Branded Dropshipping: Your Step-by-Step Guide

Ecommerce has grown exponentially in recent years, and dropshipping plays a huge part in that growth. Many online merchants use the dropshipping business model, either as a side hustle or as their main source of income.

While dropshipping is a low-risk business model, competition can be challenging. Branded dropshipping has the power, however, to help you stand out from the crowd.

In this article, you’ll find out how branded dropshipping works and how you can set up your own online store to sell your branded products.

First of all, what is dropshipping?

Dropshipping is a low-risk business model in which a business owner acts as an intermediary between customers and a manufacturer or wholesaler. The seller is in charge of marketing and sales, whereas a third-party company keeps an inventory of the products and fulfills the orders.

Basically, the merchant sets up their online store and partners with a manufacturer or wholesaler that will provide the products. Once a customer places an order, the third party receives it and is responsible for packaging and shipping.

The dropshipping business model is particularly advantageous to small entrepreneurs because the seller doesn’t need to worry about developing new products or keeping products in stock, which makes the required upfront investment relatively low. While the dropshipping supplier takes care of inventory and logistics, the merchant can focus on promoting their business and offering quality customer service.

What is branded dropshipping?

Buying products from a dropshipping supplier doesn’t mean your products can’t look like they were designed for your brand.

Branded dropshipping is the process of buying non-branded products from a third party and adding a brand’s label or other elements to them.

How does branded dropshipping work?

When you open a branded dropshipping store, the supplier is still in charge of inventory and logistics. The difference is that they sell unbranded items to you, and once you make a sale, they add your customized label to the purchased products before they are shipped.

Although branded dropshipping can be referred to as white-label dropshipping, there's a difference between this business model and white labelling. In white labelling businesses, the manufacturer is responsible for producing and labelling products, whereas the merchant is in charge of keeping stock and fulfilling orders. The additional responsibility that comes with white labelling increases the initial costs of starting your business, making it a little more onerous for entrepreneurs with a more limited budget.

On the other hand, branded dropshipping is a combination of dropshipping and "white label". For some merchants, this mix can be the best of both worlds. As a business owner, you get to sell products that convey your brand identity, which makes them unique, while you don’t have to worry about logistics and order fulfillment.

Is branded dropshipping legal?

At this point, you might be wondering: is labelling someone else’s product as my own dishonest – or even illegal?

Rest assured, the branded dropshipping business model is legitimate. Once you sign an agreement with a dropshipping supplier that works with white-label products, you are free to add your own label and sell them anywhere, whether in a marketplace such as Amazon or eBay or at your online store.

Is branded dropshipping profitable?

Branded dropshipping may seem less advantageous than standard dropshipping because it comes with the additional costs of branding your business. However, by adding your brand to a product, you make it unique, allowing you to mark up the prices.

Besides, branded dropshipping enables you to increase your profit margins because customers tend to opt for brands they consider reliable. Selling generic products might be a good business model for someone who’s starting out, but if you’re looking to expand your business in the long run, you’ll want to sell products customers can only find at your branded store.

The benefits of branded dropshipping

Now that you better understand how this online business model works, let’s get to another important question: why should you open a branded dropshipping store?

Your business stands out

While dropshipping is a great way to get your foot in the door of online selling, it can be hard to compete with other merchants who sell products exactly like yours, sometimes even with the same photos and descriptions.

With branded dropshipping, however, you create your brand identity and add your own touch to the product, which makes it recognizable and unique.

Branded items also bring another benefit: an identifiable brand inspires confidence in the quality of the product. As customers compare your products to generic ones available in the market, many customers will opt to buy from you because there is a clear brand behind your products – a brand with a verifiable reputation online.

And once you begin to stand out from the crowd and consolidate a good reputation, you’ll be able to build a solid client base and grow your business more easily.

It’s cheaper than developing your own products

Product development is a lengthy process and usually requires a significant financial investment. You’d have to build an entire supply chain by finding resources, hiring vendors, and doing everything necessary before the product reaches the customers. And if you don’t have the skills or resources to create a prototype, you’d have to hire a third party to carry out that part of the process.

Manufacturing products may push your business well above your budget. But what if there’s a manufacturer out there that already makes products like the ones you have envisioned?

By finding a white-label product supplier and adding your label, you get to sell generic products as if they were your own without spending money on product development or order fulfillment.

Branded dropshipping can be more costly than standard dropshipping because you’ll still have to invest in creating a brand name, a logo, a visual identity, etc. However, building a brand image means more brand recognition, which is bound to pay off in the long run – especially if you intend to scale your business in the future.

How to start a branded dropshipping store in 7 steps

Now that we’ve covered the main benefits, we’ve prepared a step-by-step guide to help you build a branded dropshipping store successfully.

1. Choose a niche

Merchants who work with standard dropshipping have more freedom to sell products from any niche. That’s because they don’t have a brand identity to reinforce. When working with branded dropshipping, however, it’s important to select a niche – one that is aligned with what you want to communicate through your brand.

Think of any brand that sells its own products. It’s hard to imagine Tim Hortons selling jewelry, isn’t it? Once you establish a niche, you need to ensure your products and brand identity reflect the niche you’ll be working in.

Your passions should definitely come into play at this stage. For example, if you’re a big sports fan, you might consider selling sportswear. However, you should also do extensive market research and run a competitive analysis to determine what the competition will look like and how profitable your business can be.

Here are a few ways to begin tackling your marketing research:

• Explore social media. Nowadays, you can’t start a branded dropshipping business (or any kind of business, for that matter) without collecting information from social media. Platforms like Instagram and TikTok are a good place to start. Search for keywords related to your niche and locate influencers, potential customers and competitors. Write down everything you find about them: where they live, how old they are, what they love, and so on.
• Use Google Trends. Type in a few keywords and Google Trends will tell you whether users are looking for a particular product or a solution to a problem. Google Trends is great for determining whether a search trend is going upwards or downwards. The tool also helps you identify seasonal products (products that are more popular during a particular time of the year), which will help you confirm whether a product or niche is viable.
• Get insights from dropshipping platforms. Most dropshipping services, such as AliExpress and Amazon, offer lists of best-selling products by category. AliExpress, for example, shows you how many orders have been placed and what the most popular products are. This means you can compare products from each category and identify which categories are in higher demand.

2. Select your products

Once you pick a niche, you’ll have to find products you want to sell and  make sure your products belong in your niche.

While you do your market research to define your niche, you’ll likely come across some product ideas for your branded dropshipping store. However, if you still don’t have a clue about what to sell, we’ve listed some places where you can look for inspiration:

• Social media. Trending hashtags, influencers, and your competitors’ accounts are a good place to start. While hashtags may indicate consumers’ wants and needs, influencers and competitors might give you insight into gaps in the market.
• Your competition. What products are your competitors selling – and what products aren't they selling? In what ways could you offer a better product than them? How could you provide a better solution to your audience’s pains?
• Product reviews. Another source of precious intel is customer reviews and ratings. Locate similar products to those you want to sell and see what people are saying about them. You’ll find that consumers often point out what is wrong with the product, which can indicate how your product can beat the competition.
• Marketplaces such as Amazon and eBay. Browsing through lists of top-selling products on marketplaces isn’t just helpful when you’re deciding on a niche. Those lists provide invaluable information about products trending in a category or specific location.
• Your community. Friends and family usually love to pitch in when someone they know is starting their own business. Why not take advantage of their willingness to help? Focus on those people who fit your target audience and ask them what kind of products they don’t find easily on the market and that they would love to buy.
• Your experience as a consumer. When buying products from your niche in the past, is there anything you didn’t like about them or anything you couldn’t find? What have those purchases taught you? Have you experienced any frustration? If so, what does your product need to offer to not leave your customers frustrated as well?

3. Find branded dropshipping suppliers

After you come up with some good product ideas, it’s time to look for a reliable supplier that works with dropshipping branded products.

Truth be told, finding a good branded dropshipping supplier isn’t always easy. While there are numerous dropshipping suppliers, there aren’t as many who offer white-label products and agree to work within the dropshipping model. Basically, they don’t want to manufacture products without any assurance they'll be sold, and that’s understandable.

Some suppliers might ask to see some proof of good sales records. However, if this is your first business, that doesn’t mean you can’t work with a manufacturer. In those cases, suppliers usually establish a minimum order quantity (MOQ). Platforms such as Alibaba and CJDropshipping are good places to find a supplier for a branded dropshipping store.

But how can you find a good supplier? Here are some questions to keep in mind during your search:

1. Minimum order quantity (MOQ). Check if the MOQ listed on the supplier’s page is correct. If the MOQ doesn’t fit within your budget, ask them if there is some room for negotiation – there usually is.
2. Price of samples. Most suppliers allow dropshippers to order samples to assess the products' quality. Ask them how much their samples cost. Some might offer a discount or even ship the samples to you for free.
3. Manufacturing costs. How much will it cost you to produce each unit?
4. Manufacturing time. How long will it take the supplier to manufacture your product? The longer they need to finish the product, the longer your customer will need to wait for the product.
5. Shipping costs. How much does the supplier charge for shipping? And who will cover those costs, you or the final customer?
6. Shipping time. Where is your supplier located? How long does it take to ship a product from the manufacturer’s warehouse to your target location (i.e. Canada)?
7. Payment terms. Some suppliers require that you pay for orders in advance. Knowing how much you’ll have to spend before selling your branded products is essential to ensure your new business doesn’t go over budget.
8. Customization. Does the supplier dropship branded products? Do they offer private label and custom-packaging services? How much do they charge for them? What other customization options are available (i.e. personalized messages)?

4. Create a brand

It goes without saying that, in order to open a branded dropshipping store, you need to build your own brand. You might already have an idea of what you want your brand to look and sound like, and your personality should definitely be a part of your brand. However, there are other aspects to consider when building a brand from scratch.

• A brand name that is easy to remember and pronounce.
• An impactful logo, in different formats, so you can use them on your labels, custom packages, online store and social media.
• A memorable slogan that conveys your brand’s mission and/or identity (optional).
• Colours and fonts that communicate your brand’s message, appeal to your audience and are in line with your niche.

Once your brand is ready to go, stick to it and make sure it’s everywhere (your products, social media, website, and so on). Consistency is key when you want to increase brand awareness and brand recognition.

Ideally, you’d hire a professional to help you in this process. If your budget can’t accommodate this investment at the moment, though, there are plenty of online brand name and logo generators out there to help you get started.

5. Build an online store

To make sure your target audience finds your branded products, you’ll need to create an online store.

Your store will be the main source of information for customers who want to know more about your brand, so it’s essential to showcase the benefits of your products and is aligned with your brand voice and values.

When building your online store, take the time to do some research and choose the right platform for your business.

Shoplazza, for instance, is a great platform for branded dropshipping stores for a few reasons:

• It’s user-friendly. You don’t need to know anything about coding to set up your store. Shoplazza offers dozens of free templates you can use and customize to make your store look like your brand.
• It’s perfect for dropshipping. All you have to do is install a dropshipping app from one of Shoplazza’s many dropshipping partners, set up your account and start choosing the products for your store.
• It helps you with all the bureaucratic stuff. With Shoplazza, it’s easy to set up shipping and taxing details. Besides, you get to use Shoplazza’s templates for your refund policy, privacy policy, and terms of service.
• It fits within a tight budget. For first-time store owners, Shoplazza provides plans starting at $28/month. And the best part is that you get to try it out for seven days, for free.

➡️ If you’re not yet convinced Shoplazza is the best ecommerce platform for you, find out why Shoplazza is the popular choice for ecommerce owners.

As for setting up, make sure your online store includes the following:

• A homepage that catches users’ attention and is consistent with your brand’s visual identity.
• Product pages with high-quality images and accurate product descriptions.
• A contact page that offers more than one channel through which customers can reach out to you, as well as a contact form.
• An about page that tells your brand’s story and conveys your brand identity.
• A refund policy and a privacy policy.

6. Create labels and packaging for branded dropshipping

This is the stage where you make sure your brand is everywhere.

Getting your target audience to buy and like your product isn’t enough; they need to remember where they got it from so they can buy again from you and refer friends, family and followers to your online store. By designing customized labels, packaging and packaging inserts with your brand name and logo, you reinforce brand recognition, which leaves you a step closer to building a base of loyal customers.

Branded packaging and labels also help give more credibility to your products and store. Many online shoppers out there have had at least one frustrating experience buying generic products. For consumers, the care involved in creating branded products can work as a good quality indicator.

Dropshipping suppliers are responsible for order fulfillment, but it’s up to you to give them instructions for labelling and packaging. Otherwise, they’ll ship your products with no labels and in blank packages, which could hurt your brand reputation.

7. Promote your branded dropshipping business

After going through all that, you can’t simply rely on friends and family to make your store a success. You need to spread the word about your new business.

Implementing a paid advertising strategy might be challenging when you’re just starting out and there isn’t any money coming in yet. Luckily for you, there are ways to drive organic traffic to your store.

First, you’ll want to ensure your website can be found easily on Google, not just by people who type in your brand name but also by users searching for products like yours. As a merchant, SEO will be your best friend. Ecommerce platforms like Shoplazza offer built-in features to optimize your website with just a few clicks.

Once you get acquainted with SEO, consider the idea of starting a blog with optimized content. Blogs are excellent sources of organic traffic and can help you increase brand awareness, connect with your audience, and build customer loyalty.

Many consumers believe that, if a brand isn’t on social media, then it doesn’t exist. Before launching your branded dropshipping store, set up a few social media accounts for your business. This way, people who have heard of your brand can look it up on social media, and you can produce content to reach and tap into your target audience while they’re browsing.

Branded dropshipping: conclusion

Branded dropshipping is an advantageous business model for entrepreneurs who are just starting out but don’t have the budget to develop their own products or be in charge of storage and shipping. By partnering with a white-label dropshipping supplier, you get to sell products with your brand’s name and logo while your supplier manufactures those items and ensures they make it to your customers’ hands.

Just like it’s the case with any new business, you’re bound to make a few mistakes here and there. But running a successful business is all about learning from your slip-ups and making adjustments.

When you have your own brand behind a high-quality product, you increase your chances of building brand awareness and a solid customer base. You’ll have a more scalable business in your hands, and scalability means the sky's the limit.