Dropshipping involves selling products without stocking inventory. Procurement and shipment are outsourced to a third party, allowing you to focus more on design and branding.
How much can you make from dropshipping? This question is common among aspiring entrepreneurs in this niche. This guide will help you understand your potential dropshipping income and the steps to maximize it.
Dropshipping can be a lucrative business when done right. However, as many imply, it’s not a get-rich-quick scheme or a guarantee of making money. It takes considerable time and effort to build a profitable dropshipping business.
Your potential dropshipping income depends on various factors, including your niche, target market, and promotional strategies. Dropshipping is a flexible business model, so brands can make a few hundred dollars monthly or millions of dollars, depending on their business strategies.
Dropshippers resell products sourced from third-party suppliers. These products are often sold cheaply, allowing you to resell them at high prices and make a profit. Despite the convenience of outsourcing inventory management and shipping, there’s still substantial work involved in earning dropshipping income.
This business model has intense competition because of its low barriers to entry. Hence, you need an effective strategy to stand out, attract customers to your store, and earn good dropshipping income. Let’s examine the key factors that affect how much you can make from dropshipping.
Every successful dropshipping business starts with choosing the right niche. The online retail market is massive, providing lucrative opportunities in many niches. Yet, the best dropshipping niches are those with low competition and high demand.
You can conduct extensive research to help you choose the right niche. Your passion is also crucial, as it drives you to choose the best selling products and counter the challenges of running a dropshipping business.
Fashion is an example of a niche with robust demand. The global fashion industry is worth $770 billion and is projected to surpass $1 trillion by 2027. Although intense competition exists, this niche’s massive size and high growth open many opportunities to earn dropshipping income.
Seek niches where customers tolerate high prices, which boosts your profit margins. Cosmetics and jewelry are fitting examples where buyers don’t mind paying higher prices for their favorite brands. There’s no shortage of niches with sufficient demand to make money from dropshipping.
Price is the primary consideration for potential customers. You need an ideal price range that’s sufficient to make profits yet aligned with competitors. Below are the best strategies to price your products.
This strategy involves setting a price based on your intuition of what customers are willing to pay. The price is your estimation of the value the product offers to buyers.
To get a good estimate, check a product's functionality and reviews from previous buyers. Overwhelmingly positive reviews signal that the product offers good value, so you can sell it for higher prices.
Also, check the price range of similar products from competitors. This will give you a good idea of the best price to attract customers.
Cost-plus pricing entails selling a product based on its production costs plus your desired profit margin. Suppose you want a 50% profit margin on all products. Any item sourced from a supplier at $100 gets sold for $150. An item sourced at $200 gets sold for $300, and so on.
This pricing model is preferred when selling unique products with little competition. This way, you can comfortably set higher prices without losing customers.
This strategy entails setting low prices initially to win customers. Then, you can increase prices as your brand grows and builds a reputation. The low prices help you "penetrate" the market as an unknown newcomer, but you can raise prices once your brand gains traction.
This model involves selling items at the lowest price, even if it means sacrificing quality. It’s common in highly competitive niches where dropshippers race each other to the bottom on pricing.
Economy pricing works well for dropshippers who run general stores. This way, they can sell some products at lower prices but compensate with other high-priced products. Economy pricing is best combined with other pricing strategies to maximize dropshipping revenue.
The cost of sourcing and shipping products to customers greatly affects your profitability. The higher the costs, the lower your profit potential. Hence, you need reliable suppliers offering high-quality products at affordable prices and a shipping provider with reasonable prices.
Zendrop is an ideal supplier that fits the above description. We offer access to diverse, reasonably priced products in many niches. Trusted by 3 million sellers and fulfilling $100 million+ of orders annually, Zendrop is the best partner to kickstart your dropshipping business.
Promotion strategies like paid social media and search engine ads are crucial for dropshipping businesses. Advertising costs affect your business's profitability, so it's necessary to optimize them to deliver the best return on investment (ROI).
Ad optimization starts with targeting the right audience to boost conversions. Social media platforms and search engines let you target specific demographics, including age, gender, occupation, and interests.
Suppose you’re selling medical apparel. Your ideal customers are working professionals in the medical industry. You can create Instagram ads targeted at people aged 25 to 50 interested in the medical industry. A little ad spending on this audience can generate significant sales.
Constantly monitor your ad results to ensure optimal results. Don’t hesitate to adjust your strategies or pause non-performing campaigns to avoid wasting money.
As a dropshipper, you'll pay fees for website hosting, which vary depending on your e-commerce platform. You might also pay fees for plugins that add functionality to your store or subscriptions to access a supplier's catalog. These fees affect your profit margins, so keeping them minimal is advisable.
Only pay for platforms that add value to your store, such as Shopify with its numerous advanced features. There should be a clear link between the platform or plugin you pay for and your dropshipping income.
For example, a customer support plugin helps keep customers happy and increases the chances of getting repeat sales, so it’s a good investment. Avoid shiny tools that look enticing but add little value to your store.
How much do dropshippers make on average? This question is understandably common among aspiring dropshippers. The answer is that it varies for different platforms and experience levels.
Dropshippers have average gross margins of 20% to 30% of their revenue. For instance, if a dropshipper earns $20,000 in revenue, their gross profit is likely between $4,000 and $6,000. The rest of the money goes towards overhead costs, including
The average beginner dropshipper can earn $1,000 to $2,000 monthly. An intermediate dropshipper can earn an average of $5,000 to $10,000 monthly, and an experienced dropshipper can earn $10,000 to $50,000+ monthly.
The table below illustrates dropshipping average income.
| Experience Level | Monthly sales | Cost of goods sold | Other fees | Net profit |
| Beginner | $5,000 | $3,000 | $500 | $1,500 |
| Intermediate | $25,000 | $18,000 | $1,000 | $6,000 |
| Advanced | $100,000 | $70,000 | $5,000 | $25,000 |
Note that averages aren't guaranteed. Instead, they’re the summation of a range of dropshippers’ earnings. Some dropshippers can earn good money, while some may not earn any profits because of choosing the wrong niche, intense competition, or insufficient marketing efforts, among other factors.
Like any other business venture, dropshipping has significant risks. Experts estimate that 90% of dropshipping businesses fail within the first year. However, you can minimize your failure rate by choosing the right niche, products, and promotional strategies.
“How much does the average dropshipper make?” is often paired with another question, “How long does it take to make money in dropshipping?” Like the former, the answer varies depending on niche, experience level, and marketing strategies.
It usually takes 3 to 6 months for dropshippers to start making consistent profits. Some entrepreneurs make profits earlier than others, while some make profits much later than the average. Some niches, usually those with intense competition, take longer than others.
Businesses with significant marketing budgets (e.g., $1,500+) can spend aggressively on social media or search engine ads. These ads can generate high sales quickly, shortening the time taken to earn consistent profits.
In contrast, dropshippers with small marketing budgets rely more on organic traffic strategies like SEO and social media engagement. Organic strategies take more time to generate optimal results, lengthening the timeline for earning steady profits.
High-demand, low-competition products sell quickly in new dropshipping stores. Their higher profit margins make it easier for dropshippers to earn consistent income.
These high-demand, low-competition products shorten the time it takes to earn consistent profits from your dropshipping business. Seek products with at least 30% to 50% profit margins to boost your chances of making money early.
Your store's design is crucial to converting visitors into customers. It should have a visually appealing interface with minimal clutter. Every visual element should be optimized for mobile devices, which account for most internet traffic.
Use high-quality product images to entice customers and make them want to find more products. Add reviews from previous customers to build trustworthiness, which is essential for new dropshipping stores with little brand loyalty.
A well-designed store boosts your chances of getting sales, reducing the time taken to earn steady profits.
Excellent customer service builds trust and loyalty from buyers, increasing the chances of getting consistent profits from repeat sales.
Respond promptly to customer inquiries and go the extra mile to solve their problems. Buyers should be able to contact you via live chat, email, or telephone. Offer discounts to loyal customers, making them feel esteemed and willing to buy more products.
A little investment in customer service generates a high return on investment (ROI), reducing the time it takes to earn consistent dropshipping income.
Suppliers are the foundation of your dropshipping business. You need suppliers that ship high-quality products to customers quickly. Dependable suppliers minimize disruptions and increase your chances of getting higher profits from repeat customers.
Zendrop is an excellent supplier you can depend on. It’s your everything app to run a profitable dropshipping business, handling everything from product sourcing to custom packaging and speedy delivery.
Many factors affect how much you can make from dropshipping. Let’s examine some tips that help dropshippers maximize profits.
Average Order Value (AOV) = Total sales / Number of orders
Average order value (AOR) is a major determinant of how much you can make from dropshipping. Increasing this metric helps maximize your overall dropshipping profits.
Free shipping is an effective way to encourage larger purchases per order. You can offer free shipping above a specific threshold, e.g., $100 to $500. Some buyers will purposely cross that threshold to take advantage of the offer.
Bundling is another way to increase your average order value. You can bundle complementary products, e.g., a smartphone plus a pouch and charging accessories, to encourage customers to purchase them together. Discounting the bundled package helps entice buyers.
You can also create high-value gift cards and sell them to customers. When people buy gift cards for their friends, family, or colleagues, the recipients are encouraged to spend them all at once.
Minimizing operating costs helps maximize profits. Seek suppliers and shipping providers that offer great value for money. Find products you can obtain at low cost and sell at high prices.
Reduce the size and weight of your packages to save shipping costs. The aim is to list as many compact products as possible. Newbie dropshippers should also avoid custom packaging, which is best reserved for established dropshipping brands.
Targeted marketing campaigns help you achieve more with less advertising budget. Target your social media and search engine ads to the perfect, well-researched customer profile instead of random guesses.
For example, if you’re selling gaming consoles to U.S. customers, research indicates that over 60% of gamers are aged between 20 and 39. When creating social media ads for gamers, narrow the age range to 20 to 39 to get more results with less budget, reducing operational costs.
Expanding into new product lines is an evident way to maximize profits. You can frequently explore new niches with high profit margins. Start with a few products to see how your sales fare. With early positive results, you can add more products and increase sales.
All new niches you explore won’t work out, so don’t be daunted by negative results. Dropshipping businesses involve trial and error, so you’ll likely try several new niches before finding the perfect fit.
Automation streamlines your dropshipping business and reduces overhead costs. For example, you can automate sending order details to suppliers and order confirmation emails to customers. This way, you don’t need to hire someone else for this task.
You can automate mundane customer service tasks, such as order tracking, and focus more on the complex ones. Zendrop helps you automate as many dropshipping processes as possible, reducing costs and boosting how much you can make from dropshipping.
Learning how much dropshippers make won’t be complete without some real success stories to prove it. Let’s examine case studies illustrating how much dropshippers can make from their business.
Dollar Shave Club is an American brand of personal grooming products. It became popular after a viral YouTube video campaign. This company packaged generic grooming products and sold them under a unique name.
With an intense marketing focus, Dollar Shave Club differentiated itself from other brands and earned tens of millions of dollars. Many copycats emerged but couldn’t match its success. In 2012, the brand was sold to Unilever in a $1 billion deal.
Today, Dollar Shave Club remains a successful personal grooming brand, although it has transitioned towards in-house manufacturing and custom branding rather than mere dropshipping. This brand’s focus on viral marketing was its differentiating factor.
SaberMasters is a prominent brand that sells Star Wars-themed lightsabers. These lightsabers are fictional energy devices in the Star Wars universe, and many fans love keeping real-life relics.
SaberMasters sources lightsaber devices from foreign suppliers and sells them at high markups to U.S. customers. It focuses on influencer marketing to spread the word about its products. This marketing strategy has made SaberMasters the go-to brand for Star Wars fans, and its owners have built a successful million-dollar business.
“How much do dropshippers make?” is a common question, and we’ve provided detailed answers. This guide has explained the factors affecting how much dropshippers make and the steps to accelerate your income as a dropshipper.
Zendrop is the perfect supplier and partner for your dropshipping business. Our platform offers access to diverse, high-quality products with industry-leading shipping.
Choose Zendrop Plus to start your business today and implement the recommended dropshipping tips.
On average, dropshippers make gross margins of 20% to 30% on their products. However, choosing the right niche and products and having a good marketing strategy can boost your margins to 50% or more.
You can start dropshipping with as little as a few dollars or without capital. Many e-commerce platforms and suppliers offer free services or trials that let you set up a dropshipping business without capital. Dropshipping is scalable, so you can start small and grow your business over time.
The average newbie dropshipper can earn $1,000 to $2,000 monthly in their first business year. Depending on their niche and marketing strategies, some dropshippers can make significantly more than this level.
However, building a successful dropshipping business usually takes time and effort. Don’t expect to strike it big in a short period.
Yes, dropshipping remains a profitable business model in 2025 if you play your cards right. The dropshipping sector is massive yet still growing, predicted to reach $1.25 trillion by 2030, compared to $287 billion in 2023.
You can automate many aspects of your dropshipping business to earn passive income, including order fulfillment, email notifications, social media posts, ads, and order tracking.
However, dropshipping is not something you can completely automate. It requires active input and strategic thinking to select the right products, promote them, and grow your business.
