Here is a diagram that teaches you the basics of drop-shipping on Amazon (explained in further detail below): Second, once the transaction is finalized and you receive the funds, you purchase the product directly from the supplier (on the right-hand side of the diagram) and give them the customer’s information.
Lastly, with the buyer’s information in hand, the supplier then sends the product to the customer. Print-on-demand allows you to advertise customized products such as t-shirts, mugs, posters, and even books without purchasing inventory.
As opposed to other popular e-commerce methods like private label and wholesaling, drop-shipping does not require you to own your own inventory. Instead, when you get paid by the consumer on the sale, you simply turn around and use a portion of the proceeds to purchase the product from the supplier and have them ship it to your buyer.
Because you don’t have to own your own inventory when drop-shipping on Amazon, it’s quick and easy to set up. After all, you don’t have to wait for your inventory to be manufactured and/or shipped to the fulfillment location.
There are a lot of apps and plugins online that allow you to fully automate drop-shipping on Amazon. Note : In order to drop-ship on Amazon, you must purchase from the supplier or manufacturer.
For that reason, shipping times from overseas suppliers can take up to a few weeks (or sometimes even months!) Because items are shipped directly from the manufacturer to the buyer, there is no way for you to control the quality of the product.
When you consider that products may travel 10,000 miles or more to reach their final destination, it’s easy to see how they could get damaged in the process. There, Amazon will offer you two choices for the type of account that you can start with: individual and professional.
And while you may have your own metrics to use for finding such products, I recommend starting with the following criteria: Housewares, sports & outdoors, and patio, home, & garden are all great categories for beginners because they tend to be low maintenance.
It’s a business-to-business website that puts e-commerce entrepreneurs in touch with suppliers who are looking to drop-ship their goods. When setting a price for your drop shipped product don’t forget to account for Amazon ’s fees.
If you are a professional seller, you will pay a referral fee of 8-15% depending on the category. In order to maximize sales, you will need to drive traffic to your product listing.
Next, you can drive traffic to your Amazon product listing through external methods such as social media, blogging, email marketing, etc. While this method is a little more difficult to get going if you don’t already have a following for your brand, it can help you differentiate your product from your competitors.
When you perform drop-shipping on Amazon, you’re taking a lot of the hard parts of being an entrepreneur off the table. So, whereas you would normally spend your time running your business, with drop-shipping you can invest your hours into customer service.
As I stated above, drop-shipping ’s chief disadvantage is that you will be selling a product over which you will have no final say in its development or design. But even if your product is identical to your competitor, that doesn’t mean it has to be the “same.” For example, the brand YETI sells 40 oz stainless steel tumblers for $40 each.
All of these little details will help you predict how your customers will receive the product once you start drop-shipping on Amazon. As long as you follow Amazon ’s rules, this approach is totally fine.
Hopefully, this article has gotten you excited to either start your first Amazon business, or to add to an existing one. But, if you need more motivation, check out our State of the Amazon Seller report; it’s full of helpful insights.
He shares his Amazon sales knowledge as a professional writer and social media influencer. Dave lives in Norman, Oklahoma with his wife, Tracy, son, Jack, and a whole mess of pets.
Spend it building an e-commerce business that will last and continue to bring you money years into the future? In this article, I'm going to cover why drop-shipping on Amazon might not be the best way for you to build your e-commerce business on.
There are a lot of different ways to drop-ship, but the one I get asked about the most is Amazondropshipping. The good news is Google Play have even more reach, so if you do what I teach and build your own drop-shipping store, you’re going to have a rich pool of people to market to.
Rather than hoping that the right people show up to your drop-ship Amazon store. A lot of barriers to starting your own drop-shipping business are technical ones.
That’s because buyers are interested in finding drop-shipping stores that are already successful. It’s almost a flea market type structure, where you pay for a booth.
If you’re new to e-commerce you may not know that having customer data is crucial to growing your business. With data and emails you can build a meaningful relationship with your audience, which you’ll use to sell new products.
With Amazondropshipping, you aren’t privy to the customer data… leaving you with no way to scale your business. Since Amazon owns every part of the transaction, they can offer a better price than you’ll be able too.
The main goal of this article is to help show you why drop shipping on Amazon might not be the best way for you to build a real brand that provides real value to your customers and your bank account. Let’s first start by taking a look at the three different ways you can make money– from literally anywhere in the world– using the drop shipping business model.
Basically, this model consists of buying from one place to sell to another. So in this example, especially selling on Amazon, a lot of people try to source products from a company like Walmart.
These drop shippers try to find products with low prices that sell for more on Amazon ! Drop shipping from China may sound like a good idea, considering many factories are located in that country.
However, what is tricky about this method is that most people use Overly, which is pretty much a middleman app. And as you may know, using a middleman is a huge mistake I see new drop shippers making.
The third drop shipping method I want to discuss is selling for suppliers in your home country. With this method you are building a drop shipping business, and selling for suppliers in your home country.
LIVE Presentation : Learn the Secret Weapon That all 7 Figure Drop Shippers Know So, in case you were wondering, no you don’t need to use Amazon with the above drop shipping methods.
Since there are a lot of different drop shipping strategies, here’s a quick example of the shopping experience. Arbitrage Model : You could go to Amazon, buy the product, and have it shipped to Sarah.
Use a Middleman : You could also have Overly linked to your store, which would be fulfilled from a third party supplier (most likely AliExpress). Again, these are the main ways that most people actually run drop shipping businesses to use as a fulfillment method.
When your orders are coming in on Amazon and you have to fulfill them, you are not working with the supplier who is telling you how much inventory they have. You are going to another website, buying these items, and then shipping it to the customer that bought from you on Amazon.
Not to mention, the packaging is going to come from Walmart, and that starts to lead to serious customer service issues. Even though I know people are using this method and making some quick money doing so, I have two reasons why I would never recommend this model.
Problem #1 Customer Service Arbitrage requires quite a bit of manual work. You are building a quick project, trying to flip a product to make a couple of bucks.
If you are still set on drop shipping with Amazon, your next option would be using a website that gives you a bit more freedom– like AliExpress. If you want to use AliExpress to drop-ship on Amazon, you are going to run into the issue of long lead times.
Even the fastest package shippers on AliExpress– we’ve tested all of them just to see– take weeks to deliver the item to your customer! Most of the world is used to Amazon delivering packages in two or three days, not two to three weeks.
On top of that, you are almost guaranteed to get negative reviews, and returns will be a bigger headache than your customers even imagined. On the other hand, if your customers on Amazon aren’t happy, they tell the world, and you could get banned from the site.
The third method of drop shipping on Amazon is how you can actually build a real business. The best example I can give you would be if I sold a simple paddleboard in my drop shipping business.
Think of it this way: basically you are selling these products that are on Amazon, and your supplier is in your home country. When an order is placed, you tell your supplier to ship them out.
I have been in the e-commerce industry for more than a decade, and I have learned a lot of things along the way. One of the biggest being that about 70-80% drop shipping suppliers and brands will forbid you from selling their products on Amazon.
The last thing these suppliers want is 20 different companies like us having a price war on Amazon or eBay. And if they don’t mind, it may be well worth your efforts to give drop shipping on Amazon a shot.
Check out a few of our example stores in our Ultimate Drop-shipping Guide. The idea of selling on Amazon is attractive because there are so many people shopping there every day.