358. How Do Dropshippers Get Paid?

In this episode of the Dropship Podcast, Jon and Ben break down high ticket dropshipping. We explain how payments flow from customers to suppliers and highlight the profit margins involved.

Selling higher-priced items, like a $5,000 sauna, can yield substantial profits compared to low ticket items. We also discuss the importance of marketing, SEO, and managing operational costs.

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Timestamps:

Introduction to Dropshipping (00:00:00)
Jon shares how beginners can start dropshipping without a credit card or much money.

Understanding Payment Processing (00:00:19)
Ben introduces the topic of how dropshipping payments work and how money flows.

The Sales Process Explained (00:00:52)
Jon explains the process from customer payment to supplier order placement in dropshipping.

Payment Timeline and Profit Calculation (00:01:43)
Jon discusses the timing of payments and how gross profit is calculated after expenses.

Starting Without Credit (00:03:42)
Jon emphasizes that beginners can start dropshipping by waiting for customer payments.

Real Numbers in High Ticket Dropshipping (00:04:59)
Ben uses a sauna example to illustrate the profitability of high ticket items versus low ticket items.

Acquiring Customers (00:06:17)
Ben explains how to attract customers through ads and SEO for high ticket products.

Understanding Business Expenses (00:07:28)
Jon details the various costs involved in running a dropshipping business, including ad spend.

Calculating Net Profit (00:09:51)
Jon explains how to determine net profit by subtracting expenses from gross profit.

Typical Profit Margins (00:11:53)
Ben discusses average net profit margins for dropshipping businesses and compares high and low ticket sales.