Average Dropshipping Income: How Much Money Can You Really Make? [2022 Update]

average dropshipping income

Introduction

The dropshipping business model is quickly rising to become a major industrial line by itself. And the Covid-19 pandemic has even contributed to more new eCommerce entrepreneurs engaging in dropshipping, especially since most customers now prefer to do their shopping online. But what is the average dropshipping income you can expect to earn?

The practice of dropshipping offers numerous advantages to the sellers. For example, sellers are not required to buy inventory when running a dropshipping business. More so, the process saves shippers and manufacturers a lot of time and money which would've otherwise been used engaging in marketing and selling of products.

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Considering all the benefits that come with dropshipping, it is no wonder that businesses of all sizes are utilizing this practice. In fact, even Amazon, as well as other huge retailers, use their own version of dropshipping as an important part of their retail businesses. And this is clear proof that dropshipping can undoubtedly be a profitable business.

But how much can you actually make from the dropshipping business? And how do sellers get paid from this practice? Read along!

How Do You Get Paid from Dropshipping?

average dropshipping income: payment gateways

Dropshipping is supported by a wide range of e-commerce platforms, such as Shopify. Shopify allows its users to choose several payment gateways. The main payment options offered are PayPal and Shopify Payments or Stripe. All Shopify Payments are paid out every two business days. Shopify Payments is the flagship payment gateway offered by Shopify with lower transaction fees, using Stripe in the backend. You also have Amazon offering Amazon Pay, enabling customers to shop at tens of thousands of stores using their Amazon account.

Also, PayPal payments are usually confirmed almost immediately. The first major disadvantage about PayPal is that it might put a particular percentage of cash on reserves, especially for new accounts. Also, PayPal is very customer friendly so you are more likely to have a PayPal dispute if your customer wants a refund. PayPal tends to side with the customer to preserve its reputation. On the other hand, customers trust PayPal, which increases your sales if you offer this payment gateway. Transaction fees are also higher with PayPal than with Stripe or Shopify Payments.

Still, the advantage of getting paid quickly is one that cannot be outdone by other similar business models. With dropshipping, you won't have to wait 60 days for the affiliate commission payouts. Also, you have the option of using credit cards, which usually come with good reward programs.

How Much Money Can You Make Dropshipping?

how much money can you make dropshipping?

There is no specific or straightforward answer to this question. However, to estimate the amount of money that you can make from this business, you need to understand the two different types of dropshipping and how each of these works. The average dropshipping income you can expect to earn varies depending on each type of product you are selling.

These two types are:

  1. Low ticket dropshipping
  2. High ticket dropshipping
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A. Low Ticket Dropshipping & Average Dropshipping Income

it's more difficult to be profitable with low-ticket products

With low ticket dropshipping, you create a store on the Shopify platform, then upload items from AliExpress to your website. Sellers are usually not limited to the size of the website they can create or the number of products they can sell.

Also, you have the option of selling just one product in your Shopify store or selling different products as a ‘niche' or ‘general' store. And upon uploading items from AliExpress, you then need to advertise these on different social media platforms.

For example, you can use Facebook Ads to drive more traffic to your store. Also, if you own an Amazon seller account, you will be required to look at different Amazon ads. Alternatively, you can opt to use social media influencers to advertise your products, either for a fee or commission.

However, while you can still make money from low ticket dropshipping, the profits earned are usually relatively low. After all, remember that all the social media advertising will cost you huge money investments. Also, to capture the attention of more customers, you will be required to modify your ads from time to time; and this requires more time/money investment.

In fact, most people make around $200/month or a bit more from the low ticket dropshipping practice. To make higher profits, you will have to engage in very massive, successful marketing campaigns. Better yet, you would do well to practice the ‘high ticket' type of dropshipping.

B. High Ticket Dropshipping & Average Dropshipping Income

high-ticket product dropshipping

If you are looking to make more profits and build a sustainable business, then this is the type of dropshipping that you should engage in. After creating your Shopify store, add the high ticket products you intend to promote. Advertise these products using Google Ads.

For a higher SEO score on search engines, research phrases and keywords that register the most conversions and use these on your ads. Also, try to create ads that use the least costs so as to ensure that they are running profitably. Find more products or suppliers and create ads that target people who are actively searching. The more products you advertise, the more ‘evergreen' campaigns you will attain and the bigger your business will grow.

Unlike with low ticket dropshipping, high ticket dropshipping allows you to partner with real brands and businesses. This means that you will constantly have a supply chain running. More so, this practice targets people who are already looking to buy products, or those with a ‘high buying intent.'

Average Dropshipping Income: High-Ticket Products

high-ticket products

The following is a breakdown of how much average dropshipping income you can make from high ticket dropshipping, relative to the amount of effort you put in:

  • $1000 per month – You can easily make this profit if you spend time creating a good website, learn about Google Ads and secure a few reliable suppliers.
  • $5,000 per month – You can earn this within 6-12 months of practicing high ticket dropshipping, as long as you are persistent and keep trying to find new good suppliers.
  • $10,000 per month – To achieve this level, you will need to learn how to create different systems. Also, it would help if you outsourced 2-3 virtual assistants (VA).
  • $30,000 per month – Here, you will require solid systems that help to keep all of your daily activities in order. Also, you will need to establish separate systems that ensure your growth rate remains steady.
  • $100,000 or more per month – At this level, you will need to have competent virtual employees, people who manage these employees and others who focus on the growth of your business. Also, you can consider selling your advanced dropshipping business to make even higher amounts of profits.

Conclusion – Average Dropshipping Income

Dropshipping is a worthy business to engage in. It is one of the few online businesses that will allow you to make profits more quickly without having to handle logistics yourself. The average dropshipping income you can earn is significative, depending on your products, your marketing efforts, the professional look of your store and a bit of luck too.

However, to make money from this practice, you need to be smart. And the smartest way to go about this would be to engage in the high ticket type of dropshipping. Dropshipping is an interesting and very cost-effective business model that empowers you to earn you significant profits if you’re dedicated enough.

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