Amazon Dropshipping Guide (2022 Update): Everything You Wanted To Know!

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Updated: April 29

By: Scam Risk - Expert Reviewer

amazon dropshipping guide

We all know that Amazon is one of the world’s most known brands.

But when it comes to dropshipping, is it legit?

Have you considered Amazon dropshipping?

That is what we will talk about in this Amazon dropshipping guide review. Let’s get started!

DISCLAIMER:
This Amazon Dropshipping Guide Review has been thoroughly researched with information and testimonials that are available online to anyone in the public. Any conclusions drawn by myself are opinions.

Table of Contents

Pros: What I Liked

  • Amazon is a massive online retailer.
  • Simpler to start up, with lower initial outlays.
  • Automated company.
The Good

Cons: What I Didn't Like

  • Customers have fewer long-term relationships.
  • Delivery times are very long.
  • Trademarks and product specifications are not within the company's control.
The Bad

 

Amazon Dropshipping isn’t too different from most dropshipping courses.

Sure, their marketing makes some great promise you haven’t heard from the other dropshipping gurus, but at the end of the day, no magic bullet overcomes the massive pitfalls of this business model.

Let’s get something clear: 

There is NOTHING passive about dropshipping, no matter how well most course creators sell the dream.

If you want that travel-the-world-making-money-while-you-sleep-laptop-lifestyle, dropshipping isn’t for you.

To run a successful dropshipping business, you need to be constantly on the lookout for new products.

Scouring the internet for hot trends and trying to find the next fidget spinner will take hours out of your day.

Not to mention, it’s not enough to just have the hot new product…

You also need to get the customers.

That means ads…

Lots and lots of ads…

Testing, tweaking, targeting, spending thousands if not tens of thousands of dollars before breaking even.

Not to mention, Facebook hates dropshipping, meaning one of your top traffic sources could shut you down at any time.

All of this leads to a very stressful life, not a lot of money, and a lot of time wasted.

Time that could be better spent so you can actually live the life you want.

Now, what if there was a way you could build a passive income stream that’s actually passive?

An income stream that doesn’t require:

  • Physical Products
  • Low Margins
  • Long Wait Times
  • Angry Customers
  • Thousands of dollars testing different ad campaigns

An income stream that brings in consistent revenues every single month (from a couple thousand dollars to well over $10,000)?

An income stream you could actually build in your spare time, and grow as large or as small as you want to, without having to spend hours a day running ads, researching products, and trying not to get banned by whatever platforms you’re using?

TESTIMONIAL - STILL GETTING PAID

If that sounds like something you’d be interested in, check out Digital Real Estate.

This is nothing like dropshipping, and that’s probably a good thing.

However, if you’d still like to know more about Amazon Dropshipping, keep reading.

What Is Dropshipping?

Dropshipping

Dropshipping is a business idea in which your own ecommerce store does not maintain a physical inventory of the items they sell to their customers. As soon as a transaction is completed, the dropshipper passes the order to a third-party supplier, who then sends the merchandise directly to the customer.

As a dropshipper, you benefit from the difference between the wholesale price, pay for your wholesale suppliers and the retail price you charge.

Product research and marketing are essential for dropshipping.

Because you are effectively acting as a middleman, public perception of dropshipping suppliers spans from legitimate enterprises to complete snake oil merchants.

 

Private Labeling VS. Retail Arbitrage VS. Dropshipping

Let’s take a look at two more popular online business concepts before we get into the meat and potatoes of dropshipping. These are retail arbitrage and private labeling.

Retail arbitrage (Amazon arbitrage if you sell on Amazon) is purchasing things at a low cost from a store and reselling them for a profit. Under this strategy, you own inventory at some time, which you often accumulate during huge clearance sales or heavy-discount seasonal campaigns from major retailers.

Private labeling is purchasing off-the-shelf items from suppliers (often from China) and reselling them under your brand.

What Is Amazon?

Amazon

Amazon is one of the world’s biggest ecommerce websites. Its popularity rose because it enables shops to sell their items on their platform.

Manufacturers and companies may sell on Amazon as an extra sales channel for their retail locations.

You’ll be able to start on Amazon as soon as you’ve been accepted for an Amazon seller agreement. Remember that not all brands and products are allowed.

What Is Amazon Dropshipping?

Amazon Dropshipping Business

Amazon Dropshipping is an reputable dropshipping business in which you sell real things on Amazon without having to deal with inventory, shipping, handling, or processing customer returns. Just a packing slips!

In essence, Amazon and your supplier do all of the hard work. When you make an Amazon sale, contact your dropshipper, and they will ship your items straight to the Amazon client on your behalf.

During the whole procedure, you will not have to touch anything. Except for the expense of creating an Amazon account, there are no further upfront costs. Until the item is sold, you are not required to purchase any inventory.

Dropshipping on Amazon is a low-risk business strategy since anybody can do it, and you don’t need to be computer skilled to get started.

How Much Does It Cost To Dropship On Amazon?

How Much Does It Cost to Dropship On Amazon

You don’t need money to get started with an Amazon dropshipping company. As a result, you don’t have to spend any money on inventory upfront since you don’t have to pay your supplier until a sale is made.

In addition, Amazon provides a free account for private merchants. You don’t have to pay Amazon fees until a sale is made if you dropship to an existing Amazon listing.

Amazon dropshipping is the least expensive option to be an online retailer compared to other business types.

How To Start Dropshipping On Amazon?

How To Start Dropshipping On Amazon

So, what are the steps to getting started with Amazon dropshipping? The following are the four essential stages:

Amazon Seller Account.

Signing up for an Amazon Seller Central account is a simple process. We offer a comprehensive guide to teach you all you need to know to start selling on Amazon.

When setting up an Amazon Seller account, make sure you have your personal information, billing information, and tax information.

It’s worth noting that a free Individual Account charges $0.99 for each item sold, but a Professional Account, which you should choose if you want to sell more than 40 things, costs $39.99 each month.

Conduct Product Research

Next, decide the category you want to sell in or which product you want to dropship.

Here are some fundamental ideas to get you started:

  • Find niche items that are in high demand all year.
  • Products that are both mysterious and practical, or both simultaneously, are perfect.
  • Dropshipping is preferable for high-maintenance items that would otherwise need storage expenditures.
  • Visually appealing products and those you can aggressively sell on social media
  • Avoid Prime—products supplied via Prime are already offered by an FBA-registered seller, making it almost hard to compete.

Locate A Supplier

Here are some tried-and-true methods for connecting with dropshipping supplier:

  • Google Searching- Running an online search for suppliers is time-consuming, but you can typically contact them via their websites. You seek a genuine dropship provider, not tools or sourcing agents who link you to one. They often offer forms where you can join up to be a dropshipping shop, and their websites provide contact information. If no contact information is provided, this is a significant red flag.
  • Trade Exhibitions- While it is more difficult than just searching the internet, meeting with your prospective supplier in person is an excellent method to start a dropshipping company. Trade exhibitions are good since they allow you to assess several providers in one location directly.
  • Dropshipping directories- A third alternative is identifying and paying for a pre-vetted list of suppliers willing to engage with retailer ship directly or dropshippers.

Market Your Goods

The last step is setting up an Amazon listing and selling your goods. Integrate Amazon as a sales channel whether you’re promoting the product on a standalone ecommerce business or a Shopify site.

You want to be customer-focused while yet having a terrific listing.

Consider developing your brand as you go. Once you’ve mastered Amazon, it’ll be easy to switch to more sustainable business models like private labeling.

Is Amazon Dropshipping Profitable?

Is Amazon Dropshipping Profitable

Although Amazon dropshipping is a simple business concept, to begin with, it is tough to perfect if you want to earn a large amount of money on the internet.

Because your margins are so low, you will only be able to generate a big profit if you grow your business.

The basic conclusion is that you must provide a varied assortment of things while also reducing your expenditures and ensuring that your Amazon listings are dynamically priced properly.

Meanwhile, you must ensure that your inventory counts and product descriptions are constantly correct to avoid having your account suspended or terminated.

Consequently, you cannot do any of these tasks by hand and must depend on software to handle operations.

Listed below are the tasks that must be automated to even have a chance of producing a profit.

  • Creating purchase orders — When a customer orders anything, you must automatically submit the order to your supplier for fulfillment.
  • Pricing- Because Amazon prices move continually, you must make certain that you control the purchase box.
  • Inventory Listing Management: When you run out of stock, you must ensure that your listing is deactivated to avoid unfulfillable sales.
  • Product Data Syncing- The items that your supplier sends must EXACTLY match the products that are listed on your Amazon store. Any modification to the package or product version must be taken into consideration.
  • Order tracking: Your supplier must give you electronic shipment and tracking information, which you must transmit to Amazon as soon as possible after receiving it. This procedure must be automated to manage the high amount of orders you will get.

Overall, every aspect of your Amazon dropshipping company must communicate with one another. It is a low-margin volume game with very high risks to be successful at Amazon dropshipping.

You can only make money with this business model if you expand it, and a single mistake might result in the loss of your whole business overnight.

Success In Amazon Dropshipping May Be Achieved By Following These Five Steps:

On Amazon, the process of setting up a dropshipping business is straightforward. Dropshipping on Amazon is possible, although it does need some work.

The following are five tips for a successful dropshipping business.

Promote Your Listing

To maximize sales, you’ll need to drive traffic to your product listing.

It all starts with a kind of internal sponsorship known as Amazon Pay Per Click (APPC) (PPC). Ads for your products that appear higher in Amazon’s search results for keywords that you give may be created using PPC (pay-per-click).

Third-party strategies like Facebook ads, social media, blogging, email marketing, and so on may then be used to drive traffic to your Amazon product listing. Even if you don’t have an established customer base, this tactic may help you stand out from your competitors.

Pay Attention To The Buyer

On Amazon, dropshipping is a much like starting your own business, but without all the headaches. Don’t make or transport your own purchase products.

Dropshipping enables you to focus on customer purchases instead of running your business.

It’s also important to note that good customer service helps boost product reviews. Positive product reviews, once again, may make or destroy your Amazon company.

Focus On Your Own Ecommerce Store

Dropshipping’s biggest negative is that you will sell products that you have no say in the manufacture or design of. In addition, the same supplier will be available to other businesses.

As a consequence, you have little or no advantage over your competitors. So you need to focus on the brand in order to be successful.

Even though your product is comparable to your competitors’, it does not have to be identical to them. For $40, you can get a 40-ounce stainless steel tumbler from YETI, for example. Stainless steel tumblers from RTIC, on the other hand, are available for less than $20. The YETI brand, on the other hand, continues to hold sway in that sector.

The answer is simple: buyers want to buy the YETI brand and the image it symbolizes.

Get A Sample.

It’s imperative that you know exactly what you’re selling before putting it on the market. Don’t be afraid to plan ahead of time and arrange a place to stay. A dropshipping strategy is even better if you can do it without the supplier noticing.

Examine the specimen when it arrives. I’m curious as to how it looked when it first came. How long did it take to complete? Is everything as it seems to be?

Once you start dropshipping on Amazon, you’ll be able to anticipate how your customers will get their orders thanks to all of these minor details.

Throw A Wide Net.

With dropshipping, you can reach a bigger audience since you don’t have to invest anything up front. As a result, you may list a large number of items at once.

Some people will not be able to make it. Enhance what works while reducing ineffective elements.

As long as you go by Amazon’s rules, you may use this strategy without incident.

What Software Do I Need For Amazon Dropshipping?

What Software Do I Need For Amazon Dropshipping

If you want to run a hands-off company, the best way is to invest in the finest software to automate your procedures. Order generation and tracking, inventory management, and repricing are just a few of the main areas that need automation.

Many of these tools may be found on online store. Here are some of the most popular Amazon dropshipping software:

Helium 10

Helium 10, a popular all-in-one Amazon software, includes product and keyword research tools, listing improvement, and business analytics.

Plans (discounted if you want to be paid every year):

  • Trial Period
  • Starter ($37 per month; includes core tools and expert instruction)
  • Platinum ($97/month; most popular plan for a single user)
  • Diamond ($197/month for a multi-user subscription with increased limitations)
  • Elite ($397 per month; top-tier package with live expert instruction)

Jungle Scout

This tool, which is almost a must-have for Amazon sellers, assists in discovering, launching, and selling items on Amazon. It also includes a valuable set of additional tools, such as the Supplier Database Tool.

Plans (discounted if you want to be paid yearly):

  • Basic ($49/month, including full access to the Jungle Scout browser plugin)
  • Suite ($69 per month, including review automation and access to advanced selling tools)
  • Professional ($129/month; ideal for experienced sellers; includes expedited onboarding and six users)

Oberlo

Oberlo is designed to assist dropshippers in finding items, contacting suppliers, and establishing a niche.

Plans:

  • The explorer (Free)
  • Grad ($7.90/month, including coaching, classes, and trend reports)
  • Boss ($29.90/month with advanced selling tools)

Sellery

An automatic repricing program allows you to establish price constraints, including delivery, to increase your chances of winning the Buy Box.

Plans:

  • Trial Period
  • 1% of your total monthly sales, with a minimum charge of $50 and a maximum fee of $2000 every month

Shopify

Shopify is the place to go for dropshipping. Amazon may be integrated as a sales channel on your Shopify site, allowing you to maintain inventory and keep track of sales that need to be completed.

Plans:

  • Costless (14-day trial)
  • Shopify Basic ($29/month for newcomers)
  • Shopify ($79/month for developing businesses with at least one retail location)
  • Advanced Shopify ($299/month for expanding enterprises with two or more retail locations)

Spocket

A product finding and sourcing tool is driven by machine learning suitable for companies wishing to dropship on US and European marketplaces.

Plans:

  • Free
  • Starter ($24/month for 25 distinct goods and email support)
  • Pro ($49/month, including branded invoicing and chat support)
  • Quality ($99/month for 10,000 unique and premium goods).

Is It Posibble To Dropship from Amazon To eBay?

Is It Posibble To Dropship from Amazon To eBay

It has been common to dropship products from Amazon to eBay. Using this business strategy, merchants purchase discounted products from Amazon and then resell them for a profit on eBay dropshipping.

In most cases, this implies that the end customer who purchased the items on eBay will get the thing in Amazon external packaging – which is not ideal for them.

Dropshipping from Amazon to eBay isn’t against the law, but manufacturers don’t like it. The dropship model is advantageous to the dropshipper since it allows the manufacturer to keep their hands off of their earnings.

Another reason why hundreds of Israeli businesses were barred from employing this approach in 2017 because eBay doesn’t appreciate dropshipping from Amazon to eBay.

This is a bad idea if you want to develop a credible dropshipping company.

Is Amazon Dropshipping A Scam?

Is Amazon Dropshipping A Scam

So, is Amazon Dropshipping a scam? Not technically. You can make money with this program, but it’s definitely not as easy as makes it sound.

There’s a ton of work to be done upfront, no real guarantee of success, and – most importantly – you need to do a ton of volume to make any real money.

Now, there’s nothing wrong with front-loading the work and making the money later.

But if you’re grinding it out for 3 months, $3-5k in the hole on ads (because that whole “get started with $5 a day” thing is total BS) and then your reward is 15% profit on a $12 product (which comes out to $1.80), it’s not really worth it.

What if, instead, you could do that same 3 months of work (in your spare time), and your reward was a $500 to $2,000 payment that came in every single month?

And what if you actually didn’t need to wait 3 months? What if you could get started today and have your first payment in a week?

And what if you could double it next week?

Well, that’s the power of Digital Real Estate

And, unlike dropshipping, you can legitimately do this from anywhere. It’s a true lifestyle business.

Your laptop and an internet connection is all you need.

Some of the most successful students in this program run their entire 6-figure businesses from:

  • A camper in the middle of the woods
  • A beach chair on the water in Mexico
  • A small villa in Greece

TESTIMONIAL - SAYING GOODBYE TO OUR JOBS

They’re able to travel around, living their lives first, and focusing on their income second.

Because even if they stop working for an extended period of time, the money keeps coming in.

So adventure, memories, and experience are the top priority.

And they never have to worry about how to pay for the next trip, or consider asking for time off.

If this sounds more like the type of life you want to lead, just click here to find out more about Digital Real Estate.

Are There Alternatives To Amazon Dropshipping?

Yes, there are plenty of Dropshipping programs and resources to choose from if you want to pursue this business model.  Here are just a few:

 

What Is My Top Recommendation For Making Money In 2022?

Digital Real Estate

Our review team has spent months researching, reviewing, and vetting dozens of business models and thousands of programs.

While there may be no “perfect business”, the research IS conclusive:

Digital Real Estate is the #1 online business model for those just starting out.

Whether you’ve never made a dollar online, or you’ve been in this space for a while but never really “made it,” Digital Real Estate is for you.

Why?

1) It’s Flexible: got an hour a day? You can do this. Ready to drop everything else and dive in full time? You can do this. Yes, the more time you put in, the faster you see results. But even with a little time each day, you can move the needle in a Digital Real Estate business.

And because this system is so flexible, you don’t have to constantly be working to make more money. It’s called PASSIVE INCOME because if you stop working, the money doesn’t.

Imagine taking 3 months off to just tour around Europe, rent a cabin in the woods to write a book, hike the Appalachian Trail, or live on the beach and surf all day.

This is only possible if you have an income stream that’s not tied to your time.

TESTIMONIAL - JUMP ALL IN

2) You Own & Control EVERYTHING: With dropshipping, you don’t really own anything. You have no control over the quality of products. You don’t even own the products because they go straight from the supplier to the customer.
Yes, if you’ve got a Shopify store, you technically own that. But if every ad platform suits you down, you’ve got a store with no customers. Which is literally worthless.
With Digital Real Estate, you own the assets, which means you have all the power and all the control.

TESTIMONIAL-FEELING-BLESSED

3) Little To No Startup Costs: It’s possible to get into Digital Real Estate with zero dollars upfront. Because, using the strategies outlined in this program, you can get a client to pay you BEFORE spending a penny out of your own pocket…even before you do any work.

Even without getting paid in advance, you can have your first Digital Rental Property up, running, and generating profits for less than $100.

TESTIMONIAL-SCOTT-LEAD-GEN

4) No Inventory: Ok, so technically you don’t have to worry about inventory since you’re not filling up your garage or a warehouse with products.
But, you still have all the headaches of a physical products business.
Since most dropshipped products come from China, you already have a 2-3 week wait time from when a customer places an order.
But right now, with global supply chain issues, your customers would be lucky to get anything in less than a month.
Imagine finally landing your first customer after months of experimenting, and then getting hit with a refund request or chargeback because they had to wait 6 weeks to get their order.

With Digital Real Estate, a 100% online business, you never even have to think about that risk.

TESTIMONIAL - ANNA DONE DEAL

5) Easy To Duplicate: Ok, here’s the best part: once you have your first Digital Rental Property up and running, you can literally DOUBLE your income with a few clicks, a couple keystrokes, and a single phone call (and you don’t actually need the phone call).

Remember: each Digital Rental Property is worth $500 to $2,000 a month in semi-passive income (over 95% profit). Every time you decide to create another one and increase your income, it gets easier.

Because you have more knowledge, more experience, more results, and more momentum.

If you wanted to double your income with dropshipping, you’d have to double your inventory, your profit margins, OR your average order value. And, guaranteed that’s a lot harder than a few clicks and a few minutes of your life.

TESTIMONIAL - LANCE LEAD GEN

6) Make Money Helping Real People: This part is what makes it all worth it. 99.9% of the time, dropshipping provides no value to anyone but the seller.
In a lot of cases, it has a negative impact on the customer because of poor product quality and an overall bad experience (i.e. waiting 6 weeks to get your order).

And that makes it pretty hard to sleep at night.

But with Digital Real Estate, you’re actually helping people by solving your clients’ biggest problem:

Small, local businesses need more customers, and with Digital Real Estate, you are unleashing a flood of happy, paying customers for these businesses.

You make money by helping them make money.

Not a big, faceless corporation either…a small business owner who’s using that money to put food on the table for their family, start a college fund for their kids, or take care of a sick parent.

Once you see how Digital Real Estate makes a real impact in the lives of real people, you’ll sleep like a baby with a big smile on your face.

TESTIMONIAL-BOSS-OF-MY-FUTURE

Now, the choice is yours. You could continue browsing, looking at opportunities like Amazon Dropshipping which could one day make you money.

You could continue researching, never making a decision.

OR, you could take a look inside, consider what you really want, and join a program that makes your dreams a reality. At the same time, joining a community of over 2,000 successful students that are living life on their own terms thanks to Digital Real Estate.

A consistent, reliable, semi-passive stream of income that doesn’t depend on you or your time to keep producing profits.

All while genuinely helping real people who are grateful and happy to pay for it.

If this sounds more like what you want out of life (or if you just want some nice side income), click here to learn more about Digital Real Estate.

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