PETALING JAYA: When times get tough, the saying “necessity is the mother of invention” rings so true. It is during these times that many people become innovative at generating income.
In this respect, a new business trend on the rise is dropshipping, a model based on the sourcing of products online from suppliers and then selling to customers at a higher price for profit.
Dropshippers often act as middlemen since they do not keep stocks, and will get sales from customers and then pass the sales to a third-party supplier, who then ships the order to customers.
They create their own website or business social media pages and market the products through online advertising via Facebook and Google advertisements.
Cassandra Daphne Mathews, a 20-year-old flight attendant, decided to venture into dropshipping to earn extra income after her work was affected by Covid-19.
“I was once a dropshipper for a Malaysian makeup brand. We were placed in a Telegram group that contained marketing tools and content to be promoted. When a customer makes a purchase, I would submit the order to the person holding the stock, who would then ship it to the customer.”
She told theSun she stopped after two months due to lack of sales.
“I think people should give it a go as there are no fees involved. You can generate an income as long as you are consistent,” she added.
Nur Ashiqin Md Yunan, a 21-year-old student from Johor Baru, ventured into dropshipping to challenge herself in the field of marketing.
“I am one of the dropshippers for a local makeup brand and I started in mid-November,” she said.
It is difficult right now to do business, especially since some of the target audience might not be earning money anymore, she added.
Fortunately, sales have been constant.
“I can earn an income while gaining knowledge in business. Dropshipping is the best step for those who want to start their own business,” said Nur Ashiqin.
Meanwhile, 23-year-old finance and marketing graduate Tze Hing Chan (pix) has found massive success after several failed attempts.
“I started in June 2019. After seven failed websites/stores, I finally got my big break this year when I did over US$100,000 (RM407,000) in sales selling bubble tea plush toys with my current store,” said Chan.
He did this by focusing on countries with higher purchasing power such as the US to fully maximise his margins.
Chan found the inspiration to become a dropshipper during his internship in Singapore.
“Besides the low start-up costs as compared to other businesses, my decision to start dropshipping was also mainly to compensate for my below-average results in university. I had to find a way to stand out from my peers,” added Chan.
The dropshipper and co-runner of a micro-activewear brand believes that dropshipping is an excellent stepping stone to start an online business.
But he also warned it might not be very sustainable because most products eventually lose their appeal and dropshippers have to constantly source for new products.
“My first advice would be to be prepared to handle risks – mentally and financially. The best way to be prepared is to make sure you can handle the risk of failing,” Chan said.
