Dropshipping – Part III

This last part of the article focuses on the things you can do to improve and remain competitive after you have started up your business.

Knowing Your Competitors: Know thy self. Know thy enemy. A thousand battles, a thousand victories (direct translation was a hundred battles, a hundred victories – 知己知彼,百戰百勝). The business scene is like a battleground, and hence you may have heard people employing certain tactical strategies in the field of business. Chances are your business will not be a monopoly. What you can do, many others also can. Know what is the differentiating point between your competitor and you. Is it a competition of price, or of the best service, or of the speed in getting the latest product? Someone once told me that first thing in the morning everyday, he needs to have a report on his table showing his company’s and his competitor’s company’s latest situation. The report consists of sales clocked, promotion by competitors, pricing changes by competitors, marketing changes etc. His business was selling a specific type of gadget. One day his team noticed that his competitor put up a banner which said something along the lines of: Our gadget is certified using the internationally recognised xxx method! Immediately his team took action and also plastered a banner at their own storefront within an hour, saying something along the lines of: Our gadget is customised for local use, certified with the highest authority in the country in this field!

Actions must be fast. Counter-measures must be targeted, or you will find yourself losing customers. To do this, you have to know your product and your competitors’ very well. In this case, they were one step ahead. They knew their competitors well enough to know what they would do, and prepared beforehand. When the competitor took action, they could respond very quickly, rendering the competitor’s actions useless and turning the tide in their favour once again. This is the level of dedication and homework they need to do in order to stay competitive. While this is one of the many fights between the top sellers, it is a lesson which we could also learn.

Memberships: Memberships are an additional feature which you may wish to consider in the future. There are a few benefits to starting a membership. First, you collect membership fee every year. This is an additional source of income for your business. Secondly, with a difference in member and non-member prices, customers who buy more may be enticed to sign up for a membership to take advantage of the lower member prices. But what is most important is this: once they have signed up for a membership, they will be somewhat ‘bonded’ to you. Because there is a ‘sunk cost’ or an ‘investment’ into your business, they will remember you the next time they need this particular product you are selling. They will feel they need to come back to you to make full use of their membership. It tightens the bond between you and them. Remind them frequently with your advertisements and marketing mentioned in the earlier posts and you will slowly build up a decent customer base.

Payment Methods: Always make things easy for your customers in every area. Make it difficult for them, and they will be irritated and they will run to other shops. Worse still, they will spread negative things about your shop, which you probably will never know and can never do anything about their actions. In this paragraph we will focus on payment methods. Some online shops accept only internet banking, most accept credit cards too. There are a rarer few that accepts crypto currency. The more payment methods you open up, the more customers feel it is easier to shop with you. For Western shops which wishes to appeal to the Chinese customers, some even went as far as setting up Alipay and Wechat payment options, making things very easy for the China market. It is worthy to note at this point that the credit card take up rate in China is very low. Giving customers payment options which others do not have, while is not a necessity, certainly has a bonus point factor. Afterall, isn’t attracting customers a series of plus points all stacked up together, creating that mini difference between you and the competitor?

I once wanted to buy something expensive from an online shop. Unfortunately the seller only accepts internet banking and crypto currency payment. I wanted to pay by Paypal or credit card (which by now should really be a basic payment function in all shops), which was turned down because they simply ‘do not have this option’. I was worried about the transaction because, what if after I paid, I get nothing? There will be nothing I could do to claw back my money. I would be totally unprotected. In the end, I refused to buy from them despite multiple attempts on their part to connect with me. Maybe they really are a scam, but if they are not, then they certainly deserve to lose customers.

Customer Experience: Customers’ experience is an important thing to take note of. Often times I had to buy things for customers on different platforms, and many are legit horrible and difficult to use. They pissed me off and I know I will never go to them again, unless it is the customer who requires it once more. For example, there was one platform who insisted all customers to download their app when they already had a website in order to check out and pay. I mean, why do you want to force your customer to download an app they do not want? Put an app up as an option for convenience, not stuff it down their throat. I was so pissed off I deleted the app immediately after the transaction was done.

Some websites are designed so messy and cluttered that people feel irritated. There were some websites which I had a hard time navigating. Websites do not need to be fanciful (although it will be good if they are). But they must be organised and easy to navigate. When they feel happy shopping with you, they will come again. Ask for feedback frequently, be it from your own circle or from your customers. Treat each feedback seriously. Stand in their position, not how you like it to be. Your preference may not be the customers’ preferences.

Do you feel irritated when you see the above website? Messy, cluttered with things all over the place. The colour matching and layout are also horrible. Please do not do that.

Customer service: It is also part of the customer experience. You meet all sorts of people – some are straightforward, some ask a lot of questions and do not buy, some are downright stupid and uncultured, some comes with attitude problem. You are your own boss. You decide how you want to deal with them. But always remember, pissing off a customer means they will never come back again, which means a loss of sales. There are before sales and after sales service. After sales service generally deals with defective or lost products, or even problems such as how to use the products. If something goes wrong, and you try your best for the customers to help them resolve their problems, most will be appreciative. It will increase the likelihood of them coming to you again when they need something you sell.

Of course, there is no iron-clad law to say customer is king. I have personally scolded and chased away customers too because they were just too much. You will definitely come across these people. In business, every decision directly relates to cost and profit. Like I said, you are your own boss. You are free to do what you want to, just be aware and ready to accept the consequences.

Ease Of Contact: Make it easy for customers to contact you. Some only have a feedback form on their website, which I do not like if you ask me. Add a few more contact methods. Be it Whatsapp (go register another number if need be), Telegram, Wechat, email, or whatever. Do not worry about spam. When you are starting out, nobody will bother to spam you. In fact you will be jumping for joy when there is an enquiry. I personally like it if people put their Whatsapp number for contact. It feels that I can have a faster reply. And, isn’t it easier and more personal to communicate with customers over Whatsapp or Telegram rather than email? Again, stand from the perspective of the customer. A happy customer means more business.

If you are getting another number for Whatsapp, register for Whatsapp Business. There are added functions to it, such as the automatic greeting and away message which you can set. You can also add more details about your business in the profile section, as well as an imperfect but still somewhat useful catalog section. I would say it is a great app to communicate with customers. That being said, marketing would still be more efficient over Telegram as a broadcast channel or a group in Whatsapp is only limited to 256 people. I have tried it, and thought the restrictions are too much.

Conclusion: Of course, there are many tactics and things to take note of for a successful business. But do these well, and you will be on your way to at least some achievements. All these will not get you to be anywhere near a multi-million dollar business. But it will certainly get you off to a decent start. Any further, you will have to use your experience, knowledge, decision making and courage to carve out a path for yourself. Afterall, while there are textbook answers to get you started and running, there are no textbook solutions to get you flying. You will have to depend on yourself, to create a customised solution for yourself, to walk down a path nobody else has walked. Only then, can you differentiate yourself from the rest and set yourself apart. But that will be far off in the future. For now, perhaps get started on what you can do first.

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  1. It’s always important to let your customers contact you. I stick with businesses with good customer service and give up on the ones without it.

  2. My husband has been wanting to do dropshipping for years. Reading all your helpful information is very encouraging. I’ll share your article with him.

  3. These are all really great and helpful advice. This is a really great and very informative post thanks for sharing this with us

  4. This is some great information, whew drop shipping can be a pain in the butt at times. Good customer service is vital to any business and if I find your business don’t offer it, I will not shop with you any longer.

  5. Part III of your dropshipping series delivers valuable insights and tips that are essential for anyone in the e-commerce game. Thanks for sharing this expertise!

  6. My husband and I, are planning to have a drop-shipping business, and I have read a lot of good and helpful advice from this post.

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