How Much Money Do You Need to Start Dropshipping? ($100? $500? $1000? $3000?!)

We answer the question: how much do you REALLY need to start dropshipping with Aliexpress?
►► Free $10,000/Month ebook:
►► Step-By-Step Dropshipping course:

***OTHER LINKS/VIDEOS REFERENCED***

►► Start Dropshipping with $50:
►► How to Create a Shopify Store:
►► 8 Side Hustles:
►► Free Logo Maker:
►► How to Pick Products with Fred Lam:

When dropshipping, you have 3 major costs/expenses/things to budget for:

1) Setting up your store.
2) Marketing your store and testing products.
3) Purchasing the products that customers buy.

***How Much Does it Cost to Create a Store?***

Most viewers watching this video will be looking to build their store with Shopify. That means it will cost $29/month for the subscription, and then $14 for the domain name. That means you need just $43 up front.

However, there are two optional costs that are good to consider:

1) Purchasing a logo from Fiverr for $5.50

To build your store, you will need a logo. You can make a logo for free using a free logo maker. But a professionally designed logo will look a lot nicer in your store. For such a low cost, it is well worth it if you can afford it.

2) Purchasing an Upsell Shopify Plugin for $47/month

The SMAR7 Bundle Upsell is very beginner friendly. But it’s also more expensive than a Shopify subscription! UGH! However, once you stumble upon a winning product, putting upsells on top of it will more than pay back the cost of this plugin.

So what you can do is you can leave this off your buy-list and purchase it once you’ve found your winning product. You can then install this app and then put an upsell on top of your winning product. You don’t need to buy it up-front.

***How Much Does it Cost to Market & Test Products?***

While you can use free traffic sources, they are slow. To take advantage of paid traffic, it is going to cost you money. In this video, we discuss Facebook ads. We recommend being prepared to test at least 20 products.

When we say “test products” with Facebook ads, we mean adding a product to your store, and then running a small ad for it on Facebook promoting it. If the ad is profitable, you scale that item up and it becomes a “winner.” If it loses you money, then you kill the ad and test something new.

To run ads, I normally recommend starting with a $5/day budget and running it for 4 days. That means that each test will cost $20/product. So to test 20 products, it is going to cost $400. Along the way it is very likely you’ll make some sales of products even if they turn out to be “losers” – but it’s good to budget for this just in-case.

If this is quite a lot of money (we understand!) here are some tips for you:

1) Plan to split it up over 2-3 months. You don’t need to run all of the 20 product test at once: you can do it gradually at your own pace.

2) Use side hustles to save up the extra cash. It will definitely be work – but it is well worth it. There are ways to pick up jobs from home and to save up this money to reinvest into a business.

***How Much Does it Cost to Buy Products Customers Purchase?***

Something that a lot of people don’t talk about when discussing this question is the cost to purchase items that customers buy. If you spend all of your startup money on marketing & setup costs, then you’ll have nothing left to purchase the products customers buy. And if this happens – your business is sunk!

Unfortunately, money that customers pay you will not be send to you instantly. Stripe pays out every 7 days, and PayPal is likely to hold your money for 3 weeks (potentially more) until they trust you. This means you’ll need to have money prepared in the meantime to pay for items until the money the customers paid you has cleared.

One of the most common reasons new businesses fail is due to cash-flow issues. If you don’t want to be part of that statistic, then make sure you prepare in-advance by doing one of the following:

1) Have a credit card. You will get the money the customers paid you well in-advance of when your payment will be due on it. Plus you’ll get bonuses too (such as free air miles and cash back rewards to offset fees).

2) Have a debit card with $200-300 on it prepared in-advance to purchase the items from Aliexpress.

36 thoughts on “How Much Money Do You Need to Start Dropshipping? ($100? $500? $1000? $3000?!)”

    1. Dino Derp News

      Hunter Talks hey I know it’s been a year since you posted the comment but did you have to pay taxes ?

  1. Hey guys – don’t be shy, if you’ve got any questions please ask them. We’ll try and answer as many as we can 🙂

  2. Sarah, you really make my day whenever I watch your videos. You are a very good human being . Thank you for your all the information that you have given to us and thank you to your team members too. Keep sharing.
    Help if you can, teach if you learn, give if you earn;)

  3. Life In Chiang Mai

    Good video. I use my credit card for my dropshipping business, then pay it off when I receive my PayPal money. It gives me a lot of reward points on my credit card, so I can fly free or upgrade to first class. Keep the videos coming…

  4. Sanjay Santosh Patil

    You are only one of those who explained cashflow.
    Great effort Sarah
    Will definitely follow yoir guidelines

  5. 10:00 cash flow. Excellent job. I ran a small business for 10 years and you have to play the cash flow game. You get comfortable after a few years when you know you’ll pay yourself back lol. I was seasonal too so I had to budget for winters off. Thank you very much.

  6. OMG thank you so much for this video ! I was planning starting amazon FBA but currently i only have 550 euros saved up and i’ve heard that you need at least around 1000/2000 to start on there so i got really discouraged.. this dropshipping could be ideal for the money i currently have saved up tho 😀 i’m so excited and will watch more videos on this subject !

  7. Godspower Emmanuel

    I love this lady, she opens up the dark secrets in dropshipping Business that others won’t talk about, it’s better to know ur challenges and prepare for them than to be taken unawares

    Thanks ma’am, I love you

  8. Hi Sarah, I have just started watching your videos and I truly have to admit that I have learned a lot and also enjoy the accent 🙂 God bless you for the great job you do…thnx

  9. Having watched numerous channels talking about this, I like you – you’re honest and provide useful information without too much waffling.

  10. I just started watching your videos and I love them so much! Thanks for all the content you put out there I’ve learned so much. I’m currently working on a plan of action to start my very own Drop shipping business so I don’t have to work at a part time job anymore to focus on school

  11. carlzcomedystuff standup

    I’ve been told my whole my life every time I talk about working for myself that I’m basically too basic…Im 30 and I’m tired blue collar worker who feels 50… I got very little education and appreciate people like you putting this stuff out

  12. Damn. Your channel gives such an impressive vibe. It almost makes me trust it as much as BBC! Thank you for being considerate with your research and helping new dropshippers understand the value in it.

  13. Questions, how do you push your distractions out of the way so you can actually do your work? Also it would really cool if you could show us your daily routine for work and how it’s functioning for you. Thank you Sarah, your videos are fantastic

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