Is Dropshipping Legal?
If you’re reading this I guess you’ve been wondering what a lot of other people are thinking. So, is dropshipping legal? Yes, why yes it is. We’re not going to end this article here because that would be incredibly short and weird.
If you know me you know I always bring the relevant info. With that said let’s get into it. Dropshipping is not some mystical sales tool. It is simply a business model. If you don’t know what exactly it is, I’ll take a moment to explain.
Dropshipping is an order fulfillment method. It connects wholesalers and customers all over the world. The most popular method is to use wholesalers on AliExpress. This is because the prices are much cheaper than average.
This allows you (the drosphipper) to make a nice profit on each sale. You advertise the products on your store and put them in front of hungry customers.
If your customers decide to purchase the product you simply fulfill their order on AliExpress. The magic is that you don’t have to hold any inventory or stock. The wholesalers located in Asia will take care of that for you.
Dropshipping is completely legal but there will always be people breaking the rules with anything. For example, you need to know your tax laws. They are different for each state in the USA so make sure you do your research.
If you don’t pay your taxes don’t blame me. Most places won’t require you to pay any until you’re making a decent amount of money so I wouldn’t worry right away.
“Is Dropshipping Legal?” You Bet it Is!
The two most popular payment methods are Stripe and Paypal. These platforms have buyer protection which ensures the safety of the customer. This makes resolutions fairly easy to solve. If your customer doesn’t get the product they ordered they will be annoyed (and rightly so).
Make sure you state your terms and conditions on your website clearly. If you don’t offer returns then make sure to let it be known. If you only offer refunds up to a certain number of days, make it clear.
There are undoubtedly problems with dropshipping if you do it wrong. You can risk getting into a pickle if you don’t finance properly. Let’s say you only have $100, to begin with. Then let’s say you spend it all on shoutouts and make $100 in profit.
So you’ve made your money back right? That is right but credit card payments don’t come through right away. You could be sitting at a loss for a number of days. Facebook advertising can get expensive quickly if you don’t know what you’re doing. It will keep charging you until it’s turned off so don’t forget.
Communication Is Key
The vast majority of suppliers are good business people who just want to do right. As always, some try and take advantage of new dropshippers. If they ask for a subscription fee or to preorder in bulk, be careful.
Those are things you really shouldn’t be worrying about it you’re a beginner. They will only cause you headaches at this early stage. Working with a supplier should be simple. Create an effective relationship built on communication and you’ll have nothing to worry about.
So if you’re still thinking “Is dropshipping legal?”, don’t worry. I can reassure it is very legal so long as you play by the rules. Don’t sell anything you know to be trademarked either.
Also, don’t forget to communicate with your customers. They can become impatient and even more so if you don’t respond to their emails. Let them know there is another human on the other side of the screen. Show some empathy for crying out loud.