A harsh reality in e-commerce is that most people fail before they succeed. I thought I was going to be the next e-commerce success story—until I lost thousands in my first dropshipping store. I made costly decisions that set me back, and almost made me quit. But you can still avoid them.
That’s why I’ll be breaking down what exactly makes them wrong. Learn the lessons from my experience and get proven solutions on how you can avoid making the same mistakes I did. Have a better path to growth and success when starting your dropshipping store!
What I Did: I Focused on the Wrong Products
When I first started, I chose low-ticket products just because they’re trendy. But since they’re cheap items, their profit margins are extremely low. I barely make real profits even when I sold many of them. I only made sales during trending or “in-demand” periods, like when shoppers made impulse purchases. I’m still spending on operations, so this resulted in me losing money.
Lesson: Choose High-Ticket Items for Real Profit
That experience made me realize that high-ticket products are better for dropshipping.
Aside from their higher price points, high-ticket products are high-value items. This means they offer real value or benefit to the buyer— it’s an investment. One example is a standing desk. Shoppers buy them to improve their workstations. Because of that need, they’re willing to pay more for the product.
Since they’re more expensive, the profit margins are higher. So, when I did high-ticket dropshipping after my first store, I made real and distinguishable profits from every sale.
What I Did: I Trusted the Wrong Suppliers
Your suppliers influence how well you can do your business. Unfortunately, when I started, I trusted the wrong suppliers. I found them on AliExpress—a red flag I missed. When I worked with them, I encountered many problems that resulted in poor customer experience and a lot of customer service issues for me.
Here’s what was wrong with them:
Lesson: Build Relationships With the Real U.S. Suppliers
Instead of finding suppliers on platforms like AliExpress, I decided to look for better suppliers in other regions—the US. With a domestic supplier, communication is easier, and order shipment is faster. Fewer supplier problems mean fewer chances of losing money due to product or order issues.
Some ways to find them are by looking through your competitors’ supplier lists and searching on Google. Create a list, research them, narrow them down to those in the U.S., and contact them. Then, to ensure they’re legitimate U.S. suppliers, here are some questions I typically ask:
Once I was sure they were U.S. suppliers and I was approved, I made sure to build a good working relationship with them. I communicate effectively and ask questions. Do the same right from the start so you’re not going in blind, and you’ll know what to do if something comes up.
What I Did: I Burned Money on Facebook Ads Too Soon
Ads are necessary to promote your products and your brand as a whole. But you need to spend money to run them. When I first started, I made the mistake of launching ads without any research or plan behind them. I lost money going straight to Facebook ads.
Remember, I was still starting out. When I launched them, I didn’t have a targeted audience since I hadn’t tested the market yet. In the end, the ads all went to waste, and I gained nothing from what I spent.
Lesson: Start With Google Shopping Ads & SEO
Before trying to get people from Facebook to buy, I should’ve started by displaying my products and store to the market through Google. The best tools to use are Google Shopping Ads and SEO, especially for beginners.
SEO doesn’t typically cost anything, and Google Shopping Ads are pay-per-click campaigns. This means I only paid for the number of times shoppers clicked on the ads.
These are the ads you see at the top of search results when you search for a product. I used them to display my products, including their names, images, prices, and other important details. SEO also helped showcase my products and site in the search results of my market.
This combination helps generate leads, traffic, engagement, and sales. Once I had enough information about my market and customers, I was then able to proceed to widen my promotion reach, like on Facebook.
What I Did: I Ignored My Profit Margins
Profit margin is the percentage of profit you earn from your revenue. When I started, I only looked at revenue and assumed it was the same as real profit—it’s not.
I didn’t calculate the net profit I get from each sale I make. Because of this, I wasn’t able to manage the store’s finances well. With all the other expenses, I didn’t have a sustainable profit—I didn’t even know how much I actually got to keep. I barely earned real money.
Lesson: Track Actual Costs and Pricing
The key to having a sustainable profit margin is tracking your actual costs, expenses, and product pricing. When I started making changes and started high-ticket dropshipping, here are the things I tracked:
Now, every time I get an order, it goes into a Google Sheet that calculates the actual profit after all costs. That one change helped me stay on top of my profitability.
On the other hand, for beginners who don’t have sales yet, the process is a little different. Look at the difference between the wholesale cost of your products and their minimum advertised prices (MAP). The wholesale cost is the amount you pay the supplier, while MAP is the amount you’ll sell the product for.
Your MAP should be at least double your wholesale cost. Then subtract your expected fees and expenses. If the profit left over still looks sustainable, great. If not, reconsider the margin—consider increasing your product pricing.
What I Did: I Had No Customer Retention Strategy
When I started, getting customers was enough for me. Once they bought from me, I just let them go. I didn’t try to retain customers and make them buy again. I had no strategy whatsoever. No retargeting, no email marketing, no loyalty incentives. Because of this, I lost a huge opportunity to make continuous and repeat sales.
Lesson: Use Retargeting Ads & Post-Purchase Emails
Over time, to encourage and gain repeat sales, I learned retargeting and post-purchase email marketing. I ran retargeting ads for shoppers who have interacted with and shown interest in my products. This means when they exit my store and visit other sites, the ads show up to persuade them to continue the purchase. It’s led to more customers and sales.
At the same time, I focused on retention. After every purchase my customers make, I send them an email. It can be an order confirmation, package updates, or promotions. These emails helped me stay connected to them.
Furthermore, I offer promotions and incentives alongside these two strategies. With an offer of a discount or bonus and free shipping, more customers stayed loyal to my store.
Conclusion
When I first got into e-commerce and dropshipping, I made mistakes that cost me thousands. If I could do it all over again, here’s what I wouldn’t do again:
Don’t be like the beginner version of me. You don’t have to learn the hard way.
I now have a proven system that helps me avoid these mistakes and build profitable stores. Join our free Drop Ship Lifestyle webinar and get the step-by-step strategy that works!
And if you have your own “rookie” mistakes to share, drop them in the comments. Let’s learn and grow together.
