I've long wondered why these guys are out there pitching their courses, right now I just believe its a) because they see everyone else doing it b) its easy money but really c) because their businesses are just on auto-pilot.
A lot of these guys have VA's who do a lot of the heavy lifting. I just think they're getting bored and don't want to be forgotten on the conference circuit.
The main benefit of dropshipping is usually that you don't manage any inventory, but prices and really anything but making the sale to the customer is out of your control. Serious problems can arise when your customer's expectations and your suppliers expectations (or failure to uphold thereof) are mismatched.
Serious problems like this can lead to account terminations on amazon or other platforms, forcing dropshippers without rock solid suppliers (and processes) onto custom websites, or non-mainstream platforms.
To be able to manage a decently large store well, expect to invest hundreds of hours in software and more in support. Just take it seriously with the long term outlook and you're much more likely to succeed.
What they don't tell you is that Amazon doesn't give two flying cares about you as a seller. Send out a load of late shipments, get a few cases, and game over. If you are just starting, Amazon is the very last place you want to sell things.
Of course, if they were making a cool mil a month, they wouldn't be selling courses at $299.
I have an Amazon store that I won't even use even though I'm allowed to sell dresses (which is very difficult to get approved for). I haven't found a group of suppliers I trust enough. If someone trustworthy has access to dresses and wants to try being a supplier, feel free to send me an email (it's in my profile).
A one-person shop can sometimes win for a short time by betting on a new product, but once it gets a few dozen reviews on Amazon other people who know how to type Alibaba.com will inevitably take over. And of course the Alibaba vendors themselves aren’t stupid and are now becoming retailers.
If you're a retail business you would have to get the books at a very low cost plus you would need to do it in bulk for it to be worth the effort.
Running dropship is lucrative but it's obviously very hard work, like farming or running a restaurant. It's one of those things that can easily make you a hundred thousand dollars a month, but after paying all the staff and costs, you're left with a thousand dollars, and have to decide whether to scale up or just do something else.
Running an ecommerce based on a dropship is also good. But you have to have solid dropship partners, and it can cut quite deeply into profit margin. In our case, we barely made any money on it, after other competitors. There are also mom and pop stores who run the end to end without a dropship and can afford to make enough money, while you struggle to keep afloat on the 1% profit margin on top of dropship fees, tax, and online payment fees.
It's a super competitive field with a low entry barrier. Some illegal immigrant who can't speak English or some dirt poor orphan would be willing to put in 18 hours a day.
I find it to be a foolproof way to become a millionaire, but it doesn't go much further than that and comes with a quality of life hit.
A company's goal is to figure out how to market a product at a profit. It's hard. Drop shipping is no different but there your margins are very thin.
What most ongoing companies do is to have a retail business in place with actual products and use dropshipping to supplement it.
It also cuts out from taxes, so most companies use long term marketing to 'stash money' for the future.
It's not really something worth discussing, one of those things that everyone agrees is good, that everyone should max out where possible. (As long as the business model is validated)
Marketing and sales is the lifeblood of a company yet many people think of it as an afterthought to the product. I'm one that thinks that a marketing plan should be developed at the embryonic stage of a company not after you have a product.
That's why Amazon's Bezos makes everyone write out a press release as part of a product pitch. He wants to make sure there's a compelling way to sell it to people. "Press release," never start a product without it. :)
Finding a "winning" product is the hard part (0 revenue at this point), now imagine that product has a margin of $10 (after acquisition cost), all you have to do is find just 100 people to buy it to be making $1000 a day. Think about that for a moment, only 100 people from the entirety of Facebook or Instagram to be making $1000 a day profit.
We're small fry compared to some of the guys out there, there are people doing 6 figures a day. Some mid 6 figures.