The Average Costs of Running a Dropshipping Store in Australia

Introduction 

Starting a dropshipping business in Australia is one of the most affordable ways to get into eCommerce. Unlike traditional retail, you don’t need to invest thousands of dollars into stock, warehousing, or staff before you even make your first sale. But while dropshipping is low-cost compared to other business models, it’s not completely free. To succeed, you’ll need to understand the real costs involved so you can budget wisely and avoid being caught off guard.

The Basics of Store Setup

The first step is getting your store online. At the bare minimum, you’ll need:

• An eCommerce platform (Shopify is the most common in Australia)

• A domain name

• Branding (logo and visuals)

• A theme to design your store

Shopify’s basic plan is affordable at under $40 per month, while domains typically cost $15–$20 per year. Branding can be DIY with free tools like Canva, or you can outsource design for a few hundred dollars. Themes can be free or paid, with premium themes costing between $100 and $180. You’ll also want to add a few essential apps like product reviews or upsells, which range from free to $50 per month.

Example of Setup Costs

• Domain: $15–$20 per year

• Shopify Basic: $39/month

• Premium Theme: $100–$180 one-time

• Outsourced branding/logo: $100–$300
  A minimal DIY setup might cost $100–$300 upfront. A polished, professional setup with branding and apps could cost $300–$500. If you purchase a pre-built store with everything ready, expect $1,500–$2,500 upfront.

Marketing and Advertising Costs

Once your store is ready, the biggest challenge is getting traffic and sales. This is where most of your budget will go. Paid advertising is the fastest and most effective way to drive traffic, but it requires investment. Beginners often start testing with budgets of $20–$50 per day on platforms like Facebook, Instagram, Google, or TikTok. A testing phase might cost $300–$1,000 to see what works. Once you find a winning product and ad, scaling typically requires $500–$2,000 per month or more.

Influencers and Retargeting

Influencer marketing is another cost to consider. Small influencers might charge $50–$200 per promotion, while larger ones can cost much more. Retargeting ads, designed to capture visitors who didn’t buy the first time, often add another $100–$200 per month. These strategies aren’t mandatory at the start but become useful as your store grows.

Legal and Compliance in Australia

Running a business in Australia comes with legal requirements. You’ll need an ABN (Australian Business Number), which is free to register. To own a .com.au domain, an ABN is required. Once your store makes $75,000 per year, you must register for GST and add 10% tax to your sales. While this won’t affect you early on, it’s important to plan ahead. Many store owners also set aside funds for professional accounting advice, which can cost $100–$300 per consultation.

Optional Tools and Software

There are tools that can help you grow faster, though they aren’t essential on day one. Email marketing software helps build customer loyalty and is often free or under $30 per month. Product research tools cost $20–$100 per month and help you spot trending products before competitors. Canva Pro is around $15 per month for advanced graphics. Conversion apps like urgency timers or review widgets range from free to $50 per month. These add-ons aren’t required but can significantly improve performance as you scale.

Supplier and Shipping Fees

Dropshipping eliminates the need for upfront stock, but some suppliers charge small monthly fees for access to their catalogues or automation tools. These usually range from free to under $30 per month. Shipping costs depend on whether you’re using local or international suppliers. Local Australian suppliers typically offer faster and more reliable shipping, while international suppliers may be slower and more expensive. Always factor shipping into your pricing to protect your margins.

Transaction Fees and Payment Processing

Every sale comes with processing fees. Shopify and payment processors like PayPal or Stripe charge between 2–3% plus a small fixed fee per transaction. These costs can seem small but add up quickly as sales grow. It’s important to remember that not every dollar of revenue is profit—transaction fees are part of doing business.

Cost Scenarios for Different Approaches

If you’re curious about what all of this adds up to, here’s what you can expect on average:

• Barebones DIY launch: $100–$300 upfront, $350–$1,000 per month ongoing

• Moderate setup: $300–$500 upfront, $600–$2,000 per month ongoing

• Pre-built store: $1,500–$2,500 upfront, $600–$2,000 per month ongoing
  The biggest variable is always advertising. Without a consistent ad budget, even the most beautifully designed store won’t attract customers.

Why Budgeting Matters

Dropshipping is affordable, but it’s still a real business that requires investment. Many beginners underestimate how much they’ll need for advertising and quit too soon. If you plan for realistic marketing spend, you’ll give your store the best chance to succeed. The beauty of dropshipping is that you can start lean and scale your budget as profits roll in.

Final Thoughts

Running a dropshipping store in Australia is one of the most cost-effective ways to enter eCommerce. You avoid inventory risk, staffing costs, and warehousing, which makes it far cheaper than traditional retail. What you do need is a clear plan for setup costs, marketing spend, and growth tools. If you’re starting small, you can get going with just a few hundred dollars and a modest monthly budget. As you scale, advertising and tools will cost more, but so will your opportunities for profit. Dropshipping rewards consistency, smart budgeting, and reinvestment. By understanding the average costs upfront, you’ll avoid nasty surprises and give yourself a much stronger chance of building a sustainable, profitable online store in the Australian market.