The Ultimate Guide to Dropshipping Pricing Strategy in 2021

The Ultimate Guide to Dropshipping Pricing Strategy in 2021


Did you know you can get a fully automated, USA based dropship website, built for you, in whatever niche you want, in 72 hours or less? Go to to register for our free webinar that will teach you our secret dropship model, and how you can get it built for you. Now let's dive in!

"What price can I set my items on my eCommerce website?" is a question that dropship retailers ask more often than not. Every business wishes to maximize its earnings. But how do they do it? Yes, by applying various dropshipping pricing strategies. However, setting on the perfect strategy can be difficult as most people tend to save as much as possible and are on the lookout for great offers. 

To be honest, for retailers, there should not be one Shopify dropshipping pricing strategy. Instead, retailers should choose the pricing that well fits their product line and competition. There are several different dropshipping pricing methods to choose from. The solution can vary based on your goods, supplier(s), and business model. 

Some experts claim that the only "right" approach is to constantly change the prices while evaluating what works and what doesn't. Believe it or not, deciding on a Shopify dropshipping pricing approach is one of the first steps in starting a dropship eCommerce company and has a significant effect on how consumers view your brand. 

Have you ever tried using a dropship bundles pricing strategy? Have you ever used a structured promotional plan or given spontaneous sales and promotions? Since dropshipping is competitive, deciding how to sell the goods will be the difference between attracting buyers and making a profit. This article will show you the different ways of how you can set prices on your eCommerce website to maximize profit margin. 

Dropshipping Pricing Strategies

1. Fixed Markup

A fixed markup is a good-enough pricing technique for very low-cost goods. Simply put, a fixed dollar markup is where you apply a certain dollar sum to the price of a component at the retailer.

You'll decide on a profit margin that you like to apply to all of your stuff. Let's say you want to charge a 20% markup on something, and you have a $20 piece. You will raise the price of the commodity by $4 and sell it for that number. Fixing by percentage like this is also called a fixed percentage markup.

In terms of fixed dollar markup, the rule of thumb is to set a gross margin of $10 per transaction. It would give you enough money to finance your marketing expenditures, income, and monthly payments.

Fixed markup is straightforward to set up and maintain, but the earnings can fluctuate significantly based on the purchase price of what you're selling.

2. Tiered Markup

Tiered cost markup is a pricing technique that is most widely used where a retailer has a range of goods varying in price from low to high. It helps you save your costly goods from being overpriced while still allowing you to profit from your low-cost items.

Tiered Markup

You can set parameters on your products, such as a 50% markup on items under $10 and a 15% markup on items above $500. These figures will, of course, vary depending on what the shop offers.

The aim here is to get a higher markup on the lower-priced products so that pricing is lucrative. 

3. MSRP (Manufacturer Suggested Retail Price)

If you don't care about the ins and outs of prices and really just want a safe place to camp, the MSRP is the way to go. This pricing policy takes you out of the price wars and allows you to charge what your goods are worth as the retail price is directly suggested by your supplier. 

You may use an MSRP approach in conjunction with coupons to promote the brand and deal with competitors that could have cheaper rates.

4. Free Plus Shipping Strategy 

Another promotional tactic that might fit well for low-ticket goods is this one! If you're unfamiliar with the free plus shipping approach, it's a deal in which you market a product for zero dollars and then bill the buyer for shipping costs.

Since the COGS are so small, this approach works incredibly well for low-ticket products. You can simply get away with just charging a delivery fee and give the goods away for free! However, you'll have to recoup all of the losses from the postage charges you charge your clients. 

5. Dropship Bundles Pricing 

Here's yet another pricing tactic that we've seen all over the place.

This returns to "perceived worth." How much time have you been somewhere for one item and ended up buying two or three because of a sale? "Buy two, get one free," "Buy one, get one for $1," and so forth.

This approach can be used to boost profits on low-margin products in your online store. Bundling the merchandise and adding attachments to bigger items is also a good idea. Another advantage of bundling is that it sets you apart from your competitors.

For instance, if you sell automotive detailing equipment and supplies, there will be many other retailers offering the same merchandise. You could market a whole cleaning kit as part of a bundle, which would set you apart from the competition.

But be careful not to overdo it. There are supermarkets where everything is for sale, and every product comes with a bonus. If you do so, people will notice and become suspicious.

6. Psychological Pricing 

When prices are fixed at a certain amount, the buyer perceives the product to be cheaper, depending on the price shown. The most popular approach is "odd-pricing," which uses cents ending in 5, 7, or 9 as the final value. 

Consumers round down a price of $9.95 to $9 rather than $10. Along with the very common sense ending value solution of ending in 99 or 95 cents, some people try to price below the market by using the cents ending value. 

When more people mention 95 cents as their final price, you can lower yours to 85, 45, or even 9 cents on all things to provide the best deal. 

While psychological pricing and the cents ending value are very popular on eCommerce websites, when listing on many retailers like Amazon, eBay, Walmart, and others, using a much lower cents ending value may be a smarter solution.

You can use this pricing strategy on your dropshipping website for goods that comes in different sizes or price ranges. You can persuade your customer to buy costly products by throwing a decoy at them!

Final Thoughts

The most important thing to note when pricing your dropshipping items is not to overthink them.

Pick a plan and stick to it. Try a new one if it isn't working. On your website, try out various pricing methods and see which one fits well for you. We're all in it to make money, and while the costs of your dropshipping products are critical, they're not the most important aspect of your store.

Don't forget, you can get a fully automated USA based dropship website, built for you, in whatever niche you want, in 72 hours or less. Go to to register for our free webinar that will teach you our secret dropship model, and how you can get it built for you in only 3 days!

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