SE3 EP07: Is DropShipping a Viable Model for Scale? Interview w/ Oberlo's Co-Founder, Tomas Šlimas

The mention of 'dropshipping' often denotes either poor ecommerce customer experience and lack of supply chain control or some 'guru' trying to sell online courses on how to start an ecommerce business. A search on YouTube for 'ecommerce' returns a tonne of results related to dropshipping as a means to escape the 9-5 and upsells to online courses. 

My take has been and still is, a business with poor customer experience is impossible to profitably scale; and so dropshipping as a viable ecommerce model was really off my radar. But more recently I was hired to carry out due-diligence on a drop ship business ecommerce brand with monthly revenues of $250,000+ and came across another with monthly revenues of $500,000. This is when dropshipping as a business model started to get my attention. 

Don't get me wrong, there is a LOT of crap out there. Basically most dropshipping is the scrapings at bottom of the ecommerce pot. The droppshipping sites I mentioned above and all of the dropshipping sites I see that seem to be doing well revenue-wise come across to shoppers as established brands. 

I am also seeing a lot of innovation in conversion rate optimisation with dropshippers because they really are front end marketing businesses that need to prop up the perceived value of products they have little or no control of actually producing.  

Tomas Slimas is a successful and retired dropshipping ecommerce entrepreneur who generated revenues of $3 million/year from his dropship site before he co-founded Oberlo (https://oberlo.com/), a dropship app that helps Shopify stores find products to sell.

I tracked him and got him on the show to discuss the viability of dropshipping as a scalable ecommerce model in 2017 and beyond.

This is a really interesting conversation. You should still listen to it if you are an established merchant, as you should consider latching dropshipping for product catlog expansion. 

 

 

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