Dropshipping has become one of the most accessible and low-risk business models for aspiring entrepreneurs. It allows you to sell products online without holding inventory, as suppliers handle storage and shipping.
Hungary is an excellent location for starting a dropshipping business, thanks to its strategic position in Central Europe, strong logistics network, and digital-friendly environment. Moreover, Hungary’s low corporate tax rate of 9% (the lowest in the European Union) makes it an attractive option for entrepreneurs looking to establish a business.
In this guide, we’ll walk you through the essential steps to start a dropshipping business in Hungary, covering business registration, supplier selection, store setup, marketing, and scaling your operations.
1. Understanding Dropshipping
What Is Dropshipping?
Dropshipping is an eCommerce model where you sell products without keeping inventory. Instead, when a customer places an order, a third-party supplier ships the product directly to them.
Pros of Dropshipping
- Low startup costs – No need to buy bulk inventory.
- Scalability – Easily expand your business by adding new products.
- Flexibility – Manage your business from anywhere.
Cons
- Lower profit margins – Compared to wholesale eCommerce.
- Supplier reliability – Delays or errors are out of your control.
- High competition – Many others may sell the same products.
By understanding these factors, you can determine whether dropshipping aligns with your goals.
2. Legal Requirements & Business Setup in Hungary
Company Formation in Hungary
To start your dropshipping business, you need to set up and register a company in Hungary. The most common business structures are:
- Sole proprietorship (Egyéni vállalkozás) – Ideal for small businesses.
- Limited Liability Company (Kft.) – A popular choice owing to Hungary’s low corporate tax rate.
Foreign entrepreneurs can set up a company remotely, and a virtual office in Hungary can be useful for managing administrative tasks. Company registration typically takes 4-7 days and involves submitting documents to the Hungarian Company Court and registering for VAT with the National Tax and Customs Administration (NAV).
Taxation & VAT Compliance
If selling within the EU, you must register for VAT, as Hungary follows the EU’s VAT regulations. Understanding tax obligations is essential to avoid penalties.
Legal Considerations
- GDPR compliance – Required when handling customer data.
- Terms & Conditions – Must outline refund and return policies.
- Consumer protection laws – Ensure compliance when selling online in Hungary and the EU.
3. Choosing a Niche & Finding Reliable Suppliers
Selecting the right niche is crucial for success. Research market trends and avoid overly saturated products. Consider:
- High-demand, low-competition items
- Lightweight, easy-to-ship products
- Products with repeat purchase potential
Finding Suppliers
Reliable suppliers are key to smooth operations. Popular options include:
- AliExpress & Oberlo – Good for beginners.
- Spocket & CJ Dropshipping – European-based suppliers.
- Hungarian & EU Suppliers – Faster shipping and compliance with EU regulations.
Check supplier reviews, response times, and shipping speed before partnering.
4. Building Your Online Store
Choosing a Platform
Your store must be user-friendly and optimized for conversions. Recommended platforms:
- Shopify – Easy to use, integrates with multiple dropshipping apps.
- WooCommerce – Best for WordPress users.
- Wix & BigCommerce – Other viable alternatives.
Payment Gateway Options in Hungary
To accept online payments, integrate Hungarian-friendly gateways like:
- SimplePay
- Barion
- PayPal
- Stripe
Optimizing for Conversions
- Use high-quality product images.
- Write compelling product descriptions.
- Offer multiple payment methods.
- Ensure mobile-friendliness.
5. Marketing & Customer Acquisition
Paid Advertising
Use Facebook Ads, Google Ads, and TikTok Ads to drive traffic. Test different ad creatives and target Hungarian and EU audiences strategically.
Organic Marketing
- SEO: Optimize product pages for Google searches.
- Social Media: Engage with potential customers on Instagram and Facebook.
- Influencer Collaborations: Partner with Hungarian and EU-based influencers.
Email Marketing & Retargeting
Leverage abandoned cart emails and retargeting ads to increase conversions.
6. Managing Operations & Scaling the Business
Handling Orders & Customer Support
Automate order processing using tools like DSers or Oberlo. Provide excellent customer support via chatbots and email.
Scaling Your Dropshipping Business
- Expand to international markets – Dropshipping allows you to sell worldwide.
- Analyze performance data – Use Google Analytics and Facebook Pixel to optimize strategies.
- Test new products – Keep refining your product catalog.
7. Working in Hungary as a Guest Investor
If you are a foreign entrepreneur, working in Hungary as a guest investor is a viable option. The government provides incentives for business owners, and Hungary’s business-friendly policies make it easy to start and operate a company. Moreover, with Hungary’s strategic location, you can access both Western and Eastern European markets, making dropshipping a lucrative opportunity.
Wrapping up
Starting a dropshipping business in Hungary is an exciting opportunity for entrepreneurs seeking low startup costs and scalability. By registering your business, selecting the right niche, setting up an optimized store, and using effective marketing strategies, you can build a successful online store.
Whether you are a local entrepreneur or working in Hungary as a guest investor, dropshipping can be a profitable venture with the right approach. Now is the perfect time to take action and start building your dropshipping empire in Hungary!