Is Dropshipping Saturated? (The Truth Today) Episode 155

👉 Ready to start your own online store? Start here: https://dropshipunlocked.com/online-event?el=podcast-155-is-dropshipping-saturated

🗣 In this episode, Lewis Smith and James Eardley unpack the big question: “Is dropshipping saturated?” They break down why the wrong kind of dropshipping feels crowded, what actually works today, and how to approach e-commerce in a way that’s sustainable, profitable, and simple to run.

👉 Prefer to watch this on YouTube? Check it out here ➡️https://youtu.be/nHCL3JSLlOs

Topics Discussed:
 ★ Saturation vs. Strategy: Why low-ticket, AliExpress-style “trend hopping” feels saturated—and how brand-direct, UK-stocked high-ticket e-commerce is a different game entirely.
 ★ Home-Turf Advantage Model: Partnering with UK brands/distributors for fast delivery, fewer admin headaches, and healthier margins.
 ★ Demand > Fear: How to think about competition properly (it often signals demand) and why you only need a tiny slice of a huge market to win.
 ★ Simple Math, Big Results: The high-ticket approach—fewer orders, higher margins, less stress.
 ★ Mindset Shift: Flipping from fear/“it’s too late” to “what if it works?”—and why most people get stuck in the wrong questions.
 ★ Real Examples: Shoutouts to members like Kit and Sally, illustrating what’s possible when you follow a proven process.
 ★ Getting Started Costs: Ad budgets, lean overheads, and why ads are an investment (not an expense).
 ★ Listener Q&A: “How much in savings should I have to get started?”—the practical way to plan your budget and timeline.

Links and Resources Mentioned:
 Pick up a copy of Lewis’ book: https://dropshipunlocked.com/book
Get Shopify for £1 a month for 3 months: https://dropshipunlocked.com/shopify
Get a free trial with a professional phone line: https://dropshipunlocked.com/circle

Key Takeaways:
 ★ It’s the wrong model that’s saturated: Trendy, low-ticket imports with slow shipping create unhappy customers and razor-thin margins.
★ Play a different game: High-ticket, UK-stocked brands, fast delivery, and authority-led stores win on trust, margins, and simplicity.
★ You only need a slice: With billions shopping online, a handful of high-ticket orders can replace a full-time income—if you follow a proven system.

FOLLOW:
 Instagram: https://www.instagram.com/dropshipunlocked/
Twitter: https://twitter.com/DropshipUnlockd
LinkedIn: https://uk.linkedin.com/company/dropship-unlocked
YouTube: https://www.youtube.com/c/dropshipunlockedlewissmith
Website: https://www.dropshipunlocked.com/

Thank you for listening to the Dropship Unlocked Podcast! Don't forget to subscribe and leave a review on your favourite podcast platform.

★★★ Dropship Unlocked - Lewis Smith ★★★
 🌏 Want to create location, time, and financial freedom? Watch Our Free Training ➽ https://dropshipunlocked.com/free?el=podcast-155-is-dropshipping-saturated

Transcript

0:00

Yeah, people say dropshipping is saturated. And the truth is that if you've. Ever looked at a niche and thought there's just too much competition, then and. That is how I would approach dropshipping today, to guarantee your success. And if you get that wrong, you will never have a successful store. The key with starting in today's market is to welcome to the Dropship Unlocked podcast. I'm Lewis Smith, the founder of Dropship Unlocked and with me is our client, success coach, James Eardley. Now, when we're not recording podcast episodes or running our own e commerce businesses, you'll find us helping aspiring entrepreneurs launch their own high ticket dropshipping stores. So if you're ready to build your own six or even seven figure online business, then head over to dropship unlocked.com forward/start. Now sit back, relax and let's unlock your potential with the Dropship Unlocked podcast. Very often we get questions asking, is dropshipping saturated today? And honestly, I get it, but YouTube is flooded with cheap product hacks and, and everyone is racing to the bottom. But we have a unique perspective on this after generating over £7 million combined in revenue with our stores and generating over eight figures for the members in our programme. So we do have a perspective to share and we're coming from that position. So in today's episode, Louis, we're going to break this down. What is the current landscape and explain what we would do if we were considering starting all over again today. So Louis, let's, let's start here. So why do you think we get that question so often? Why do you think people think that dropshipping is saturated today? Yeah, it's interesting because this same belief has been prevalent in the market since I started in this and probably even since years before I started in this. And it's a very common belief, but it comes from slightly misinformed thinking or even outdated thinking. I think people are looking at this and assuming the wrong model. They're looking at the type of dropshipping which, where people source cheap products from China, usually things like AliExpress or Temu, they throw them onto a burner shopify store that they have no long term brand with, they have not got any long term plans for. They hope they can make a quick buck by just pouring some meta ads at the whole thing and hoping that they get a flurry of sales that very quickly falls apart. The products are low quality, the business model itself is just low quality. And so there's this kind of flood, this wave of like generic stores all selling the same cheap products from China, I'm sure you listening to this right now, have been flooded with these types of ads on your own Instagram and Facebook feed where you see that the same products are being sold again and again and have clearly just been marked up by some supplier in China or from some supplier in China marked up to a retail price when being sold in the US or the uk. And so the space itself is really noisy because everyone's thinking there's such a low barrier to entry here I can make my million, so I'm just gonna do this kind of really easy business model. But that is not where we play. Like we don't operate in that space at all. And I think the misunderstanding here comes from people mistaking competition in that kind of very competitive, very noisy, low quality, low profit type of E commerce and drop shipping. They mistake that for saturation. And yes, that business model itself is not only saturated, but there are many, many other problems that we could list with it. But just because other people are doing it and are running dropshipping businesses does not mean that there's no route. I think this is a really dangerous trap that we can fall into and almost limit ourselves and create a false ceiling on what we're able to do. All because we had a misinformed sense of what the business model were and what the limitations were. So we'll dive into that in this episode. But generally I see competition specifically in high ticket E commerce and dropshipping as a good thing often because it means that there's demand there and if there are other people playing in that market and earning good profit, good enough profit to have been around for years, then I only need a small slice of that market to replace a full time income. You know, if I want to take the business to hundreds and hundreds of thousands per month, that might require a little bit more strategic thinking long term. And that's definitely a bridge we can cross when we get to it. But to start with, if you want to make your first 10, 20, 30,000amonth, you can absolutely operate in a market where there's plenty of competition because you just need a small slice of that pie to make a full time income. And I had to see that mindset shift. It's not something that's built into us. I think especially in the UK mindset, there's, there's an expectation if you're winning, then somebody else is losing. And it took me to get into the business world and to work with you, Louis, to realise that actually competition is a real sign of success and we want to go where the success is. And so we need to see a certain level of competition in order for us to succeed as well. Because if there's no competition, it's probably for a reason and it's much more likely that there's no chance of success rather than it being a one off miracle unicorn industry that you're going to go into. So we have to accept they're going to be some level of competition mindset comes into this. I think lack of seeing other people's case studies comes into this, but I'm sure we're going to address that as we go through the episode today. But the biggest point is where people might just write it off because they're thinking about the wrong type of dropshipping, which is such a great point because it's easy to just think negatively because you're seeing the same thing over and over again. What we do with this podcast, Lewis, is constantly reminding people that we are representing a different type of E commerce. That's not the norm that you'll see on YouTube. That's easy to write off. So let's dig into that then. Louis, what are the main differences that actually sets our approach apart when it comes to the way we do E commerce? Yeah, it's a great question because we are essentially playing a totally different game to the people operating in that low ticket products from China. Long delivery times, unhappy customers, space like that is almost a totally separate business model. The only similarity, the only common ground between the two really is that in neither model do you need any stock. So we never have to part with any capital and we use an E commerce site to fulfil it. Other than that, they're almost totally separate businesses. So with our home turf advantage model, we sell high value, high ticket products. So we're thinking products upwards of about 500 pounds and more, up to 8,000, 10,000 and beyond. And we work with UK distributors. So whether that's a UK manufacturer or just a UK supplier for a internationally manufactured product, the important thing is they have the product in the UK already so that when we make a sale on our Shopify store, we can pay the supplier the trade price and then the supplier sends that item straight out to our customer, usually within a couple of days for delivery, which means the customer is kept happy. We make our 20 to 30% profit margin because it's a higher ticket, higher price sale. We only need a 20 to 30% margin to be able to make, you know, if it's a two grand sale we make £600 in profit on that single order. You know, I saw a post yesterday from Sally we had on the podcast recently who made, I think it was 1800 pounds profit on a sale the other day. How many of those sales do you need? If you're making the best part of two grand profit on a single sale, ask yourself from this business, how many sales do you need per month? Like, I think this is a really good exercise because if someone says I want to make 10k a month, I want to, you know, £10,000 profit per month for my business would, would be a good first milestone for me. And I think that's good. I think you can stretch your goal way beyond that. But if that's where you're starting, that's a, that's a really good goal. Okay, so if you're making, you know, nearly 2k in profit per sale, what do you need 5 sales in a whole month to achieve that? So one of the things that I think that really brought this home for me was like when I was in Chiang Mai in Thailand and I was sitting next to a friend of mine in a co working space, he had his laptop open and he was running one of these lower ticket dropshipping stores and his computer just looking at it stressed me out because it was going like, ping, ping, ping, ping, ping, ping, ping. Like with all these sales coming through and I was like, fascinated. Like this looks so complicated, so much admin, so many customers to keep happy. Like you know, he's making, I don't know, 20, $30 profit on each sale. And I just looked at one of them and I spotted that the address was Clapham in London, which is interesting because it's like an area that I knew fairly well. And I just thought for a second, like driving through Clapham in London, like an area in London, looking at all those houses and all the people walking down the streets and all the people on the tube and all the people on the common, all it takes is one of those people to pull out their phone, need a product and purchase it from your store. So think for a second how many thousands and thousands of different high ticket products are being sold in every niche imaginable in the uk, Every hour of every day, right now. Think I only need 5 of those per month to make 10k per month. I know we've made some assumptions here and it might be that the products you're selling are not that high ticket. Maybe they're just know two thousand pounds or a thousand pounds, in which case, okay, you need 10 sales a month or 15 sales a month. But we're not talking about that scenario that I saw on my friend's laptop where it's just constantly needing that high volume of sales. So it's a totally different game we're operating. We, we've stacked the cards in our favour because we're focusing on building trust and brand authority with a real niche, focused brand. We're not, you know, looking for gimmicks or trend hopping or trying to find out what winning products there are at the moment. We help our members become specialists, not just generalists. So that instantly then positions them above the saturated stores that are trying to be everything to everybody. If you think of it like imagine the numbers just, you know, sometimes I go on Google Maps for example and just look at the sheer volume of streets and roads and houses in the UK or when you're driving down the motorway and you see all these towns, think I, I just need one person in one living room with one phone per day to go on our site and just buy something and they buy a 2,000 pound treadmill or a thousand pound barbecue or a 4K massage chair. Like just think that if that's all it takes to get your target income, sometimes it's really helpful to give that perspective and to really zoom out. So that's why we're playing a different game and why it's a much simpler, less stressful form of the business and. It'S, it's just world apart to the most common drop shipping that you'll see. And you made the point so well, there is people are so keen to look at the competition in terms of the supply and how many people are supplying the products and they're so slow to look at, actually look at how many people that have the demand for those products. Why is, why is it not everyone talking about, my God, look how much the, the e commerce space is growing. I did some research recently and there's $6.8 trillion in E commerce. The E commerce industry is worth 6.8 trillion. It's going to go to 8.1 in the next year and there's now 2.7 billion shoppers worldwide. So just say this just to sort of blow those limited beliefs out of the water. In terms of one in three human beings do their shopping online now and if we just need a handful of orders to make 10k a month in dropshipping, then we need to start to think big about how big this opportunity is rather than thinking small and thinking about how much competition there is. So, yes, we do a different type of dropshipping. But I also think this question of is it over saturated comes from a mindset issue or it comes from a place of lack and people not believing in themselves. So I just want to dive into that list. I wonder if you've got a similar opinion to me as the reason people don't think that their saturation is not because necessarily what they've seen online. It's just purely coming from a position of I need to protect myself from potential risk. Do you, do you agree with that kind of sentiment? Yeah, I think that we have a tendency, like you say, to look and focus too much on the potential downsides and risks, which is what's in our human nature to do. It's our survival mechanism, but we maybe don't give enough weight to the potential upside. And the funny thing is that I think it comes down to almost like the mental disposition and the default, either optimism or pessimism, the glass half full or the glass half empty kind of state of mind that you can condition yourself to be it. You know, it's not like you're born a pessimist and you must remain one for your whole life. Like you can make that shift. And there are certain things unrelated to this that will help with that. You know, not filling your brain with negative news media all day long and like tuning out some of the negative hysteria that's in the media and really just focusing on like the controllables and what happens in your life and how you optimise your morning and your day for positivity. And, you know, back when I started, I remember 2017, there were people screaming from the rooftops about how dropshipping was too saturated, it would never work. You just did one search on forums online and people were bashing it, saying, it doesn't work, it's outdated, it will never take off. Unfortunately, like those people today, years later, and I'm what best part of £6 million into e commerce now in terms of the sales I've made since starting, those same people are probably still bashing whatever business model that they've now turned a hand to and are kind of trying to justify why they aren't going to do it and why it will never work. Because maybe it makes them feel better for the short term, maybe it kind of makes them feel less like they gave up on it. But I think the thing is, the biggest favour that you can do yourself is just to flip that switch and like you say, start focusing on like the sheer opportunity out There and it's difficult to remember when you're sitting in your house and you're looking at like the four walls in your room. You can't see the millions and millions of online customers and consumers out there. So sometimes I think it's helpful go for a walk to a public space, see like go to a shopping mall, see the thousands of people walking around and just look at them on their phones and just think, I just need one of those people a day from the whole of the country to want to purchase a product from my store and I've made my target income. And it very quickly start, you start to realise like this is definitely possible. And so yeah, the people that are saying it's saturated are, are going to always find an excuse and a reason not to act. And most people don't follow through. That just seems to be the default in society. They just jump from idea to idea. They never kind of get anything up and running properly. They wouldn't finish an E commerce website. And often what they'll do is they'll try and do it alone, they'll try and piece it together without a clear roadmap or support. And remember their default is pessimism. So as soon as something goes wrong or doesn't quite work out how they expected which will happen, we all know this in business they are very, very quick to blame the model and they'll just say, see, I knew it wouldn't work, you know, supplier doesn't answer the phone or something, they'll be like, yep, knew the whole thing was saturated and it's never going to work. Ah, should write it off and throw in the town now. And unfortunately that's like the default cycle most people get caught in. So you have to break out of that and you have to say, well okay, let me look at the positives here. There are thousands of people now who are running these types of businesses online full time, living in Bali like you are at the moment James, and enjoying the fruits of the labour that they put in earlier. So the business model works in terms of saturation. Like you say, focus on the demand and look at the sheer number of consumers and how many people are spending their income every month on products. Do you need 100% of that market? The reality is all you need is just a very small slice of that market to be able to make a full time income as we've talked about. So yeah, I think the winners keep showing up even when it's quiet at the start because they remember that eventually they'll get There it's a proven process. We have a step by step blueprint to do it. There's enough demand out there so you just got to stick with it. Exactly. It's exactly what Kit did. So if you need some proof, if you want some confidence around the market, if you're viewing this as like it's something that's definitely saturated, then listen to Kit's episode that was only two weeks ago, actually maybe five weeks ago, but it's on the channel not, not long ago. And he did a fantastic job of explaining his journey and he went from somebody who had no experience but he's done almost a million pounds in sales, you know, with making 29 profit in a £29,000 profit in a day. Now obviously that's not typical from every single member, but I say that and we featured them because the confidence that you can see from somebody in the same position as you, who's just taken the actions that we lay out and gets to that success should give you that, that, that reassurance that there is clearly lots of demand for the products that we show you how to sell. Otherwise you wouldn't have these sales. Listen to Sally's success story that you mentioned earlier in the podcast today, Neil. We've got on the podcast Mason Jared who's done over 4 million. I could keep listing all the names and sorry for those, the members listening now who haven't had a shout out because I'll be screaming through the, the podcast now to tell me it's just over and over again. We see this over and over again and if people listen to these kind of lack mindset of not getting started then all of those people would still be thinking about it, still be watching videos, still be, you know, just in consideration mode, thinking when's the right time to start and they'd never be where they are today is me like you say Lewis in Barley now been living in abroad for the last 12 months and that's because I took the action initially to build a successful business. So I've now got my income online and it, the, yeah the freedom and the opportunities that you get when you go for it and leave behind the mindset of lack is incredible. So yeah, I think we've done our best there to overcome the emotional argument and the logical argument that people come to us if they have that in mind. So if you're having these thoughts, listen back to the episode and we're going to be referring people to listen to this now when we hear that question. But any final thoughts then Lewis, for somebody who's thinking maybe I'm just too late and this won't work for me. People said the same thing in 2015, they said the same thing in 2017. They'll probably be saying the same thing five years from now. Right? It's, it's not too late. If you are, if you know what the criteria that you want in the business are, it might be that some niches now are not viable anymore and that you need to change, but there are new niches emerging every day. You know, we talked about the example there with Kit, one of our members that we interviewed recently on the podcast. Like you said, he made £29,000 in profit in a single day. So yes, that's not typical. But just ask yourself, like, what if you just made half of that? What if you made 15k in profit in a day or even half of that? What if you made 7k profit in a day or just 3k profit in a day? Like a fraction of that? I'm pretty sure most people would be okay with in terms of an income when they're starting out from their business from just a handful of sales. So you've got to come into this, seeing the upside and being an asking the question of yourself and your subconscious not what if this doesn't work? What if it goes wrong? But flip it, have the glass half. Half full for a change and just say, what if it did work? What if I did make £10,000amonth from this? What if I did create a business that allowed me to live anywhere on the planet? Because the reality is you're not too late, you're early. If anything, you're most people, when you speak to them about E commerce and dropshipping, walking down the street, they'd be like, oh yeah, I heard about that thing on, on TikTok. Like I'd love to do that, but. I don't really know how. Like, if you're at the point of this episode and you've listened this far in and you're willing to do it properly, the opportunity is still huge. The window is wide open for those who want to come into this and treat it like a real business and are not looking for some quick fix, some get rich quick, sell a load of gimmicky widget products from China and make a few pounds and then disappear. That's not what this is about. So if you want our help building your store the right way, a long term sustainable brand that's defensible, that you can stand behind and can serve you and your family for years to come. And you want a proven method and our support step by step, holding your hand every step of the way. To do it, head over to dropshipunlocked.com. Start are you enjoying the podcast? We'd love to hear from you. Leave a comment or a review and we might feature it in an upcoming episode. And for detailed show notes and resources, visit dropshipunlock.com podcast. If you found value in any episode of this podcast, please could you take just 10 seconds to leave us a quick five star review on your favourite podcast app. It helps us more, more than you can imagine. And who knows, you might just hear your comments read out on the show. Thanks for being a part of our community. Your support helps us keep delivering new episodes to you every week. Now let's answer a question that's come in to a recent episode of the podcast. And remember, if you've been listening to this episode today and any questions have come into your mind, if you comment beneath the YouTube video version of this episode, we might just feature it on an upcoming episode. So I'm going to put this question to you now, Lewis. We had a question that came in from Devon lufram, that's his YouTube handle, and they asked I'm really keen for a new path in my life and I've watched many of your podcasts. One of my questions is to get started. How much in savings would you advise to have? Yeah, great question. So I think the first thing to say is give it a bit of perspective. Look at some other different types of businesses that people start. Many people will go to the bank and get a loan out before they start a business and will be 10, 15, 20,000 pounds in before they even get started. Then they've got to go and maybe purchase inventory and then lease a warehouse and then hire a few staff. You know, the overheads really start to stack up and you could be the best part of a hundred thousand pounds into a business venture before you even made your first penny back in sales. And that's not abnormal. Like that is a very typical kind of way of starting a business. Often there are capital requirements up front required to get up and running. With this business model, it's incredibly lean, but there are still some. For example, you can run your store for well under a hundred pound a month in terms of like shopify fees, your domain name, basic software tools like phone number, you know, chat tools, things like that. Also in terms of advertising, when it comes to the point of running ads, once you've been through the process, we've built your store, you've got your suppliers on board and we want to start generating traffic and getting customers to your store. We recommend about 30 pounds per day to test on ads. Remember, as soon as you make a sale, let's say you make £600 in profit on that sale, that covers your ad spend for quite a long time and then that frees you up, that gives you profit to put into more ads, to scale things up and eventually that becomes the game. It's making sure you can acquire customers profitably while still having a steady flow of customers coming through into your website. That's definitely enough to start generating data, making your first few sales. Now, the more you invest in support, the cheaper overall your journey is going to become, because you won't make the same mistakes that many other people before you have made, that you'll get results faster because there's just a more direct path to it. So that's why mentorship and training won't just save you time, but it actually helps you avoid really costly mistakes that could make or break your business. So if you can have, say, a couple of months of your savings, your salary set aside, ready to really give this a good shot, I think that will put you in a really good position. So although there's not a definitive answer to this, if you can have a few thousand pounds set aside ready to go as a budget to make sure that you have a safety net there and ideally, if you still have a full time income and you're doing this on the side, that's a great way to be prepared and to treat it like a real business. Yes, that's exactly how I approached it. Lewis, great point. And just to jump in as well, when you mentioned about 30 day, a 30 pound a day on ads, some people get scared by that because they think I've just got to front this money into ads and I won't see any return on that. But that's a wrong mindset to approach ads because when you spend money on ads, it is a direct investment with a direct amount of money that comes back from the amount of money you put into ads. It's not like you're tying up 30 pound a day. You're never going to see a return. After you put the right products on your site, after you build the right store and choose a niche, after you've been through the programme, you'll get sales very, very quickly. And so your return on that money is very quick. You know, within the first few weeks, you'll be getting sales back in. So that's what happened for me. Just wanted to jump in on that because some people can get frightened and scared by hearing that there's an ad budget needed to put behind it. But yeah, that's the way to look at ads, isn't it? There is, yeah, exactly. It's an investment. And yeah, I understand that some sometimes people think it's almost just like a. I've got to just pour money down the drain. Like the reality is we wouldn't be paying Google or Meta money just for fun. We're paying them that money so that we can multiply that that money into more money. That's why they exist and that's why they're so rich as companies is because they allow people to invest a small amount of money into ads and generate more money back in sales. So we're starting to now be able to play that game as business owners. And so, yeah, it's a bit of a mindset shift. We're now not just aimlessly boosting a post and hoping it'll work. We have a strategic advertising campaign that we construct with you, show you how to optimise it so that every time you're paying for someone to click on one of your products, there's a high likelihood that they're then going to purchase. And as soon as one person purchases a high ticket product from your store that pays for all of the ads for the month and hopefully leaves you with some nice profit as well. Exactly, yeah. That's why ads are so exciting. And we've talked about it in previous episodes. If you want to know how to approach the ad investment, then check out another episode after this one and we go right into depth about how to set up an ad campaign. Recently, in the last few episodes we did that. So to consider as well is my lifetime roas with my business is like 16. So 16 times ROAS for the amount of money I put into ads and the amount of revenue that I've generated with that ad spend. And so I say that just to get people excited in ad spend rather than being shying away from it, because what investment would you get 16 times return on? You're expected to get 10 if you put it into the S P 500, for example, let alone 16 times. So yeah, say that just to illustrate the point. It's a good question though, and thanks for your answer to this. Now we're going to highlight a recent review that we've had for the podcast as well, because we like to give you a shout out if you say nice things about the podcast. So thank you Papa Brood for the Apple Podcast review. And they said I've been looking for a solution like this for years. Thank you Dropship Unlocked well, thank you. Very much for your review Papa Brood. We really appreciate it. Now, as we wrap up today's episode, one question I have for you, listening or watching this episode today is who do you know that could benefit from hearing this one? Open up your phone, click Share on this episode and send them a link to this one on WhatsApp and just say, I thought you might enjoy this. That tiny gesture could be the thing that changes the direction of their life for the better. Thank you for joining us on this episode of the Dropship Unlocked podcast. We hope you are leaving with new insights and inspiration to fuel your entrepreneurial. Journey to kickstart your e commerce business. Head over to dropshipunlocked.com start. It's the perfect place to start and get access to of resources that will help you build your business from the ground up. And don't forget to hit that subscribe button for more episodes packed with strategies. Tips and success stories. Plus, if you enjoyed this episode today. A five star review would mean the. World to us and you might even get a shout out on the next episode. Thank you for choosing to spend your time with us today. We can't wait to bring you more insights on the next episode of the Dropship Unlocked podcast.