Making Sense out of Dollars

One of the biggest steps in finalizing your dropship website is finally mapping out the potential earnings. Its a step that is intimidating to some, but it is vital that we go through this process as a prelude to the actual creation of our site, rather than after we've gone through all the sweat and elbow grease to get our website up and running.

We do this all before our site is completed so that we know if the product(s) are going to be profitable before we complete the web site and have to start over again with a new niche. Let's say that we're interested in selling remote control cars and that we have already found what we believe to be a great supplier. They have a ton of available products, and they're bursting at the seams with variety. Seems like a pretty good deal.

Okay, so the variety of product in stock is amazing and the price is about what it should be so we get going, spending weeks on building our website. Weeks have passed and still no sales. The products are great, the website is solid. Why aren't we getting a sale?

Needing to know what we're doing wrong, we decide to take a look at one of our competitor's websites. Well, as it turns out, our site is a bit better than theirs but they're selling the products for our retail price! This could be a fluke, we say, and we look at another site. Uh oh, their retail price is a little higher, but still lower than ours by a fair bit.

One time is luck, two times may be coincidence... so we take a look at a third site. Big surprise, this site is actually lower than the other ones we've looked at! All of these are sites we found just looking up our product. There's a pretty good chance customers who are interested in that product will run a similar search.

Hmmm, so now we have a supplier whose prise is way too high. We have a couple options, we can market as aggressively as we can or we can reduce our profit margin even more. Either way, we're going to have to spend more or take a loss

But how do we avoid this situation? There are some things we can do to prevent this from happening again; we'll talk about them in our next article!