Are you someone who is looking to start a side hustle? If so, you are likely considering getting started with private label dropshipping.
And if you are, then you have done a great job on finding this article and doing some research on private label dropshipping before taking the leap.
If you want to get started with private label dropshipping as a beginner, there are a few things you should know beforehand.
For example, you will need some money to start with. Since you will be building a genuine brand and your products will come with your own branding, starting a private label dropshipping business requires a relatively high budget.
Secondly, you must be prepared to work hard and learn more than you ever thought you needed to know.
Today, I will guide you through five simple steps that will allow you to get started with private label dropshipping. Not only that, but they will also give you a jump start!
Dropshipping vs. private labeling: What is the difference?
Private label dropshipping. If you have never done it before, you will definitely find some key differences compared to ‘normal’ dropshipping.
However, due to those key differences, private label dropshipping allows you to benefit from several advantages.
So, are you curious to hear the differences now?
Well, the difference between dropshipping and private labeling is that with private labeling, you sell products that are marked with your company’s brand. This can be done by putting your company’s own logo on the product and packaging.
A simple example of a private-labeled product is a SPA bottle:
As you can see, this product is branded by adding SPA’s (private) label to the bottle.
By branding the water bottle, the company is able to evoke a recognizable feeling for its customers. Because of this, people are tempted to buy the SPA water bottle rather than a different non-branded water bottle.
In the end, SPA can ask for a higher price compared to a non-branded water bottle because of their private label.
With private labeling, you are the only one selling your product. It belongs to your brand. Unlike dropshipping, no others can just hop on AliExpress and buy the exact product you are selling.
Because with the complete private labeling approach, your product will come with a unique:
- Brand name
- Brand identity
- Custom (branded) package
- Branded invoice
I hope you’re now a bit more familiar with the difference between dropshipping and private labeling.
However, if you feel like you could use a bit more explanation, then I have some great news for you.
Normal private labeling vs. private label dropshipping
Wait, we are not done with explaining all the definitions just yet!
When it comes to private labeling, you will find that there are two separate business models that you may come across.
First of all, there is the “normal private labeling” business model. Secondly, there is the “private label dropshipping” business model.
For both business models, your products are equipped with a private label, meaning they are branded.
So, what’s the difference?
Well, the difference sits in the fulfillment method of the business model.
For normal private labeling, you first search for a supplier that can private label the product you are looking for.
Then, you order that product in bulk and ship them to either a third-party or private fulfillment warehouse. When you get an order, you have the product in stock and should send it to your customer yourself.
When doing private label dropshipping, you don’t have any of your products in stock.
In this case, you work with a private label dropshipping supplier that can add a private label to the product you sell one by one (only if you get orders for it).
Private label dropshipping has less risk to it, but because it is a lot of work for a supplier to private label a product one by one, you will often have a hard time finding such a supplier, and the products from these suppliers will be more expensive compared to when buying them in bulk.
If you’re interested, then you can learn more about this here! That article contains everything you need to know about minimum order quantity (MOQ).
Now that you know the difference between these two, let’s take a look at whether or not you should start a private label dropshipping business:
Should you start a private label dropshipping business?
If you are still doubting about whether or not to start a private label dropshipping business, then let me try to help you make a decision by telling you about some of the pros and cons of private label dropshipping.
Some people are very optimistic about private labeling since it can bring some great benefits to your business compared to regular dropshipping.
So, let’s start by discussing the pros of private label dropshipping!
The pros of starting a private label dropshipping business
First things first, a private label dropshipping business can allow you to sell practically the same product for a higher price.
When adding branding to your product, you will often be able to increase the product’s perceived value.
Curious how that works?
Well, take a look at the soaps that are sold by the brand Dr. Squatch:
As you can see, they charge $7 for a bar of soap. Looks pretty cool, doesn’t it?
But wait, what would you think if you would see a bar of soap in the supermarket that looks the same but comes with plain plastic packaging.
In that case, would you pay $7 for a bar of soap?
Not really, right?
By using private labeling, Dr. Squatch is able to adapt its pricing strategy and charge customers a premium price for its products.
The second benefit of starting a private label dropshipping business is that competition will become a bit less of a worry.
Since your product comes with your own label, no one will sell the exact same product as you. Because of this, customers are likely to stay more loyal to your brand, which is the third advantage of a private label dropshipping business.
If your customers like your product, they can’t simply go to a competitor’s store to buy it for a lower price. You are the only vendor for your product!
The cons of starting a private label dropshipping business
At this moment, starting a private label dropshipping business sounds like a great idea, but don’t forget about the other side of the story.
Starting a private label dropshipping business comes with a few cons as well that can make it harder to do, especially for beginners.
First of all, it’s simply a harder and more complicated process to go through.
You will have to find a dropshipping supplier that can manufacture your private-labeled product for a good price and ship it to your customers in a respectable time frame.
Besides that, you will have to spend time branding your business. Creating a story of your brand, designing your own label, packaging, and everything else. It simply takes much more effort to do.
With regular dropshipping, finding a supplier is much easier, and when you have found one, you can start selling their products within a few days!
Another benefit of private labeling is that the products will generally be more expensive to buy from your supplier, as they require more work to produce. Things like a custom logo and packaging take extra time to manufacture, so it will drive up your cost of goods sold (COGS).
Additionally, some suppliers will even ask you to purchase your private-labeled products in bulk before you have sold them. This is because, for some suppliers, it’s not worthwhile to produce these unique products one-by-one.
All in all, the decision of whether or not to start a private label dropshipping business will depend on your experience, budget, and discipline.
If you already have experience with dropshipping, a relatively high budget, and the discipline to keep on going in difficult times, the chances of creating a successful private-labeled brand will greatly increase.
However, if you are just starting out with dropshipping and don’t have much money to spend on building your business, it may be a better choice to start with a regular dropshipping store.
After all, don’t forget that a regular dropshipping store can be transitioned into a private labeled brand later on as well if you have found a winning product!
How do you get started with private label dropshipping?
If you love the idea of getting started with private label dropshipping after weighing the pros and cons, then it’s time for some action!
A private label dropshipping business will allow you to increase your product’s perceived value, differentiate yourself from the competition, increase your customer loyalty, and build a genuine brand.
While the overall picture of starting a private label dropshipping store will closely resemble the steps of starting a ‘regular’ dropshipping store, there are some aspects you should put extra focus on.
In the following section, I will guide you on how to get started with private label dropshipping by showing you the process in five simplified steps. For a more detailed guide on how to start a dropshipping store, you can visit this article.
Let’s get started:
1. Brainstorm about your niche, product, and audience to target
The first step of getting started with private label dropshipping is thinking about which product you are going to sell and which audience or country you are going to target.
By making a decision on these two things, you will have a much easier time doing the second step, which is finding a private label dropshipping. That’s because you will know what niche and/or supplier location to look for.
I recommend picking a dropshipping niche that interests you or that you are passionate about, especially if you are a beginner.
Picking a niche that interests you will make working on your store a lot more pleasurable. You will learn more about your topic of interest, and it will motivate you on days when you are struggling not to give up and always keep going until you succeed!
You will be able to find some ideas for dropshipping niches in our article about the 25 best dropshipping niche ideas.
For example, you could build a business around the:
Besides looking at niches, you could also directly think about possible products to sell on your store.
Remember, a logo can be added to almost every product that exists, so pretty much anything can be private-labeled!
To find out what is possible and get some inspiration, take a look at our article featuring 14 great private label product examples for dropshipping.
The products in that article are chosen based on the characteristics of winning dropshipping products. Remember, a product should have good profit margins, a “wow” factor, and/or solve a problem.
Interested to see an example already?
Well, here you go!
This is a teeth whitening kit sold by Hismile for $129.
Meanwhile, you can find similar (non-branded) kits on AliExpress for less than $20!
Disclaimer: If you are a beginner, take a look at our list of niches to avoid before picking a product. Products in the health niche (like this teeth whitening kit) are not recommended for beginners since there is a small chance they might cause damage to someone. You are liable for the products you sell, so be careful with this!
If you would like to see more private label product examples, check out this article!
After looking at your store’s niche and product, there is one more question to answer.
Which countries are you going to target?
You may want to build a worldwide dropshipping store, or focus on one specific country.
While building a worldwide dropshipping store is definitely possible, you may be able to imagine that not every country will respond as well to your Facebook ad or your product page.
In other words, your store may generate high profits when advertising in one country, while being active in a different country may lead to a loss.
If you want to learn more about the best and worst countries to target as a dropshipper in 2021, just check out our article here!
2. Find the right private label dropshipping supplier
Once you have a product, niche, and/or target country in mind, you can start your search for the best private label dropshipping supplier.
Unfortunately, these suppliers are often hard to find, and sorting the good from the bad can be daunting sometimes.
Finding the right private label dropshipping supplier can be done in two ways.
First of all, you can take a look at our ultimate list of the best private label dropshipping suppliers in 2021.
In this article, you will be able to find both paid and free private label dropshipping suppliers that can help you to get started with your private label dropshipping business.
An example of a private label dropshipping supplier featured in the article is Dripshipper, which allows you to start a coffee business in just one day:
Another cool supplier you can take a look at is called Dropified, which is a supplier that offers products in niches like supplements, CBD, skincare, and more:
To make it easier for you, we made a table showing all the featured private label dropshipping suppliers in the article we mentioned above.
First, here is an overview of the suppliers that offer products in all kinds of niches:
|Supplier||Private label features||Region||Pricing|
|AliExpress||Custom logo, packaging, and invoice||Worldwide||Free|
|Alibaba||Custom logo, packaging, and invoice||Worldwide||Free|
|Wiio||Custom logo, packaging, and invoice||Worldwide||Free|
|HyperSKU||Custom logo, packaging, and invoice||Worldwide||Free|
|SupplyMeDirect||Custom product label/logo||China, US, UK, EU||Free|
|BigBuy||Custom packaging and invoice||EU||€69 / month + €90 registration fee|
|DropCommerce||Custom invoice||North America||$49 or $89 per month|
And, in case you already have a niche in mind, here are some of the best niche private label dropshipping suppliers:
|Supplier||Niche||Private label features||Pricing|
|Printful||Print on demand||Custom logo, packaging, and invoice||Free|
|Dripshipper||Coffee||Custom logo, packaging, and invoice||$30 per month|
|Dropified||Supplements, CBD, Skincare, Coffee & more||Custom logo, packaging, and invoice||$497 one-time or $97 per month|
|TeaSwan||Tea||Custom logo, packaging, and invoice||Free|
|Art of Where||Print on demand||Custom logo, packaging, and invoice||Free|
|Power Body||Fitness nutrition||Custom logo, packaging, and invoice||Free|
|AOP+||Print on demand||Custom logo, packaging, and invoice||Free|
|BTS Wholesaler||Beauty||Custom packaging||Free|
If you didn’t manage to find a supplier that meets your needs in this list, then don’t get bogged down just yet.
As I said, this was just the first method of finding private label dropshipping suppliers. By simply using a search engine like Google, you will be able to find more suppliers yourself!
A great strategy for this is using the following search structure:
Private label + product keyword + no minimum + country
For example, when I search for “private label yoga mat no minimum USA”, I get the following results:
Now, let’s take a look at the first result that pops up:
There you go, a new private label dropshipping supplier. Easy as that!
3. Create your private label dropshipping store
Once you have found a promising product to source from a supplier, you can start building your private label dropshipping store around it!
For beginners, this can become quite a time-consuming process (especially if you are going to build a private label store!), which includes steps like:
- Creating a (Shopify) account for your online store
- Designing your logo
- Creating a private label for your product
- Branding your store
- Adding apps to your store
- Writing product descriptions
- Setting up the standard ecommerce store pages
- And much more!
While this may seem like a lot, remember that you will have to do most of these things just once.
So, please, don’t rush this step, especially if you are building a branded private label dropshipping store!
By putting time and effort into your store, you can beat your competition and create a genuine asset for yourself.
If you would like some guidance for the general steps of creating a dropshipping store, check out our full Shopify dropshipping guide here. (Warning, it’s long!)
Also, take a look at this checklist before starting to work on your store to make sure you didn’t forget anything!
4. Launch your online store
After all your hard work, it’s finally time to launch your new private label dropshipping business.
Before launching, it’s important to do a last check and see if you have everything in place. For example, don’t forget about:
- A working checkout
- Customer notification emails
- Your order processing
- And everything else you need for a functioning online store!
You could also think about your opening.
Do you want to organize anything special?
For example, you could host a giveaway for one of the products you will be selling.
Of course, it isn’t mandatory to do anything special with the launch of your new business, but it could be an awesome sale booster if you can come up with something unique.
For example, maybe your giveaway goes viral because a lot of people tagged their friends, and now you have a ton of emails that you can later use to promote your products!
5. Build your brand and market your products
You may want to celebrate launching your new business, but don’t think that the hard work stops there.
For example, you shouldn’t expect that customers will just magically find your new dropshipping business online.
After launching, you will have to explore ways to get the customers to your store and build a brand.
Using free marketing methods, you will be able to get new customers to your store without spending any money. If you are interested in these strategies, then read more about eight amazing ways to get free traffic here!
During the marketing of your products and brand, don’t forget to try and continuously improve your online store and branding.
Getting started with a private label dropshipping business can allow you to build a true online brand that can thrive for years to come.
Starting a private label dropshipping store is pretty similar to starting a ‘regular’ dropshipping store. However, the key difference here is that you should put a lot more focus on branding and finding the right private label supplier.
Nevertheless, since the process resembles that of a regular dropshipping store, you will definitely benefit from any previous experiences in creating a dropshipping store.
However, if you decided that getting started with private label dropshipping is too big of a step for you right now, then remember that ‘regular’ dropshipping is still a great business model in 2021.
Also, a dropshipping store can be a great stepping stone to a private labeled brand, both for beginners and experienced dropshippers.
So, if you want to transition your normal dropshipping store into a private-labeled store, I recommend checking out this article for more information
It will definitely help you to get new ideas for ways in which you can brand your store!
Let me know if this article has helped you to get started with private label dropshipping, and don’t forget that if you get stuck on any of the steps, you can always leave behind a question in the comments below!
Good luck with starting your online store!