HOW TO START DROP SHIPPING

Learn how to start drop shipping from choosing a niche to finding suppliers. Discover the steps to launch a successful drop shipping business.

At Lillian Purge, we specialise in Ecommerce SEO Services and have developed comprehensive guidance on How to Start Drop Shipping.

What Is Drop Shipping?

Drop shipping is an ecommerce business model where you sell products online without holding any inventory. When a customer places an order, you purchase the item from a third-party supplier who ships it directly to the buyer. You act as the intermediary, managing the online storefront, pricing, and marketing while the supplier handles fulfilment.

This model allows entrepreneurs to start selling products with low upfront costs and minimal operational complexity. It’s particularly appealing to new business owners who want to test product ideas before investing in stock.

Why Drop Shipping Has Become Popular

Drop shipping has surged in popularity over the past decade because it removes the barriers traditionally associated with retail. With no need for a warehouse or large capital investment, it’s possible to launch a brand with a laptop and an internet connection.

Platforms like Shopify, WooCommerce, and Wix have made it simple to set up online stores. Supplier directories such as AliExpress, Spocket, and Modalyst connect sellers with thousands of products ready to ship globally. Combined with digital advertising on platforms like Meta and Google, drop shipping has become a low-risk entry point into ecommerce.

Who Drop Shipping Is For

Drop shipping is ideal for entrepreneurs, marketers, and small businesses who want to start selling online quickly. It suits:

  • Individuals testing product ideas before committing to stock

  • Content creators or influencers building branded merchandise lines

  • Retailers adding new products without warehouse expansion

  • Students or part-time sellers seeking additional income

However, it also attracts competition, so success requires careful planning and differentiation.

How Drop Shipping Works

The drop shipping process follows a straightforward sequence:

  1. You list products from suppliers on your ecommerce store.

  2. A customer places an order and pays the retail price.

  3. You forward the order to the supplier and pay the wholesale cost.

  4. The supplier ships the product directly to the customer.

  5. You keep the profit margin between your selling price and the supplier’s cost.

For example, if you list a phone case for £15 that costs £7 from the supplier, you earn £8 profit per sale (before transaction and advertising costs).

Step-by-Step Guide to Starting Drop Shipping

1. Choose Your Niche

Your niche determines your audience, marketing strategy, and product selection. Choose an area that has consistent demand, manageable competition, and healthy profit margins. Popular niches include fitness, home decor, fashion accessories, pet supplies, and eco-friendly products.

Focus on a specific subcategory within your niche to build authority. For instance, rather than selling general fitness gear, specialise in yoga equipment or resistance bands for home workouts.

2. Conduct Market Research

Use tools like Google Trends, SEMrush, or Ahrefs to identify trending products and search volumes. Research your competitors on platforms like Shopify and eBay to see what sells well, how they price their products, and how they market them.

Check reviews on supplier marketplaces to ensure products are high quality and shipping times are acceptable. Poor fulfilment experiences are one of the main reasons drop shipping businesses fail.

3. Find Reliable Suppliers

Your supplier is the backbone of your drop shipping business. Choose one that offers reliable shipping, responsive support, and quality products. Popular supplier sources include:

  • AliExpress: Large product range, ideal for testing ideas.

  • Spocket: Focuses on UK and EU-based suppliers for faster delivery.

  • Modalyst: Offers branded products and global fulfilment.

  • SaleHoo: Curated directory of verified suppliers.

Always order samples to check quality before listing products.

4. Build Your Ecommerce Store

Most drop shippers use Shopify because of its user-friendly setup and integrations with supplier apps. You can also use WooCommerce (WordPress) or Wix for lower costs.

When building your store:

  • Choose a clean, mobile-friendly theme.

  • Create engaging product descriptions that highlight benefits.

  • Add clear images and detailed specifications.

  • Include essential pages like About Us, Contact, and Returns Policy.

Set up payment gateways like PayPal, Stripe, or Shopify Payments for secure transactions.

5. Set Up Legal and Business Basics

Although drop shipping is relatively low-risk, you must still operate as a legitimate business. In the UK, you’ll need to:

  • Register as a sole trader or limited company with HMRC.

  • Keep financial records and pay taxes on profits.

  • Include terms and conditions, privacy policy, and refund policy on your website.

If you’re trading internationally, understand customs and import taxes that may apply to your buyers.

6. Price Your Products Strategically

Profit margins in drop shipping can be tight, so pricing requires balance. Calculate your total cost per product, including supplier price, shipping, transaction fees, and advertising costs. Aim for a 30–50% markup to cover expenses and still generate profit.

Use psychological pricing (£19.99 instead of £20) and bundle offers to increase average order value.

7. Drive Traffic to Your Store

Traffic is the lifeblood of your drop shipping business. You can generate it through both paid and organic channels.

Paid traffic: Use Meta Ads, Google Shopping, or TikTok Ads to test different audiences quickly.
Organic traffic: Invest in SEO, blogging, and social media content to build long-term visibility.
Email marketing: Capture leads and nurture them with special offers or product recommendations.

Combine short-term paid campaigns with long-term SEO for sustainable growth.

8. Optimise Your Store for Conversions

Driving traffic is only part of the process. You must also convert visitors into paying customers. Focus on:

  • Fast loading times (under three seconds)

  • Simple checkout process with minimal steps

  • Clear call-to-action buttons

  • Trust signals such as reviews, secure payment icons, and returns guarantees

  • Mobile responsiveness

Small design tweaks can significantly improve your conversion rate and overall profitability.

9. Manage Orders and Customer Service

Once orders come in, use automation tools to streamline fulfilment. Apps like DSers or Oberlo (for Shopify) allow you to forward orders to suppliers automatically. Keep customers updated with tracking numbers and estimated delivery times.

Good communication builds trust and encourages repeat sales. Respond to customer messages promptly and resolve issues quickly.

10. Monitor and Scale Your Business

Analyse performance metrics regularly. Review which products sell best, what traffic sources convert most effectively, and which ads deliver the highest ROI.

When you find consistent winners, reinvest profits into scaling through paid ads or influencer partnerships. You can also expand your product range or launch multiple stores in different niches.

Advantages of Drop Shipping

  • Low startup costs with minimal financial risk

  • No need for inventory, storage, or packaging

  • Easy to scale once products prove profitable

  • Flexible working from anywhere with an internet connection

Challenges of Drop Shipping

  • Thin profit margins due to competition

  • Dependence on suppliers for product quality and shipping

  • Longer delivery times for overseas products

  • High refund or dispute risk if expectations aren’t managed

Understanding these limitations helps you plan a more sustainable business model.

Expert Tips for Drop Shipping Success

  1. Choose a niche with emotional appeal or clear pain points.

  2. Invest in brand identity, even if you’re reselling generic products.

  3. Avoid copying competitors’ product listings; write unique descriptions.

  4. Test multiple ads with small budgets before scaling.

  5. Use email remarketing to recover abandoned carts.

  6. Prioritise UK or EU suppliers for faster shipping and better reviews.

  7. Continuously improve your website, marketing, and product range.

Is Drop Shipping Still Worth It?

Yes, drop shipping is still worth it when done strategically. The days of instant profits with minimal effort are gone, but serious entrepreneurs who focus on branding, quality, and marketing can build lasting ecommerce businesses.

The key to success lies in long-term planning rather than quick wins. Treat your store like a real brand, provide value to your customers, and continually refine your approach based on data.

Starting a drop shipping business in the UK offers freedom, scalability, and low financial risk, making it one of the most accessible ways to enter ecommerce in 2025.

We have also written in depth articles on Drop Shipping Suppliers UK and Is Drop Shipping Legal? as well as our Drop Shipping Suppliers UK Hub to give you further guidance.