Passive Income with E-commerce and Dropshipping – Best Cash Flow Business Ideas!

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Passive Income with E-commerce and Dropshipping – Best Cash Flow Business Ideas!

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Selling products online is one of the best and easiest ways to generate passive income.

Not only is it convenient, but you can also sell a variety of products without even stepping out – right from the comfort of your home without actually opening a physical store. Selling products online will not only help you make extra money but will also help you to drive away that burden on your pocket.

But where to begin? Well, the best ways to sell products online and earn passive income are E-commerce and Dropshipping. While E-commerce has been around for years, Dropshipping is a comparatively new business model that is now gaining momentum and popularity, especially among gen-z and millennials.

Nevertheless, both of these strategies can keep that extra cash coming in without hampering your daily life or work in any significant way. Plus, they require little investment, so they are not going to cost you much.

Passive Income from E-commerce and DropshippingPhoto by on Unsplash

However, it is important to comprehend and learn the basic strategies behind generating e-commerce and Dropshipping passive incomes. Otherwise, it will become a full-time job for you, which will not only be demanding but will also go against the basic concept of passive income.

Also, if you decide to sell products online, it is important to understand that it is not just about selecting a good niche for your product, you will also need to market your business and give time and sincere efforts for it to bloom and flourish.

To learn more about passive income and the best passive income strategies, check out this post. In this post, we are going to explore E-commerce and Dropshipping, as the two amazing sources of passive income. Let’s get started!


E-commerce is the process of selling and buying products on the internet. Since it is done electronically, it is called “E-commerce” or “Electronic/Internet Commerce”. Many of us use e-commerce websites to buy a variety of products. From clothing to medicines, almost anything can be bought and sold through e-commerce from the very comfort of your homes. Some of the most popular e-commerce websites are Amazon, Flipkart, eBay, Alibaba and Snapdeal.


Passive Income from E-commercePhoto by CardMapr on Unsplash

To start generating passive income with eCommerce, you can use a variety of methods. For starters, you can sell your own products online. You can also choose Commoditized products (essential and high demand goods that everybody needs) or Niche products (aimed at serving a specific customer base and product category).

Moreover, you can also sell other people’s products, provided you are authorized to sell them. Also, you can try Dropshipping which we will be discussing a little later.

To start your e-commerce business, it is not necessary though to build or create your own products. Also, if you are a working professional, you might not have the time and bandwidth to make your own products and goodies. In such a scenario, you can begin by selling other peoples products online.

It is the easiest and most beneficial ways to get started in the world of eCommerce. Moreover, selling other people’s products doesn’t mean that you have no control over the selling process. In fact, if you so choose to sell other people’s products, you have the option of being actively involved in all the steps of their products sales process.

It also eliminates the need to physically stock any product, thus striking off stocking and inventory costs. You can start selling products online through platforms such as eBay or Amazon, or if you have the time, skills, and resources, you can even build a dedicated online store or shop.

Most of these platforms will help you become a seller and will automatically upload the product details on their website. However, given the number of products they deal with daily, it may take some time – may be more than a couple of days.

Most of these companies will also provide you with a seller login ID which you can use to manage everything, from uploading the product details to updating the necessary stocks. Sounds a little confusing, right? Well, don’t fret. These companies always give you a full demonstration and training to help you become an online seller.

After selecting a platform, the next step is to choose your product. It is one of the most important steps in selling products online. To sell online, you need to have a niche of products in your mind that you will be selling. It can  depend on your interest as well as on the availability and demand of the product.

If you are selling your own products, make sure they are of good quality, as the website that you will be using to sell your products online will also be associated with your product

In case you have a wide variety of products, we suggest that you create a Product Portfolio. It can be a PDF or an Excel file containing good quality and multiple angle photographs of your products, along with their detailed specifications and pricing.

Next, take care of the Shipping and the Shipping Policies. Be ready to have your own shipping partner in case the platform you are using isn’t providing its courier services. Packaging of your products also needs to be taken care of. Make necessary arrangements for the packaging material and as well as for the branding of the product.

Last but not the least, in fact one of the most important elements – Clearly discuss and study the ‘payment cycles’.  Also, make sure to thoroughly read the complete Terms and Conditions for becoming a seller.

Most importantly, be optimistic and realistic. It is not easy, at least not at first. Your online business isn’t going to succeed overnight. It requires dedicated effort from your side as well. Consider the market dynamics, study your strategies, and always look for what’s not working for you, so that you make the necessary changes and improve.


When it comes to selling goods, one of the biggest hurdles for a seller is acquiring and stocking of products. Not only this complicates, but is also time-consuming and adds to the expenditure. If it becomes time-consuming, it goes against the basic concept of passive income.

If you do not want to stock products but still want to sell them online, Dropshipping is the answer that you are looking for. It is a business model that is widely trusted by people to generate passive income. And guess what? It is very simple!

In Dropshipping, the seller does not sell the products directly. Instead, they contact a manufacturer or a wholesaler by accessing the specific demand for a product or products, and then selects and promotes these specific products online.

The manufacturer or the wholesaler, as the case maybe, stocks the products. They are also responsible for the shipment of these products once a sale is made i.e. they also take care of the entire fulfilment cycle and service. Thus, you can start selling products without having to manage any of them physically.

It is a really great strategy to earn passive income with very little investment. It lets you become an entrepreneur and helps you start an online business. As you will be selling products without actually stocking them, this will eliminate all inventory, operational, and storage-related costs.


Passive Income from DropshippingPhoto by Brooke Cagle on Unsplash

To start generating passive income from Dropshipping, you are required to first set up your own website or find a suitable platform to take and manage orders from.

Some of the good online platforms that will help you start your Dropshipping business are BigCommerce, Shopify and WooCommerce.

Platforms like these generally function as a fully hosted shopping cart and handle most of the work for you. You need to just sign up on these platforms, and upon sign up, they provide you with a lot of handy tools such as a secure website, efficient products and orders management, and a built-in payment processing system.

Following this, you have to partner with a manufacturer, a wholesaler, or a drop ship distributor. They will be the ones to ship products directly to your customers. You and your distributor will decide on all the necessary details and sign an agreement, and once it is done, you are good to go!

Here’s how the whole process works. First, a customer places an order for a product and you collect the money for the order. You forward the order details as well as the shipping details to your supplier. The supplier is also paid according to the amount you and they agreed upon.

Upon successful payment, the supplier then packs and ships the product to your customer as if it was delivered from your own online store. In this way, Dropshipping enables you to sell online without stocking any of the products.

It is also a less time-consuming source of passive income. The difference between the price at which you sold the product to the customer and the price you paid to the supplier is your passive income!


We discussed about how E-commerce and Dropshipping can prove to be amazing sources of passive income for you. Not only do they allow you to become online sellers, but they are efficient, require low investment of both time and money, and can easily help you in keeping that extra income coming in.

However, these strategies may not yield over-night success. You cannot expect a lot of orders to come in on day one. During the initial stages, it is required that you have an optimistic attitude, and work hard with sincerity and consistency. But in due course these strategies will pay off, and will generate handsome passive income for you.

What do you think about E-commerce and Dropshipping as sources of passive income? Also, which one of these do you think is the better option to earn passive income? Don’t forget to share your thoughts in the comments section down below. Ciao!

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