Last week I shared an episode that went over what I would do if I was starting over and building a dropshipping store with a $5,000 budget and NO connections.
I loved hearing the feedback from you all about my strategies. And I had a lot of people ask me what I would do with a $1,000 budget... So that's what this episode of The eCommerce Lifestyle podcast is all about.
The constraints are similar to the last episode:
Listen in to hear what I would do to start making profits within 30 days...
What's up everybody. Anton Kraly here, and welcome back to the eCommerce Lifestyle Podcast. So one week ago I did a podcast called, what I would do if I was starting over with a $5,000 budget, and that podcast got some really good feedback.
So first of all, thank you for that, but it also got a bunch of questions and people asking me what would I do if I was starting over with a $1,000 budget? And I thought, "You know what? I'm sure a lot of people are thinking the same thing. If people are asking, it means even more are thinking of it."
So that's what I'm going to talk about today. Now, some things I should mention. First, we're going to use the same constraints that we had last week.
So we're going to assume I know everything I know, I don't lose any of my knowledge. But we're also going to assume that I lose my connections. So again, my suppliers, my vendors, all the people I work with, we're going to assume I'm starting with $1,000 and they are gone.
We're also going to assume obviously that I have $1,000 to invest into this business and we're going to assume that I need it to generate net profit within 30 days. So not just sales, but I need it to be profitable within 30 days. So just like last week, obviously I'm going to put this money and my time in to the drop ship lifestyle business model because it is the fastest way to start generating real returns with a small investment, and the fastest way to build a real business.
So regardless of whatever budget you're starting with or I'm starting with, step one is choosing a niche. So I'm going to make sure that the niche has an average order value of $2,000 or more. Again, this is just getting back into it.
So I don't want to start with something even around $200, I want to go away up the ladder. So every time I get a sale I'm making hundreds of dollars, if not thousands of dollars of net profit. I'm going to make sure the niche has no brand loyalty.
I'm going to make sure it's not something that's seasonal, because I want to start making money right away and not wait for my season to come around. I'm going to make sure there's market demand for what I'm selling and I'm going to make sure I can find at least 20 brands and at least 100 products in the niche that I want to get into. And of course, I'm going to make sure that it's drop ship friendly.
Now step two, this is where things start to change because step one costs no money at all, that was just me doing research.
But step two is when I'm actually going to build the store. And to do this, I'm still going to use Shopify, which is $29 a month, but I'm going to get the 14 day free trial and I'm not going to outsource my store design. I am going to build the store myself even though I know I am not technical and I am not an amazing web designer.
With that being said, I do know a few hacks that I can put together to make a website that looks good enough for now, that looks good enough until I start making money and can reinvest it into professional website design.
So what I'm going to do to build my website is I'm going to go on google.com and I am going to pick a color I like, and I'm going to look for what's known as a color palette. So let's just say store I was building was selling surfboards.
I'm going to type in ocean color palette, then I'm going to go to Google image results. And what I'm going to see are little different swatches, I think they're called, of colors that go good together.
So maybe a shade of blue with a shade of gray, and a shade of orange, and a shade of white. And it's going to show me, "Okay, these colors look good together," and I'll be able to use those colors when I'm building my store.
Because one mistake people make all the time when they're building websites themselves, and I do this too, is you just think, "Okay, I want a color of orange. I want a shade of blue. Yeah, let's put some green in there," and before you know it, nothing goes together and it looks unprofessional.
So again, I'm going to find the color palette of colors that I already know that go together because somebody that's professional put them together and I'm going to use those color codes on my website so I know what color my text should be, what color my button should be, what color my logo should be.
It's all going to be based off of that color palette that I find. Now another thing that's going to have to get made are things like my logo and things like a homepage image.
Again, I'm not a web designer, but I don't have the budget to outsource these things. So what I'm going to do is go to canva.com, C-A-N-V-A.com. I'm going to make a free account there and I'm going to look at different logos they have for inspiration already, and I'm going to simply pick something that I like.
And I'm going to type out my company name there and I have a logo for free. I might not even choose an image to be in my logo, I might just type out my company name, but then pick a nice font and pick something that looks good and that's going to be my logo.
Again, ideally I would have a logo made, but because I have a thousand dollar budget, that's not where it needs to go if I want to see a return within 30 days. So again, I'm going to make my logo and if I want a homepage image, I'm going to make those on canva.com for free using templates that they already have available. So at this point, my budget is still $0, haven't spent a dime yet.
Now, the next thing that I'm going to do where I do need to start spending some of that money is I'm going to get an app for live chat put on my website. I'm going to get a phone number so that people can call the business and so that I can call out from it. I'm going to sign up for G Suite from Google so I could have all of my domain emails go to the same place. And again, these things cost money, they do have free trials, but I'm going to put money there because if I want to make sales, I need to be professional.
I need professional emails, phone numbers, I need live chat so I can communicate with people in real time because I need to close every sale opportunity I have because there's no room to start leaking money. So figure about a hundred dollars for all those things combined.
Yes, they start with free trials, but let's just say $100 towards apps, email, phone number, and all of those things. Now I'm also going to take another hundred dollars and I'm going to put that towards getting an LLC set up, and I'm also going to get my EIN number, which is free to get by the way.
But I'm simply going to go online, I'm going to get an LLC, I'm going to get an EIN and I'm going to do that because even though I'm starting with a small budget, I know that I want this business to snowball into something huge.
And while I could not have that cost and just do business as a sole proprietor, I would rather just pay that $100 up front and that's an average a hundred dollars or so. I'd rather just pay that up front though so that I don't start as a sole proprietor and then one month later have to go back and form an LLC and then go back to my suppliers and change information.
I'm just going to do it, I'm going to bite the bullet. And between those apps I mentioned and between the business formation, I'm in for about $200 now. So I have 800 left. Now, the next thing that I have to do is get suppliers. And for this I'm calling them, right?
And that I'm doing myself, so there's no money involved. I'm simply reaching out myself. I'm saying this is Anton from antonsurfboards.com, here's why we should work together, go through the reasons and I'll fill out a form, I'll get approved.
By the way, if you don't know how to do any of this stuff, go to dropshipwebinar.com and I show you exactly how we do this step-by-step, dropshipwebinar.com. But I'm going to do that again, zero cost to getting approved with the suppliers. Now the next step is to upload these products to my website.
So once I'm approved, I'm going to put the products on my store. Now in the video I did, in the podcast with a bigger budget, I mentioned how if I had a huge product catalog, like if I was getting approved for brands that had thousands of products, I mentioned how I would outsource that and pay somebody to upload them for me.
But because my budget's not there, I'm going to do it myself. I'm going to upload the products to the website myself. And if you're thinking like, "Okay, I get that, but what if you have 3,000 products to upload? How long is that going to take? Can you do that and still be profitable within 30 days?"
Well, yes, because I, when I'm doing it myself, am not going to start by uploading, let's just say 3,000 products. Instead, what I'm going to do is use the 80/20 principle and I'm going to ask every supplier that I get approved with, "What are your top selling products?"
And they're going to tell me because we're doing business together. And I'm going to take what they tell me with what their top selling products are and I'm going to upload those products to my website. So maybe instead of having to upload 3,00 products, I have to upload 200, very doable.
And the other 2,800 products, I'm not going to ignore, they're going to get uploaded eventually, but I'm not going to do it from day one because the time isn't there and because I cannot afford to outsource that, I need my budget to go to other places.
So again, 80/20 principle. Talk to your suppliers, find out what you should be focusing on, what sells the best, upload those, start there, circle back, get the rest uploaded later. Now, the next thing I'm going to do is optimize my product pages, turn them into mini sales letters if you will.
Again, I'm doing that myself. So no budget spent. At this point, I'm still only out $200. Now we get to traffic, and things change here a little bit too because I love paid traffic, I still do.
We're still going to use paid traffic. We got $800 to spend and that's definitely where it's going, but I'm not spending as much as I would per day if I had that bigger budget. So what I'm going to do is set up my Google Shopping campaign using the alpha-beta campaign structure that we use and that I teach you inside of Drop Ship Lifestyle. And I'm going to have a budget of $30 per day. So $30 per day for my Google Shopping campaign, and then I'm going to take $5 per day and that's going to go into my Facebook remarketing campaign for dynamic remarketing ads.
So now my ad budget between Google and Facebook is $35 per day. Again, I had an $800 budget left, so that would last me 23 days of paid traffic, assuming I never made a sale. But I'm going to make a sale a lot sooner than that and we'll talk about why. But I'm going to spend that much money per day.
I'm also going to take advantage of the free $100 credit. I get to advertise on Google, I'm going to use the free hundred dollar credit. I get to advertise on Bing and I'm going to get the free hundred dollar credit. I get to advertise on Facebook.
So I do have a little bit extra, more of a runway for how many days of paid ads that I can run. But that's what it looks like, right? So if you're thinking like, "Well, in your bigger budget video, you're spending more per day, won't you get sales quicker?"
The answer is you probably will. But because there's a smaller budget here, you want to space it out longer so that you can act on data and actually be able to start turning a profit. So if I'm spending three times more than what I'm spending in this example, I'm going to see a lot more data faster but it's not a big enough sample size.
I want to see a couple of weeks of traffic. I'm going to start optimizing sooner, but I want to see what traffic and sales look like on a Monday versus a Sunday. So with a smaller budget, you're able to kind of do this over time. So that's where the money would be going.
Now I'm not going to only stop there and only spend less. I'm also going to try to find ways to bring in sales sooner than later for free so that I actually have the opportunity to start pulling that profit and reinvesting that into paid ads. Because that's the goal, right?
If my budget's $1,000, I don't want to stay at $1,000 for the next six months. I want to be able to grow and grow. So I want to start making cash quick so I can increase my budget. So what I'm going to do is find the most popular and heaviest visited Craigslist sections for my industry around the country, assuming I do business in the States. And I'll give you an example.
If I was selling the surfboards, right? I would think, "Okay, where are people currently buying surfboards?"
And maybe it is in Santa Monica and maybe it's... I don't know if people surf in Florida, I have no idea. You would know if you did the research, right? But I would go to Craigslist on those cities and I would make posts in the first sale section and I would make it look natural.
But I would say, "Hey, we have this surfboard for sale." And I would pick one of the best surfboards I have based on what my suppliers told me are the bestsellers. And I would say, "We have these, they're in stock now. We could ship them anywhere in the country."
Or, "We can have it delivered locally within three to five business days, whatever it is, here's my phone number for more information." So I wouldn't spam all of Craigslist. I wouldn't do this to the point where the account gets flagged and all my ads get taken down.
I would only post a few of these ads in the most irrelevant cities. I would make them look organic. I would have our phone number and then when people called, I would tell them, "Yeah, this is antonsurfboards.com, we have these with our supplier."
Their warehouse is wherever it is, they can ship it out whenever, right? Today. And I would take orders that way. And I would do that even though it's not going to be the biggest source of traffic and sales, it's not going to be the best thing you ever do.
But it's going to be a way to get started with no money where you can capture maybe a couple extra sales in a week and maybe those couple extra sales earn you $500 net profit, and maybe that's what's going to allow you to spend more money per day on your ads.
Maybe that's what's going to allow you to outsource somebody to build your website and make it look better so you have a higher conversion rate. Maybe that's going to give you the extra money to hire somebody to upload the other 2,800 products that you didn't do yourself, right?
But that's what it's about. When you're working with smaller budgets, there's more hustle involved, there's more creativity involved. Like the color palette example, like using the Canva example, like hustling on Craigslist example.
But these are things that we do so that we can get that net profit so that we can either pay ourselves or that we can reinvest, and that we can get our budget from 1,000 to 5,000 to however high it goes.
And as it goes up, we're making money along the whole way. So hope you found that useful for everybody that enjoyed last week's episode and that was curious about starting with $1K. And any questions, as always, let me know.
You can go to ecommercelifestyle.com/episodes, and you'll see this episode with full transcripts and all of our other episodes. As always, if you got value from this video, please let me know. The best way that you can do so is by leaving a review on Apple Podcasts.
And if you're brand new here, you're just getting started, you want to see more in-depth training, go to dropshipwebinar.com, D-R-O-P-S-H-I-P webinar.com and I will see you there. Thank you.
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