Everything You Need to Know About AliExpress Dropshipping in 2020Source
Making money online is a goal for many people. And if you’re one of them, you’ve probably thought about starting your own eCommerce store.
Today we’re going to give you the low down on one the most popular (and profitable) eCommerce models in recent years: Dropshipping with AliExpress.
By the end, you’ll be equipped with everything you need to know about how to start a successful Aliexpress dropshipping venture.
Sounds good? Let’s jump in.
What is AliExpress?
AliExpress is a gigantic marketplace. It’s got listings for just about every type of product under the sun. And because most of the suppliers who sell products on AliExpress either source or manufacture them overseas, they can sell them at extremely competitive prices.Source
Many successful e-commerce entrepreneurs source their products from AliExpress. With millions of products at your fingertips, you’re spoiled for choice.
What is Dropshipping?
Dropshipping is an eCommerce fulfilment model. In simple terms, it means sending products directly from the manufacturer to a customer who’s placed an order on your store.
Many leading brands like Nike, Apple and MVMT use or have used dropshipping as part of their fulfilment process.Source
With dropshipping, your store doesn’t hold any stock instead your supplier handles that.
That means you don’t have to purchase loads of inventory upfront, so it’s easy to get started with only a small investment.
Almost all of the suppliers on AliExpress are delighted to accept dropshipping orders.
How Does AliExpress Dropshipping Work?
The basic principle of Aliexpress Dropshipping is simple. It looks like this:
- 1. Find a product to sell on AliExpress
- 2. Create an eCommerce website using software like Shopify
- 3. Import your products to your store, pricing them at a mark-up
- 4. Advertise your store & drive traffic using Google or social media
- 5. Make sales
- 6. Order the products from AliExpress using your customers delivery address
- 7. The AliExpress seller packs and ships your order directly to your customer
- 8. Rinse and repeat until you can buy a Lambo
Okay, that last point might not be an essential step. But hopefully, you get a general idea.
You’re advertising and selling your suppliers products at a markup, and they’re managing the stock and sending the orders out to your customers.
Seems simple huh? Well, there are usually a few questions that immediately pop into people’s heads. Starting with…
Why Would a Customer Buy From You and Not Aliexpress?
The basic answer is because you got to them first.
See, for the most part, Aliexpress suppliers are not good marketers. They're wholesalers. And that’s where you can come in and pick up the slack.
How? Well here’s a few examples:
- Getting the product in front of people who didn’t know it existed previously
- Writing compelling product descriptions that entice & educate customers
- Positioning the product in a way that most benefits your target customers
- Building a brand around the product that delivers a better customer experience
- Providing awesome native language customer support
In other words, your marketing, support and operations are your competitive advantage. For example, which of the following two companies would you rather buy from:
Pretty obvious right? Even though the Phoenix one is more expensive they’ve created a better shopping experience and that’s how they earn their sales.
How do You Handle Refunds & Returns?
Most Aliexpress suppliers don’t accept returns. And understandably, many consumers won’t shop in a store that doesn’t offer returns. That means you’ll have to handle customer returns yourself.Source
The most common tactic is to eat the cost of returns and build it into your pricing model. So for example, if you know 10% of your orders are returned on average, then you’ll need to increase your prices by 10% to cover that cost.
If a customer receives a damaged item or an incorrect order, then they’re entitled to a refund. All Aliexpress suppliers offer refunds for defective items, but getting them to issue one is another story.
It’s best to ask your customer for photos of the defective product and then to issue a refund to your immediately (or offer to re-send another product free of charge). Then use the Aliexpress dispute system to try and recoup some of the order costs.
Obviously you’ll have invested marketing spend to win that customer, so you’ll likely end up making a small loss. But you’ll just have to accept that it’s as an inevitable cost associated with the business model and move on.
Why Should I Try Aliexpress Dropshipping?
AliExpress Dropshipping represents an incredible opportunity to make money online. Some of the main benefits it offers are:
- Low Startup Costs: When starting a traditional business, costs of inventory, premises rental, insurance etc add up quickly. With Dropshipping you don’t need any of these things so you can get started with only a couple hundred dollars.
- Automated Order Fulfilment: You don’t have to wrangle with managing stock, picking and packing orders, shipping them etc. That’s all handled by your supplier which lets you focus all your attention on the marketing side of the business.
- Minimal Risk: What happens if you buy $10,000 worth of product and then nobody wants to buy it? Hint: it’s not good. Dropshipping lets you test multiple products to see what the market responds to without large financial risk.
What Are The Challenges Associated With AliExpress Dropshipping?
Like any business, Aliexpress Dropshipping isn’t all sunshine and rainbows. So be ready for:
- Little Control Over Delivery Times: Since your supplier handles all your fulfilment, if they screw up, it’s you who’ll have to deal with an angry customer.
- No Control Over Stock: Being able to stop and start selling products in a couple of hours is the beauty of dropshipping. However if your supplier runs out of stock, or ceases to sell it, your business also runs out of stock. Not good.
- Lower Profit Margins: By purchasing individual units, you can’t leverage bulk buying to bring your product costs down. This means you’ll be working with tighter margins and less room for error.
How To Discover Winning Products on AliExpress
So, you’ve weighed up the pros and cons and you’re going to give dropshipping a chance. Awesome!
The first step is to find products to sell on AliExpress. Not just any products though. You need a winning product to make money. In this section, we’ll show you how.
Method 1: Study Bestseller Lists
You don’t need to reinvent the wheel to make money. Find what’s already selling well with sites like:
- Amazon Bestsellers
- Amazon Hot Releases
- eBay WatchCount
- eBay Daily Deals
- Etsy Trending Now
- Walmart Bestsellers
Examining these lists will give you an idea about the kinds of products people are looking to buy. You can then hop over to AliExpress and search for similar items that you can sell.
Pro Tip: Don’t always look for exact product matches on AliExpress, but rather ask:
‘What problems are people having that’s driving them to buy this product?’
This allows you to draw out consumer trends and open up a whole host of products that you can market to help your customers out.
For example, let’s say a particular board game is selling well on Amazon. By asking the above question - ‘what’s the problem?’ - you can deduce that people are bored, or perhaps that they want to spend more time with their families.
Now, rather than being stuck trying to sell Chinese board games, you can choose from a wide range of products that could help attenuate boredom or encourage more quality time.
Like these retro games consoles for example:
Method 2: Browse AliExpress
This old school method involves just perusing the various categories on AliExpress until you find a product that catches your eye. For example, this product sets my dropshipping sense a tingling:
But this approach usually works best for experienced dropshippers who have a trained eye to pick up potential winning products. If you try this method, make sure the product satisfies these criteria:
- It’s eye-catching
- It solves a problem
- It can’t be bought at a local store
- It has plenty of high-quality images
- It’s not highly technical (e.g. a drone)
With this method, it’s a good idea to validate your chosen products - either by looking at sales data (which you can do with Salesource) or by using the Google Trends to see how many people are searching for it.
Method 3: Use Google Trends
Google Trends can be useful to see if a product idea you have is going up or down in popularity. It’s not watertight, but it can help inform your product selection decision. It’s a great way to discover what niches are good to jump into right now.
For example, here I’ve searched ‘Athleisure’ and you can see that it’s an industry growing in popularity each year.
Using this data, you can jump over to aliexpress and find in-demand products within that niche like these:
Method 4: Use A Product Research Tool
The steps outlined above work well - but be prepared to do quite a bit of leg work. Especially if lady luck is against you.
And because dropshipping requires you to root out and test multiple products to find a profitable one, using a product research tool can dramatically boost your chances of success.
Obviously we’re slightly biased in this regard, after all, we do make a product sourcing software. But research tools like ours use artificial intelligence to analyse enormous swathes of data and extract the golden nuggets.
Not only that, but you’ll also be empowered to run a better business with a whole host of features such as:
- Historical & forecast sales data for better decision making
- Advanced competitor analysis to stay ahead of the competition
- Auto-generate product copy to save hours of time
- The ability to track products of interest over time & more
So, if manually searching for your products sounds like a drag, definitely check out our free trial to see how you can take your dropshipping business from zero to hero with minimal stress.
How To Be Successful With AliExpress Dropshipping
Finding a great product is one of the largest factors that’ll determine your success when dropshipping with AliExpress. However, there are a number of other key factors that you need to make sure you get right too.
Here’s how to set yourself up for success:
Find a Reliable Supplier
Your product is only as good as the people who supply it. Think about it, they’re responsible for the sourcing, picking, packing, quality control, and shipment of your orders.
And while AliExpress does a decent job of rooting out sub-par suppliers, you’ll need to do your own filtering too. Here’s how to sort the wheat from the chaff:
1. Choose Sellers With A Good Feedback Score
The feedback score on AliExpress lets merchants rate their buying experiences with a given supplier. This is hugely valuable as it means you can ensure you’re not getting into business with a cowboy who’ll take your money and run.
As a general rule of thumb, you want to choose suppliers who have a feedback score of 95% or above and have been in business for at least one year.
2. Communicate With Multiple Suppliers Before Making a Decision
Every business eventually runs into some challenges that need to be overcome. Maybe a batch of defective products got through quality control and your customers need a refund. Or maybe your advertising costs are increasing and you need to negotiate a lower product price.
Basically, there’s going to need to be a huge amount of communication between you and your supplier if your business is going to be a success.
That’s why it’s wise to contact multiple suppliers of your product before choosing one to buy from. Send messages to the top 10 suppliers and see who responds the fastest, and who speaks the best English.
It’s not an understatement to say that good seller communication could be the difference between the success and failure of your dropshipping business. So choose carefully.
3. Order Samples
Once you’ve narrowed down your suppliers to 3 you think you’d like to work with, place an order for the product you’re going to be selling.
The idea here is to compare shipping times, packaging and quality of the product. Once all your parcels arrive, you’ll be in a good position to choose the best supplier for your business.
As a bonus, you’ll now have products that you can use to create custom marketing collateral such as videos and images, putting you one step ahead of your competition.
Be Transparent About Your Shipping
Thanks to Amazon, most people’s delivery expectations are extremely high. Free shipping and delivery within 48 hours are increasingly becoming the norm.
With dropshipping that’s just not possible. If you’re shipping from China using e-packet shipping, your orders are going to take between 7-14 days to arrive (and sometimes more).
As a result, many new dropshippers try to hide the fact that customers will have to wait longer for their order to arrive.
Don’t do that. You’ll only end up with thousands of upset customers and more chargebacks than you know what to do with.
Instead, make your delivery times clear on your product pages, in your FAQ and in your order confirmation email. Being transparent earns trust. And the truth is...
Customers don’t mind longer delivery times if the product is truly unique.
Also, it goes without saying that you need to use trackable shipping options so that your customers can keep tabs on their order.
This reduces the number of support tickets you have to deal with while also easing your customer’s anxieties over delivery.
Don’t Sell These Products
These should be fairly self-explanatory, but selling the following will seriously endanger the longevity of your business:
- Products that infringe on copyright law
- Products that are difficult to advertise (Facebook won’t allow you to advertise things like health supplements, adult products, tobacco products etc)
- Large or bulky items that are expensive or difficult to ship
- Products that offer a low margin
- Products that use misleading claims to deceive people
- Fragile products that are likely to break in transit
- Technically complex products such as drones or other high-tech gear
At best you’ll have an army of angry customers who want their money back and at worst you’ll find yourself going to battle in court (pro tip: that's not good).
To find out more do's and don'ts when it comes to dropshipping, click here
So, just rule out any products that fall under the above categories, and focus your energies elsewhere.
Enhance Your Customer Experience
We touched on this earlier in the article. But here’s the truth: shopping on aliexpress is a pretty poor experience. It’s a bargain basement rather than a high-end store.
The justification for you charging more for the same product is found in the value you add to the customer’s buying journey.
This can take many forms such as:
- A beautiful clean design store with awesome product descriptions
- Professional product photography and videos
- How-to blog content that helps customers live better lives
- An email newsletter sharing tips and tricks for your niche
- A Facebook community for your customers to share ideas
- Fast and helpful customer service & a reasonable refund policy
All these things are worth something to the customer. They make their shopping experience more rewarding than it otherwise would be. And when you do that, you’ll find customers are more than happy to hand over their hard-earned cash.
Starting a successful Aliexpress dropshipping business isn’t a walk in the park.
Between fiinding a suitable product, rooting out a good supplier and driving traffic to your store, you’ll inevitably encounter roadblocks along the way.
But nothing worth doing is ever easy. It’s going to take heaps of time, effort and perseverance.
Hopefully, the information in this article makes that process just a little bit easier. If you’ve found it helpful,l bookmark this page so you can come back and revisit it when you need to.
And don’t forget to share it with your entrepreneurial friends too.
From all of us here at SaleSource, Good Luck!