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Dropshipping 101
A Step-by-Step Guide to Understand the Dropshipping Business
By Frederic Gosset Posted in Non-fiction 13 min read
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Dropshipping 101

by Frederic Gosset

available on Amazon


Thank you for choosing to read Dropshipping: The Beginner’s Guide To Passive Income Using E-commerce, Amazon FBA, Affiliate Marketing, Facebook Advertising, and Instagram. Who wouldn’t want to quit their regular 9 to 5 job to start their own business? The very thought of being your own boss is quite tempting; however, it’s not uncommon to hear about someone dreaming big, not following through, and ultimately giving up on their dreams. Starting and managing a business is not an easy venture. However, if you’re interested in giving your business a try, but you aren’t ready to make a huge investment or give up on a regular paycheck, at least not yet, then this book might be exactly what you need. To start a business, you often require huge sums of capital. A lack of capital is often the primary deterrent to why many people never get entrepreneurial ventures off the ground. However, the introduction and advancement of e-commerce technology have changed all this. Our 21st-century-world is dominated by e-commerce in just about everything we do and experience. And because access to this and other technologies has lowered barriers to entry for so many, you no longer need unrealistic amounts of money for capital; all you need is a good idea and the motivation to make it real. Dropshipping is exactly that one innovative and very accessible approach and tool you can use to feed your entrepreneurial spirit. Regardless of what you know, or even what you think you know about dropshipping, this book will be a key resource for concepts both new and known.     Everything you need to launch and operate a successful dropshipping business is covered in this book. Topics such as the numerous advantages it offers; the proper steps to setting up a dropshipping business; selecting the right niches, products and suppliers; using affiliate marketing; Amazon FBA; and many other useful and important areas. If you’re willing to put in the required time and effort and maintain the necessary consistency, you, too, can set up a potentially lucrative dropshipping business to generate that passive income stream you’ve wanted to create for yourself. Now, if you’re ready to make that dropshipping dream a reality, let’s start right now!

Chapter 1: About Passive Income

What is Passive Income?

The premise of passive income is to create a source of income that generates money for you, but with as little effort as possible. It’s often done as an addition to another job, but with something like dropshipping, if you can make it your primary income source, you must be doing something really well. A common misconception about earning passive income is that it takes absolutely no effort to do it. Nothing could be further from the truth. More often than not, the most successful passive income earners are very busy people, and they wouldn’t hesitate to tell you as much. Earning passive income takes dedication, commitment, consistency, patience, and plenty of hard work. There are certain routine requirements of every business that need attention on an almost daily basis. Ideally, your choice of passive income business would contain as much automation built into these processes to reduce the amount of time they take up. Inherently, that is the purpose of a business being “passive”. It gives you the freedom to step away from certain repetitive, workrelated tasks to create a self-sustaining stream of income. But before you can start earning passive income, you must set up the business, invest enough initial time and energy to create or sell a product, and then continue seeking to automate that system, thereby minimizing your physical involvement. The great thing about passive income is that it gives you complete autonomy to leverage your time and invest as much or as little as you want. Dropshipping is a great way to earn a passive income, but be prepared to put in the effort.

Benefits of Passive Income

Hello autonomy

If you’re tired of working for or under someone else, establishing your own business is a great way to remedy your situation. A dropshipping business is a great way to have autonomy over an entire business you can call your own. Working for yourself means that you run things the way you want to run them. Decisions about things like direction, marketing and scope are yours.

Goodbye mediocrity

Some large organizations don’t often encourage their employees to excel in whatever they’re doing. And many employees tend not to care because they don’t believe their excellence is important enough. Besides, in a huge company who’s going to notice? A dropshipping business helps you to see the relationship between excellence and results. In other words, the more you put into the business, the more money you will actually see at the end of the day. Because you’re driven by your own motivations, instead of the words of a manager looking over your shoulder, your business rises past mediocrity. You can see the excellence you put into it.

Work culture

More often than not, in a full-time job you don’t get to choose the environment in which you’re hired to work. Regardless of whether you like your colleagues or hate them, changing your situation usually isn’t an option. When you start your own business, the culture and environment are yours to create. You get to choose where and with whom you work. You can hire others to work for you, or you can stay a solo dropshipping entrepreneur. A happy work environment and your individual investment in your business is a recipe for success.

Tax considerations

Depending on where you live and work, income tax requirements should be a top consideration. As a business owner, rather than an employee, it might be more advantageous for you to consider the passive income dropshipping business route. For example, if you work out of a home office, in some jurisdictions, your rent or portions of your mortgage might be exempt from any number of tax requirements. Of course, it would be a good idea to hire a professional accountant to better understand how it works for your dropshipping business.


If earning passive income is your chosen direction, instead of a regular, full-time job, you can expect to be the master of your own schedule. You’re free to work whenever you want or take a month-long vacation. You could even do both of those things at the same time. With so many systems now being automated, you don’t really have to be on top of everything all the time. The flexibility of a dropshipping business can be achieved with a laptop, smartphone and a decent internet connection. You could be sipping a Mai-Tai cocktail and making money right now!

Laid off no more

These days, job security is about as common as actual pink unicorns. Even if you’ve been with a company for 20 years, there’s no guarantee that you won’t be laid off or “right-sized” tomorrow. When you own your business, no one can fire you but…you. As long as your business is running and is making money, you will always have a job. Say goodbye to the dreaded pink slip and hello to the adorable pink unicorn!

Love your work

It’s been said by countless business thought leaders and ancient philosophers: “Do what you love and you’ll never work a day in your life.” Nothing could be further from the truth with a passive income stream generated by dropshipping. If you’ve taken the earlier advice of finding a niche you enjoy, you’ll be fully invested in your business. When you turn your passion into your work, you’re a step closer to the kind of success you’ve always wanted. There are various benefits of passive income, and it goes beyond financial independence. We hope you decide to head in this direction.

Chapter 2: The Mind of a Passive Income Earner

Work Ethics

You have complete autonomy when it comes to creating a stream of passive income like dropshipping. However, if you don’t first understand and adopt the mentality required of you while you seek out your financial independence, you’re setting yourself up for either a very difficult journey or one of failure. Perhaps you’re already in this frame of mind. Or maybe you have some work to do on yourself. Either way, keep reading if you want a better understanding of what you’ll be facing and the mental workout you should prepare to have.

Mindset matters

Before starting a business, getting inside your head to understand your motivations might help you prepare for many situations. Perhaps making an actual list of motivations can help you articulate. Do you want to earn money? Are you ready to quit your job? Is becoming a decision-maker important to you? Money is certainly important, but it shouldn’t be the only reason you get into a dropshipping business. A customer-loving and value-centric work ethic, as well as a positive mindset will help you on your journey to running a passive income-generating business you love.

Competition is constant

There will always be someone competing for dominance in business. And on the rare chance you corner a market in something, chances are someone will do their hardest work trying to become better than you. This is why you not only need to be on your guard all the time, in a sense you have to be clairvoyant–you need to know your competitors’ next moves and stay ahead of those. This is a game of chess with no end in sight. As a dropshipper you must always keep up-to-date with your niche, including the other dropshippers in that space. There’s no “set it and forget it” in dropshipping!

Customer service is fundamental

Regardless of how brilliant your business idea is and how revolutionary the products you are, if you aren’t catering to your customers’ needs, you might as well cease all business operations. You must always work on building trust and positive relationships with existing and prospective customers. Establishing a strong and loyal customer base at the outset will boost your credibility and authority within your niche. Providing quality service to your customers should be one of your most important business goals.

Practice makes money

If you’re expecting to become an overnight success as a dropshipper, you’re going in the wrong direction. It takes quite a bit of work and dedication to build something up to the point where you can just sit back and count your money. As with any endeavor, it takes practice and the chance of failure to become successful. It’s okay to make mistakes–it’s a great way to learn. Prepare to put in the effort and be disciplined enough to create a business that generates a decent passive income. If you lack the drive and motivation to stick to it, you might as well keep working for someone else.

Financial responsibility

As a single business owner, there is no one else to share financial burdens. And on the more encouraging side of that coin, every bit of profit you earn is yours. You must be prepared to make sound financial decisions and take calculated risks while assuming financial responsibilities that come with starting a new business. It’s always a good idea to prepare yourself for financial difficulties, but if you spend all your time calculating and not doing, you risk missing your opportunity to become successful.

Accountable to who?

When you decide to start your own business, your only accountability is to yourself. No one else is regulating your work schedule or performance on any given day. A day of procrastination could be the cause of lost profits. You are your own boss. Create small, measurable, achievable, realistic, and time-bound goals for yourself and the business. These goals will provide a sense of direction and keep you on track and in focus.

Forget about shortcuts

There’s a difference between looking for the easy way (shortcuts) to do something and building systems in a business to ensure things run smoothly. This is true with a dropshipping business, especially because of how much it depends on automating systems. But rest assured, these are not the same as finding a way to cut corners. If you see a self-proclaimed expert telling you how easy it is to make quick money, run the other way. Unless they’re recruiting you to rob a bank or they know something about next week’s lottery numbers, they’re feeding you myths. There’s no shortcut to success. Be prepared to work.

Be objective

Emotions are wonderful to have. But in a business like dropshipping, you might consider leaving them out. Staying objective within your business will ensure you always make rational and informed decisions based on solid data and hard facts. You can (and should) “trust your gut” every so often, but your business practices and decisions should be based on evidence and intelligence. You can definitely feel passionate about what you’re doing, but it should not be the reason why you make a decision.

Ask for help

Everyone could use a little help. There’s no shame in asking for it if you need it, especially when it comes to doing something you’re not experienced in, such as accounting or marketing. If you feel like you’re going wrong somewhere, talk to others in the dropshipping world. It’s always good to get a fresh perspective – or BE the fresh perspective – in any given situation.

Know when to stop

A successful business person knows when to stop. If something isn’t working, move on. Stop trying to salvage the unsalvageable. If a plan isn’t working, then change tactics to see what works for you. Learn to cut your losses before things get worse.

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