I know this sounds controversial, but hear me out and I will prove it (and show a trick to avoid it).
If you've ever tried side hustles, you probably know what dropshipping is. Basically, people find cheap products made in China and put them on Amazon/Shopify for a steep markup. The rule of thumb is to price them up by 300-500% (yes I used to watch those “influencers”). They make it seem like a good business because you don't have to hold any inventory or create any value; when someone buys, you just buy it on Aliexpress and enter their shipping info. Cha-ching.
According to a quick google search:
- Dropshippers make $110b in the U.S. every year
- The population of the U.S. is 340 million
- = they're making $323 off the average person
Now here's where things get interesting. You can't easily identify when something is dropshipped because dropshippers will change the image slightly so that it can't be reverse searched. BUT with the rise of ChatGPT, now AI can do it for you: https://chrome.google.com/webstore/detail/findcheap/pobingkblchehgpekbamnokiejaibeed
So I went to my most recent order in Amazon (an $80 keyboard) and let chatgpt work its magic. Guess what? The SAME EXACT product is sold on Aliexpress for $18. Almost 80% less.
Granted, free shipping takes about 2 weeks longer if it has to come from China. So effectively, I paid $62 for shipping.
Thoughts? I'm sure AI is only going to get better at this. Maybe it will eradicate the dropshipping industry?