How much capital do you need to start a drop-shipping business?

Between $50 and $100 startup costs is usually all you need to start a dropshipping website.

Really, you can start for less than $15 (the cost of a domain name), since Shopify allows you to transfer your real domain name to your store and accept orders while still on their 14 day trial. We just had a new Store Coach member start a store and get his first order 4 days later so in his case, his startup cost actually was the cost of the domain name, since he was still on the Shopify trial and had 10 more days until he had to start paying the $29/month fee with Shopify.

Dave nailed it, it doesn't cost much at all to get started with a domain name and web host/shopping cart.

I would add that it is generally a good idea to drop a few more bucks on getting a formal "sales & use" business license from your state (assuming you are in the US). Cost varies depending where you live but it will most likely fall in the $50-200 range. Also, you should register for an EIN number (free; on the IRS website). Many US suppliers request seeing these before dropshipping for you.

Other than that, just add in the fixed monthly costs to have a seller account on the marketplace(s) you choose (Amazon, eBay, etc).

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Less than $100 and you will make a lot of sales if you know what you are doing,

More than $1000 and ZERO sales if you don't know what to do.

Besides setting up a website, you will need money to pay for the products once you have orders. It would be a good idea to have a few thousand dollars available.

Well, people will always disagree because not everybody does things exactly the same. I'd agree with MValmont. We have operated nearly 200 eCommerce stores over the past decade (about 50 currently) and we would never hire a developer to set up a simple eCommerce dropship site. There are too many platforms out there now that have everything you really need already set up - Shopify, 3DCart, BigCommerce, etc.

As mentioned by someone else earlier, you really do need a sales tax ID. It all depends what state you are in whether or not there is a cost for that and you should also get a DBA which also costs money but we don't sweat the DNA until a site has already stated making sales.

Of course, if you are dealing with foreign suppliers, they couldn't care less about a sales tax ID. To stay legal, however, you should get one to conform to your local laws.

Still, with all that, you still probably come in at under $100.

Based on personal experience, it didn't went up to thousands to start. Here the things that I prepared when starting:

Your store. If you would go with Amazon, you have to take note of the listing and sales fee. If you want to setup your own store, you will have to get rid of these but in exchange, the fees that you will be paying are hosting and perhaps your theme and plugins.

Supplier. The cost may vary from one supplier to another. That is why choosing the right supplier for your chosen niche is very important. Choosing the right one can help you save money as your site runs.

Marketing. After setting up the store and finding the supplier, you need to get to real business. How will you get your first sales? It will depend on how well your marketing strategies are. Social media, ads, SEO could be few options.

Prepare also for other costs. Tax ID, credit card and your local laws may have documents or licenses needed to start your dropshipping business.