Dropshipping in Germany offers a compelling opportunity for residents looking to escape the 9-to-5 grind and build their empire. This flexible business model can be operated from anywhere, and with Germany’s thriving marketplace, it’s an ideal location for this venture.
This business model allows you to sell products online. Thus, you are not restricted to a specific location or country; you can sell your products worldwide.
This means that you can target markets other than the local German market. For example, you can target European neighbors like the UK, France, and North America.
Going beyond borders can exponentially grow your sales and profits, a prospect that should excite and inspire you. But to achieve that, it’s crucial to understand the dropshipping model’s ins and outs.
This article explains dropshipping in Germany. We will explore how to start, the top suppliers to consider, and the products to sell in your online store.
Let’s get down to the basics:
Table of Contents
What is Dropshipping?
Dropshipping is a fulfillment business model where you can sell products without holding an inventory. You create a “customer-facing” online store and promote your products.
Here’s how dropshipping works: when a customer orders on your online store, you forward the order to the supplier. The supplier then fulfills the order by picking, packing, shipping, and delivering it to the customer. Your role as the store owner is to keep the customer informed about the order status and provide any necessary customer service.
Your job as the store owner is to inform the customer that the order is on the way and may also provide additional customer service.
How Does Dropshipping Work
The process of dropshipping is very straightforward. Here is the standard sequence:
- You sign an agreement with your supplier.
- Customers place orders online.
- Your business receives the order.
- A customer then receives an order confirmation.
- You forward the order to the supplier.
- Seller ships/fulfills the order.
- Customers receive their product.
Why Dropship in Germany?
Establishing an eCommerce business in Germany is worth it. Here is why: This business model experiences exponential growth year after year.
According to Statista, Germany’s B2C online revenue had grown from a million to three million euros at the beginning of the twenty-first century. But by 2021, it had reached 87 billion euros.
Forecasts show that the market will continue expanding in years to come, making Germany a perfect market for online entrepreneurs.
Statistics don’t lie. But besides statistics, Germany’s ideal conditions also make it a perfect place to run and grow your online business.
For instance, a reliable Internet connection in Germany lets you stay in touch and run your store 24/7.
Also, starting and running a dropshipping company in Germany is legal, provided you comply with the e-commerce regulations.
For example, you must familiarize yourself with business registration, tax obligations, and legal products.
You must also register your business, pay VAT for goods and services at the applicable rate, and ensure you are not selling hazardous, age-restricted, branded, or intellectually protected items.
Furthermore, the German social and cultural environment makes it easy to understand your potential customers. Plus, you can work with globally accepted payment gateways such as PayPal Express Checkout, Stripe, Amazon Pay, AliPay Global, Shopify Payments, and Skrill.
So, if you’re ready to embark on the dropshipping journey, there’s no better time than now. You can launch your own business, start living your dream, and work towards achieving financial independence, a goal that can truly empower and motivate you.
Pros and Cons of Dropshipping in Germany
The dropshipping business has its upsides and downsides. Here are some of the pros and cons you should be aware of before you can get into it:
Advantages
- Low start-up capital and overheads: To start dropshipping, you only need a domain name, a hosting plan, and an e-commerce platform like Shopify. Then, factor in the minimal costs for a business registration permit, marketing, and automation if you want to automate. While these will require some capital, it’s significantly minimal compared to the cost of buying stock upfront.
- Work with multiple suppliers: When dropshipping, you work with many suppliers. This means you have a more comprehensive selection of products and can choose the best suppliers.
- Low risk—high—high reward: This business model is low-risk, as you don’t need to invest in inventory and has low running costs compared to being a Wholesaler. The returns are also enormous.
- Scalability—Scaling a drop shipping business is easy; you only need to add more products to your store.
- Automate everything – You can leverage tools like EcommerceBot and DSers for dropshipping.
Cons
The drawbacks of dropshipping are few. They include:
- Lack of control of the supply chain since the suppliers tackle the inventory and order fulfillment
- Stiff competition within the German e-commerce industry
- Inconsistent policies, as it depends on the different suppliers.
Typically, the benefits outweigh the bottlenecks. Therefore, it’s worth giving it a shot.
How to Start Dropshipping in Germany
Let’s explore the steps to dropshipping right from inception to reaping profits. The process is straightforward to follow, which should reassure and boost your confidence.
Step 1: Pick a Niche
The first step is to choose a range of products in a specific niche. Consider a product or a market you are eager to sell.
Then, research whether the items you intend to sell can catch the attention of your target audience. Take your time exploring online marketplaces for inspiration and then leverage online tools that offer valuable insights about the market and product demand.
For example, search Google Trends to find the items’ interest levels over time. Set your search to Germany to understand the local market, or set it worldwide for a broader search.
Step 2: Research Competition
Competition analysis is paramount when starting a new business, including dropshipping in Germany. Why? You need to understand who your competitors are and how they conduct their businesses.
Understanding your competition gives you a glimpse of what they are doing right and where they are lacking. In doing so, you’ll know how to tailor your marketing campaigns or position yourself to what consumers want. As you identify the gaps left by the competitors, you can carve your market for your products in the best way possible.
But how do you ensure you’ve done a comprehensive competitor analysis? You can start with a simple Google search or browsing social media. The two can give you an overview of the market and its workings.
However, you can use competition spy tools like Alexa or Similarweb for deeper insights. Such tools give you more information about competitors, such as their social media profiles, number of visitors, traffic sources, and main competitors. This way, you dive into the market well-prepared.
Step 3: Find Your Suppliers
Finding reliable suppliers is very crucial when dropshipping. Establish a good relationship with trustworthy suppliers who guarantee competitive pricing, quality products, and swift delivery.
Therefore, when searching for suppliers, review their refund policies, customer support, and shipping policies, among other pertinent details. Reading online reviews can help you verify if a particular supplier is worth partnering with.
Also, research other essential information, such as the supplier location, minimum order requirements, order processing duration, product pricing, and contact information.
To make your supplier’s search easier, you can incorporate a platform like DSers. It is a marketplace that helps you find the best items to sell and their suppliers. In addition, it enables you to import those items to your Shopify store easily with just a click.
With DSers, your ordering process is automated. For instance, it automatically forwards your shop’s orders to suppliers, eliminating the hassle of manually completing them. This results in efficiency and satisfied customers.
Step 4: Set Up Your Online Store
The following essential step is creating a user-friendly platform. Shopify is a popular e-commerce option thanks to its design flexibility and ease of use for dropshipping.
The website should be visually appealing to attract and retain customers. Its design should also have straightforward navigation so users can quickly access the necessary information.
You can export products manually or automate the process. For example, you can use Dsers to export products from AliExpress. Ensure the images are high-quality and the product descriptions are detailed to help customers understand them.
Step 5: Choose a Business Structure
Just like starting a business in the US or any other country, it’s wise to pick the proper business structure when starting dropshipping in Germany.
In other words, you must choose a legal business method.
The main business structures in Germany are sole proprietorships, partnerships, and corporations.
A sole proprietorship is a business started by a single person. The owner is liable for any debts incurred by the company.
Partnerships are formed by either two individuals or two companies. Here, the partners are liable for any debts or legal issues from the business. However, limited partnerships enjoy the distinction of partners and business assets and liabilities.
Examples of partnerships in Germany include:
- Civil law partnership
- Limited partnership
- General commercial partnership
- Partnership Company
- Limited partnership & limited company partnership
Lastly, you can choose a corporation type of business. A corporation is a legal business form that 2-5 people share. You must register it with the German Chambers of Commerce, whose taxes are relatively high. A corporation distinguishes between your assets and liabilities and those of the business.
Examples of corporations include:
- Limited liability company
- Provincial Private Limited company
- Public limited company
- Non-profit limited company
Step 6: Promote Your Business
To draw customers and boost sales, you need to promote your business. You can do that in several ways.
Social media is a popular promotion method. Engage with your target audience through Instagram, Facebook, and TikTok.
You can automate the process using tools like EcommerceBot. Ecommerce Bot is an AI-powered tool that helps you manage your ad campaigns, social media activities, and customer interactions across multiple channels.
You can also create engaging and SEO-focused blog posts and videos related to your niche to boost traffic to your site. This helps drive traffic to your online store, enhancing visibility and sales potential.
Another way to promote your business is to collaborate with bloggers and social media influencers. That also helps widen your target audience.
Step 7: Monitor and Evaluate the Progress
Analyzing your business’s performance is also crucial after a while. This helps you determine whether the company is making losses or profits or has broken even.
Therefore, after operating the business for a few months, it is wise to evaluate its progress. You can do this by monitoring sales, shoppers’ behavior, profit margins, and even the effectiveness of your marketing strategies. With such information, you can see the areas that need improvements and those that are doing well.
Some useful tools to help you in this stage include Google Analytics and Google Search ConsoleConsole for traffic assessment. With these tools, you can evaluate the traffic to your site and determine the effectiveness of your marketing efforts.
Best Suppliers in Germany
You need to find trustworthy dropshipping suppliers with excellent customer service. The suppliers are your partners, and the service you receive from them is what you extend to your customers:
Here is our list of incredible suppliers that you can partner with:
Costway
Costway is a leading retailer in Europe. If you are in Germany, you can do an excellent dropshipping business with them.
Some of the benefits you can receive by partnering with this e-commerce retailer are:
- Premium Products – Costway has over 8,000 self-branded products in 10 different categories.
- Flexible shipping Plans- Costway provides free standard shipping
- Competitive pricing – Their competitive prices allow you to set high-profit margins.
- Reasonable Return Policy – Costway has a 30-day refund and return policy
- Trustworthy customer support – They offer exceptional customer service, boosting customer confidence.
eBay
eBay is a renowned worldwide retail giant. And you can also use it when dropshipping in Germany. eBay promises the following benefits for drop shippers:
- An enormous product catalog
- Shipping Efficiency
- Quality products
- Exceptional customer support
- Etsy integration with your Shopify store
The features ensure efficiency in serving your customers. You have quality products, fast shipping, and excellent customer support, leading to a satisfied customer base and more sales.
Shein
When you think of fashion, think of Shein. It is among the world’s largest fashion companies, making it an excellent choice for anyone aspiring to dropship fashion products in Germany or anywhere else.
Some of the main advantages of using Shein as your fashion supplier in Germany include:
- It has a warehouse in Germany
- It has a wide variety of items to choose from
- It boasts stylish products that customers love
- You might enjoy free shipping
- It is ready to offer refunds if dissatisfied with their products within 30 days.
The only drawback is that Shein needs an app to integrate into. However, since it has a German website, customers can still access products from its online store.
DHGate
DHGate is another incredible supplier to consider. Some of its outstanding features include:
- Extensive product selection – With over 20 million products in multiple categories, DHGate is a great supplier to partner with.
- Domestic warehouses – It has about 16 global distribution centers, including Germany.
- Low-cost items—DHGate offers wholesale pricing as a trusted Chinese supplier, which enables low-cost sourcing and increases profit potential.
- Fast shipping – With local warehouses worldwide, items are delivered faster, leading to greater customer satisfaction.
Spocket
If you want to dropship general products in Germany, Spocket is undoubtedly a go-to dropshipping supplier. It has suppliers in the UK and Europe, meaning that warehouses are nearer than if you were ordering your products from China. This alone makes it an ideal supplier source for German drop shippers.
Other features that make Spocket an excellent supplier in Germany include:
- Filters: This feature allows you to filter for the location or source of the supplier when searching for products.
- Integrations: The app integrates with numerous platforms, including Shopify, eBay, Woocommerce, and Wix.
- Customer support: Spocket offers 24/7 customer service, which is rare with many suppliers.
Spocket also has a wide range of suppliers from the EU and China. The only disadvantage is that you have to pay to use the system’s premium features.
SaleHoo
SaleHoo outranks other dropshipping suppliers in kids’ toys. If your business idea includes kid toys, you should consider SaleHoo among your suppliers.
Initially, SaleHoo was just a database for dropshipping suppliers. However, it currently has an app that seamlessly integrates with Shopify. Also, it boasts an effective Market Research Lab that makes product research relatively easy.
The main benefits of using SaleHoo include:
- Boasts reliable suppliers
- Has a functional Market Research Lab
- It has a vast product catalog with over 2 million products
- Can integrate with your Shopify store
- One-click import tool
As for the drawbacks, SaleHoo only integrates with Shopify. This might not be ideal, especially for those not operating Shopify stores.
Printify
Printify is known for its print-on-demand services, meaning you can dropship your designs. And it’s a great option when dropshipping in Germany.
The main Printify features include the following:
- Integration—The platform can seamlessly integrate with several e-commerce stores, including Shopify, WooCommerce, BigCommerce, Wix, Walmart, and Prestashop.
- Design and Mockup—Printify products are usually blank, so you must include an image in the design. You can also use the mockup feature to get pictures.
- Flat Rate Shipping—Many suppliers here offer a flat rate shipping option. This uniformity means you won’t have to create too many shipping regions.
- Unlimited designs – With Printify, you can create as many designs as possible. There’s no limit!
The platform allows you to sell numerous designs on hoodies, caps, phone cases, t-shirts, journals, and even beauty products. Therefore, if you want to venture into custom designs in Germany, your dropshipping business needs Printify as a supplier.
CJDropshipping
Do you want to venture into dropshipping in Germany but source your products from China? Well, CJDropshipping makes this happen. It is an excellent supplier choice for individuals or stores that want to get products directly from China. This is because it works best with AliExpress and Alibaba marketplaces.
The most attractive features of dropshipping with CJDropshiping are:
- Sourcing specialists: With CJDroshipping, you won’t have to worry about them not having a product. If they don’t have a product, you need to send them the product’s link, and they will source it for you at the best prices. Their sourcing specialists make this possible.
- Branding: They offer branding services for your products. You only need to buy the packaging materials; they’ll print your brand name.
- Warehouses: CJDropshipping has several warehouses in the UK, Canada, and France, which makes it ideal for German drop shippers.
The only drawbacks with CJDropshipping are that it charges processing fees for certain transactions, and the shipping time might be a bit longer. Otherwise, it is among the most reliable dropshipping suppliers in Germany.
AppScenic
Statistics show that furniture is among the best-selling dropshipping products in Germany. And since every drop shipper looks for a product that sells readily, you might also be drawn to this niche. If so, AppScenic will serve you well as a supply partner.
The best features of AppScenic include:
- Global supplier: AppScenic gives you access to suppliers worldwide, including those in the UK, the US, the EU, and Canada. This means you can easily access quality products that meet your customers’ demands.
- 100% Order Automation: When a customer places an order, the system sends the order to the correct supplier without requiring your input. This means you can continue making sales in your shop while away.
- Integration: The appSceninc system can be integrated with various e-commerce platforms, including Shopify, Wix, eBay, and BigCommerce.
The platform also boasts fast shipping. However, you’ll only access the premium features when you choose a paid plan.
Amazon
Amazon is the world’s largest online retailer, with a market share of 37.6%. Even better, Amazon allows dropshipping, making it one of the best dropshipping companies in Germany due to its vast product variety.
But besides a massive product catalog, Amazon also boasts the following benefits:
- High-quality products
- Excellent customer support
- Fast shipping time
With such features, using Amazon as one of your suppliers can lead to satisfied customers and more sales.
Best Dropshipping Products in Germany
In the world of dropshipping, trendy products are the key to a successful dropshipping business. But which are these products?
Smart Home Gadgets
Dropshipping smart home appliances is a great idea. Why? Smart homes are taking the world by storm.
Many must be more satisfied with internet-connected tech gadgets to monitor and manage home systems and appliances. Therefore, the demand for smart appliances such as lamps or smart sockets is rising.
With such a high demand, good sales are guaranteed if you do your marketing right. Therefore, you can establish your dropshipping business using smart home gadgets if you want trendy products.
Eco-friendly Products
The world is geared towards achieving sustainable living. This calls for increased use of eco-friendly products to ensure a livable world for future generations. Products such as bamboo toothbrushes, cosmetic pads, vegan pet accessories, sustainable yoga gear, and recyclable activewear have all seen a spike in demand.
It is easy to make money online by tapping this trend through dropshipping. Your store’s sales will continue rising as people consume more eco-friendly products.
Fitness Accessories
People want to lead healthy lives; fitness is one way to achieve that. As more people join fitness classes or conduct home workouts, the demand for fitness gear and accessories increases.
Resistance bands, yoga mats, fitness planners, and intelligent health trackers are trendy fitness accessories. Their high demand means that sales are also high. Also, most are small and low-cost, making them the perfect products for dropshipping.
High-Quality Kitchenware
Every home has a kitchen—if not all, then almost all. This means that kitchen equipment and gadgets are quite in demand. And if you can dropship high-quality ones, you can be sure to have a loyal customer base.
Some of the most trendy items include silicone baking pans, pop-up toasters, cookie cutters, and flexible cutting boards. These practical items help make cooking easy, so their demand is always high.
Additionally, most of them are small-sized items. This, plus their low purchase cost, makes them fast-moving products, ideal for dropshipping businesses.
Kids’ Educational Materials and Toys
Every parent wants their kids to learn new things as fast as possible. They will buy educational materials or toys to facilitate their early-age learning. These toys and materials have become quite popular in the market.
Dropshipping such materials in Germany is a good idea. First, the items are in high demand. Also, they are fast-moving, as kids are born every day.
The most popular items to consider here for your shop include puzzles, magnetic building blocks, educational busy boards, Montessori toys for coordination training, and more. These toys and materials help toddlers or kids to develop their cognitive abilities quickly.
Beauty Products
Beauty products are one of those product categories that never run short of demand. The truth is, everyone wants to look great. That’s why, in 2022, the beauty industry, which comprises skincare, makeup, haircare, and fragrance products, generated an annual revenue of $430 billion.
Venturing in such a vast market is a wise thing to do. However, just as it’s big, so is the competition. Therefore, before diving in, ensure you’ve done comprehensive product and competitive research. It can be a lucrative niche if handled well.
Baby Products
Almost every baby product is an essential item. For instance, they can’t survive without diapers, baby wipes, baby carriers, strollers, or healing ointments. In other words, baby products are always in high demand, just like beauty products. You need to identify the most trendy ones and those that leave you a good profit margin.
The baby product industry is projected to reach $88.72 billion by 2026. So, if you want to tap into this lucrative industry, there is no better time than now. Also, there is no better way to do it than through dropshipping.
Tips to Consider when Picking the Best Dropshipping Products
Figuring out the best product for your dropshipping shop can be challenging. You have many things to consider, including your audience, passions, budget, etc. There always needs to be a sure way of identifying a product that guarantees 100% ROI.
However, the following tips can help you make the best choice based on your goals and customer needs.
Find a Product that Solves a Problem
Before even deciding on the product to sell, you must do market research and identify various customer pain points. This is the basis of your search for the best product to sell. It should be a product that resolves or solves customers’ pain points.
Also, when advertising the product, ensure the target audience can see how it works. That way, they can be drawn to purchasing because they need to find a solution to their problem.
This approach guarantees a never-ending demand as you’ve identified the customers’ needs.
Avoid too Large Products.
While items like furniture do pretty well in dropshipping, large products may not be the best in some instances. For example, have you ever tried to dissect the cost of a product you bought online? A massive chunk of the price goes to shipping, which can be huge for large items, adding to the cost of those products.
When prices go up, it means that, in most cases, your profit margins go down. Since we seek good profits as entrepreneurs, you should choose products that guarantee such. Small-sized products that are relatively cheap are an excellent choice.
Find Novel Products
Dropshipping allows you to sell almost anything. This means you have the best chance to create novel, unique products, which many customers are looking for nowadays.
Don’t go for what everyone else is selling.
You’ll do what they always do and get the same results. However, if you can be creative enough to develop new products, you can create your niche and attract your unique customer base.
Item Reliability
Consider item reliability in terms of fragility. How easily can the product be broken or damaged?
Choose products that are manageable for your dropshipping business. Your online store will receive negative reviews as more customers receive broken or damaged products. Customers will be dissatisfied and likely to refrain from doing business with you again.
The worst thing is that this might be something other than your fault, as you need to handle packaging and shipping. However, the customers only know you as the source of the products, so the entire blame is on you.
If you can work with sturdy products, this might save you a lot of headaches.
Look for the Best Automation Tools
For an online store to work effectively, you need automation tools. These are necessary for automating order tracking, inventory tracking, ad management, and customer engagement.
You can try Ecommercebot for free; no credit card is required. You agree to turn your E-commerce business into a success story by clicking the image below.
Some excellent options include DSers for finding suppliers and importing products from AliExpress or EcommerceBot for automating all the functions mentioned above. With such tools, your e-commerce store can efficiently meet customers’ demands, even when you are not there.
Conclusion
Dropshipping in Germany can be very lucrative, especially considering the population and economy. In fact, as of 2023, Germany was the largest economy in Europe, with a gross GDP of around 4.121 billion euros.
However, before you get it right and make those profits, you must consider everything we’ve outlined above. This includes the type of product you choose, the kind of supplier, and the proper business structure. All this ensures that you serve your customers in the best way.
