If you're new to the concept of dropshipping scroll to the bottom and watch the videos or check out this article to learn more.
For cash strapped aspiring entrepreneurs dropshipping is the dream. The idea being that with next to no money you can create an online store and simply print money as orders come in and are fulfilled by someone else. You heard that correctly, you can sit in Bali sipping cocktails while watching the millions of rands roll in on your Shopify (or other) account without ever investing a cent in carrying stock. No more waiting in line to ship your products or dealing with importing challenges. Sounds great right?
Totally. But like all pitches that lead to yachts and little work it's just a little too good to be true. Drop shipping has done a ton of good but also a ton of harm to the world of eCommerce. Here's a quick run down of some of the good, the bad and the ugly when it comes to dropshipping.
What gets me excited about drop shipping in Africa?
When you are talking about generic 'travel backpacks' or 'insert cheap electronic name' it's hard to see any silver lining but when you think about the idea of connecting manufacturers, wholesalers or retailers with overstock to other sellers then the model starts to sound much more impactful. Here's a few of the trends that give me hope for dropshipping in South Africa.
1. Localised dropshipping. Companies like Dropstore and Shopstar are already working to enable a world where people that want to sell online but not carry stock can find products to sell right here in South Africa. This provides a space where wholesalers can work with SME's and ideally consumer will have a good experience. Think of someone creating a clothing store where they can have access to sell thousands of brands but not have to spend a single cent. It sounds easier than it is but there's surely a big opportunity for people and businesses with audiences to sell online without the normal investment and effort involved.
2. Localised Print on Demand. With international companies like Printful you can actually sell hoodies, shirts and hundreds of other things online without ever getting them made in advance. Exactly like dropshipping, print on demand companies create your products once they are sold and deliver them. I've heard folks in South Africa talk about this model but I've yet to see anyone execute on it and take it to market with eCommerce platforms. It has a ton of potential mainly because the international players are too expensive for South Africa and the logistics are problematic.
3. African expansion. It's very rare to see any eCommerce brand expand into other African markets. If a dropshipping ecosystem were to develop it could have the potential to create more visibility into goods and create more reliance between African markets for products as opposed to importing from outside the continent. This is a bit pie in the sky for right now but eCommerce and dropshipping could be the catalyst for a more digitally open and inclusive environment.