June 7th, 2008
It is important to run dropship businesses dealing with products that people really need and buy online. If you browse our case study category you will find many exotic, narrow niche product categories where you are likely to have much lower competition and MUCH LOWER demand. From my subjective point of view it is better to deal with high demand products trying to work smarter than your competitors – in this case the potential of earning is higher.
Analyze our latest case study:
Self defense and home security products niche
• URL: www.firsthomesecurity.com
• Established: Tue Apr 30 2002
• Uniques/Month: 10,000
• Page views/month: 25,000
• Monthly Revenue: 2000
• Google Pagerank: 3
• BIN: $20 000
I’m selling my business which I’ve been running for 6 years. The reason is I don’t have time to promote it.
My highest revenue was in 2005 (Yahoo stats show $57,000.00 not including phone and mail orders), then I had my third child (I’m a female) and just don’t have enough time and desire to promote the site.
If you could outsource the promotion, running the site doesn’t take much time at all.
You get an order and submit it to a drop-shipper through your online account – takes 2 min per order. Then later you receive UPS tracking and input it into an order. That’s it.
Although I do provide a toll free number I don’t get many calls, but if the traffic increases, you can expect more calls. The buyer will need to change the number anyway or decide not to have a phone order line at all. Same thing with emails, not many.
I use two drop-ship companies. They both are very good in resolving any issues with order delivery (like UPS lost the package or delivered to the wrong address), they just ship another order while dealing with UPS.
One drop-shipper charges $50 per year ($99 per 3 years) to have an account with them and also $2.50 for each order shipped. I added this drop-shipper because they have some stun guns my first company doesn’t have.
Another drop-ship company is free to join and also provides a phone number for technical questions for my customers.
Returns: This year so far I had 3 returns. Last year 10 returns.
Chargebacks: I only had four “true” chargebacks during all these 6 years. “True” means fraudulent orders. The other chargebacks people just forgot they ordered and after calling them the disputes were resolved.
I have a merchant account but payment can be taken by Paypal as well.
After deciding to sell the store, I had to transfer it from Yahoo because Yahoo doesn’t allow the change of ownership. I did it in mid
April, you can see my Yahoo stats end at this time.
I don’t rank well in SE right now. Do adwords. Installed convertion tracking in April and accoring to it got 7 orders, conversion rate 3.3%.
Hosting – $19.95 p/m
Business phone (Vonage) – $19.00
Toll free # – $6-$10
AdWords – $70-$90
Merchant account fees (depends on the sales volume) – last month was $85.00
Phone orders: 2-6 a month, depends on traffic.
Mail orders: 1-2 a month.
Way to increase revenue: add more products. I don’t have all the products my drop-shippers have. There are many more. For example, security cameras.
Customer base: more than 3500. I have all contact information and will transfer it to a buyer.
March: $ 1,938.00
2007 – $13,500.00
2008 Jan.-May. – $ 5,560.00
14% referring sites