Dropshipping is often seen as an easy way to get into ecommerce, but is it really the perfect side hustle?
Before diving in, we want you to understand what you’re getting into.
Why?
Many aspiring dropshippers jump in expecting minimal effort and quick results, only to find that it demands more time, money, and strategic planning than they initially thought.
In this article, we’ll tackle the key questions you should be asking before starting dropshipping as a side hustle!
Is it truly a passive income stream? What are the common misconceptions, and how can you avoid them?
By the end, you will know if dropshipping is the right fit for your lifestyle and goals.
Is dropshipping truly a side hustle?
Dropshipping is marketed by 'gurus' as the perfect side hustle—something you can do with minimal effort and a few hours a week.
But the reality is way more different.
Can you start dropshipping while holding down a full-time job?
Absolutely.
Will it be easy?
Not quite.
At its core, you should know that dropshipping is a real business.
That means dealing with everything from building an online store and sourcing reliable suppliers to marketing your products and managing customer expectations.
It’s not a 'set it and forget it' model. You'll need to dedicate evenings, weekends, or any spare time to it.
Yes, it’s possible to kick things off as a side project.
But once orders start rolling in, you'll find yourself handling customer service issues, resolving supplier delays, and constantly tweaking your strategies to stay competitive in a crowded market.
At that point, dropshipping demands more attention than a typical side gig—you may even need to work on it full-time or hire a virtual assistant if you can’t do so.
So, is dropshipping a true side hustle?
It can be, but only at the beginning.
Once your store starts taking off, you’ll need to invest considerable time during the day to keep it going.
Know that the more successful you become, the more involved you’ll need to be.
But isn't that a good thing?!
Think about it: you’d want your dropshipping business to grow to the point where you can quit your full-time job and focus entirely on building something of your own.
Is dropshipping a passive income stream?
If you’re hoping dropshipping will bring in passive income, think again.
As we discussed earlier, running dropshipping businesses requires active involvement, especially if you want to make it profitable.
It’s not like traditional passive income sources, such as investments or rental properties, where you can sit back and watch your earnings grow.
Sure, dropshipping automation tools will help you streamline processes like order tracking and inventory management, but these won’t eliminate the need for your attention.
If you don’t stay on top of things, issues like delayed shipments or miscommunication with suppliers can quickly disrupt your business.
So, can dropshipping become more passive over time?
To an extent, yes.
Once you set up efficient systems, hire virtual assistants, or outsource tasks, you can reduce the time you spend on daily operations.
But it will never be entirely hands-off.
What are the common misconceptions about dropshipping as a side hustle?
One of the biggest misconceptions is that dropshipping is a quick and easy way to make money.
Many online 'gurus' love to highlight overnight success stories but rarely mention the months—or even years—of effort that go into building a profitable store.
Another common myth is that dropshipping doesn’t require any upfront investment.
Sure, you don’t need to buy inventory upfront, but that doesn’t mean it’s free to start.
You’ll need to budget for building your store, buying a domain, running ads, and maybe even paying for some automation tools.
These expenses add up faster than most people expect.
And then there’s the idea that anyone can succeed if they just follow a formula or blueprint.
While guides can help, each market is different, and what works for one person might not work for another.
Success in dropshipping comes from adapting to changing trends, learning from mistakes, and constantly testing new strategies. It’s more about persistence and problem-solving than finding a one-size-fits-all solution.
To help you understand what to watch out for, we’ve created a guide that lists the most common reasons why people fail at dropshipping.
Check it out so you’ll be better prepared when you set up your own store:
How much time should you expect to dedicate to dropshipping?
The time you’ll need to invest in dropshipping really depends on your level of expertise and how many systems you have in place.
When you’re just getting started, plan to dedicate around 10-20 hours a week. Most of this time will go into:
- Product research (5-7 hours)
- Setting up your store (10 to 20 hours for a basic one-product store)
- Learning about digital marketing (4-6 hours)
If you already have some ecommerce experience, you can probably reduce this time significantly.
Once your store is up and running, you can scale back to around 5-10 hours a week.
This time typically goes into routine activities like processing orders (2-3 hours), handling customer service (3-4 hours), and tweaking ad campaigns (2-3 hours).
Automating tasks like order fulfillment or hiring a virtual assistant can help further reduce the time needed.
When you’re looking to scale your dropshipping business, you can expect to spend 20+ hours—especially as you start managing more customers and multiple suppliers, launching new products, and running more complex ads.
Can you manage dropshipping alongside a full-time job?
Yes, you can definitely manage dropshipping while working a full-time job, but it does require smart time management and a clear plan.
It can be challenging to balance both, especially during the initial setup phase. So, it may take you a few weeks just to get everything in place.
After your store is up and running, managing it typically becomes easier.
But be prepared for unexpected issues like supplier delays or urgent customer inquiries that might need your immediate attention.
What are the upfront costs involved in starting a dropshipping side hustle?
When starting your dropshipping business, you’ll need to budget for various expenses, both upfront and ongoing.
- Startup costs like business registration
- Shopify-related prices like apps, monthly plans, and themes
- Setting up your dropshipping store
- Domain and hosting costs
- Payment processor fees with platforms like PayPal
- Supplier fees (like Spocket or Syncee)
- Any advertising expenses
Typically, your one-time setup costs will range between $150 and $700. This covers business registration, domain costs, and building your store.
If you handle most of these tasks yourself—like setting up your website and configuring everything—you can save a lot of money.
Once your store is live, ongoing monthly expenses will likely range from $150 to $4,300, depending on your marketing budget and the tools you decide to use.
This includes your Shopify fees, app subscriptions, advertising costs, and supplier fees.
How much you spend each month really depends on your growth strategy and how quickly you want to scale.
If you want to see the exact breakdown, check out our detailed article below:
How do you choose the right products to sell as a dropshipper?
The ideal products have solid profit margins, solve a specific problem, or have that special 'wow factor' that makes people want to buy them on impulse.
When you’re evaluating potential products, don’t just rely on research tools. While they’re helpful for gathering insights, they won’t always give you the full picture.
Instead, check out what’s working for successful dropshipping stores. Look at their best-sellers, read customer reviews, and see what types of products are really clicking with buyers.
This will give you a better idea of what resonates in the market!
To spot winning dropshipping products (which requires skills), look for these five key characteristics:
Want to dive deeper into product research? Check out our detailed guides below:
- 18 Winning Dropshipping Product Examples in 2024 (Inspiration)
- How Do You Do Product Research on Instagram? (8 Great Tips)
- How Do You Do Product Research on TikTok? (7 Great Methods)
- How Do You Do Product Research on YouTube? (6 Great Methods)
- How to Find Winning Dropshipping Products (14 Research Methods)
What are the key risks of dropshipping?
One of the main risks is your dependence on third-party suppliers.
Since you don’t control inventory, product quality, or shipping times, you could run into issues like stock shortages, shipping delays, or inconsistent product quality—all of which can damage your store’s reputation.
Low profit margins are another common risk.
Because dropshipping has so much competition, many stores operate with thin margins, making it difficult to scale or manage unexpected costs like increased ad spend or returns.
Shipping complications can also become a headache when you work with multiple suppliers.
If an order includes products from different suppliers, you will end up with higher shipping costs and longer delivery times, which can frustrate customers and result in negative reviews.
Lastly, handling customer service can be tricky since you’re acting as the middleman.
You’ll be responsible for managing complaints, processing returns, and resolving issues, even though you don’t physically handle the products.
We know this might sound discouraging, but it’s better to be aware of the risks upfront!
Understanding these potential issues will help you prepare and run a smoother operation. If you want to learn more, check out our articles below:
- 10 Dropshipping Risks to Consider Before Starting Your Store
- The Advantages and Disadvantages of Dropshipping in 2024 (Is It Still Good?)
What legal and tax obligations should you be aware of?
Your legal and tax obligations will vary depending on your location and the markets you operate in, so it’s always a good idea to consult with a professional to ensure compliance.
However, here are some general guidelines to keep in mind:
First, you’ll need to register your business.
This typically involves choosing a business structure—like a sole proprietorship, LLC, or corporation—and obtaining a business license or permit, depending on local regulations.
A legal business entity not only legitimizes your operation but also provides personal liability protection if you choose a structure like an LLC.
Next, you’ll need to look into your tax responsibilities.
If you’re in the US, you’ll need to understand sales tax regulations, while if you’re selling in regions like the European Union, Value Added Tax (VAT) might apply.
To learn more about taxes, check out our article:
Plus, you must comply with consumer protection laws, which include having clear return policies and accurate product descriptions.
Misleading information can lead to legal consequences and fines.
Check out our article for tips on how not to get sued when dropshipping to help you avoid any legal complications.
Lastly, keep your finances organized. Maintain accurate records of your income and expenses, as this will be crucial when filing taxes and staying compliant.
It’s always a good idea to consult with an accountant or legal expert to understand the specific obligations based on your business location and operations.
Is it realistic to scale dropshipping from a side hustle to a full-time business?
Yes, it’s possible, but it takes time and effort. Many successful dropshippers start by experimenting with different niches and products part-time, often reinvesting profits into their business.
Take Gymshark, for example!
Did you know the now multi-million dollar brand started as a small dropshipping side hustle selling fitness supplements?
Look at how long they have come!
We’re not saying every dropshipping side hustle will turn into the next Gymshark, but it shows what’s achievable with the right strategy and persistence.
Just keep in mind that you’ll need to put in serious work, automate where you can, and consider hiring help as your business grows.
It’s challenging but entirely possible if you’re prepared to go all in!
Related articles that will help you learn about dropshipping
Ready to take the next step?
Check out these articles for quick tips, best practices, and in-depth guides to help you hit the ground running:
- 9 Tips to Learn Dropshipping Faster (Without a Course)
- Top 10 Fastest Dropshipping Suppliers (Quick Delivery)
- Dropshipping Mindset: 6 Things to Know Before You Start
- The 5 Best Ecommerce Platforms for Dropshipping in 2024
- 23 Most Successful Shopify Dropshipping Store Examples | Inspiration
The best way to learn about dropshipping is to check our checklist here!
This checklist is perfect if you’re feeling overwhelmed or not sure where to begin.
We’ve organized all our guides step-by-step, making it easier and faster for you to build or continue growing your dropshipping store—no matter where you’re starting from!
FAQs
What makes dropshipping a good side hustle?
Dropshipping offers flexibility and a low entry barrier, making it an attractive opportunity for entrepreneurs with limited capital. You can sell a wide variety of goods, including apparel, pets, and kids’ items. This venture allows you to align your business with your interests and hobbies.
What's the next step after starting dropshipping?
The next step is branding through branded dropshipping—selling products under your own brand with custom designs while avoiding inventory management. To outpace competitors, you can create unique products under your brand, though this may require buying inventory upfront.
Can I sell products like clothing or t-shirts through dropshipping?
Yes, platforms like Printful make it easy to sell apparel and other custom-designed products without handling manufacturing.
What are the key aspects of running a successful dropshipping business?
Important aspects include managing your cash flow, setting clear pricing, and addressing target audience needs. Using data to track performance and incorporating sustainability in your approach helps create a strong foundation.
What advice would you give to avoid failure in dropshipping?
Avoid failure by choosing a niche with strong popularity and low competition, backed by reliable data. Plan for unexpected costs like increased ad spend or delayed goods deliveries, and maintain strong relationships with your partners. A consistent, strategic approach can help you scale and grow your side hustle.
How does dropshipping compare to wholesale or retail businesses?
Dropshipping allows entrepreneurs to start with minimal investment compared to wholesale or retail models. While you avoid managing logistics or inventory, the trade-off is thinner revenue margins. It's ideal for those prioritizing low-risk and high flexibility.
Summary
Before we go, we've created a quick summary of this article for you so you can easily remember it:
- Dropshipping can be a good side hustle, but it’s not a quick or easy way to make money. It requires a solid strategy, time, and effort, especially during the initial setup phase.
- Many beginners believe dropshipping is a hands-off business, but it actually involves regular tasks like managing suppliers, processing orders, and handling customer inquiries.
- It’s possible to manage a dropshipping business alongside a full-time job by automating routine tasks and dedicating specific hours each week.
- Choosing the right products (for the right audience) is absolutely crucial! Look for items with good profit margins, high demand, or a unique 'wow factor' that grabs customer attention.
- Be aware of risks like low profit margins, dependency on suppliers, and legal obligations. Understanding these can help you prepare better and avoid common pitfalls.
- Dropshipping isn’t a passive income stream, but with the right systems in place, you can reduce the amount of time you spend on daily operations.
Final thoughts
We hope this article has shown you that it’s absolutely possible to grow your dropshipping store from a side hustle into a full-time business with enough time and dedication!
Yes, it can be challenging, but many dropshippers have successfully made the transition, and you can too!
As long as you’re realistic about the commitment required and willing to learn from mistakes along the way!
Want to learn more about dropshipping?
Ready to move your dropshipping store to the next level? Check out the articles below:
- 9 Checkout Examples From Ecommerce Stores | Inspiration
- 67 Best Dropshipping Products to Sell in Your Store in 2024
- 10 Most Common Dropshipping Mistakes & How to Avoid Them
Plus, don’t forget to check out our in-depth guide on how to start dropshipping here!
