Now that you have discovered dropshipping
You are now wondering if you should sell in France or abroad? This question is indeed legitimate because I personally asked it myself at the beginning. You should know that my first stores were mainly in the English-speaking market. Nevertheless, I quickly changed my strategy to focus on the French market. Why did I make this decision? This is what we will see below.
An opportunity in France?
The first question to ask is whether dropshipping is really an opportunity in France even today. I will answer you simply and then I will detail my answer, if you want to start a business on the Internet, dropshipping is certainly one of the best businesses or the best in my eyes. In spite of all that you can hear on the Internet that dropshipping is dead, I can assure you that this is not true.
Generally, people who say this are simply not successful, it is indeed easier to blame the market than to see where you went wrong.
It is important to know that the purchase of products on the Internet has been constantly evolving for more than 10 years. This translates into an increase in consumption on the web, but also an opportunity for several thousand new entrepreneurs. The thing to know is that you don’t need to have tens of thousands of customers to achieve financial independence.
The goal is to target a small segment of the market on the Internet.
With e-commerce, you are already in a sub-segment of the huge market that is the Internet. Moreover, in recent years several features to help e-merchants have emerged, unlike the first entrepreneurs on Shopify, we have more resources, more turnkey solutions to solve our daily concerns. It is therefore for me a big mistake to think that dropshipping is no longer a golden opportunity for anyone wanting to start an online business. The exponential evolution of the demand on the Internet, the new applications allowing the execution of several tasks, and the growing information thus facilitate the entry of new stores in e-commerce.
Can you really make money doing dropshipping in France?
Now the question is to know if the French market is a good market in e-commerce. Mainly, it is important to know that there is not really a market that is above the others strictly speaking. Of course, some are more suitable for Internet shopping. This is the case of the Northern countries (America, Europe, part of Asia). Indeed, African countries, South American, and several Asian countries are not “developed” enough in the sense that the delivery services, security of payment on the Internet, or simply the purchasing power of their household are not high enough.
Then, you should know that there are always differences in each market.
For example, in France, it is very complicated to have a product placement with a “successful” influencer for a beginner. It is important to know that in France some scandals about dropshipping have broken out over the last 2 years. As a result, the agencies that manage partnerships with influencers are much stricter. Generally, they ask for a product that is branded (a brand that sells its own products).
In Germany for example, about 70% of consumers on the web pay via Paypal.
Hence the importance of installing Paypal on your store. In France 2019-2020, 20-30% of consumers pay via Paypal.If you want to enter the French market, you can indeed make a lot of money, like almost everyone else. Of course, you have to keep this in mind, you have to adapt to your customers and your target market.
This is the key to success if you start in Germany, Italy, or Spain for example.
So you should analyze your market. Personally, I recommend launching on the French market simply because you speak the language and if you are a French resident you must surely know the habits of the French, what we eat, the TV series we watch and so on.
How much do you really earn in dropshipping?
Finally, in this last part, we are going to talk about what Dropshippers really earn. It is important to know that this percentage depends on several factors, the product, advertising costs or the cost of promotion, transaction costs, and much more. We will list the different costs and fees that come into account in a Shopify store.
The cost of the product:
The margin is the difference between the cost of the product, i.e. the price at which you buy it from your supplier, and the selling price on your website. Generally, I advise putting a selling price 2.5 to 3 times higher than the cost. Simply to be able to pay the other expenses and costs.
If you want to use paid platforms like Google Adwords, Facebook ads, or product placements on Instagram. So you are going to have to pay for these services, usually, these are the most important costs.
The price of applications:
To have a store that converts you will surely need paid extensions whether it is an application for upsells (additional sales), applications for customer reviews, or email marketing applications.
This is the price you pay every month to Shopify, also know that Shopify has a commission of 1% to 2% on your sales depending on your subscription.
Paypal and Stripe fees:
In particular, you should know that your payment processor charges you a certain commission on your sales. So the more your turnover is important, the more the expenses will be too.
Depending on your current status, you will have a certain percentage to pay.
In general, a good margin corresponds to 30-40% of the profit on a turnover, take into account that the more the turnover is important the less the margin will be important.
The more you sell in quantity, the more you will have to pay
Therefore logically your margin will be reduced, but you will earn more money. 40 % of 10 000 € (4 000 € of profit) corresponds to a profit less than 20 % of margin on 100 000 € (20 000 € of profit).