Categories: Dropshipping

Amazon Dropshipping 101: A Complete Guide for Beginners

Selling on Amazon can be tricky – but highly rewarding.

The platform gets over 95 million unique monthly visitors in the U.S. alone!

In this article, you’ll find out what Amazon dropshipping is all about, the pros and cons of selling on Amazon, and a step-by-step guide on how to start dropshipping with the platform.

We’ve also included some expert tips and recommended tools for beginners to take their Amazon dropshipping game to the next level.

Ready. Set. Read on!

What is Dropshipping?

Dropshipping is a business model that lets you sell products to customers without worrying about production, inventory, shipping, and related aspects.

With dropshipping, your supplier is responsible for manufacturing, packing, and shipping the products to your customers directly from their warehouse.

All you need to do is set the prices, promote the products, make the sales, and keep the profits to yourself!

There are several channels through which you can dropship – Amazon is one of them.

How Does Amazon Dropshipping Work?

Most dropshippers sell only through their online stores and social media pages.

But Shopify now lets you add an additional Amazon sales channel to your existing online store. This means you can easily manage the products you sell on multiple platforms, including on Amazon.

But, here’s the catch.

Dropshipping on Amazon comes with rules:

That’s right. Amazon explicitly states you’re not allowed to sell products that another online retailer directly ships to the customers.

This means TECHNICALLY, you can’t virtually import products from AliExpress and sell them on Amazon.

But, you know what? Tons of sellers on Amazon still do it anyway.

The key is to make sure the identity of your supplier is not revealed.

You can do that by communicating with your supplier and reaching an agreement for the paperwork – the packaging, labeling, contact details, and all other relevant information should state the products comes from you and not the supplier.

Once you take care of that, you’re good to go!

The Pros and Cons of Amazon Dropshipping

Amazon dropshipping is great – but it’s not for everyone.

Before you start dropshipping on the platform, you need to carefully look at both sides of the coin. Weighing the pros against the cons will help you make a better decision.

To make the task easier for you, we’ve listed some of the top advantages and disadvantages of dropshipping with Amazon:

The Good

Of course, Amazon dropshipping has tons of benefits! If it didn’t, you wouldn’t be reading an entire guide about it.

Here are some excellent advantages of dropshipping with Amazon:

Save time

Dropshipping with Amazon can save a lot of your precious time by eliminating the need for production, packaging, and shipping concerns.

All you need to do is add the Amazon sales channel to your online store and you’re good to go. This leaves you with plenty of time to focus on the important stuff, like marketing.

Minimize inventory costs

Selling on Amazon or any other platform can be pretty expensive if you’re not dropshipping.

Dropshipping lets Amazon sellers eliminate any costs that come with storing products, renting warehouses, and keeping check of inventory. You could use that money to promote your products instead, like running sponsored ads on Amazon.

Sell to a large audience

Amazon gives dropshippers access to over 300 million customers from all over the world!

Imagine the exposure your products will get if you decide to dropship on the platform. This means selling on Amazon can promise you huge returns for your business. And what’s more, you’ll have more chances of selling to a target audience you never even knew you had!

Benefit from Amazon’s good reputation

There’s a reason so many customers buy from Amazon.

The website was ranked #1 by a 2016 Neilson Company survey and has an already established brand image. You can capitalize on the platform’s reputation by selling your products on Amazon.

Starting your own online store requires you to build brand awareness from scratch. Dropshipping on Amazon can save you the time and effort. Most customers will already trust you just because you’re selling on the world’s most popular e-commerce platform.

Spend less on ads

Just like any other platform, Amazon also lets you spend on paid ads and sponsored product promotions.

The good news is, you can control how much you choose to spend – there is no minimum amount!

Plus, Amazon is a huge e-commerce marketplace – this means you can always optimize your page and products, like nailing Amazon SEO, to get organic traffic.

Let the experts handle it

Dropshipping on Amazon means you’re letting your suppliers take care of the packaging and shipping concerns.

That’s a good thing – in most cases, your suppliers know what they’re doing. They’re the experts. Chances are, they can pack and ship the product better than you!

When your customers receive your products in the best possible condition, they’ll be more likely to be happy with their purchase.

Feel free to experiment

Dropshipping on Amazon gives you a lot of flexibility as a retailer.

Think about it. If some of your products aren’t performing well, you can always discontinue them without worrying about any additional costs or wasted stock!

This means you can safely experiment with a range of different products to see what sells the most. Once you’ve identified your most profitable products, you can always shift your focus on them.

Sell unlimited products

Along with flexibility, dropshipping with Amazon gives you the freedom to sell as many products as you like. And that too without worrying about storage space or inventory.

This means you’ll be able to sell a huge volume of products. The more you sell, the more money you make!

The Bad

Amazon dropshipping is great, but it’s not perfect.

If you really want to make the right decision, you need to carefully look at any potential drawbacks too.

Here are a few concerns most sellers have while dropshipping on Amazon:

Risk violating the rules

As discussed above, Amazon has certain rules and policies when it comes to dropshipping. Technically, you’re not allowed to sell through a third-party retailer.

Of course, this can be managed if you keep the identity of your supplier hidden. But there’s still the risk of violating the rules and getting penalized or banned from the platform.

Less control over supplier

The problem with dropshipping is you don’t really have much control over getting your products delivered to your customers. You rely on your supplier for that.

While it’s great to not have to worry about these things, less control also means if something goes wrong, you’ll be held responsible.

If your supplier doesn’t deliver the right product to your customer, for example, it’s your reputation that will suffer in the end.

Step-By-Step: How to Dropship with Amazon

Now that we’ve talked about what Amazon dropshipping is and why it matters, let’s dive right into the steps involved in getting started with it.

Dropshipping with Amazon is tricky, but it’s not as complicated as you think.

Here’s what you need to do:

Step 1: Find the Right Supplier

Start with figuring out what you want to sell.

Next, find a reputable supplier to partner up with.

You can either check out dropshipping marketplaces, like Salehoo, or search for suppliers on AliExpress.

Keep in mind, AliExpress suppliers are Chinese, and you might face communication issues and language barriers.

Step 2: Check if Your Product is Eligible to Sell

That’s right. You can’t just sell anything and everything on Amazon. There is a list of eligible stores you need to stick to.

You can check if your product qualifies to be sold on Amazon here.

Step 3: Create an Amazon Seller Account

To sell on Amazon, you need to make a seller account.

The platform offers you two plans to choose from – Individual and Professional.

If you plan on dropshipping a lot of products – like more than 40 – it’s wise to sell as a professional. Selling as an individual will cost you $0.99 per item, which can bring down your profits if you sell a large amount of stuff.

Once you’ve picked a pricing plan, you’ll be taken to Amazon’s Seller Central to create an account.

Enter in your personal and business details and finish all the steps required to set up your seller account.

Step 4: Get Your Product Category Approved

Certain products and categories on Amazon require approval before you can sell them on the platform. Some of these niches include Fashion, Beauty, Jewelry and others.

You can find out more details about how to get your product category approved here.

Step 5: Start Listing Your Items

Once you get approved, you can finally start listing your items.

First of all, search up the item you want to sell on Amazon. If it already exists, click on “Sell yours here”.

Next, describe your item’s condition and set the price, shipping method, and other details.

If your product is new and doesn’t exist in Amazon’s catalog already, click on “Add a Product” and then on “Create a new product listing”. You can check out more details on how to add a product here.

Remember, Amazon has strict requirements for product images, like using a white background in your main product image.

Make sure you ask your supplier to stick to Amazon’s requirements when providing you with product images.

Once you’re done listing your products, you’re now ready to sell!

Step 6 (Optional): Promote Your Products on Amazon

This step is optional because you’ve already listed your products on Amazon and customers can start buying from you right away.

But without the right kind of promotion, you won’t be making as many sales on Amazon as you potentially can.

Here’s what you can do.

For starters, you can run Amazon’s Sponsored Ads to get your products more exposure.

Don’t forget to specify certain well-researched keywords to make your ads more targeted.

You can also work on your Amazon SEO by optimizing your page and product listings to organically make your way to the top of search results.

Amazon Dropshipping Tips & Tricks

The steps above will help you set up your Amazon seller account and get started with dropshipping on the platform.

But, did you know? There are proven best practices out there to help you skyrocket your sales.

Here are some tried-and-tested Amazon dropshipping tips you can start implementing today:

Get More Reviews on Your Products

What’s the first thing you look at before buying a product on Amazon?

The reviews!

It’s simple. The more positive reviews you have of your products, the more credible you’ll come across to potential customers.

Better yet, more reviews can help you rank higher in search results. That’s because good reviews lead to a higher conversion rate, which ultimately gets you featured more on Amazon.

Here’s exactly how you can get more reviews.

Email your customers after they buy your product. Thank them for their purchase and ask them to leave you a review if they’re happy with their purchase. Don’t forget to include a link in your email to make it easier for them!

You can also create an automated email campaign to send out a series of follow-up emails post-purchase.

This will help you connect to your buyer, offer them support, and maybe throw in a request for feedback too.

Invest in Amazon SEO

If you don’t want to splurge too much cash on paid ads, you can always nail your Amazon SEO to get more organic traffic.

So, how is Amazon SEO different from regular SEO?

Well, just like you optimize your website to show higher up on Google’s search results, you can optimize your Amazon store and product listing to show up higher on Amazon search results.

Pretty neat, huh?

Here’s how you can do that.

Optimize your product title. You don’t have to be concise. In fact, make sure you include as many details/keywords as possible, like the brand, color, type, material, and even the size.

Optimize your product descriptions. Do your research and find out the keywords your customers are most likely to search for. Go for long-tail keywords instead of the ones you’ve already used in your title.

Get more reviews. As discussed above, getting more positive reviews can increase your conversion rate and boost your Amazon SEO.

Find a Reputable Supplier

If your supplier is bad at communication or doesn’t have a lot of good reviews, your business will be at risk.

Think about it. If your supplier reveals their identity or does something wrong when it comes to order fulfillment, your reputation will be at stake and you might even get banned from Amazon for good.

The key is to find a reliable supplier who already has a lot of positive reviews from past customers.

The more trustworthy your supplier is, the more likely you are to have satisfied customers.

Win the Buy Box

Amazon’s Buy Box is a big deal. In fact, it’s responsible for nearly 82% of all Amazon sales!

And that’s why you should aim to get your product in there.

Here’s what the Buy Box looks like:

To get featured in the Buy Box, there are several things you need to take care of.

First, you need to have a high seller rating. Experts say a rating of 95% and above is good enough.

Next, price your products lower than your competitors. This increases your chances of landing the Buy Box. But, if your performance metrics are excellent, you can get away with a slightly higher price too.

Also, it’s good practice to keep negative feedback, guarantee claims, refunds, cancellations, and delayed shipments at a minimum.

Use Multiple Sales Channels

If you’re planning to dropship, don’t just stick to a single platform. Use as many channels as you like to reach a bigger audience.

That’s the beauty of e-commerce. You can sell the same product through multiple channels and manage all of them from a single platform – especially if you use Shopify!

Shopify lets you create your own online store and add multiple sales channels, including Amazon, to sell and manage your orders conveniently.

Amazon Dropshipping Tools

Good news! There are dozens of handy tools out there to help you dropship better on Amazon.

Here are some really good ones you can use to get started:

Feedback Express

Feedback Express is a great tool to help you get more reviews on your products. It also lets you get rid of negative reviews on Amazon and even blacklist shady customers. Their pricing plan starts at $14.95/month with a 30-day free trial.

Feedvisor

Feedvisor is an AI-based tool that helps sellers strategically price their products by analyzing performance, inventory and competitive data.

FeedCheck

FeedCheck lets you view and manage all your product reviews in one place. This is a great tool to have if you sell a lot of products on Amazon, because keeping track of reviews manually can get difficult. It also lets you monitor your competitors. Pricing starts at $59/month with a 7-day free trial.

Amazon Keyword Tool

This free tool by Keyword Tool Dominator lets you find long-tail keywords for your Amazon products and categories. You can use it to optimize your listings and rank higher in Amazon search results.

Ready to Dropship on Amazon?

That’s it. You’re ready to dropship like a pro on Amazon!

Dropshipping on Amazon can be tricky, but you can always learn as you go. This complete guide will help you get started.

Did you find this article helpful? We’d love to hear from you. Let us know in the comments below!

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Kaizen Sigma, LLC

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