Why start a Dropshipping business in South Africa?

Contributor: Oberlo.

With a population of 57.69 million and a total GDP of 349.433 million in 2018, South Africa is a large and flourishing marketplace to start a dropshipping business in.

In eCommerce alone, South Africa spent 2.913 million USD in 2018 making it a great nation to market to and a great country to start an online store in. This is projected to continue growing by 10% over the next five years, expanding the market to 4.781 million USD in 2023.

Research has shown that South African customers prefer to purchase items using credit cards.

Furthermore, their adoption to e-wallet is set to grow 10% in the next five years, making it a low maintenance market that you can capitalize on easily.

BizHub Central is negotiating to provide all its merchants and consumers with digital ewallets and debit cards when they make use of our services, to cut down on bank fees and other costs and to give each person total control over their own money.

The average revenue per user is projected to grow 33% in the next five years, most of which will be through online purchases. Although the younger demographics are more inclined to purchase items online, the male to female breakdown is equal and income level doesn’t seem to affect spending habits in South Africa.

As South Africa is the gateway to the rest of Africa and as fewer dropshipping competitors exist in Africa than in the rest of the world, this opens a huge marketplace for dropshippers who start a business in South Africa. The cost of advertising and marketing to customers is still relatively low, making it a low-cost, high-return market to dropship to.

Dropshipping to South Africa is a risk-free endeavour that requires no additional costs for holding inventory and shipping products. This gives you more time to focus on growing your business through marketing, business development and relationship building.

Why Dropshipping is Better than Wholesaling in South Africa.

Dropshipping in South Africa is a more affordable business model than wholesaling. Startup capital is low and risk is low with dropshipping as you are not buying stock from your suppliers until after a customer has bought from you.

Because warehousing is not necessary and delivery is organized by the supplier directly to your customer, your cost is significantly reduced. Profit is a lot higher with dropshipping as you can mark-up products as much as needed in your store, without taking on the cost of manufacturing, delivering, or bulk orders.

Through BizHub you will have a choice of hundreds of suppliers, with thousands of products to choose from, so you can keep risk low by adding or removing products from your BizHub shop if something isn’t performing well, without any financial costs.

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