Why Most Dropshippers Face Inconsistency – And How Anyone Can Scale Fast, Consistently, And Profitably This 2021 🚀

If you’re an experienced dropshipper, you’d know how inconsistent dropshipping can be.

One moment you’re generating 6 figure months feeling like an absolute baller…

Few months later you’re struggling to scale past 5 figures and barely breaking even.

Ring a few bells?

Now… when this happens, most people think of a few things:

1. “It’s just my bad luck.”
2. “My product researchers suck.”
3. “Dropshipping is dead.”
4. “Time to pivot and create some courses” (Just kidding)

After working with multiple 6-8 figure dropshippers…

The real reason why most dropshippers face such inconsistency – is because they scale their ecom stores before ensuring that their business is SCALE READY.

What’s scale ready?  Let me explain.

“Scale ready” refers to how optimized your business is for scaling.

It’s often impacted by how optimized your day to day operations (team, systems, and processes) are for scaling.

The more scale ready your business is, the easier it is for you to scale quickly, consistently, and profitably.

(I’ll explain more below)

Most dropshippers scale their business without first ensuring that their day to day operations are scale ready.

The moment they find a winning product, they’ll just double down their budget on FB ads and “scale to the moon”

While that sure can bring you some good revenue at the start, it’s only a matter of time before you come crashing down again.

Because they face more operational problems like:

– Not preparing enough creatives before scaling, leading to creative burnout and ultimately, a drop in ROAS and profitability.

– Running out of products to test before your winning product dies as the team doesn’t have enough time to find more high quality products, leading to lesser product launch which results in drop in revenue.

– Higher unresolved tickets from customer service as the team cannot handle the sudden influx which ultimately leads to higher complaint rate and PayPal/FB banning your accounts.

– Team members getting burnt out because they’re overwhelmed with last minute urgent tasks.

– Team members leaving because they can’t take the stress, leaving you to scramble to find a new hire and re-train them from scratch.

And many more.

======

You see, without an optimized day to day operations, it’s simply impossible to scale (and most importantly, maintain that scale) no matter how big your advertising budget or skills in media buying.

Think of it this way, advertising without first optimizing your operations is kinda like trying to fill a bucket with holes, with water.

Water will just leak out.

Or for your case, profits… (Ouch)

This is why most people face inconsistent revenue and a decrease in profit margin as they scale.

>> So how can you ensure that your ecom business’ day to day operations are scale ready? <<

Before we get into that…

I want to first show you what an optimized day to day operations look like, and how it can change the course of your business.

(These are just some of the results that our clients see after we optimize their operations to become scale ready.)

When your operations are optimized:

– You’ll be able to see a consistent growth in your business for both revenue and profits

– You’ll see higher profit margins

– You’ll be able to test more high quality products consistently

– You’ll be able to conduct more split tests to increase your conversion rate & ROAS

– Your team members will be performing at peak performance and become much more productive

– Your team will be more in-sync leading to them becoming more effective

– You can easily see what’s happening in your business (both metrics and productivity of team)

– You’ll be able to see which part of your business is generating you profits and which parts are draining profits, this way you are able to cut off the losses and double down on what gives you the most profits

– You’ll have to do much lesser firefighting

– You’ll be able to identify your profit/loss for the month down to the cent

======

So… how do you optimize your day to day operations to ensure that it’s scale ready?

There are 3 key areas when it comes to optimizing your operations to become scale ready.

The entire process typically takes a couple of months to implement as there’s many moving parts that need constant monitoring and tweaking…

But to keep this post shorter, I’ve separated the 3 key areas into different posts so that it’s easier for you to digest and understand.

Part 1: How To Scale Your Business FAST By Accelerating Your Critical Scaling Factors (CSFs)

Part 2: How To Automate Your Key Business Pillars So That You Can Scale Consistently And Profitably

Part 3: How To Multiply The Productivity And Effectiveness Of Your Team To Produce Consistent Results
For this post, we’ll focus on Part 1.

How To Scale Your Business FAST By Accelerating Your Critical Scaling Factors (CSFs)

As mentioned earlier, when it comes to scaling fast, most people think about doubling down their ad budget.

But as we all know, scaling your ads too quickly leads to a series of problems like inconsistent ROAS, creative burnout and drop in profit margins.

Instead of depending on ads, accelerating your critical scaling factors is no doubt one of the fastest and most profitable ways to scale. Not to mention how much more profitable and consistent it is.

(I’ll explain what CSFs are, and why it’s a much more profitable and consistent scaling method very soon)

🚀 By accelerating our client’s CSF, our dropshipping clients started to test over 50-80 high quality products a month, and created new stores and brands to expand into different countries.

Here’s what we do for our clients:

Step 1: Identify your business goals

This is more of a no-brainer, but the very first thing to do is to clearly identify your goals for your business. Be as specific as possible.

For example:

“I want by business to generate 7 figures a month consistently with 20% profit margins by December”

“I want my brand to become a household brand by 2022”

“I want my product to rank the first page of Google in the household niche”

“I want to generate 20M views on my YouTube Ad”

“I want to collect 300,000 emails by December”

Once you’ve identified the goal for your business, move on to step 2.

Step 2: Identify your Critical Scaling Factors (CSFs)

Critical Scaling Factors are tasks that directly impact your goals.

Let’s take the goal of “I want by business to generate 7 figures a month consistently with 20% profit margins by December”

What are some tasks that can directly impact that goal?

• Increasing the number of product tests each week
• Increasing the quality or success of each product test (through copy/creatives)
• Conducting more split tests
• Test more upsells 
• Improve the backend system (upsell, SMS, email marketing, referral programs)
• Duplicating your stores across different niches, countries, languages etc
• Launching more retargeting campaigns

And many more.

Identifying your CSFs is extremely important as it not only helps to set the direction and priority for your team members…

But CSFs are also tasks that directly impact your business’s growth and revenue.

So you want to accelerate and do more of them faster and better.

The less CSFs are achieved, the slower the company grows. 

Here are some examples of CSFs for dropshipping:

• Increasing the number of product tests each week
• Increasing the quality or success of each product test (through copy/creatives)
• Duplicating your stores across different niches, countries, languages etc
• Turning the general store into a brand
• Launching more retargeting campaigns
• Adding more post purchase upsells
• Split testing bundles to increase AOV 
• Increase number of touchpoints with customers for retargeting

Notice how these are tasks that can directly impact the growth of your business? 

This is why if you want to scale and grow your business quickly, consistently and profitably, your CSFs are the 🔥Most Important🔥 things you should be working on.

Step 3: List Down The Strategy, Steps & Metrics Needed To Achieve Your CSF

Now that you’ve identified your CSF, the next step is to list down the strategy, steps and metrics needed to achieve that particular CSF.

For example:

Let’s say you’re currently doing $300k/month revenue with a consistent profitable campaign, and your goal is to scale to $1mil/month in revenue.

What do you need to do to scale to $1mil/month? 

Examples of CSFs to achieve $1mil/month could be to:

1. Increase the conversion rates of your funnel so that you can have higher ROAS and scale up even further on the ads side
2. Increase your AOV so that you can have higher ROAS
3. Open up other traffic sources like Google Shopping
4. Increase repeated sales from your existing clients
5. Improve the creative performances of your ad campaign

Let’s say out of all these, you have identified number 1 to work on first.

So increasing your conversion rates should be your top priority and main focus.

If you can increase your conversion rates by 30%, your ROAS will also increase by 30%, e.g. from 1.8 ROAS to 2.3 ROAS, allowing you to scale up much faster.18

So the next step would be to turn this into a proper strategy and action plan.

For example, to increase conversion rates of your funnel, the strategy is to do conversion rate optimization and run split-test.

The faster you’re able to increase your conversion rate by creating split-tests that beat the current control, the higher your ROAS will be and the faster you’re able to scale. 

Also, the more split-tests you run, the more control-beating winners you will be able to find, and the higher your ROAS will be.

So the plan would involve being able to run split tests continuously one after another after another until you have higher conversion rates.

As you run these tests, you will also better understand what works and what doesn’t work, and then use these insights to further improve your conversion rates.

So your entire operation, after listed down, would look something like this:

Step 1: Identify what to test for CRO

Action step: Creative directors / marketing strategist / CRO Specialist to produce direction for testing

• E.g. Test above-the-fold banner image

Step 2: Create testing ideas

Action step: Creative directors / marketing strategist / CRO Specialist to create testing ideas 

• E.g. Test images with people vs images with just the product only
• E.g. Test different headlines
• Test different element placemen

Step 3: Produce testing variables or elements from testing ideas

Get the designer/video editor/copywriter to produce the creatives or copy for testing

Step 4: Run the test

Ask the media buyer or web dev to set up and run the test

Step 5: Collect the result and analyze

Create a spreadsheet or report to analyse the results 

Creative directors / marketing strategist / CRO Specialist to review the results and give direction for the next test

Once you’ve done this, we’re ready to move on to the next step.

Step 4: Execute 

Once you have done step 3, the next step is to make sure that these plans and processes are being executed.

And it has to be executed without you getting involved.

Meaning the entire process must be able to run without you.

Why so?

Because you as the business owner shouldnt be spending all your time and energy executing what you’ve planned.

You have to spend your time and energy planning for new CSFs to reach your goal.

This is why many successful entrepreneurs emphasize on “working ON your business, not IN your business.”

And this is exactly what it means.

Now, to ensure that the entire process is executed without you, you need to do 4 things.

1. Create proper SOPs and workflow for each process.
2. Turn these process into systems
3. Create a delegation system to successfully delegate it out.
4. Hire A+ players and managers to ensure that the process runs smoothly

===========

Hope you found this post valuable.

Atomatic Agency specializes in streamlining, optimizing and automating systems and processes for eCommerce businesses (including dropshippers) to scale to their highest potential, as well as build and train our client’s team into a team of A+ players. 

By doing so, our clients are able to achieve consistent revenue, and turn their business into a consistent cash cow with less effort, and in a short timer period.

Ready To Automate And Scale Your Business?

If you’re a 6 figure/month dropshipper that is serious about automating your business and scaling consistently, click on the button below to schedule a call with us.