Exploring the Viability of Dropshipping as a Sustainable Income Source for Individuals with Limited Resources and Experience
Gerhát, Péter (2024)
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2024112730726
https://urn.fi/URN:NBN:fi:amk-2024112730726
Tiivistelmä
This thesis investigates the viability of dropshipping as a sustainable income source for individuals with limited resources and experience, a perspective largely underexplored in existing research. Dropshipping, an e-commerce model reliant on third-party suppliers for inventory management and fulfillment, appeals to aspiring entrepreneurs due to its low startup costs and operational flexibility. However, its practicality for those balancing other commitments, with little capital or prior knowledge of e-commerce, remains uncertain.
The theoretical framework grounds the study in key aspects of the dropshipping business model. It examines operational dependencies, such as supplier reliability, and applies lean startup principles, emphasizing iterative learning, minimal investment, and cost control. Additionally, the framework considers profitability dynamics in e-commerce, including slim margins and the critical role of digital marketing strategies like SEO, social media outreach, and automation tools. These principles guide the analysis of how individuals can overcome the steep learning curve and operational challenges inherent to dropshipping, such as supplier dependency and intense market competition.
The research employs a mixed-methods approach, combining a questionnaire and an in-depth interview. The questionnaire, distributed across online dropshipping communities, collected quantitative data on key factors such as initial investment, time commitment, and income generation. While the responses provide valuable insights, the sample size was limited, reflecting the challenges of engaging dropshipping practitioners who often protect their competitive advantage by withholding information. The interview complements the questionnaire, offering qualitative depth through the experiences of a student balancing part-time work who has previously managed a dropshipping business. The interviewee’s account highlights the practical realities of dropshipping, including challenges like managing time, navigating supplier-related issues, and adopting low-cost marketing strategies, such as word-of-mouth promotion.
The findings underscore that while dropshipping presents significant opportunities for individuals with minimal resources, its viability as a long-term income source depends on strategic planning, adaptability, and the effective use of digital tools and automation. By focusing on the perspective of the average person—those with limited experience and resources—this thesis addresses a critical gap in existing literature, offering practical recommendations for aspiring entrepreneurs and contributing to broader discussions on accessible e-commerce ventures.
The theoretical framework grounds the study in key aspects of the dropshipping business model. It examines operational dependencies, such as supplier reliability, and applies lean startup principles, emphasizing iterative learning, minimal investment, and cost control. Additionally, the framework considers profitability dynamics in e-commerce, including slim margins and the critical role of digital marketing strategies like SEO, social media outreach, and automation tools. These principles guide the analysis of how individuals can overcome the steep learning curve and operational challenges inherent to dropshipping, such as supplier dependency and intense market competition.
The research employs a mixed-methods approach, combining a questionnaire and an in-depth interview. The questionnaire, distributed across online dropshipping communities, collected quantitative data on key factors such as initial investment, time commitment, and income generation. While the responses provide valuable insights, the sample size was limited, reflecting the challenges of engaging dropshipping practitioners who often protect their competitive advantage by withholding information. The interview complements the questionnaire, offering qualitative depth through the experiences of a student balancing part-time work who has previously managed a dropshipping business. The interviewee’s account highlights the practical realities of dropshipping, including challenges like managing time, navigating supplier-related issues, and adopting low-cost marketing strategies, such as word-of-mouth promotion.
The findings underscore that while dropshipping presents significant opportunities for individuals with minimal resources, its viability as a long-term income source depends on strategic planning, adaptability, and the effective use of digital tools and automation. By focusing on the perspective of the average person—those with limited experience and resources—this thesis addresses a critical gap in existing literature, offering practical recommendations for aspiring entrepreneurs and contributing to broader discussions on accessible e-commerce ventures.