Dropshipping is becoming the hottest business trend in the booming e-commerce era. With the dropshipping advantage of low investment cost – even starting with 0 VND – and dropshipping profit from price difference which can reach 30-60%, this model attracts tens of thousands of Vietnamese participants. However, dropshipping risks account being blocked and many other practical challenges are waiting for those who are unprepared.
Understanding what dropshipping is?
What Is Dropshipping? Understanding The Business Model Correctly
What is Dropshipping? This is an online retail model where the seller does not need to import goods, store inventory, or transport products themselves. You play the role of an intermediary connecting customers with suppliers. Dropshippers only focus on marketing, customer care, and order tracking.
The operating mechanism takes place through 5 simple steps:
- Step 1: You establish a relationship with a supplier (can be in Vietnam or international).
- Step 2: Build sales channels such as websites, fanpages, TikTok Shop.
- Step 3: Example: When a customer orders from your channel for $200, you order from the supplier for $150.
- Step 4: The supplier will pack and deliver directly to the customer with your information.
- Step 5: Customers only know you as the seller, the whole process takes place invisibly.
Table 1: Dropshipping & Traditional Business
| Criteria | Dropshipping | Traditional Business |
| Initial Capital | 0 – a few million | Tens to hundreds of millions |
| Warehouse | No need | Mandatory |
| Inventory Risk | None | High |
| Quality Control | Difficult | Easy |
| Delivery Time | About 14-20 days (or longer depending on the carrier) | 1-3 days |
Dropshipping advantage of low investment cost: Why does it attract tens of thousands of people?
Dropshipping advantage of low investment cost is the most attractive factor of this model. Startup capital is almost 0 because you don’t need to buy goods in advance – only order when a customer has paid. You don’t have to rent warehouses, premises, or spend on personnel costs for packaging and shipping. This is especially suitable for students, office workers, or beginners with a tight budget.
Flexibility is also a strength: you can work anytime, anywhere with just a laptop and internet. No worries about stagnant inventory, you easily expand products from many different suppliers. Fast capital rotation, receive commission immediately after each order without waiting for third-party approval.
Diverse sources of goods: allows you to sell many items at the same time, flexible according to market trends and benefit from reputable supplier brands.
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Key advantages of Dropshipping
Dropshipping profit from price difference: What is the actual figure?
Dropshipping profit from price difference operates according to a simple formula: Profit = Selling price to customers – Buying price from suppliers – Incurred costs. The average profit margin fluctuates between 30-60%, even reaching several hundred percent if you have good skills and choose unique products.
Specific example: A customer buys a product for $200 (about 5,260,000 VND), you import from a supplier for $150 (3,945,000 VND), minus marketing costs and transaction fees of about $10 (263,000 VND). The actual profit you receive is $40 (1,052,000 VND), equivalent to 20% per order.
Factors affecting profit include skills in finding good price suppliers, marketing ability to sell at higher prices, choosing products with high demand but low competition, and optimizing advertising as well as shipping costs.
Table 2: Profit margin by product type
| Product type | Profit margin | Competition | Difficulty |
| Fashion | 40-60% | Very high | Difficult marketing |
| Electronics | 15-25% | High | Requires large capital |
| Small accessories | 50-100% | Medium | Long shipping |
| Niche products | 60-200% | Low | Difficult to find customers |
Dropshipping risk of account being blocked: A worrying reality
Dropshipping risk of accounts being blocked is a serious problem that many sellers encounter. Large e-commerce platforms like Amazon, eBay often suspend dropshipper accounts due to strict policies on invoices and product origins. Copyright infringement, violation of sales policies, or customer complaints about quality and delivery time can cause accounts to be permanently locked.
The risk of quality and reputation cannot be underestimated. You do not control the product before delivery to the customer; defective or damaged goods will seriously affect reputation. Completely dependent on the supplier, and even more worrying, the supplier can become a competitor when they have your customer data.
Other risks include fierce competition causing profit to be squeezed, long shipping (14-20 days) making customers frustrated, having to share customer data with the supplier, and being passive in supply when products are out of stock.
Risks to avoid when doing dropshipping
Table 3: Risks and prevention
| Risk | Level | Prevention |
| Account being blocked | High | Comply with platform policies, have legal documents |
| Poor quality | High | Order samples for testing, choose reputable suppliers |
| Slow shipping | Medium | Use models with inventory in the target market |
| Price competition | High | Focus on niche market, build brand |
What to prepare to start Dropshipping successfully?
To succeed with dropshipping, you need to prepare, learn, and research Digital Marketing knowledge (Facebook Ads, TikTok Ads, SEO), market research skills, competitor analysis, professional customer care, and financial and tax management.
Regarding tools, you need a laptop and a phone with internet, an initial marketing budget of 2-5 million/month, choose 1-2 main sales channels and a separate bank account for business.
5 steps to start:
- Step 1: Market survey and identify target customers (this step needs deep research to understand the customer journey, meeting exactly & sufficiently the needs of customers)
- Step 2: Choose a product niche (small, compact, light, high demand, meeting the “need & want” needs of customers)
- Step 3: Find reputable suppliers and order samples for testing (should order small quantities first to test product quality)
- Step 4: Build sales channels with images suitable for the industry
- Step 5: Run ads and take dedicated care of customers (learn how to run ads on Facebook, Google, Tiktok, Instagram, Youtube…)
GMAJOR – The Key to Dropshipping Success
What is Dropshipping? It is a business opportunity with dropshipping advantage of low investment cost – even 0. Dropshipping profit from price difference can reach 30-60%, but dropshipping risk of account being blocked and difficulty in quality control are real challenges.
The challenges faced by dropshippers stem from the realities of the market
Success requires good marketing skills (very suitable for those with expertise or majoring in MKT and those with a passion for dropshipping), choosing reputable suppliers, and persisting in learning. If looking for a low-capital business opportunity, dropshipping is worth considering – as long as you prepare carefully!
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