Starting a drop shipping business, although more simple and straight forward than starting your own traditional e-commerce store, still comes with many decisions and considerations. One of the most commonly asked questions with drop shipping is whether you should sell one product or multiple. I had the chance to speak to Jason Feemster – Owner of POSUSA.com,
his expertise is in the retail point-of-sale industry, and he gave us some good information on this topic. Here’s the answer we came up with.
Many people go into the drop shipping business thinking that they could choose one viral product and become rich. It’s very simple to do things this way, however through doing it this way you acquire more risk. Let’s take a look at a viral product like the fidget spinner. When those things came out, many people started a drop shipping store based on them alone, and then the hype died down.
In the rest of this blog post I’m going to dive into why you should diversify your product offering, while still keeping it in the same niche.
The Benefits of Selling Multiple Products
When you sell multiple products, there are many different benefits. Below I’m going to dive into each one.
You Have More Data To Learn From
Selling multiple products gives you the ability to let you see what works. Let’s say you have five different products on your drop shipping store. You can take the analytics and sales from each product and come up with new product ideas using that information. When you only have one product, it become hard to get the big picture and get better at finding new products.
You Look More Like a Brand When You Sell Multiple Products
The next thing is, when you sell multiple products you look more like a brand. When someone goes to a site where there’s only one product being sold, there could sometimes be a lack of trust.
If you sell multiple products on the other hand, you look more like an authority on the topic, and therefore more people are likely to trust you (which will result in more sales).
You Have The Ability To Make a Lot More Money Selling Multiple Products
The simplest way I could put this is, look at Amazon. Do you think they would be making the sales they make with only one product listed? No. Of course you’re not going to be Amazon (at least right away), but having multiple products on your store could give you the potential to make more money than having just one.
Reduced Risk
When you only sell one product, you put yourself at risk because you’re completely reliant on that product. If something happens to it, you could lose a lot of money and time. On the other hand if you have multiple products, you have much less risk associated with them because any issues with one product won’t affect the rest of your store.
Gives You The Opportunity To Sell Products High In Price and Low In Price
Most people don’t realize this, but having multiple products on your store really opens up the opportunity to sell high priced items as well as low priced items.
For example, let’s say you’re selling fly fishing equipment. You could sell a $5 pack of replacement hooks, as well as a $500 reel (or even higher). This would give you the ability to target different types of customers and get more sales.
I recently wrote an article about profit margins in drop shipping, and one thing that stood out to me was being able to use the higher priced (higher margin) items and using them for special sales in order to get your revenue up.
You can also afford to promote your brand with those higher priced items, which will result in more sales. Let’s say you make $100 profit on those $500 reels, those would be the products you include in your ad that you’re spending $20 per day on. If you make one sale per day, or even a sale every other day, you’re still making a profit.
When it comes to the lower priced items, this isn’t really possible to do.
How Many Products Should You Start With?
I wouldn’t start with 50 different products, because when it comes to marketing that may get overwhelming. I’d start with 4-6 carefully chosen products. This isn’t too much to the point where you’re spreading your self out too thin.
Once you have the 4-6 products running and you’re able to get enough analytics to see what’s going on in your store, you can then start to expand using that information.
What’s The Best Way To Choose Good Drop Shipping Products?
So it’s not going to be super easy to choose those 4-6 products, but I have you covered with a couple of different methods you could use in order to find products. Let’s hop into them.
The First Thing You Want To Do Is Pick Your Niche
The last thing you should do is pick a bunch of different products in different niches. When it comes to customer loyalty, you want to be able to be the go to store for a certain thing. If you starting with fishing equipment, try to stick to that. If you start with kitchen utensils, then try and stay in the kitchen niche.
Maybe eventually you will be able to dive into different related niches. For example, if your customer base likes fishing, chances are they will like camping. Once you become successful as a fishing store you could expand into camping as well.
Use Keyword Research To Find Popular Products
I always thought of using SEMRUSH and AHREFS as blogging tools, and maybe YouTube as well. However, you could use it to help you find products for your store. As you could see below, I created a search for fishing, filtered the keywords to commercial, and also changed the difficulty to easy.
The results I got were pretty good products that you may want to think about selling on your drop shipping store (or at least it’s just a start.)
The image I posted is blurry so let me tell you what fishing came up with in terms of products:
- Fish Boots
- Pans For Cooking Fish
- Fish Lure Spoons
- & More
Test The Product (Make Sure The Supplier Is Reliable And Has Good Quality)
Now you may get excited because you see so many good ideas in your niche, but you don’t want to get started until you’re able to test the products you want to get. You want to make sure the supplier is able to ship things to you quickly, the quality is what you’re expecting, and the customer service is good.
Try And Think Of Spin Off’s Of Products (Try and Make Them Different)
Last but not least, you want to make sure you can try and think of spin off’s of every day products in order to differentiate it from other stores. Let’s say you’re selling fishing poles, try and think of something like a bundle.
In Summary
I hope this article helped you figure out whether or not you should start with one product or multiple products. In my opinion you shouldn’t start with one, but you shouldn’t start with too many either. Try and start with 4-6 products in order to get you going. The most important thing though, is that you get started. You won’t learn the in’s and out’s of the business without actually being in the business.
If you found this helpful, please share it on social media and other platforms you may use. If you have any questions or comments please leave them below. I’d like to hear your input as well.
