Choosing a category of products to sell is one of the biggest challenges while seeking dropshipping business opportunities. There a lot of different products available for drop shipping. Naturally, there are a lot of things to consider while selecting the products to you want to list in your online marketplace.  Here, we’ll take a look at some of the most profitable drop shipping product categories.

Spotting current trends before they go take off is your best bet. This way, you can make use of low marketing fees and constantly increasing demand. One such category can be in health and beauty.  Its popularity is constantly increasing with no sign of stopping anytime soon.

What is Drop Shipping?

Dropshipping saves online retailers from having to stock tons of products and taking on inventory risk. Dropshipping companies have large warehouses, in which they stock a wide selection of products to be delivered to the retailer`s customers. Online business owners who use this method first sign up  these suppliers. When retailers receive an order, they forward it to the supplier. Picking, packing, and shipping are among the supplier`s responsibilities.

This method is crucial for small online retailers to compete with larger businesses. Managing such a wide-selection of products is not feasible for small business owners. They simply cannot afford the time and labor that goes into managing such inventory. Because dropship suppliers ship a lot of packages, they have negotiated rates with their carriers. This is very important because merchants need to manage shipping costs. Negotiated shipping rates offered by the supplier can save retailers a huge amount of money.

Dropshipping suppliers also help you manage your listing with their up-to-date inventory data. This helps avoid overselling. You may list your products according to their availability in the supplier`s inventory data, which should update throughout the day.

Overall, dropshipping makes life a lot easier for small online retailers. There are a lot of different drop ship suppliers, who may focus on different categories. We believe natural organic food category and natural beauty products are the most suitable categories for your dropshipping business.

Natural and Organic Food Category

As the focus on healthy lifestyles and fitness grows, so does the natural organic food category. Organic Trade Association reported $3.7 billion more sales in 2016 than the previous year. More emphasis on healthy lifestyle and climax of eating disorders are some of the reasons behind this increase.

Organic food is becoming mainstream because of consumer concerns. The USDA believes that “consumers prefer organically produced food because of their concerns regarding health, the environment, and animal welfare.” It is true that organic farming is much better for the environment because it does not use genetically modified seed, synthetic pesticides or fertilizers.

Overall Demand for Natural Products

Apart from its increasing popularity, there are other reasons behind this category`s aptness for drop shipping. Organic food is something people buy regularly. So, their purchases are not a one-time thing. They are recurring. This means if you can please your customer with shipping times, cost, and the condition of the products, they will keep coming back to your online store to buy more. High re-order rate means lower acquisition costs, which is one of the most expensive things in online retail business.

In this category, you may also enjoy low return rates. Unlike some other categories such as clothing, online retailers selling in grocery category enjoy much lower return rates. There is no good reason for your customers to return a product unless there is something from with the condition of the product.

Natural Beauty Products

Thanks to innovative methods, natural beauty products are just as effective as the chemical based products that are widely used. These unnatural products come with harmful chemicals such as paraben, SLS, SLES, and polyethylene glycol. As the media awareness and concerns for such products grow, demand for natural, organic beauty products grow. Recent data clearly illustrates this growth:

A recent 34-page study of the online health and beauty market indicates that the sector has become one of the most profitable in online retail. In 2016, according to the newly-released Health & Beauty Online report:

“online sales of health and beauty products grew 24.5% to just over $12 billion in the U.S., increasing their share of the total beauty market to 18.3%—a market share that has grown every year since 2011, when the web accounted for just 11.9% of sales.”

Global Demand for Natural and Organic Products

Another recent market report published by Transparency Market Research reveals that the global demand for organic, natural personal care products used to be over $7.6 billion in 2012. However, by 2018, it is very likely to reach $13.2 billion. The research also reports:

“Based on product, the organic skincare segment has emerged dominant in the market. The segment includes facial care, body care, ands sun care products. The increasing demand witnessed in the segment is mainly attributed to the rising consumer awareness regarding the side-effects of synthetic personal care products. The segment is gaining significant impetus from the launch of new products and the expanding distribution channel.

The hair care segment is projected to emerge as the second-leading segment in the market during the forecast period. The rising aging population, increasing concerns pertaining to hair fall, dandruff, and hair loss, and the demand for products enabling maintain youthful appearance are the key factors fuelling demand from the segment. The launch of innovative products aimed at resolving specific hair problems will further lead to the growth of the segment.”

Increasing interest in natural beauty products makes it an ideal category for your dropshipping business.

Ready to sell natural organic food or natural beauty products online? Learn more about dropshipping or join us if you’re ready to become a member.