Pizza Hut goes bankrupt, dropshipping can bring it back to life

A major Pizza Hut franchisee with more than a thousand locations is bellying up to bankruptcy court with the hope of slicing its debt.

NPC International filed for Chapter 11 protection Wednesday citing, among other hardships, the shutdowns triggered by the coronavirus pandemic, CNN Business reports.

Pizza Hut bankruptcy

The company, which is contending with a nearly $1 billion debt, is Pizza Hut’s largest franchisee, operating 1,200 of the eatery’s 7,100 U.S. locations.

A number of franchised restaurant companies have declared bankruptcy since the pandemic hit, including the parent company to Chuck E. Cheese and the U.S. division of bakery chain Le Pain Quotidien. Franchised chains largely depend on customers coming into their dining rooms and have had to navigate a plunge in sales due to mandated restaurant closures.

Even Pizza Hut with such a large scale of development has not escaped the disaster caused by the epidemic, so what work is not affected in this epidemic? Of course, it’s an online dropshipping business. I have to say that it’s reasonable that this type of online work is being respected. This is also the reason why shopify’s stock price has continued to rise recently. The dropshipping business gives many unemployed people the possibility of making money again. Also led to the work of many developers, such as oberlo, it is also a beneficiary. If Pizza Hut also changes to online mode production and joins the dropshipping business, can it turn into a profit?

If you don’t have an online job to increase your income, then you can take a look at dropshipping, this is a simple job, you can use it as a sideline. However, if you do not have such a job, when you encounter a large-scale shutdown and shutdown, you are very likely to lose your job, have no source of income, or even go bankrupt, facing the difficulty of not being able to live a normal life. When the savings are used up, what do you have to rely on to obtain living supplies, you can’t do anything without money.

If you want to understand this industry, then please read on.

Ding: If you are watching this, you can skip it. Speaking of dropshipping, in fact, the most profitable model is the no-supply model. This kind of drop-shipping model can make the dropshipper make the most money at the least cost. Most of the non-supply models rely on AliExpress to find product stores. After all, AliExpress has a wide range of cheap products, which can make dropshipper profitable. Later, tools such as oberlo, dsers, and antdiy provide store and download Single efficiency, so you can do more in less time, dsers will start to charge fully, and dropshipper has an additional expense. If you don’t want to pay, you can use ANTDIY, which is free and efficient, and can Shop by key and place orders automatically, greatly improving the efficiency of dropshipping. ANTDIY, high-efficiency, high-automation, one-click completion, dropshipping no-supply mode essential app.

Summary of this article

  • What is Dropshipping?
  • Disadvantages of Dropshipping
  • Benefits of dropshipping.
  • Is Dropshipping Profitable?
  • What are some dropshipping product ideas?
  • Do dropshippers ship internationally?
  • Dropshipping as a Side Hustle
  • How much do I need to invest to start dropshipping?
  • How do dropshippers make money?
  • Is dropshipping a legitimate business?
  •  is dropshipping worth it in 2020?
  • Getting Started With Dropshipping.

What is Dropshipping?

dropshipping

Dropshipping is a type of retail fulfillment method. Instead of a store stocking products, it purchases the products from a third-party supplier. The products are then shipped directly to the consumer. Sound familiar? Maybe not, but 33 percent of online stores use dropshipping as a fulfillment model.

For the store, this is a mostly hands-off process. The merchant doesn’t have to order inventory or fulfill the orders in any way. Instead, the third-party supplier takes care of the product itself.

Dropshipping is great for entrepreneurs because it doesn’t demand as much as the traditional retail model. You don’t have to open a brick-and-mortar store, pay overhead, and stock products. Instead, you open an online storefront and buy wholesale from suppliers who already have products and warehouse space.

The merchant is mainly responsible for gaining customers and processing orders in dropshipping, meaning you’ll effectively be a middleman. Despite this, you’ll reap the lion’s share of the profit by marking up the items you sell. It’s a simple business model and one that can be very rewarding.

Millions of entrepreneurs flock to dropshipping because it requires less hassle and money to get started. That’s probably why you’re interested! And the best news of all? With dropshipping, you can build a business that’s sustainable in the long term right from your laptop.

Of course, there are many drawbacks and advantages, and it’s important that we look at them before you start your own dropshipping ecommerce business. Once you understand the pros and cons of dropshipping, however, learning how to do so effectively will be a breeze.

Disadvantages of Dropshipping

Ding: If you are watching this, you can skip it. Speaking of dropshipping, in fact, the most profitable model is the no-supply model. This kind of drop-shipping model can make the dropshipper make the most money at the least cost. Most of the non-supply models rely on AliExpress to find product stores. After all, AliExpress has a wide range of cheap products, which can make dropshipper profitable. Later, tools such as oberlo, dsers, and antdiy provide store and download Single efficiency, so you can do more in less time, dsers will start to charge fully, and dropshipper has an additional expense. If you don’t want to pay, you can use ANTDIY, which is free and efficient, and can Shop by key and place orders automatically, greatly improving the efficiency of dropshipping. ANTDIY, high-efficiency, high-automation, one-click completion, dropshipping no-supply mode essential app.

1. Low profit margins.

Sure, since you don’t have to manage or store your own inventory, the overhead is low– but so are the returns.

You put less money in, but you get less money out. That means you have to do a lot of business just to stay afloat, let alone turn a profit.

Think about it this way: every sale you make, most of that money goes to the supplier.

What you earn is basically skimmed off the top.

That’s hardly enough to cover your expenses for marketing/advertising, maintaining your site, managing sales orders, and covering your office hours.

According to Fit Small Business, you can predict your income using these variables (they’re averages, so they’ll change depending on your industry and situation):.

  • 20% margin.
  • 2% conversion rate.

You can then calculate a working estimate using this equation:.

( Traffic x 0.02) x (Avg order value x 0.2) = Profit.

While this is fine for a quick starting estimate, there are a few problems you also have to consider:.

  • Chances are, your discount on buying from manufacturers and wholesalers will be less than 20%.
  • This doesn’t account for any of the additional expenses mentioned above that you have to pay from your end. It’s not the final profit.
  • For most products, you’ll have to cut into your profits to keep your sales prices competitive. If you stubbornly hold on to your 20% margin, other companies will easily undercut you.

On top of that, you’ll notice that your profit is also largely determined by your traffic, so if you’re building an ecommerce brand from scratch, you’ll be struggling for a long time as you build a client base.

Plus, according to Adam Enfroy from BigCommerce, dropshipping is a lot of work no matter how you dice it. Although it seems hands off, dropshippers always have to deal with their wholesale suppliers, order processing, returns, and customer service.

It’s much more reasonable to approach dropshipping when you already have a regular source of traffic.

2. Highly competitive.

There will always be overly optimistic entrepreneurs who focus solely on the “low overhead” part, ignoring the clear evidence above.

Because very little capital is required to start a dropshipping business, that low barrier to entry means a lot of competition, with the most popular markets suffering more than others.

Basically, the bigger a company is, the more they can reduce their markups to offer the lowest prices.

Reiterating what we said above, smaller businesses have to cut into their profits just to stay competitive with their prices, and at a certain point, it becomes unsustainable.

To make matters worse, chances are you don’t have an exclusive deal with your suppliers.

Disadvantages of Dropshipping

Ding: If you are watching this, you can skip it. Speaking of dropshipping, in fact, the most profitable model is the no-supply model. This kind of drop-shipping model can make the dropshipper make the most money at the least cost. Most of the non-supply models rely on AliExpress to find product stores. After all, AliExpress has a wide range of cheap products, which can make dropshipper profitable. Later, tools such as oberlo, dsers, and antdiy provide store and download Single efficiency, so you can do more in less time, dsers will start to charge fully, and dropshipper has an additional expense. If you don’t want to pay, you can use ANTDIY, which is free and efficient, and can Shop by key and place orders automatically, greatly improving the efficiency of dropshipping. ANTDIY, high-efficiency, high-automation, one-click completion, dropshipping no-supply mode essential app.

3. No control over supply-chain.

In standard ecommerce, if customers complain about product quality, fulfillment speed, or return policies, you can address the problems yourself.

In dropshipping, you’re more or less at the mercy of your supplier– but you’re the one who still has to talk to your customers directly.

Dropshippers are essentially trapped, doing little more than hoping the supplier addresses the problems while simultaneously reassuring the customer about something that’s out of their control.

On top of that, there’s also a delay in communication as the dropshipper goes back-and-forth between the customer and the supplier. If one answers slowly, all communication grinds to a halt and the problems take longer to fix.

In ecommerce, customer service is paramount.

Even the slightest transgression– such as a delay in communication– pushes your customers right into the hands of your competitors.

And if they’re vocal about it, those bad reviews early on could end your business before it even starts.

4. Legal liability issues.

Although this isn’t a common problem for dropshippers, it’s worth mentioning. Some suppliers aren’t as legitimate as they claim, and you don’t always know where the merchandise comes from.

Even more deceptive is when suppliers illegally use a trademarked logo or another company’s intellectual property, which happens more than average.

Whatever illegal activities your suppliers are up to, as their vendor you’re automatically complicit.

This potential problem can be rectified with a solid Dropshipping Agreement Contract, but not every dropshipping upstart knows that.

It’s something you’ll want to keep in mind when choosing suppliers.

5. Difficult to build a brand.

Like ghostwriters or behind-the-scenes songwriters, dropshippers must understand that the credit for their work goes to someone else.

If whatever product you’re selling is so amazing, your customers are going to focus mostly on the product’s brand and forget about the shopping experience entirely.

But this is not all the shortcomings, and how to start dropshipping quickly, these are very important core content, if you want to know all the content, please click this link to view the complete content.

6 、 Dropshipping can make order processing difficult.

Dropshipping seems straightforward: The customer orders, you process, and your supplier fulfills. And for the most part, it is simple.

However, if you’re sourcing products from multiple suppliers, you might run into some problems. Each of your suppliers might use a different shipping solution, which presents a problem for both you and your customers. Costs can get high, and shipping multiple products can be problematic.

Different suppliers will also have different structures in place for processing and billing. Since you have to manage the interaction with your suppliers, this can get tricky.

Ding: If you are watching this, you can skip it. Speaking of dropshipping, in fact, the most profitable model is the no-supply model. This kind of drop-shipping model can make the dropshipper make the most money at the least cost. Most of the non-supply models rely on AliExpress to find product stores. After all, AliExpress has a wide range of cheap products, which can make dropshipper profitable. Later, tools such as oberlo, dsers, and antdiy provide store and download Single efficiency, so you can do more in less time, dsers will start to charge fully, and dropshipper has an additional expense. If you don’t want to pay, you can use ANTDIY, which is free and efficient, and can Shop by key and place orders automatically, greatly improving the efficiency of dropshipping. ANTDIY, high-efficiency, high-automation, one-click completion, dropshipping no-supply mode essential app.

7 、 Dropshipping makes customer service more challenging.

This is another problem that happens when orders go wrong or suppliers fail. Because you’re just the storefront and don’t have a lot of control, it can be difficult to sort out orders and handle customer support.

One of the most unfortunate disadvantages of dropshipping is that you have to take the blame when your customers complain. You could be doing everything right and still run into problems if your suppliers have issues.

Benefits of dropshipping.

Dropshipping is a great business model for aspiring entrepreneurs to start with because it’s accessible. With dropshipping, you can quickly test different business ideas with limited downside, which lets you learn a lot about how to choose and market in-demand products. Here are a few other reasons why dropshipping is such a popular model.

1. Less capital is required

Probably the biggest advantage to dropshipping is that it’s possible to launch an ecommerce store without having to invest thousands of dollars in inventory up front. Traditionally, retailers have had to tie up huge amounts of capital purchasing inventory.

With the dropshipping model, you don’t have to purchase a product unless you’ve already made the sale and have been paid by the customer. Without significant up-front inventory investments, it’s possible to start sourcing products and launch a successful dropshipping business with very little money. And because you’re not committed to selling-through any inventory purchased up front, like in a traditional retail business, there’s less risk involved in starting a dropshipping store.

Benefits of dropshipping.

2. Easy to get started

Running an ecommerce business is much easier when you don’t have to deal with physical products. With dropshipping, you don’t have to worry about:

  • Managing or paying for a warehouse
  • Packing and shipping your orders
  • Tracking inventory for accounting reasons
  • Handling returns and inbound shipments
  • Continually ordering products and managing stock level

3. Low overhead

Because you don’t have to deal with purchasing inventory or managing a warehouse, your overhead expenses are quite low. In fact, many successful dropshipping stores are run as home-based businesses, requiring little more than a laptop and a few recurring expenses to operate. As you grow, these costs will likely increase but will still be low compared to those of traditional brick-and-mortar businesses.

4. Flexible location

A dropshipping business can be run from just about anywhere with an internet connection. As long as you can communicate with suppliers and customers easily, you can run and manage your business.

5. Wide selection of products to sell

Since you don’t have to pre-purchase the items you sell, you can offer an array of trending products to your potential customers. If suppliers stock an item, you can list it for sale on your online store at no additional cost.

Ding: If you are watching this, you can skip it. Speaking of dropshipping, in fact, the most profitable model is the no-supply model. This kind of drop-shipping model can make the dropshipper make the most money at the least cost. Most of the non-supply models rely on AliExpress to find product stores. After all, AliExpress has a wide range of cheap products, which can make dropshipper profitable. Later, tools such as oberlo, dsers, and antdiy provide store and download Single efficiency, so you can do more in less time, dsers will start to charge fully, and dropshipper has an additional expense. If you don’t want to pay, you can use ANTDIY, which is free and efficient, and can Shop by key and place orders automatically, greatly improving the efficiency of dropshipping. ANTDIY, high-efficiency, high-automation, one-click completion, dropshipping no-supply mode essential app.

6. Easier to test

Dropshipping is a useful fulfillment method for both launching a new store and for business owners looking to test the appetite customers have for additional product categories, e.g., accessories or wholly new product lines. The main benefit of dropshipping is, again, the ability to list and potentially sell products before committing to buying a large amount of inventory.

7. Easier to scale

With a traditional retail business, if you receive three times the number of orders, you’ll usually need to do three times as much work. By leveraging dropshipping suppliers, most of the work to process additional orders will be borne by the suppliers, allowing you to expand with fewer growing pains and less incremental work.

Sales growth will always bring additional work– especially related to customer support– but businesses that utilize dropshipping scale particularly well relative to traditional ecommerce businesses.

Is Dropshipping Profitable?

There are many ways to start and grow a dropshipping business. Our success stories talk about merchants who have started dropshipping businesses to make a few extra hundred bucks a month, while others have grown multiple six-figure stores. Whether you are looking to start dropshipping as an introduction into ecommerce or a business model to last forever, it is important to understand how dropshipping can be profitable to you.

What are some dropshipping product ideas?

If you’re interested in dropshipping but don’t know where to start, here’s a list of product ideas for inspiration. We tried to only list auxiliary items that could fit the product range of any industry.

  • Tote bags supporting a cause or charity.
  • Novelty t-shirts.
  • Funny coffee mugs.
  • Motivational bookmarks.
  • Inexpensive watches or jewelry.
  • Marketing merchandise (shirts, bags, mugs, pens, etc., with your logo).

Otherwise, see the section above on market research for a more personalized approach.

Do dropshippers ship internationally?

This varies widely by dropshipper, so you’ll need to check.

International shipments can quickly get expensive, and getting accurate quotes regarding shipping fees, customs and duties for hundreds of countries is complex. It also takes a drop shipper significantly more time to process an international order as there is more paperwork involved. Some will charge an additional fee while others simply won’t bother.

Dropshipping as a Side Hustle

Dropshipping as a Side Hustle

What is dropshipping’s main appeal? Because it’s flexible and it doesn’t demand much, it’s the ideal side job. Many entrepreneurs choose to do dropshipping on the side while they have a main job that provides steady income. In other words, you don’t have to sacrifice your day job to pursue your dreams of becoming an entrepreneur.

The No. 1 worry here is that your employer will prevent you from having a side hustle, but believe it or not, many companies are fine with it. You’ll want to make sure you’re in the clear by asking about your company’s policy on side businesses and review any non-compete agreements you’ve signed. You also definitely want to ensure there’s no conflict of interest. But if everything checks out, then you’re good to go.

You don’t need to dedicate too much time and energy to dropshipping, meaning you’ll likely be able to take it on without a hitch. Worried that your side hustle will make you underperform? You don’t have to be! You can spend only a couple hours on your business every day and still succeed.

However, it’s important to know your limits. If you regularly work overtime at your day job and struggle to find time for important daily responsibilities, you might not be able to give a dropshipping business the attention it needs. Even though dropshipping doesn’t require a lot, you do need to carve out time in your day for it.

In most cases, it just takes a little bit of time management and scheduling. Plenty of dropshipping retailers manage their main and side jobs easily. You don’t need to sleep three hours a night or skip meals to make it work. You’ll need to figure out a schedule that works for you and stick to it religiously.

Common questions about dropshipping

Throughout the rest of this book, we’ll cover all of the necessary steps to start a profitable dropshipping business. But before we continue, it’s worth answering a few common questions we receive about what dropshipping is and how it works.

Ding: If you are watching this, you can skip it. Speaking of dropshipping, in fact, the most profitable model is the no-supply model. This kind of drop-shipping model can make the dropshipper make the most money at the least cost. Most of the non-supply models rely on AliExpress to find product stores. After all, AliExpress has a wide range of cheap products, which can make dropshipper profitable. Later, tools such as oberlo, dsers, and antdiy provide store and download Single efficiency, so you can do more in less time, dsers will start to charge fully, and dropshipper has an additional expense. If you don’t want to pay, you can use ANTDIY, which is free and efficient, and can Shop by key and place orders automatically, greatly improving the efficiency of dropshipping. ANTDIY, high-efficiency, high-automation, one-click completion, dropshipping no-supply mode essential app.

How much do I need to invest to start dropshipping?

Though it’s hard to predict the exact costs for any individual business, there are a few items every dropshipping business will need to spend money on in order to get started. Here’s a quick summary of the essential costs.

How much do I need to invest to start dropshipping?

Online store

Estimated cost: ~$ 29/month.

You’ll need to find an ecommerce platform or website builder in order to create and host your online store. We obviously recommend starting a Shopify store. You’ll be able to effortlessly sync with the ANTDIY marketplace to source products, and you’ll get access to our full selection of themes and free branding tools so you can get your business up and running quickly.

Domain name.

Estimated cost: $5-20/ year.

It’s hard to build trust with customers without your own domain name. While there are a number of top-level domains available (e.g., example.shop, example.co), we recommend looking for a.com that fits your brand, if one is available. Use our domain name generator to get started, or learn more about how to come up with a catchy business name.

Test orders.

Estimated cost: Varies.

Although dropshipping lets you have minimal involvement with handling your overall product catalog, you should set aside money, as well as a little bit of time, to test out the products you plan to sell. If you don’t, you risk listing a product with too many shortcomings or defects, which will result in unhappy customers and a lot of time spent dealing with returns.

Online advertising.

Estimated cost: Scales with your business; we recommend budgeting at least $500 to get started.

Every ecommerce business should look for ways to reduce their average cost to acquire a customer through organic channels like content marketing, SEO, and word of mouth. But to get started, advertising is usually an essential channel for most product-based businesses. The most common channels include search engine marketing (SEM), display ads, social media ads, and mobile ads.

How do dropshippers make money?

Dropshipping businesses act as product curators, selecting the right mix of products to market to customers. Remember, marketing is a cost you incur, in both time and money, helping potential customers find, evaluate, and buy the right product. You’ll also have to include the cost of providing customer support whenever there’s a product or shipping issue. Last but certainly not least is the original price that your supplier sells the product for.

With all of these costs to account for, dropshipping businesses mark up individual products in exchange for distribution. This is why suppliers are OK having dropshippers market their products for them– dropshipping stores drive additional sales that the supplier would have otherwise missed out on. In order to make a profit with your dropshipping business, it’s a good idea to find out how much it costs for you to “acquire” a customer, and price your products with that in mind.

Ding: If you are watching this, you can skip it. Speaking of dropshipping, in fact, the most profitable model is the no-supply model. This kind of drop-shipping model can make the dropshipper make the most money at the least cost. Most of the non-supply models rely on AliExpress to find product stores. After all, AliExpress has a wide range of cheap products, which can make dropshipper profitable. Later, tools such as oberlo, dsers, and antdiy provide store and download Single efficiency, so you can do more in less time, dsers will start to charge fully, and dropshipper has an additional expense. If you don’t want to pay, you can use ANTDIY, which is free and efficient, and can Shop by key and place orders automatically, greatly improving the efficiency of dropshipping. ANTDIY, high-efficiency, high-automation, one-click completion, dropshipping no-supply mode essential app.

Is dropshipping a legitimate business?

Dropshipping is merely a fulfillment model, one used by many global retailers, and is perfectly legal. Like with any business, satisfying customer expectations and building a brand that resonates with the right audience is still key to long-term success.

This question usually comes up due to a misunderstanding of how dropshipping works. Most retail stores you shop in are likely not selling products they personally manufacture. Dropshipping takes this curated approach and turns it into a fulfillment model fit for an online business.

There are, of course, the more fundamental things you need to do in order to run your business legally. Consult a lawyer who specializes in these matters to ensure you’re conducting business legally in your region.

So, is dropshipping worth it in 2020?

As we’ve mentioned, dropshipping isn’t a perfect, stress-free way to build a successful online business– hard work is always required to start a business. The model has some definite advantages, but comes with a number of built-in complexities you’ll need to address.

We’ll be examining these challenges, and how to best address them, in future chapters. The good news is that with some careful planning and consideration, most of these hurdles can be resolved and need not prevent you from building a thriving, profitable dropshipping business.

Getting Started With Dropshipping.

shopify–ANTDIY

All of this sounds like a complicated puzzle, but once you learn how to dropship, it’s a smooth process for everyone involved. You, the dropshipping merchant, can do everything remotely and never even touch a single product!

Remember that you don’t need any business experience to open a dropshipping storefront. It certainly helps, but it’s not necessary. Many budding entrepreneurs don’t ever chase their dreams because they believe they need an MBA or years’ worth of experience. This is not the case. One of the benefits of dropshipping is that you can learn how to dropship as you go.

Better yet, there are numerous resources that make dropshipping easier than ever before. For example, this useful video provides some great advice on getting started. You can have absolutely zero business experience and still easily make a profit. You’ll need to learn the ropes along the way, and it will be challenging at times, but it’s more than worth it.

Now that you understand what dropshipping is, read on to find out what you need to get started!

Learn more

Ding: If you are watching this, you can skip it. Speaking of dropshipping, in fact, the most profitable model is the no-supply model. This kind of drop-shipping model can make the dropshipper make the most money at the least cost. Most of the non-supply models rely on AliExpress to find product stores. After all, AliExpress has a wide range of cheap products, which can make dropshipper profitable. Later, tools such as oberlo, dsers, and antdiy provide store and download Single efficiency, so you can do more in less time, dsers will start to charge fully, and dropshipper has an additional expense. If you don’t want to pay, you can use ANTDIY, which is free and efficient, and can Shop by key and place orders automatically, greatly improving the efficiency of dropshipping. ANTDIY, high-efficiency, high-automation, one-click completion, dropshipping no-supply mode essential app.