We Analyzed 1115 Business Owners. Here’s What We Learned About Making Money on Shopify

By Bill Acholla January 19, 2022

Running a successful business is often a unique experience with shared trends that are common to many merchants.

To help you get informed insights into this aspect of the industry, I surveyed 1,115 business owners and picked their brains on the current state of making money on Shopify.

So, if you’ve ever wondered how to make money on Shopify effectively, here’s what the successful users had to say.

Our summary findings are as follows:

  • 85% of business owners think Shopify is great for beginners, and 79% believe that newbies can make sizeable earnings on this platform.
  • Most businesses who engage in dropshipping prefer Shopify over its alternatives.
  • While clothing, accessories, and printables remain in high demand, successful dropshippers in any category can make up to $100,000 a year.
  • Success in dropshipping requires 10-hour workdays and intelligent balancing of profits and shipping costs.
  • A small percentage of business owners believe dropshipping to be a scam, and about 20% of those doing it are facing losses.
  • Over 89% of business owners make a successful living on Shopify working from home.
  • If done right, you can earn your first $100,000 in as little as two months, but more than 10% of businesses fail on Shopify because of exaggerated expectations.

1. 85% of business owners consider Shopify as the best platform for beginners

One of the biggest reasons why Shopify has a wide following is because it’s super easy to use and set up.

As new entrepreneurs and business owners, the technical side of online retail can be confusing.

So, it’s easy to find wholesome answers to the question, What is Shopify?’. And for many of the respondents, it’s certainly a platform worth using.

We found that a whopping 85% of business owners agree that Shopify makes it easier for first-timers to get into online retail.

For instance, they have an hour-and-a-half video that serves as a Shopify tutorial for beginners. And it’s just one of the many ‘how-to’ resources on their website.

The structure and content all focus on training a newbie into becoming a successful user of the platform.

Apart from tutorials like these, their help center and educational resources such as beginner’s guides allow anyone to quickly pick up the basics.

Key Takeaway: Shopify is user-friendly, and many businesses agree that it works well even for first-timers.

2. 79% of business owners believe that beginners can make significant money using Shopify

Setting up and getting your business running is one thing and actually making money is another! A vast majority (79%) of our respondents firmly say that Shopify allows even beginners to make substantial earnings.

This one is an important metric because users who start from scratch can still make profitable returns.

That’s not to say that Shopify is a get-rich-quick solution. But it’s certainly a fast and effective way of getting your store up and earning online. 

And we’re not just talking about chump change here. The respondents all insist that the potential for earning sizeable amounts is almost limitless, even for beginners.

For those who already run a successful website or earn profits from an affiliate program, Shopify can offer even more opportunities.

Key Takeaway: Beginners can still make significant earnings even with a lot of users already on Shopify.

3. The majority of merchants prefer Shopify for Dropshipping business

Dropshipping has become an incredibly popular form of online retail because it doesn’t require a whole lot of capital and is easier to manage.

And a large section of our respondents opted for Shopify as their first preference for executing their dropshipping business.

The reasons, of course, vary.

While some prefer user-friendly systems, others like the wide range of features you can get for additional payment.

The Shopify vs. BigCommerce debate may continue, and there may be other competitors like WooCommerce or Magento who also offer dropshipping solutions.

But most merchants here believe that Shopify is still the way to go!

Key Takeaway: Ease of use and handy features make Shopify the preferred choice for most dropshipping merchants.

4. Wardrobe and accessories are the most profitable niches

Clothing and related accessories continue to be the most sought-after and popular categories on Shopify.

A large section of our respondents deals with clothing goods.

And they all agree that it’s a niche they will continue to be in regardless of how successful their other goods are.

There is a general consensus among both shoppers and sellers alike that the clothing industry isn’t dwindling anytime soon.

Firstly, it’s a basic need for everyone.

But very importantly for business, it’s something that’s used for comfort, style, creativity, personality, and a host of other expressions.

Many vendors revealed that leveraging their Shopify app or linking their website to Shopify’s eCommerce functions was a good move for the clothing business.

Regardless of what style or type of clothing you deal in, the wardrobe and accessories category remains the most lucrative products.

Key Takeaway: Clothing and related goods are still among the best-selling products.

5. Low-profit margins and high shipping costs destroy dropshipping businesses

If there was one thing that the business owners unanimously agreed on, it’s that shipping costs and low profit can break your dropshipping business.

Depending on the product or item you’re selling, shipping rates and profit margins can sway from one side to another.

Take a look at this example from Shopify’s own website:

Here, the merchant can charge a flat shipping rate of $3.67, like the example suggests. Alternatively, you can also transfer the exact shipping cost of the items to the buyer.

Some businesses may offer free shipping and pay for it through their profits. But in each case, there is a risk of a decrease in sales, which means lower profits.

Key Takeaway: Managing your profit margins and shipping costs is a key element in the success of a dropshipping business.

6. 45% of successful Shopify dropshippers make $50,000 to $100,000 per year.

It should be obvious by now that Shopify seems to be the go-to choice for dropshipping businesses in their nascent stages.

But what about dropshippers in their prime?

We learned that 45% of dropshippers doing well on Shopify easily earn more than $50,000 a year. And in many cases, the yearly earnings go up to $100,000.

Simply put, dropshipping can be a convenient source of income if you can get it right on Shopify.

Regardless of whether the aim is to increase passive income or build a full-fledged business on dropshipping, successful users on Shopify are certainly reigning in the big bucks.

Sarah Titus, a successful blogger, and Shopify client made $52,060 in just the first week of her business.         

Key Takeaway: Over three-fourths of successful dropshippers can make as much as $100,000 on Shopify.

7. To be a lucrative dropshipper, you need to work 70-90 hours a week

All of our respondents agree that investing your time wisely into your dropshipping business is a non-negotiable element.

And you should be able to dedicate 10 hours or more on a daily basis, especially when your business is just starting out.

Whether your store is a vibrant website or a social media page, you have to put in the daily grind.

For instance, a Shopify SEO checklist could take up anything from a few hours to several days.

If a single task takes up that amount of time, you’ll have to put in extra hours the following days to focus on other areas.

At first glance, it may seem like the creators built Shopify for small business owners.

But today, tons of big businesses use it as their preferred platform.

So, if you want to break into the high-earning category, you’ll have to put in more hours than your competitors.

Key Takeaway: Be ready to commit over 10 hours a day to the success of your dropshipping Shopify stores.

8. Selling Printables is the most high-demand product you can sell and make good money

Online platforms like Shopify are not restricted to the simple delivery of physical goods only.

Today, more and more virtual products get bought and sold on a daily basis. And printables enjoy a high demand on Shopify.

Many of the business owners we interviewed deal with graphics and artwork.

Instead of making physical copies, they sell printable versions in digital format.

This way, buyers can store the files and print them at their leisure. It’s a convenient form of buying and selling digital art and drawings.

Today, most people prefer this route because they can preserve the original soft copy.

And they always have a good-as-new version ready to print whenever they need.

Key Takeaway: Printables are in high demand because transactions are convenient for both buyers and sellers.

9. 89% of people make a living from home selling products on Shopify

If this pandemic has taught the world anything, it’s that working from home can be a full-time and sustainable way of life.

For small and medium businesses, owners all agree that platforms like Shopify have made this easier and more efficient.

Over 89% of the business owners in our survey revealed that they are able to earn more than they need even when working from home.

For any business owner, this comes as a huge plus. You get to spend more time at home and valuable hours with your family.

And all the while, you still get to monitor, manage, and execute crucial aspects of your business.

Of course, they admit that there are times when you have to juggle a lot of roles.

But if done correctly, it’s a win-win for both the business and personal lives.

10. 20% are losing money with dropshipping

Our survey wasn’t all good news and positive trends.

We found that almost 20% of merchants were running at a loss in their dropshipping business.

But they also admitted that the failure wasn’t directly because of Shopify’s systems.

And as we dug deeper, we found that the reasons for failure varied from merchant to merchant.

For instance, many vendors blame their loss on their own choice of products.

Picking the wrong niche as a beginner can break your dropshipping business before it takes off.

For others, a lack of resources and basic capital was another reason.

Some owners blamed it on their own management skills and lack of expertise in dealing with logistics.

For example, balancing shipping costs with-profits is a crucial bit in ensuring the sustainability of the business.

Key Takeaway: As with any business, there are about 20% of merchants lose money on dropshipping.

11. Only 5% of business owners believe that dropshipping is a scam

Many of the business owners had varying ideas about how they saw dropshipping.

But a good 95% agreed that it’s a legitimate means of business where your enterprising qualities bridge the gap between demand and supply.

However, there were a handful of respondents who saw dropshipping as a type of scam.

For them, dropshipping is a fraudulent practice that isn’t fair on at least one of the parties.

Dropshipping, as a business model, is not illegal and has been around for decades now.

But it’s true that scammers can often build dropshipping models that aim to trick buyers into paying extra money or getting inferior goods.

Key Takeaway: 95% of business owners see dropshipping as a legitimate and profitable mode of business.

12. On average, it takes 8 weeks to scale your from $0 to $100,000 per month

Successful Shopify stores have different stories on how they scaled up their sales and business.

While some sellers struck gold early on, others had to grind for longer periods before they got a recurring and stable earning.

Taking all the accounts into consideration, the average time it took for business owners was about 8 weeks (or around two months).

Given the tough and nail-biting competition, there exists in most niches, that’s a pretty short time to achieve big numbers.

Key Takeaway: Most businesses took about two months before they started earning $100,000 or more.

13. 14% of businesses fail because of too much expectation

Many successful business owners today reveal that some of their good ideas failed in the past because of unrealistic expectations.

Reading success stories on Shopify can be uplifting and motivating. But you can’t forget the grind that goes on behind the curtains.

Some beginners make the mistake of expecting success too soon or hoping that managing logistics is an easy task.

When they fail, some may move on to Shopify alternatives like BigCommerce or WooCommerce, while others persevere on Shopify till they hit the jackpot.

Key Takeaway: You must stay practical and realistic as you begin your business on Shopify or any other online platform.

Conclusion

Starting, managing, and running a business on Shopify is riddled with successes and failures along the way.

If you’re a small-to-medium business owner who has experienced any of these trends, let us know your story by commenting below!

Comments

  1. Hi Bill,

    What a great share! I gained a lot of insights from this article. I really appreciate you sharing this. By analyzing these business owners you have created a great resource for aspiring business owners like myself. I think it will be very helpful for many business owners, and I will definitely share this with my friends. I gained a lot of insights from this article, and it will help me a lot. Thanks for such a great share!

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