February 2nd, 2008
Reading these posts you should get more ideas about:
- what products to dropship
- how to market your dropship business
- where to find reliable merchants
- how to build long term relations with customers and suppliers
We also refer you to the comparison table of top real dropship supplier lists, but it does not mean that you should focus just on those products sources (though according to our reader’s responses these two dropship sources are really worth what they charge: this one and this one).
Do your own research to find and set up relations with merchants directly.
Today we publish dropship candy store case study
Store averages a 39% traffic growth each month
• URL: www.esnacks.com
• Established: 30 Apr 2007
• Uniques/Month: 11,000
• Page views/month: 40,000
• Monthly Revenue: 7,500
• PageRank: 3
• Min Bid: $35 000
• BIN: $50 000
This e-commerce candy store currently brings in around $1,100 – $1,400 of monthly profit after expenses. I am looking to sell the site for around 3x net although a motivated individual could easily make their money back in less than a year by making some obvious updates to the site and by marketing it.
I am looking to sell this business in order to raise funds for another project of mine. The e-commerce store has an excellent domain and is custom designed and built on a custom shopping cart which exclusively uses Google Checkout and PayPal as the checkout methods. The administration tool for the shopping cart is also custom made. All orders are placed through a drop-shipper who has very few other online retailers, a contract is in place with this drop-shipper.
Included With This Sale:
- Administration Tool
- Email List of All Previous Customers (currently around 800-1000)
Problems with this business:
- Although we bring in a high volume of orders there are many orders that our drop-shipper has to backorder or are out of stock. If you purchase this site I would suggest establishing a relationship with a second drop-shipper to cover these orders which would probably increase your monthly profit an additional 15%-20%.
- Like every e-commerce store you will need to answer customer service emails. We currently do not offer a phone number on the site (like Amazon.com) and instead require people to submit customer support requests via our contact form or email.
- Admittedly I do not do a good job at managing margin levels or adding new products. If you were to adjust products prices and add in newer products then you would probably see around a 10%-15% increase in monthly profit.
Opportunities for this business:
- Add in the ability to take credit cards directly on the website. Currently only Google Checkout and PayPal processing is used which may deter potential customers from ordering.
- Update the categories and homepage. I haven’t updated the homepage or category pages since I started the business. I imagine this would help increase sales even more.
- Market the website. This site is not marketed in per click engines or through any advertising. Email marketing may not be a bad idea, especially since we have hundreds of emails of people who have previously ordered through the website that you can market to. I imagine if you were to market the website then obviously the order volume would increase.
Unique traffic comes in (primarily from search) and orders through the website. Once an order is placed we relay it through our drop-shipper at a lower fee and keep the remaining difference. Every month has always exceeded the traffic levels of the previous month. We have seen an average unique visitor growth of 39% each month over the previous month.
Unique Visitor Traffic Growth Statistics
Average Monthly Growth: 39%
December ‘07 to January ‘08 – 19% Growth (9,270 to 11,000 (estimated))
November ‘07 to December ‘07 – 27% Growth (7,278 to 9,270)
October ‘07 to November ‘07 – 22% Growth (5,980 to 7,278)
September ‘07 to October ‘07 – 85% Growth (3,235 to 5,980)
August ‘07 to September ‘07 – 7% Growth (3,034 to 3,235)
July ‘07 to August ‘07 – 73% Growth (1,751 to 3,034)