My conclusion is that because you will always be working on thin margins a pure play dropshipping website has no long-term future. However, integrating dropshipping with an existing stock-based business is a great way to test new products and find new markets.
When you stumble across an in-demand product via dropshipping, then you'll want to maximise your profits from the opportunity. You can either buy in bulk from a wholesaler to increase your margin with the knowledge that the product is going to sell or in some cases you could manufacture the product yourself and make a much bigger return.
New 3D printing technologies and specialist prototyping companies have drastically slashed the upfront cost of developing new products. It is a logical extension of the eCommerce business model to test new product lines by dropshipping them and then to subsequently manufacture them yourself rather than importing from abroad.
It was Napoleon Bonaparte who sarcastically described Britain as a nation of shopkeepers. What would he think of us now that we are all selling the same product on Amazon or eBay and descending into a never-ending spiral of merciless dog eat dog price cutting?
Competing on price is not the answer, manufacturing your own products will give you both exclusivity and bigger product margins.
Be An Expert In Your Niche
If you really understand your target market, then you'll have a much better idea of product requirements in the marketplace. It is always better to concentrate on a small sector of a market and understand it thoroughly rather than trying to cherry pick products for sale from “best seller” lists.
There may be people "making a killing" by shipping in goods from China and using Fulfillment By Amazon (FBA) to make a profit but I guarantee for every success there are hundreds more who are failing to cover storage fees and losing money hand over fist on advertising costs because they don't have enough trust (reviews) in the marketplace. Building a website as a base from which to work should always be your first priority.
It is your job to be an expert in your space and to know what the competition is producing. Being an expert in your field and concentrating on a niche also helps to make your website laser focused and keyword targeted for that valuable search engine traffic.
Ideas For Products To Manufacture
To begin with, keep it simple and spend as little money as possible getting your first product developed.
Manufacturing a product is a learning process, and as you gain knowledge, skills and contacts, you'll be able to increase your manufactured product base. The most straightforward products to make are plastic with few moving parts, and these are also the cheapest to develop.
Mobile Phone Accessories
The explosion of smartphones has given rise to a huge accessories market for car holders, desktop holders, chargers and all kinds of device stands. Many of these are very simple to make and you can be first to market with the accessory when a new phone comes out.
Plastic protective cases are also in demand so producing short runs of exclusive designs would be another great product idea.
Kitchen Utensils & Plastic Bottles
Refillable plastic bottles that look good are fast becoming the “must have” fashion accessory due to the concern about throwaway plastic waste. Would it be possible to make a range of “reusable” kitchen utensils that can easily be washed and reused instead of being thrown away at parties and barbeques?
Reusable plastic is going to be one of the fastest growing trends in the next few years as Governments clamp down on plastic waste.
Tervis Tumbler, a Florida-based maker of drinkware, has developed a plastic, insulated wine glass that customers “absolutely love,” said Matt Tosi, a product innovation engineer for the company. Tervis sells its products through major retail outlets such as Bed, Bath & Beyond and also sells personalised plastic cups and glasses directly to consumers.
Tervis used an injection moulding service for help with both rapid prototyping and final-part manufacturing.
View more case studies on the Protolabs website.
You don't have to mass produce items for them to be cost-effective. Many car parts that wear out are not available from the original equipment manufacturer or can be improved upon tremendously with some design expertise.
Many engine parts are now made of plastic, but I'm thinking of interior creature comforts. If you know your vehicle, then you'll know which parts wear out and are hard to replace, for example, window and fascia buttons for Saab's are very expensive to replace even second hand from scrap yards.
High-end luxury cars also have parts that wear out, and it could be cheaper to manufacture them in a short run than source them from expensive car breakers. Seven series BMW's and other luxury marques would be ideal for this approach.
Even for amateur enthusiasts, off-road motorcycling can be highly competitive. So when David Spanton’s motorbike needed an Italian-made replacement part just days before a race, finding one available with such short notice wasn’t possible. Instead, David decided to create a 3D CAD model himself and called on a digital manufacturer of prototypes and production parts to produce it.
View more case studies on the Protolabs website.
Perhaps you have a unique idea for a product that doesn't already exist or is a significant improvement on something already in the market?
On my many dog walks, I'm always getting new ideas for blog posts and products. The latest idea was a fish tank scraper that reuses your old razor blades to do the dirty work. You'd need to make a handle out of plastic and then have a way of receiving the replacement blade. That sort of idea is perfect for a small run, small-scale prototyping.
How Plastic Injection Moulding Works
Several companies in the UK now offer plastic injection moulding for small-scale projects at a low cost. Where once it used to cost thousands of pounds to tool up a mould and get it ready for production now you can produce moulds in hours and production parts in several weeks. Simply type "mould prototyping" into the Google search box.
Aluminium moulds instead of steel are used to produce plastic moulds injected from different thermoplastic resins, and this is what keeps the cost low. Runs of as low as twenty items are possible using this technique although naturally the more you have produced, the lower the cost.
Computer Aided Design (CAD) models are sent directly to the production floor where the mould milling begins. This process is akin to website designers sending their photoshop files directly to an offset litho printer for spot colour printing.
How 3D Printing Works
3D printing is a process of making a three dimensional (3D) solid object from a digital file.
Laying down successive layers of material on top of one another creates an object made from a chosen additive. This method of producing an object means there is far less waste than traditional methods because you are only laying down the required amount of material and not trimming anything away.
Don't settle for selling the same product as your competitors and the associated low margins. Differentiate! Where the opportunity presents itself get your product made. New technology has massively reduced the cost of tooling up a mould, and 3D printing can produce very short runs of product or prototypes at low cost.
Why try and compete on price with every other eBay and Amazon seller when with a bit of thought and the shaking of your idea tree you can produce your very own product.
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