Practically, you need approximately at least $339 and at least, and $823 at most to start a drop shipping business on Shopify. You can also start a drop shipping business with $100. This post will show you how. The figures are derived from the following cost centres: costs of registering a custom domain, cost of the Shopify Basic Plan (we factored in the special of $1 per month for the first three months), product sampling, marketing and the cost of a typical drop shipping app like Spocket or Dsers. We also factored in the cost of legal compliance such as registering a legal business entity such an LLC or a sole proprietorship.
See the table below:
| Expense Category | Minimum Budget | Maximum Budget |
| Custom Domain | $14 | $14 |
| Shopify Basic Plan | $25 (for first 3 months) | $299 |
| Product Sampling | $200 | $200 |
| Marketing | $100 | $125 |
| Drop shipping app | $0 | $49 |
| Legal | $100 | $500 |
| Total Estimated Cost | Approx. $443 | Approx. $1,187 |
| Costs in First 3 Months | Approx. $339 | Approx. $823 |
Later on in the article, we will also share details on how you can practically start a drop shipping business for $100. So read on.
Calculating the Costs of Starting A Drop Shipping Business on Shopify
Custom Domain Costs
As much as Shopify assigns your new store an auto generated subdomain name by default, for branding purposes and as best practice, you need to run your ecommerce drop shipping store on a custom domain that you customers can relate with. You then connect your custom domain with Shopify store to.
A custom domain costs about $14 per year. Shopify has domain registration services. You can also make use of external domain registration and hosting services like Bluehost if you like.
Shopify eCommerce Basic Plan Cost
Drop shipping requires a solid ecommerce platform with all the essential features and functions for product sourcing, inventory management, product listing management, online payments and order fulfillment. The Shopify Basic plan is a good entry level plan for drop shipping.
The plan costs $19 per month paid yearly and R25 per month paid month to month. Take note that this plan has a 2% transaction fee- you need to factor this into your pricing model and business strategy.
The good part with Shopify is that it has flexible pricing plans and packages, you don’t have to pay an arm and a leg when you are starting out – you only pay for what you need, as your drop shipping business grows and scales you can then switch to a relevant high tier plan seamlessly within Shopify.
Sampling Products
As part of your due diligence in identifying and sourcing high quality products that meet the standards of your customers, you may spend around $200 (Once off), in sampling products.
This is a crucial step for ensuring that you only deal in quality products. The cost of this exercise will vary according to the industry/sector and product type you are dealing in.
While sampling is not mandatory, it is an important exercise to consider and to budget for in your plans to start a solid drop shipping business on Shopify.
Marketing
Remember, setting up and configuring a drop shipping store on Shopify is just one important part of the puzzle. However, without a solid marketing strategy, your drop shipping business will not fly.
You need to put together a decent budget, approximately $100 – $125 per month for marketing. You can also keep your marketing costs low by leveraging cost effective digital marketing channels such as Google ads and Facebook ads.
Other Business Expenses (Legal Structure)
You also need to make budgetary provisions for the other business expenses such as establishing a legal structure for your business.
Cost for this may range between $100 and $500 depending on the type of incorporation you want to go with. The options are mainly choosing between a sole proprietorship and LLC.
The LLC option costs more than the sole proprietor option as it comes with more legal protection for your personal assets.
Drop Shipping Apps Cost
The other cost area you need to consider and plan for is getting a drop shipping app. Drop shipping apps cost you between $0 – $49 per month.
The way drop shipping works on Shopify is such that after determining the products and suppliers for your drop shipping venture, you then need to identify an app that integrates your supplier platform with Shopify.
The purpose of a drop shipping app is to automate importing products and product details from your supplier into your Shopify store.
The app also helps with the automated inventory management as well as conveying order details for the supplier to fulfil the shipment.
Most drop shipping platforms have their apps. Spocket for example has a free plan. However for advanced automation features you will need to consider taking premium plans.
Cost Breakdown for Starting A Drop Shipping Business on Shopify
| Expense Category | Minimum Budget | Maximum Budget |
| Custom Domain | $14 | $14 |
| Shopify Basic Plan | $25 (for first 3 months) | $299 |
| Product Sampling | $200 | $200 |
| Marketing | $100 | $125 |
| Drop shipping app | $0 | $49 |
| Legal | $100 | $500 |
| Total Estimated Cost | Approx. $443 | Approx. $1,187 |
| Costs in First 3 Months | Approx. $339 | Approx. $823 |
The figures on the table above help answer the question: how much does it cost to start drop shipping on Shopify more practically.
Please note that the figures used particularly in the product sampling and marketing items are not cast in stone, it can be more, it can be less – however those figures are helpful as benchmarks for the bare minimum plan.
So starting a drop shipping business on Shopify can cost you approximately $433 on the lower end and approximately $1 187 on the upper end.
With the Shopify special of $1 per month for the first three months on any premium plan, you can start your drop shipping business for approximately $399 on the lower end and approximately $823 on the upper end.
Keep reading to see how you can also legally and practically start a drop shipping business on Shopify for literally $100.
Can I start Shopify drop shipping with $100?
Starting a drop shipping business on Shopify for $100 is possible. However there are some adjustments you would need to make in your approach. See the adjusted cost breakdown below for starting a drop business for $100 on Shopify.
Cost Breakdown for Starting a Drop Shipping Business with $100
| Expense Category | Minimum Budget | Maximum Budget |
| Custom Domain | $14 | $14 |
| Shopify Basic Plan | $25 (for first 3 months) | $299 |
| Product Sampling | $200 | $200 |
| Marketing | $100 | $125 |
| Drop shipping app | $0 | $49 |
| Legal | $100 | $500 |
| Total Estimated Cost | Approx. $443 | Approx. $1,187 |
| Costs in First 3 Months | Approx. $339 | Approx. $823 |
The table above shows the adjustments required to practically start a drop shipping business for $100. The cost for the custom domain remains the same, which is crucial for branding and the success of your ecommerce drop shipping business.
The calculations are also based on the Shopify special for $1 only for the first 3 months, so you would need to factor in the normal costs of your Shopify plan after the 3 months.
With $100 as your start up budget, you would have to drop the costs of product sampling. This must be a change of approach though and not a complete elimination of the due diligence required to make sure you only deal in quality products.
So what you can do here is to do your due diligence by thoroughly evaluating the quality of the products that you intend selling on your front store.
You can also check reviews and testimonials to get on the ground insights on how other drop shippers feel about the products you are considering.
While drop shipping apps such as Spocket only start giving you critical automation features when you subscribe to the premium plans, drop shipping apps like Dsers will enable you to start automating product imports and inventory management with the free plan.
This way you can drop costs on drop shipping app subscriptions and reduce your start-up costs.
However, you need to watch out for costs that may come with Business Name Registration (if you want this), Local permits and licenses, (cost vary based on state and location), as well as tax considerations.
Cost Saving Tips for a Drop Shipping Startup
If you really want to go low cost in your drop shipping business start-up, then consider drop shipping business models such as print on demand, niche products, low cost products and wholesaling generic products that can be sourced in bulk at very low costs.
You can also save costs on the ecommerce platform – Shopify has a great balance of comprehensive drop shipping features. Shopify’s Basic Plan is available for $1 only for the first 3 months.
This is an opportunity you should grab if you are keen to start a drop shipping business for $100 and test your business model before you go big.
Final Thoughts
How much you need to start a drop shipping business on Shopify depends on a number of factors as we have outlined in the article.
That said, Shopify gives you a head start with its leading, robust and user friendly ecommerce platform.
Also, the option to access the Shopify basic plan for only $1 per month for 3 months is just the perfect opportunity to launch your drop shipping dreams at a minimal cost.
Remember platforms like Shopify have different features and functions designed to help you grow your business.
The good part is that the Shopify platform can grow with your business, eliminating the need to switch platforms amid operations.
Now is the perfect time to get started.
All the best.
