Drop Ship Lifestyle founder Anton Kraly literally sells a course on high-ticket dropshipping, so you know his opinion’s biased, but I’m curious to hear his take on the matter. Like why’s he so sure big ticket’s where it’s at? And what should you consider when deciding between that or dropshipping cheaper items? Let’s find out. Anton calls it high-ticket dropshipping when you’re selling items that are at least $200. And there’s really no ceiling. He’s sold products for $5,000+ before.
So then low-ticket’s when you’re dropshipping products that retail for less than $200. “So why do I prefer high-ticket?” Anton says. “Quite frankly, because you get paid, you make more money. Rather than having people come to your store every day and only spend a few bucks, why not have a few customers come and spend big money to where you can actually earn a real profit? So this is the idea, right? This is why we want to focus on high-ticket things. But you may be thinking, ‘Isn’t high-ticket drop shipping more expensive to get into?'”
“Maybe you could see yourself selling low-ticket products because, where’s the risk?” Anton continues. “Whereas, with high-ticket, it’s a different game. And while that’s true, here’s the beauty of it. You could do either, right? But if you’re going to put your time and effort into this, why not build a store that’s going to have the greatest potential? That has a bigger upside? The one using high-ticket dropshipping? ‘Cause remember the beauty of dropshipping is you’re not laying out any money before you actually get sales.”
“You’re not buying this inventory until the customer pays you. So again, you have the choice. And I am giving you this decision for which one you wanna build, and why wouldn’t you choose the one that has a higher profit potential? Now, when you think of it a different way, with the pros and cons of high-ticket dropshipping versus low-ticket dropshipping, we can just compare and contrast two different products. Let’s consider a cell phone case versus a stand up paddle board, okay?”
What are the advantages of the lower-ticket phone case? It’s lightweight, easy to ship, huge demand, and there are lots of styles and variations. Whereas, the stand up paddle board is big and awkward and therefore costs more to ship. It obviously costs more to order it from the supplier too. And there’s a smaller market for it, right? For these reasons, most dropshippers would gravitate towards the cheaper phone case. But Anton believes that’s a big mistake. It all comes down to units sold versus profit.
“This is very important,” he says. “When I first realized this, it totally changed my business. I personally got started by selling cookies online. Average order value of about $15. And once I realized this, I totally shifted my business. See, if you do this right, if you build your store using my Drop Ship Lifestyle system, you can get a profit margin of about 30%. So every time you sell a $10 iPhone case, you would make $3; and every time you sold a $1,000 paddle board, you’d pocket $300. And that’s for the same amount of work.”
“Once you really get this and you make your whole business about high-ticket drop shipping, you will be well on your way to being successful with this whole business model.” Hmm. Don’t get me wrong, I’d probably lean towards big ticket too, but I feel like he’s oversimplifying this. How would net profit be 30% for both example products when the paddle board costs more to buy and ship? Also, wouldn’t premium products have higher refund rates because expectations are higher? And what about cost of acquisition? Wouldn’t it be cheaper to run a Facebook ad to sell a phone case over a stand up paddle board?
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