2. Cannot Put Anything Extra In The Package
Some companies often have something special for their new and returning clients. They deal with every client with a new style and try their best to understand their needs. The best way to show their special concern towards the buyer is the addition of something extra in the package. It can be a flower, a thank you note, a special discount offer for the next shop or a small amount of cash as a surprise. Various webshops grab the attention of buyers in this way and often use these tactics to convert the new customers into the returning clients.
But in dropshipping, you do not have any control over the packaging, so you have to rely on the manufacturer or supplier company. You cannot ask them to add something on your behalf as it may go too complicated to contact them for this. So, the core of the matter is that you cannot make anything personal and cannot reach out to the buyer by adding some extras.
In this way, you lose a big chance to entice the customers and grab their interests.
3. No Control Over Timely Delivery
As discussed earlier, from packaging to shipping you have to rely on the manufacturers. In case the supplier fails to deliver the product on time, it will fall under your irresponsibility as the buyer is unaware of the supplier. So any kind of issue related to order processing and shipping times can badly impact your reputation.
The best solution to this problem is to choose the partners who have a good reputation for the delivery times and always ship the products by the stipulated time. It is mandatory to maintain customer satisfaction and an essential thing to run the dropshipping business.
Well, if you have already chosen the company that is not good at shipping the products at the given time, you can deal with other dropshipping suppliers and end up your agreement with this company.
4. Cannot Combine The Products For An Order
Having the products of different suppliers on the same page is a very common thing in dropshipping. If the customer purchases products from multiple different suppliers, each of the suppliers will ship the product separately and it will not be possible for you to ship them as a single package.
It is a bit of a costly option for the buyer as well. But unfortunately, you do not have any other option and the customer is also bound to wait for the shipping of each product separately.
Want to know the worst part?
The customer can complain about the incomplete package after receiving only the first one, and even if he knows that you will send him in part, he may not like it.
5. Stock Shortages
Well, you should know that you do not have control over the things that you are selling. If you are not vigilant enough, certain products can go out of stock and you will not have mentioned them on the site. In this case, if the customer places the order, you will have to cancel it or face bad reviews.
Moreover, if a certain product is selling at a good rate, and immediately goes out of stock, it is you who will suffer in the end and not the supplier.
Want to know the solution?
Talk to your suppliers about the products and confirm how fast they can have new inventory. After getting the logical answers, you should proceed with the supplier. It is better to have a keen eye on the stock list and regularly update the finished products as “Out Of Stock”.
It will help you in not getting the orders on out-of-stock products.
6. Low-Profit Margins
Profit margins are often lower in dropshipping because you have to pay more to the supplier. This seems alright, because the supplier is responsible for everything from packaging, storing, and shipping of the product. So, in most cases, you can expect a margin of less than 20%.
In this way, you can only enjoy financial freedom if you are getting regular and bulk orders. And the worst part is that when marketing costs are added to this price, the situation gets even worse.
One solution to this problem is to choose free and DIY marketing ways to save your money, but definitely, it will require more effort and time. Another option to solve this problem is to sell more and more products, but this is possible only when you have enough reviews and have maintained some reputation.
Best of all?
You should opt for only high-margin products and should not display the products on the site with the lowest margins.
Well, here it is worth mentioning that the right pricing and selection of the right products for your dropshipping store are the things that need a separate discussion.
7. High Competition
As we are talking about the cons of dropshipping in 2021, it is very important to tell you that this market is slowly getting saturated in 2021. The fact is, things have enormously changed after the pandemic and now people are more geared towards online businesses especially the ones which do not require huge investments.
Due to these reasons, people are moving towards dropshipping more than ever and the trend is getting increased day by day. So, if you have decided to dive into this business, it is never too late. However, you should come up in the market with more confidence, passion, and marketing expertise.
What else?
In the end, we would like you to understand that although dropshipping starts at a low pace, you can expect very high margins after you have got some experience in the field.
Do not forget to value the fact that you are doing almost nothing and your supplier is handling everything from scratch till the end. So it is an easy way to make money if you are ready to start with patience.
Further, you can leave this business option without losing much, so if you are not satisfied with it due to the disadvantages mentioned above, you should not be giving it 5 minutes.
Here are some pro tips for your further guidance.
- After negotiating with the suppliers, reduce the delivery times as much as possible
- If you have multiple suppliers from each country, you should try to deliver the products from the same country.
- If the customer is not happy with the product, send it back to the supplier and let him ask for the refunds.
- If you have got a question from the supplier whose answer is unknown, you should ask him politely to wait until you will get back to him.
- Try to fix the complaints of the customers as soon as possible. It is better if you can satisfy him on your own.
Conclusion
Now you have seen the negative side of this business and read the cons of dropshipping in 2021, hopefully, it will become easier for you to decide whether this business idea is right for you or not.
In case it does not fit your plans and aptitude, you should not waste time on it.
If you are still confused, feel free to comment in the comment section below.