How dropshipping works explained:
1 - the customer purchases an item from your own online store at retail price
2 - You forward the order to your supplier - you pay wholesale
3 - Now your supplier will ship to your customer under your business name
Dropshipping business plan:
Step 1. - find a profitable niche: you should take couple good hours if not days to figure out what are you gonna sell, will you go for hot items, seasonal items, trending items, will you stay under the 2kg per item limit to avoid paying extra for shipping? On average dropshippers will go for products that are at least $20 and up to $250, not more than this because will become harder to sell. Also here you must check the demand for that specific item on the market and do a lot of research on your competitors, there's high chance someone is selling already what you trying to sell. You can learn a lot from them and improve your store.
Step 2. - find dropship suppliers: critical choice for your new business, having a supplier with enough stock and deliver products to your fresh customers in time is super important. So my advice is to choose suppliers with good experience, must provide fast shipping, must have quality products so your customers will be happy and buy more from you as well recommend your products to their friends, and charging small order fees not more than $4.
Step 3. - get sales Tax ID: getting into products selling requires paying taxes to the state you belong to, this is about 10% of the sale price, you should get this at your local county clerk's office or google it online.
Step 4. - chose the selling platform: here you must choose between biggest marketplaces in the world, eBay, Amazon, and Etsy. For access, there are different fees and can go up to 15% per sale from what I read. There are more selling platforms, check local ones as well, it matters a lot what you gonna sell.
Step 5. - create your online store: for long-term, it is best to create your own online store using Shopify or similar tools. By doing this you cut fees, you have bigger profits and you have full control, and let's not forget you don't rely on anyone else's platform. The downside of this is that it requires bigger investment upfront, a higher risk of losing more money if you don't have success with your dropshipping business. And very important you will have to deal with Search engine optimization so that you rank on Google SERPs(this takes time).
Step 6. - start promoting your store: this is where many drop shippers fail, they have more expenses in getting clients than making a profit, there are many choices to drive clients, you will need to start buying either Facebook ads or Google ads for fast results, contact YouTube Influencers for reviews, for slow results you have to contact big blogs and big forums and mainly do content marketing, basically post articles with a link back to your store so it drive traffic, increase your authority and hopefully new sales. I don't recommend social media marketing and email marketing, you will need to spend too much time posting updates and requires huge following to get decent sales, this strategy used to works couple years ago before Facebook fan page update, now Facebook urges you to buy posts promotion to reach your own followers. You get the point.