What is drop surfing eCommerce? Why is it important? And how can entrepreneurs, startups, and existing businesses cash in and get a piece of this rapidly growing eCommerce business?
In this article, we’ll give you all the information you need to know about drop surfing; work out how you can find suppliers, keep up with trends, choose a website, market your wares and turn a profit.
There seems to be a level of mystery surrounding drop surfing, and consequently dropshipping. Dropshipping has been around for a while and it’s the structure from which drop surfing has grown. So before we get confused, what is dropshipping and drop surfing?
What is Dropshipping?
According to Shopify:
‟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 using the dropshipping model, it purchases the item from a third party and has it shipped directly to the customer.”
The main difference between a traditional eCommerce store and dropshipping is that when dropshipping the business selling the product doesn’t stock or own inventory. Instead, the seller makes the purchase on behalf of the buyer from a third party-normally a manufacturer or supplier.
Dropshipping vs Drop Surfing
Like dropshipping, drop surfing makes use of 3rd party suppliers. However, the major difference is that when drop surfing you search or “surf” for the best deal from multiple manufacturers or marketplaces, rather than sticking to one source. When we say the best deal, consider things such as; price, quality, delivery speed, delivery cost, manufacturer reputation, and reviews.
Drop-Shipping + Checking Multiple Vendors For The Lowest Price To Fulfill The Product Purchase = Drop Surfing.
Rather than choosing the same supplier each time, why not consider shopping around? Suppliers consistently alter shipping costs and methods along with the price of the product. With drop surfing, you choose the best price at that time by looking for a different vendor.
Drop surfing raises the question ‘Why chain yourself to one vendor if you can find a better deal elsewhere? Ultimately you’re in competition with thousands of other dropshippers and surfers, searching for the best deal may just get you ahead of the competition.
Consider drop surfing as a door into entrepreneurship. With the move by several of the biggest website platforms to provide financing options, it’s never been easier to actualize your eCommerce dreams.
The Problem Drop Surfing Solves
Many people have great ideas when it comes to starting up an eCommerce store, but don’t have the capital to invest in the stock, warehousing, and inventory management. It’s a lot when you’re trying out a new idea, there’s a high level of risk, with a big question mark hanging over whether you’ll get any return on investment.
Drop surfing removes a great deal of risk that comes with setting up a traditional store. It provides a lower-risk approach for smaller businesses and startups. It’s ideal for testing new products or lines, without investing in mass buying storage.
What’s Behind Drop Surfing’s Rapid Growth?
We all know that stores have struggled in the last few years. It is estimated Covid-19 has accelerated the move to online by 5 years, in truth traditional retail is dying! As sad as that sounds there will be winners- drop surfing is one of them.
“Mass Extinction” sounds pretty brutal, but not to worry, Market research has shown
“The global dropshipping market size was valued at USD 102.2 billion in 2018 and is expected to register a CAGR of 28.8% from 2019 to 2025.”
One of drop surfing great strengths of drop surfing is the ability to follow trends, and trends are where people spend money. Not fixed on one supplier you can react to market changes. Drop surfing, in essence, is where you ride the trends of already winning products, taking the guesswork out of finding profitable products’.
There are two clear ways of spotting trends:
- Use Google Trends. Use this incredibly useful tool to understand what’s trending. Google analyzes the popularity of top search queries on Google, around the world.
- Use a dropshipping wholesaler such as AliExpress to review the popularity of products. We’ll talk more about wholesalers and market places later.
The Risk Involved in Drop Surfing
There is a risk using this tactic, wherein the desire to find cheaper products you alienate suppliers. Do your research first, you don’t want to jump ship, only to find you’ve been sold an inferior product, all for minuscule savings. Furthermore, Chinese suppliers, and manufacturers (where many of these products come from) value trust, once you’ve built that trust and start putting in repeat orders, there’s a high chance that starting a conversation about best price will end positively.
Drop Surfing Automation, and Marketplaces
In the olden days, dropshippers would go to trade shows, send emails, and call manufacturers to find the product they needed.
Once you had found what you needed, you would make a spreadsheet with all the relevant information; price, sizing, colors, and fulfillment.
On receiving an order you would refer to your spreadsheet, and then make the order with the supplier. But stop! This method has some serious floors. Suppliers often change prices and apply discounts, but unfortunately, you’ll be unaware of this. This inconsistency is going to do nothing for your business.
And…In Steps Automation!
Drop surfing automation tools are there to make things easier, in several ways.
- Firstly, automation software will update you when there are price changes from suppliers. You don’t want to be selling a product at a retail price not adjusted to your supplier’s new wholesale price.
- You can add different suppliers, and the software will update you about the best deals.
- Shipping, there are a variety of different shipping options from manufacturers and marketplaces, ship, plane, quick, slow. Automation software can guarantee specific shipping times- important as according to the Harvard Business Review it costs 25 times more to find a new customer than retaining a customer
- Manual labor. If you’re ordering 1 or 2 items, going to make orders yourself isn’t a problem, however as you start to grow (we hope) you’ll have hundreds of orders, with automation software the order goes straight to the supplier- giving you the time to invest where you’ll get most ROI- marketing your wares.
Now, the cost of drop surfing automation software varies, as each solution comes with different specifications, so make sure you weigh up your options. Three of the most popular are Oberlo, uDroppy, and Dropified.
There are differences between the three options.
Oberlo can only be used with Shopify.
Dropified can be used with Shopify, WooCommerce, and BigCommerce!
uDroppy can be used with Shopify and Commerce. And boasts the ability to go direct to manufacturers rather than marketplaces-unlike the other two.
A basic but fully functional drop surfing business could certainly run with a website, automation software, and manufacturer. However, as we’ve already discussed, finding the perfect product can be time-consuming. Drop surfing marketplaces take the pain out of this.
AliExpress and other marketplaces bring suppliers to one place, think eBay or Amazon but this time you buy exclusively from the manufacturer. Having so many vendors in one place makes the task of finding the right product, at the right price, far, far easier. You can also set marketplaces up with your automation software, so you’re always aware of the best deals.
Most big marketplaces are based in China, where there’s a high possibility of finding knock-down prices. If you’re trying to drop surf using products made in the U.S.A or Europe, you’re going to struggle.
Should You Trust Marketplaces?
There are far more drop surfing manufacturers and suppliers based in China. Of course, there are thousands of upstanding professionally run businesses in China. But with so many suppliers, and sometimes weak adherence to copyright law, the chance of ending up with a poor quality product or lagging delivery times is high.
The main reason people had issues with marketplaces- was previously, money was debited into the manufacturer’s account before delivery, meaning there was no insurance the right product would turn up, and getting your money back would be unlikely. When an order is placed now payment is held in escrow- this is important. These days a customer’s money is only taken, once the product is delivered.
Of course, there are other issues, and you need to be sharp. If you see; inconsistent image quality, massive product ranges, limited company information, and/ or they don’t respond to emails, alarm bells should start to ring. All in all, marketplaces offer some incredible deals, and by paying attention you’ll avoid the pitfalls.
Other marketplaces include:
Setting Up Stores
With so much competition, a successful drop surfing business requires a top eCommerce. Three of the best in the game are WooCommerce, Shopify, and BigCommerce. Each has its merits.
Shopify– billed as one of the quickest ways to set up an eCommerce store. Comes full of great functionality, and doesn’t skip themes and styling. Pay a monthly fee, to get all the things you need to set up a store. To get drop surfing Shopify recommends using Oberlo automation.
WooCommerce is free! But you will have to pay for hosting, domain name, extra add ons. WooCommerce gives you more flexibility- if you need it, but requires more effort. Now comes with a free Google Chrome Extension, to automate order with AliExpress.
So now you’ve got an eCommerce store, automation software, and marketplace. So what are you going to sell? Firstly, if you want to succeed make sure you:
Pick a niche you’re genuinely interested in, you’ll have a lot more energy for something you already have a passion for. Hopefully accompanying your passion will be the knowledge that’ll help you identify what’s hot and what’s not.
Choose something in demand! Have you ever seen Shark Tank? Passionate “entrepreneur” fails to sell the idea to sharks- normally because there simply isn’t the market for it.
We are living in unprecedented times, but what is clear, is through Covid-19 some consumer trends are emerging. Trends around health, fitness, pets, and sustainable products.
- The Athlete/ leisure market now estimated at $288 billion is set to rise to an impressive $547 billion by 2024. The men’s yoga market is on the rise
- Posture correctors- that’s right, sit up straight. 8/10 people will experience recurring back pain. Injured backs cost 100 billion US dollars per annum to the US economy.
- Pets- bowls, blankets, feed, anything pet related. It won’t come as a surprise that the pet industry is worth 99 billion dollars, and it’s growing.
- Organic products- replace your plastic toothbrushes with bamboo. Help stop 12 million tonnes of plastic getting into the sea, and food chain!
The Pros of Drop Surfing
- Low start-up costs, low risk for startups, and businesses wanting to try new product lines.
- No need for inventory means you can react to trends, and not get stuck with a warehouse full of stock
- Less money on inventory means more time and money for marketing!
- Flexibility, use drop surfing as a way into business, a side hustle, or try a new product.
The Cons of Drop Surfing
- Low-cost products, high levels of competition = low margins (potentially)
- Inventory issues. When dealing with a marketplace and marketplace dealing with manufacturers there’s a chance of complications. Automation software helps.
- Shipping complications. One customer orders 3 separate items from 3 suppliers.
- Low-quality products. Test order, without that you don’t know what’s going to arrive at your customer’s door.
Should You Become a Drop Surfer?
Apart from having a cool job title, becoming a drop surfer can provide a low-risk option to generate new revenue streams, or add to existing ones. Whether you’re new to eCommerce, or a successful retailer looking for a different option, drop surfing can provide opportunities, without needing to invest in inventory. Gone are the days of manually searching for new products, drop surfing automation software and marketplaces allow you to ride trends, get the best price, and get your store turning a profit.
Word of caution, 90% of drop surfing retailers don’t make it. There are many reasons why drop surfers don’t succeed, but if it had to be summarized in one word it would be-care. Yes you got the best price, and your shipping units left and right, but you’ve forgotten that there’s a human at the other end of the sale. Poor customer service, low-quality products, and poor user experience are just some of the reasons for failure. Just because it’s easy to set up doesn’t mean drop surfing is easy. If you want to be trading for a while, care about the service you give, and if you’ve got the right product, you’ll be sure to make some money.