When choosing a drop-shipping niche you have to take several things into account:

* The niche needs to be of sufficient size and purchasing power to be profitable.
* The niche needs to have growth potential.
* Make sure large companies have little interest in the niche.
* You have the required resources and skills to serve the niche effectively.

Let’s face it, you might be selling the world’s best blue meanie widgets at insane low prices, but if nobody wants them….you won’t make any money!

Step by Step tips
Check the eBay Pulse: The eBay Pulse shows which listings are the most watched, with the most views by users. You can bet that if a product makes it to the eBay Pulse, it is very much in demand! There are a slew of categories on eBay, so you won’t lack for types of products and/or niches.
Use the Google Keyword Tool: The Google Keyword Tool is free and can be an invaluable source of information for anyone stumped for what to sell in an online dropship business. For instance, let’s say that you are considering selling baby wares. Enter “baby wares” into the search box in the Keyword Tool and it will show you how many global searches were performed for that phrase in a month’s time. If there aren’t many searches---forget that product and move on to something in greater demand.

Continue with the process till you have at least 5 HOT selling niche product then dropship it.