Entrepreneurs are attracted to dropshipping for the chance to quickly set up a completely new business with minimal investment. Plus, it’s possible to almost immediately see a profit — provided you avoid the worst dropshipping niches.
It’s tempting to think you know what you’re doing. After all, you’re a consumer. That should mean you know what consumers like and what will sell, right? It’s actually more complicated than that. Simply choosing products that look appealing rarely leads to positive results. Instead, you need to do some research.
One of the first things to research is what dropshipping niches to avoid. Simply ruling out the worst dropshipping niches will immediately narrow down your options and help you make better decisions.
1. Clothing in General
Clothing as a whole is not a niche: it’s a broad category. This means it’s far too diverse to be successful for a dropshipping business. Everyone needs clothing — and that’s part of the problem. You never want your audience to be everyone; you need to target just a segment of consumers.
If you want to sell clothing, you need to have a theme. This will give customers a reason to choose your store and keep coming back for more. When you just have clothing in general, there’s nothing to make you stand out from countless other options.
Another issue with clothing is quality. This is particularly problematic for dresses. When customers buy dresses, they expect to look just like the models in the product description photos. If you’ve even seen any expectation vs reality pictures, you’ll know that it often doesn’t work out like that.
If you do decide to go ahead and sell dresses (or any other type of fitted clothing for that matter), be prepared to deal with a large amount of returns. Also don’t be surprised when a dress from your dropshipping store becomes the next meme — and that’s not the kind of social media attention you want.
3. Basic Essentials
Essentials are, again, things that everyone needs. You’d be excused for thinking they could be more successful than clothing, as essentials are far less personal. You may even reason that you can create ads to remind consumers they need to purchase something — like dishrags or kitchen utensils.
The issue is that essentials fail to meet one of the main principles of dropshipping: products need to grab users’ attention. You’re trying to encourage customers to impulse buy for something they wouldn’t normally go looking for.
Basic essentials are so boring that most consumers will just ignore your ad. Besides, they can pick up everything they need in the grocery store, and any discount they receive buying from you will barely seem worthwhile.
4. Surveillance Equipment
Technically, you could set up a dropshipping store around any products that are legal to sell online. However, you’re prohibited from advertising some types of products, both on social media and through Google ads. In addition to surveillance equipment, this includes adult products, weapons and ammunition, tobacco, and alcohol.
Anything large or heavy is much more expensive to ship, which eats into your profits. Whereas furniture is an extreme example, if you’re sourcing from abroad, any bulky items are a definite no.
If you’re sourcing from China and sending to customers in the U.S., you’ll need to meet strict package restrictions to use ePacket (the delivery agreement between the US Postal Service and China Post). This limits your packages a maximum of 60 centimeters and a total length, height, and thickness of no more than 90 centimeters. Products also need to weigh less than 2 kilograms.
6. Novelty Items
The challenge with selling novelty items is their high wholesale cost. When you factor in shipping costs, you’ll need to sell at quite a high retail price to make a decent profit. Customers tend to be put off by such high prices, making it more difficult for you to see significant sales.
Anything made of glass or another fragile material poses a huge risk to dropship. If you were shipping out items yourself, you could make sure to package them carefully to prevent breakages. However, you’ll be relying on suppliers. You’ll need to trust that they’ll do everything possible to ensure glassware arrives to your customers in one piece — literally.
Reading reviews of suppliers can help, as can asking specifics about packaging. All the same, don’t be surprised if the occasional item arrives to a customer broken. Then, you’ll need to deal with a return — and possibly a negative review.
8. Pug-Themed Products
It’s true that there is a reasonably large number of pug fans out there, but how many of them are you going to be able to reach with your ads? Plus, even if they do see your ad, how many of them will want to buy that specific pug-themed product? The answer is probably not many.
If pugs started trending, that would be a different story. However, right now, your audience is limited and the competition is already too high for you to make much of an impact. The lesson: avoid going too niche.
9. Safety Equipment
Selling safety equipment that you’re unable to verify is too big a risk. With other dropshipping niches, the worst that could happen if you sell a low-quality product is an upset customer. With safety equipment, there could be dire consequences. For instance, if something breaks or otherwise causes the person using the equipment to have an accident, you’ll be liable.
For this reason, avoid helmets, mouthguards, pads, goggles, and anything else used for protection in sports or industry.
10. Branded Products
Most big dropshipping platforms say that all their products are legitimate. However, if you look at the prices of the branded products, they’re clearly too low to be anything other than counterfeit. Not only is it illegal for you to sell these items, it’s a bad business model. Branded products may appear just like the real thing in pictures, but they’re actually poor quality. Complaints from customers will soon start rolling in.
Choose this niche and your dropshipping business will be doomed from the beginning.
Another of the worst dropshipping niches because of quality concerns is cosmetics. As you need to rule out known brands, you’re left with products that are difficult to quality check. This is a significant risk, since customers will be applying the products to their eyes, lips, and skin. Cheap ingredients could cause an allergic reaction or irritation. If the reaction is severe, it’s your business on the line.
If you do want to focus on the cosmetics niche, avoid consumable products and sell brushes or other makeup tools instead. This is actually a top niche in a number of countries, with consistent demand year round.
12. Musical Instruments
A niche focused on high-quality products like musical instruments is far too expensive to be suitable for dropshipping. Recommendations about how much you should spend sourcing items vary, but experts agree you should pay no more $100. Some even advise keeping to under $5, including shipping.
This is because expensive purchases tend to require more thought from consumers. You want people to see your ad and buy without thinking too much. Musical instruments don’t meet this requirement.
13. Waterproof Cases
Having a waterproof phone or camera is great. You can take pictures while in or around water, such as on a boat, playing water sports, and even swimming underwater. As only high-end phones and specialized cameras are waterproof, cases to protect devices from water could be appealing to many customers.
But there’s a big problem: there’s no way for you to assess how waterproof a product is. A waterproof case could allow you to submerge a camera several feet underwater or just protect a phone in a downpour. Without knowing where your product falls, you’ll be unable to advertise it appropriately.
Even if you purchase a case yourself and test it, you can’t possibly do the same for all the different models. Plus, you’re putting your own devices at risk. Furthermore, if a customer pushes a product beyond its limits and ends up breaking a phone or camera, your store will receive a bad rap.
14. Cheap Jewelry
The good thing about cheap jewelry is that it has a low wholesale price. The bad thing is no one is willing to pay much more than wholesale price. If you do receive some sales, customers will often be disappointed in the product they receive. As well as looking even cheaper than it did in the photo, the jewelry is likely to break quite soon.
You’re never going to have perfect success with your dropshipping business. However, the great thing about dropshipping is that minor mistakes can cost you very little.
Of course, you do need to avoid major mistakes — such as sourcing a counterfeit product or an item that harms someone. Avoiding the worst dropshipping niches is a good start, but you’ll also need to conduct further research to find out the potential of the products you want to source.
If you’re feeling unsure about dropshipping as a business model after this, first of all — don’t worry! There are also plenty of profitable dropshipping niches to choose from. However, it’s still worthwhile considering all your options. For instance, another way to start an e-commerce business is to use Amazon FBA. Check out our comparison guide to decide which would be better for you.