Are you looking to get into the dropshipping business? If you are, then one of the first things you need to look into is the best dropshipping niches.
The best dropshipping niches include clothing, jewelry, non-perishable food, eco-friendly products, office products, tools, car accessories, toys, beauty, and home items.
You need to know if you even have a market to sell to. Otherwise, studying how to dropship and how to earn money through dropshipping is useless.
Good thing I'm here with the list of the most lucrative dropshipping niches. Let’s figure out how to choose them, and how to experience sustained success.
Best Dropshipping Niches 2022: What is a dropshipping niche?
Market and product analysis study is the cornerstone of success.
Product research is essential. You have to have a basic understanding of the psychological levels of customer demand. I think one of the main reasons why a dropshipping business fails is the general lack of preparation among many dropshippers.
Consider your ROI in creating the most precise drop shipping business plan. If you don't know what return on investment (ROI) is, it's what you make compared to what you spend.
Choosing the best dropshipping niche can be pretty challenging. There are just so many options around, you don’t know which one will run you dry. You'll want to develop fast but also position yourself for long-term success.
Not sure where to start in dropshipping?
What is a niche?
A niche is a segment of a larger market. It can be defined by its own unique needs, preferences, or identity. This is what makes it different from the market at large.
You might ask: why not sell everything and anything under the sun? This will give you a better chance at getting a sale right? Well, that’s kind of…NOT…how it works.
A niche dropshipping store only targets a specific group of people that are already interested in the niche. That's why these stores get more orders. This also increases the number of repeat customers.
How to Choose the Best Dropshipping Niche?
Like what I mentioned earlier, you need to think about maximizing your ROI and be smart in managing your capital. Considering every item you add to your business is one of the things you can do.
You can start with asking the following questions in choosing which items to sell:
➡️Is there a market for it?
➡️How does it benefit buyers?
➡️Can it be sold again and again?
Still in the dark?
In that case, read on because I have a list to help you out!
How can I find a profitable dropshipping niche for my business?
Selling to a niche market helps you stand out from your competitors and gives your brand a good name in the market.
Here are some quick tips on how to find a niche market:
➡️Reflect on your passions and interests
➡️Identify customers' problems and needs
➡️Research the competition
➡️Define your niche and its profitability
➡️Test your product or service
Your business can become an expert in its field for a small group of people. This will bring in more customers for your dropshipping store.
“How do I choose a profitable niche?” — Grab the checklist below 👇 to figure it out!
✅ Does it have a high demand?
It seems obvious to consider demand when choosing a niche. One of the basics of marketing is to figure out what problem your product solves for your customers. But this only works if there is really a problem or people that need your product.
It would help to consider demand analysis as part of your process. This will help you find out what buyers want in a target market for a product or service. Businesses use certain techniques for analyzing demand.
Doing this helps them figure out if they can enter a market and make the expected profits. Businesses can use this information to figure out if it's worth investing in each of these markets.
Once you confirm that there is a demand for a particular niche, you can decide on products.
You can try to pick products that are different from others on the market. Make sure they meet the needs of consumers. This will make them want to buy the products more.
✅ Can you find a lot of suppliers for the niche?
Imagine getting order after order but having no stocks to show for it. Nothing is more frustrating than waiting for an order that’s not going to come. Worse, getting a crappy product that meets NONE of your expectations.
Suppliers give you everything you need to make sure your buyers get what they want. A company can't offer its customers consistently high-quality products or services if it doesn't have a good relationship with its suppliers —or if they can’t find a decent one.
What is the point of suppliers?
The main benefit of having good relationships with your suppliers is that you can get more for your dropshipping business. The more you know about your suppliers and the more they know about you, the more likely it is that you will get better service, lower prices, and better terms.
✅ Is the product turnover high?
A low inventory turnover could mean that the product isn't priced right, isn't positioned right, or the obvious —there isn't much demand for it.
Inventory, sales, and profit always had significance with retailers. Using the correct formula is the first step in improving your inventory turnover ratio. Your balance sheet will show the consequences of over or understocking.
You calculate inventory turnover ratio by dividing the cost of goods by average inventory for the same period. The higher the ratio, the more likely it is that the sales are going well. A lower turnover means weak sales.
You need to find out if the product turnover is high. A low inventory turnover could mean that the product doesn’t have a demand.
✅ Is the niche good for cross-selling?
Dropshipping businesses depend on a lot of orders, so any chance to raise the average order value of your customers can pay off. Focus on products that are similar and can be used to sell other products.
Cross-selling can help you make more money with dropshipping. It can increase sales by 20% and profits by 30.
Cross-selling makes each customer spend more at your store. Eventually, you make more sales. For example, if you wanted to sell phone cases, you could also look into selling charging cables, selfie sticks, PopSockets, and more.
You can put a widget on your website that shows these extras on the product pages for the phone cases. Customers will be more likely to add these items to their order, which will help you make the most money possible from each sale.
You should find a niche that is ripe for cross-selling. This is because it increases your sales by 20% and profits by 30%.
✅ Does the niche have passionate customers?
The next thing worth looking into is a market with customers who are really—REALLY— interested in what you sell. This is one of the best ways to make sure your dropshipping business can grow.
These customers may be pickier about what they buy. But they're great for building long-term relationships and will spread the word about your business if they like it.
For example, if you choose to target coffee lovers out there, you are looking at an industry with a revenue of $436,632 million. In fact, the market is expected to grow annually by 8.28%.
Are you thinking of getting into the coffee business?
Ecommerce marketing is already challenging. Imagine how much easier and more successful it will be if you go after customers who are passionate about your product.
✅ What is the result of your demand planning?
It is important to know how customer demand for products goes up and down. It lets you change what you sell and grow your business. Don't choose the products you sell on a whim or with little information. Do demand planning to be ready to meet your customers' needs.
Take the time to find out what customers want, how long a certain product will be popular, and if it has any seasonality. Then, change your products and marketing materials to fit what people are looking for.
Implementing a good strategy for managing relationships with suppliers will help you in this area. Focus on selling high-demand items that are easy to get, and you'll start making money quickly.
✅ How is the product quality?
I can't say this enough: you can't build a successful dropshipping business on low-cost, low-quality products. Some dropshippers have been flooding the market with low-quality products and bad customer service for years.
All of those businesses failed, therefore: Pay attention to quality. It's pretty clear that you need to find a good balance between product quality and profit margins. Long-term success depends on how well you can keep customers happy and make your brand known as a reliable source of products.
People will go somewhere else to shop if your business is known for selling low-quality goods. Even if you have to pay a little more.
This checklist is going to help you out in finding the right dropshipping niche to spend your time and hard-earned money.
Most profitable dropshipping niches in 2022
Now that you know what to look for it’s time to find out what are the best niches for dropshipping. Here is our list and some specific products you might like to consider.
Clothing and accessories are two of the most popular dropshipping niches, and they're also some of the cheapest. You can opt to sell anything from t-shirts to underwear to hats.
Private label dropshipping allows you to brand these products with your company's name and logo. A lot of suppliers do custom packing slip and return merchandise authorization (RMA) form in your packaging too.
However, what matters most is limiting your product line to a single subject. This could differentiate your business from your competitors and establish your identity.
Personal jewelry will forever be tied to the idea of success and money. Jewelry sales are estimated to reach $480 billion by 2025.
Using dropshipping to sell jewelry online helps you save money too. It also frees you up to concentrate on marketing rather than packaging your products.
With dropshipping jewelry, you may try out a variety of products to narrow down your niche. There is no risk in just deleting unwanted products and replacing them with fresh ones.
Here are a few of the best jewelry to dropship:
- tree of life necklace
- bridal jewelry sets
- chain jewelry
3. Food and Groceries
Snacks and other non-perishables have a sizable market despite the fact that not all food is suitable for dropshipping.
Avoid selling baked products online unless there’s a really high demand for it. You don’t want to end up with boxes of expired food.
Instead, concentrate on non-perishables like alcohol, liquor, beer, wine, and even whiskey, which may all be sold online. Here’s a better idea, why not take advantage of the enormous coffee market?
Like I mentioned earlier in this article, the love for coffee has been around for a long time. It’s almost impossible to run out of buyers for this beloved breakfast item. (Well, personally, I also have coffee at lunch. Also with my afternoon snack. AND in the evening —pretty much all throughout the day actually!)
Check out Dripshipper for the best quality coffee!
4. Eco-friendly products
Shopping trends appear to be influenced by environmental awareness. Because of this, the popularity of eco-friendly products has skyrocketed in recent years.
Eco-friendly products and green lifestyles are becoming more popular than ever before. If you want to keep up with the latest trends, we recommend that you look into this dropshipping niche
85% of people all over the world claimed that they have shifted their purchase behavior towards being more sustainable in the past five years. One third of consumers are willing to pay more for eco-friendly products. In fact, half of consumers rank sustainability as a top five value driver.
5. Office Products
Dropshipping office products like mugs, notepads, and keyboard trays is a terrific way to get started. There is no expectation of great quality from buyers. Well, because they are almost always dirt cheap. Your product offers will be less of a concern because of this.
There is also a huge market for it, especially if you can tap into office trends and popular culture. In fact, this niche is expected to reach a market size of $186.9 billion by 2027.
Here are a few of the best office items to dropship:
- packaging tape
- Ink cartridge
- File folders
- Paper for printers
Tools are a dropshipping niche with few rivals. Specialized toolkits are available for a variety of purposes, such as computer maintenance and basic household items. If you're selling to non-professionals, you'll probably want to keep the prices as low as possible.
Focus on selling to a younger demographic who just require a few tools for occasional use around the house, the office, or even in the car. The quarantine that most of us had to go through has led to a lot of people trying DIY projects. This accounts for the increase in demand for tools.
Here are a few of the best tools to dropship:
- Outdoor smart plug
- Video doorbell
- Magnetic screen door
- Extension cords
7. Automobile Parts and Accessories
A lot of people own a car, and they spend a lot of time in it. People are willing to spend time and money on their cars which makes it a great niche for dropshipping.
Product lines like automobile decals and stickers that customers can buy to personalize their car can be a good idea. Global sales of automobile accessories are predicted to grow as high as 3% in 2022 to 2030. If you want to get into this niche, now is a better time to do so.
The toy industry has a lot of potential for growth. By 2025, the toys and hobbies industry is estimated to generate $88,206 million in sales and grow at a 3.9% annual pace.
This will result in a market volume of $106,766. As a result, it should come as no surprise that the toy dropshipping niche is a lucrative business for many dropshippers.
Here are a few of the best toys to dropship:
- Remote controlled cars
- Digital drawing boards
9. Health and Beauty
Health and personal care items is one of the best selling dropshipping niches. This includes skin creams, hair care items, and even razors. All of these items can be marked up significantly in order to provide you with the highest possible profit margin.
If you're not familiar with the term "margin," it refers to the difference between the revenue generated by a product and the cost.
Grooming items have a low acquisition cost, therefore you can simply boost your profit margins by targeting a market with a steady need for repurchases. I mean, you always almost need a fresh set of razors, right?
10. Home items
Home items are one of the most lucrative dropshipping niches to get into right now. In fact, analysts now project that the global market for home décor goods will reach $838.6 billion by the end of 2027, with millions of people shopping for these items.
People have been spending more time in their homes and gardens in 2020 thus far. Another benefit of choosing this niche is its high-profit margin. Maintaining at least 20% to 25% in profit margins is doable.
Now that you know the best dropshipping niches you can get into, it’s time to pick the one that you think is the best match for you.
It doesn’t end there though, you have to find out what you need to do to succeed in your niche.
How to make a successful dropshipping store with your niche
Dropshipping allows you to make money by increasing the profit margin on your product. Your profit margin is determined by how much the merchant is willing to charge you in total.
You should keep in mind that online retail is extremely competitive. Your profit margin needs to be realistic.
Here are the basics on how to make money dropshipping:
➡️research profitable product ideas
➡️find dropship suppliers
➡️start a dropshipping store website
➡️drive traffic to your dropshipping store.
Dropshipping niches to avoid as a beginner
We already talked about the best dropshipping niches to get into. However, I feel like I have to leave you with a short list of a few niches to steer clear from.
1. Computers and other electronic devices
Dropshipping electronic goods can be a challenge. As a dropshipper, you may end up with low-quality equipment that no one wants, or a little profit margin.
In the electronics industry, you might lose a lot of money if your product does not live up to your expectations. For a product in the electronics market, it is critical that it be of high quality and simple to use.
If you're just getting started with dropshipping, you're undoubtedly working with a tight budget.
When selecting a new product to sell, it is generally recommended that you first purchase the product and thoroughly test it. This is a must-have for everyone working in the electronics industry!
In the electronics industry, a subpar product will cost you a lot of time and money in the form of refunds from unhappy customers.
2. Health-related products
Everything from vitamin and weight loss supplements to anti-aging skin creams may be found in the health and wellness market.
I won't recommend this niche to beginners. This is because you have to be absolutely positive that your product will not harm anyone in any manner. If you're selling a health product, especially a consumable one, you need to be extremely careful because you're responsible for the product you're selling.
Apart from that, there are strict rules in place at Facebook regarding the types of advertisements that can be run. Because of this, there's a huge possibility that your ads will be put on hold.
3. Heavy or bulky items
One of the most important aspects of dropshipping is your profitability. In order to be profitable, you always have to keep a close look at your costs.
Unfortunately, Heavy or bulky items occupy more room and are less efficient to transport. That’s why the delivery cost for these items will be very high, which causes your margin to shrink.
Just as with these bulky items, beginners should also avoid choosing heavy dropshipping items. Shipping companies often calculate their shipping prices based on the weight of your product.
So bear in mind that you will have to pay extra for shipping if you are planning to dropship heavy items such as fitness equipment and furniture.
Are you tired of brainstorming dropshipping niches?
Best Niches For Dropshipping - Final Thoughts
I hope I was able to help you out in picking the best best niches for dropshipping. Before getting into any business it is important that you prepare and plan. This includes the basics such as choosing your niche.
Do you know what else to add in our list of best dropshipping niches?