Beginner’s guide to dropshipping and Print on demand (POD)

Beginner's guide to dropshipping and print on demand

When I just started out, I wanted to create my own brand,  notebooks with my own designs. I started to look for manufacturers in China through Alibaba. Alibaba is a Chinese multinational e-commerce conglomerate that provides consumer to consumer, business to consumer and business to business sales services via web portals. It has lots of manufacturers , in all sorts of sizes and industry types, and you can find there whatever you want.

The only problem that I had (well I actually had few problems but let’s just pretend that I had one), was that all manufacturers has a minimum of order, meaning I can’t order 1 piece but 50 or more (most of them even have minimum of 500 and up and that’s why the prices per item can be as low as 0.02$ per item, no kidding the more you order the less it costs you)

I guess I don’t have to tell you, but as a new online shop owner I didn’t want to spend any money on things that I wasn’t sure would sell. Let’s not mention inventory = products and packaging boxes that I’ll need to storage. That is why I started to look for other alternatives and that is when I found out about dropshipping and print on demand companies (POD).

List of 12 print on demand companies

What exactly is dropshipping and Print on demand?

Dropshipping is a retail fulfillment method where a store doesn’t keep the products it sells in stock. Instead, when a store sells a product, it purchases the item from a third party and has it shipped directly to the buyer.

Print-on-demand (POD) is a printing technology and business process in which book copies (or other documents) are not printed until the company receives an order, allowing prints of singular or small quantities (thanks Wiki). HOWEVER it doesn’t end up in the documents field.

Today you can find lots of print on demand products, from mugs to shirts and even to shoes, that you can design with your own brand and manufactured by the piece. Moreover, most if not all of these companies, ship your products directly to the buyer.

That’s amazing isn’t it?!
The biggest downside that I found ,till now, is the prices, which are pretty high. Thus, you have to price your products in a way that guarantees good profit margins for you.

What is a profit margin and how to calculate it?

Sidenote: You probably ask yourself what is a profit margin? Well it’s the percentage income that remains after calculating your product’s cost that you pay the manufacturer + shipping cost + transaction fee (for the ecommerce platform) and the price that you set for your product. Confused? Let me give you an example:

1. You sell your product for 50$
2. 
Each product costs you 30$ (incl. shipping+transaction fee)
3. 
Now you have to calculate the gross profit, the difference between the        revenue (50$) and the cost (30$):  $50 – $30 = $20
4. 
To find the margin, divide gross profit by revenue: $20 / $50 = 0.4.
5. Convert it to percentages: 0.4X 100 = 40%.
The margin is 40%. That means you keep 40% of your total revenue.

Of course there are products that can leave you with great margins, but there are also products that you just can’t price so high, cause nobody will buy them at that price. You still have to research the market to get an idea of the right and reasonable price for your products.

A less significant downside is the packaging. Not all POD companies offer white label packaging { when a company removes its brand and logo from the end product and instead uses the branding requested by the purchaser – you}.

Beside that the POD solution is AWESOME!

Action steps – How to create your brand product?

  1. Choose the right product for your niche based on market  
    research, or create a survey in case you already have audience.
  2. Create your own design in Adobe illustrator, Photoshop, Canva or you can outsource it.
  3. Upload it to the POD company’s website*.
  4. Be proud of yourself, cause you’ve just created your own branded product.

** I firstly recommend you choose a POD company and a product, cause
each company and product has its own specific design guidelines that
you have to follow in order to create your own designed products.

After creating the product, I suggest you order a sample so you can test out the quality. If you’re satisfied with the outcome, you can then add it to your shop.

And that’s it! Now you know how to start a dropshipping business online.
Super easy right?

List of 12 print on demand companies

After creating your products / inventory, you’re now ready to open your online shop. If you choose Etsy as your platform, I invite you to read my step by step guide to start an Etsy shop.

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2 Comments

  • oprolevorter

    I love it when people come together and share opinions, great blog, keep it up.

    May 31, 2019 at 12:14 pm Reply
    • Ayelet Refaeli

      Thanks so much. I’m glad I can help.

      June 1, 2019 at 11:09 am Reply

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