How to start dropshipping in Australia

Dropshipping has become an accessible way to start an online business in Australia. Instead of stocking products yourself, you can partner with suppliers who handle storage, packing, and delivery — freeing you to focus on things like marketing and growth strategies.

It’s a model that’s growing fast. Australia’s e-commerce market is now worth around $40bn¹. For entrepreneurs, dropshipping is a flexible way to launch a business quickly without heavy investment. But it’s important to do it right.

This guide will detail exactly how to start dropshipping in Australia. There’s a step-by-step guide covering tips on how to find suppliers, create an online store, take care of legal registrations, manage finances, and more.

Table of contents
How to start a dropshipping business in AU - Guide Navigating dropshipping payments Wise Business - Addressing cross-border payment challenges FAQs

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How to start a dropshipping business in Australia: Step-by-step guide

Starting a dropshipping business is a way to enter e-commerce without managing an inventory yourself.

Dropshippers differentiate themselves by focusing on branding and added value. Typically, it’s less about the product itself and more about how it’s presented and delivered to create a unique experience for the customer. This starts with selecting a niche and building from there.

Here’s a step-by-step guide for getting a dropshipping business off the ground.

1. Choose a niche

The first step is to decide what type of products you actually want to sell. This is a big one as it will dictate the direction of your business. Most people either opt for an area that they’re passionate or knowledgeable about, or double down on a niche that’s currently in high demand.

To hone in on your niche for dropshipping, you can:

• Check demand - Use tools like Google Trends and TikTok to input product-related search terms to gauge interest and market demand.
• Look for gaps in the market - Research competitors to see if you can offer something unique or better.
• Consider profitability - Going with a niche you’re genuinely interested in will help, but make sure you can eke out a margin on the products you sell.

2. Find the right suppliers

Dropshipping is defined by its fulfilment model based around suppliers who will not only store your products, but package and ship them directly to customers after you make a sale. This is the backbone of the business and key to building a trustworthy brand and keeping customers happy. So you need to choose carefully.

To find reputable and reliable suppliers, look for:

• Delivery speed - Customers don’t like waiting. Look for suppliers that ship promptly and have partnerships with trusted carriers so orders land on doorsteps quickly.
• Inventory reliability - Products regularly going out of stock can really kill the momentum of a dropshipping business. Choose suppliers with plentiful stock and solid inventory management to prevent orders from being cancelled.
• Returns and refunds - No-fuss returns make life easier for you and your customers. Check their refund and exchange policies.
• Reputation - Read testimonials and reviews of the supplier on places like Google Business and Trustpilot — the most reputable ones will have profiles on these sites.
• Costs and margins - Review product pricing and fees to make sure you can actually turn a profit.

Many dropshippers now source products globally, often from marketplaces like AliExpress or suppliers based in China or the US. This opens up broader product ranges at competitive prices, but involves regular international transactions. Multi-currency accounts can help here (more on this later).

3. Decide on a platform for your store

You’ll need a storefront for your products. Popular choices for dropshipping in Australia include Shopify, Magento, WooCommerce, and BigCommerce. These are all quite easy to set up with user-friendly templates and interfaces that don’t require coding knowledge. They also provide the essential tools and features for managing a dropshipping business, such as:

• Online storefront - Showcase your products and brand.
• Payment processing - Accept multiple payment methods securely.
• Order management - Track and fulfil customer orders.
• Customer accounts - Allow buyers to sign up and manage purchases.
• Basic inventory tracking - Monitor stock and availability.
• Marketing and SEO tools - Promote your store and attract traffic.
• Analytics and reporting - Measure performance and sales trends.

Most of the big e-commerce platforms also have built-in integrations with dropshipping tools like Spocket and DSers to create product listings. These let you complete:

• Product sourcing - Browse items and import them with images, descriptions, etc., straight into your store.
• Order automation - When a customer buys a product, the order is automatically sent to the supplier.
• Inventory sync - Stock levels are updated in real time, so you don’t accidentally sell something that’s out of stock.

4. Build a store and set pricing

Next, use the platform to create a professional and eye-catching storefront. You should prioritise:

• Clean and mobile-friendly layout - This makes it easier for customers to browse and buy.
• High-quality product images - High-resolution, well-lit photos build trust and give customers confidence.
• Clear and informative descriptions - Explain everything in detail, including product features, benefits, sizing, etc.
• Multiple payment methods - Tailor payment options to the Australian market. Debit and credit cards are still very popular, but you can broaden your appeal by offering PayPal, mobile wallets, and Buy Now, Pay Later (BNPL) services.
• Detailed shipping times andreturn policies - Transparency here can reduce abandoned carts and customer complaints.

Finally, set your pricing strategically. There are quite a few costs to factor in, including how much you pay suppliers, shipping fees, marketing and advertising costs, payment processing fees, etc. You want to leave room for a healthy profit while being competitive.

5. Register your business

Running a dropshipping business rather than selling products “on the side” or as a hobby means you’ll need to register everything to operate legally in Australia.

To meet all the legal requirements, you must:

• Decide on a business structure - Most dropshippers choose “sole trader” as it’s the easiest to set up and operate. But other common structures include “Pty Ltd” and “Partnership.”
• Register business name - If you plan on trading under a brand name other than your own name, register it with ASIC.
• Apply for an ABN - It’s free to get an Australian Business Number (ABN), and it will legitimise your setup and look more professional on invoices, etc.

👆 Check out our guide on how to apply for an ABN as a dropshipping business

6. Set up finances

Now, it’s time to get your finances in order. The Australian government says it’s a “good idea” to open a separate bank account for your business, even if you’re a sole trader². Keeping your dropshipping transactions apart from personal spending makes it easier to see what’s actually coming and going out. It’ll also make tax time far less painful.

Also, think about the banking features you’ll need. Can the account handle payments from international customers? Can you pay suppliers overseas without losing a chunk of money to fees or poor exchange rates? Opting for a flexible multi-currency account with lower international transaction fees can keep more money in your business when you get started.

7. Market your store

Finally, you’ll need to promote your store to attract customers. You can do this through:

• Email marketing - Build a dropshipping email list for newsletters and product drops.
• Social media marketing - Set up accounts on Instagram, TikTok, and Facebook and publish organic content — product photos, customer stories, promotions, and offers, etc.
• Paid advertising - Run targeted ad campaigns to reach more customers.

Navigating dropshipping cross-border payments

Dropshipping businesses often manage a global chain of suppliers and customers across multiple countries and currencies.

You might be buying products in USD or EUR, while your customers pay in AUD. Each conversion or payment delay chips away at your profits, especially as providers often charge hidden fees or use marked-up exchange rates to make a profit.

Coordinating these overseas payments across multiple currencies can be confusing, too. You’ll waste time tracking payments and trying to find which ones have gone through and how much money you’ve lost to fees, slowing down your ability to reinvest and grow.

How Wise Business solves dropshipping payment challenges

When you're running a dropshipping business, speed and reliability are key—not just for shipping products, but for paying your suppliers too. Delays with international bank transfers or confusion over fees can complicate your cash flow and strain important partner relationships.

In such scenarios, Wise Business provides a more direct way to handle international payments. It lets you pay suppliers and get paid like a local in numerous countries, all from a single account, which helps simplify your finances and reduce the costs of operating a global online store.

A Wise Business account allows users to can send, receive, and hold in multiple currencies. Experience hassle-free global transactions by transacting like a local business. Here's what you get with a Wise Business account:

• Free to register — Hold and convert between 40+ currencies. Send to 140+ countries
• Debit cards for you and your team, which you can use in 150+ countries
• Multi-user access for team members, with ways to control and manage permissions
• Pay up to 1,000 recipients at once with the Wise batch payments feature
• Integrate with your favourite cloud accounting solutions like Xero, QuickBooks, and more
• Get account details to receive in 8+ currencies for a one-time fee of 65 AUD

Sign up for the Wise Business account! 🚀

This general advice does not take into account your objectives, financial circumstances or needs and you should consider if it is appropriate for you.

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FAQs on starting a dropshipping business

1. How old do you have to be to start dropshipping?
You don’t have to be an adult aged over 18 to start a business in Australia³. Minors can legally operate a business, but the government states there are a “few extra things to consider.” For example, you’ll need a tax file number (TFN) and may need consent from a parent or guardian to open a business bank account.

2. How to make money dropshipping?
You make money in dropshipping by selling products at a higher price than you pay your supplier. For example, if a supplier charges $25 for a product and you sell it for $40, you generate $15 in gross profit. However, you need to take things like transaction fees and marketing into account. The key to success is keeping customer acquisition costs low while providing a strong customer experience.

3. Is starting a dropshipping business worth it in Australia?
Yes, dropshipping is still worth it in Australia. It’s one of the lowest-risk business ventures — you don’t have to build your own inventory or store it locally. While competition is high, it’s possible to grow and succeed if you find the right niche and manage your costs.

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Source:

1. Statista - Ecommerce in Australia
2. Business Gov Au - Set up your business bank account
3. Business Gov Au - Start a business when you're under 18