You need to avoid these dropshipping niches in 2023

Some dropshipping niches are more volatile and risky than others. You want your dropshipping processes to be as seamless and straightforward as possible. Many factors can come into play to disrupt those processes – return and refund rates, shipping problems, market saturation, and quality control.

Some dropshipping niches are more volatile and risky than others. You want your dropshipping processes to be as seamless and straightforward as possible. Many factors can come into play to disrupt those processes – return and refund rates, shipping problems, market saturation, and quality control.

This doesn’t mean you can’t enter a broad category like clothing. Just make sure you narrow down your product as much as possible, targeting a very specific customer segment. See if you can filter it by age, gender, location, and other interests.

We’ve selected five product categories you should try to avoid, especially when starting out.

1. Furniture

5 Dropshipping Niches To Avoid - Furniture

Furniture seems like a safe bet for a dropshipping business – large items can bring in more profit. We also covered that the home decor and office improvement categories are versatile. So where’s the risk?

The size. Bigger objects result in higher shipping rates for your customer, especially if your manufacturer is from abroad. Consider import taxes, packaging costs, and potential returns and refunds if the product gets damaged along the way. You still have to offer your customer an acceptable price. These extra expenses can hurt your profit margin if you need to bring the price down to stay competitive.

2. Fragile Items

5 Dropshipping Niches To Avoid - Fragile Items

Delicate items such as glass decor, watches, wine glasses, and electronic components often cause headaches for dropshipping businesses. They tend to be expensive and extremely fragile, especially when shipped from overseas. Longer shipping times equals a higher risk of damaged goods.

You can also ship them through a higher-class courier, which will demand higher shipping costs. We suggest going for sturdier, less expensive, and locally manufactured goods when looking for products to sell in your online store. Keep an eye out for a new generation of eco-friendly packaging – it appeals to consumers and is designed to protect even the most fragile items.

3. Basic Clothing and Apparel

5 Dropshipping Niches To Avoid - Basic Clothing and Apparel

The basic apparel industry is saturated with competition in every direction you look. Top players like fast fashion enterprises run the market and can quickly adapt to the ever-changing fashion trends.

If you want to start a dropshipping business in the clothing industry, make sure you construct a carefully thought-out strategy. Know exactly who you’re selling to and what you provide them that no one else does. The most promising clothing subcategories in the Clothing section were mentioned above.

People love being a part of a movement and are looking for like-minded brands they can support. Think about values you can share with your ideal customer and build your brand around them.

4. Electronics

5 Dropshipping Niches To Avoid - Electronics

Electronics is another category that experiences a high return and refund rate. In fact, it’s the third most returned product group in the United States, following clothing and shoes.

When choosing an electronic product to sell, we recommend that you order a few product samples and test them before making a final decision. Low build quality and poor performance will likely result in bad reviews that damage consumer trust in your store. Even if your samples work okay, keep in mind that manufacturing errors can still happen and catch you off guard. You can avoid this by carefully reading other eCommerce company reviews of the manufacturer.

5. Cosmetics

15 Dropshipping Niches to Choose and 5 Dropshipping Niches to Avoid for Online Merchants 15

While beauty and personal care products are still some of the most profitable dropshipping niches out there, cosmetics carry considerable risk for your dropshipping business. These are products that people put directly on their skin – one bad reaction because of a poor product description or simple inattention can severely damage the reputation of your online store.

The cosmetics market is also highly saturated. To enter this segment and be able to compete, you need substantial capital to bring quality products and a powerful marketing strategy. You can also offer lower prices, though this could mean you compromise on product quality and durable packaging.