Are you looking to launch your eCommerce store without spending so much time and money? Consider dropshipping on Amazon!
If you ever get to speak with an e-commerce expert about the best way to begin selling online without breaking the bank, they’ll most likely tell you dropshipping is the way to go.
However, dropshipping on Amazon can be daunting, especially for beginners. Regardless, if you follow through with this piece, you can have a smooth and profitable dropshipping experience with Amazon.
In this article, you will learn how to:
- Understand How Dropshipping on Amazon Works
- Create an Amazon Seller Account
- Find a Product(s) You Wish To Sell On Amazon
- Get Approved In Your Product Category
- Create an Amazon Product Listing
- Receive Orders And Send Them To Your Suppliers
- Automate Your Business
Sounds like a lot? It’s really not. Let’s get started.
1. Understand How Dropshipping on Amazon Works
Dropshipping is an e-commerce technique that helps sellers take orders from distributors, suppliers, or manufacturers to customers. Think of it as a retail job where you’re the middleman, taking orders from manufacturers for consumers.
Dropshipping on Amazon is an excellent idea, as Amazon is one of the world’s most recognized brands. On top of that, there is strong trust among Amazon shoppers. Dropshipping on Amazon allows you to capitalize on that trust for your brand.
That said, very simply, here’s how dropshipping on Amazon works:
- You list certain products on Amazon
- An Amazon customer purchased the product(s) you’ve listed
- Once the transaction is completed, you receive the funds and purchase the product directly from the supplier giving them your buyer’s information
- With your customer’s information in hand, the supplier sends the product directly to them, and you’re paid a certain percentage
2. Create an Amazon Seller Account
To begin your dropshipping on Amazon journey, create an Amazon seller account. To create this account, log on to sellercentral.amazon.com to register.
There Amazon will provide you with two options for the kind of account that’ll be a great fit for your business—individual or professional accounts. The individual plan costs $0.99 per sale, while the professional plan costs $39.99 a month—no matter how many items you sell.
However, if you sell more than 40 items in a month, the professional plan might be a better option. Furthermore, to complete your registration, you need to provide certain information, including:
- Bank account and routing number
- Government-issued ID
- Tax information
- Chargeable credit card
- Phone Number
3. Find A Product(s) You Wish To Sell On Amazon
Next, find a product(s) you wish to dropship on Amazon. Look out for products in high demand and low competition. You can use these metrics to make your search easier:
- Search for products within 100-300 unit sales a month
- The search competition level for these products to low or very low
- Set an inch to 7+
- Fix the average monthly price between $20-$40
These metrics will give you a range of products to pursue in all categories. Additionally, keep things simple. Look out for household items, sports and outdoors, patios, gardens, and the like. These categories are great for beginners.
4. Get Approved In Your Product Category
To dropship on Amazon, depending on the items you choose to sell, Amazon requires that you get approval for certain products like grocery, music, jewelry, and fashion, as these are popular categories that require approval before setting up your store.
You can get the approval requirement from suppliers looking to dropship their goods.
5. Create an Amazon Product Listing
Once you find a supplier willing to approve their products for you to dropship on Amazon, create an Amazon product listing.
Follow the below step to create an Amazon product listing:
- Go to your seller central account
- Click on inventory > Add a product
- When the add a product screen opens, click—create a new product listing
Mind you; you will have to choose your product category before you can fill out the information for the listing itself. Also note that while adding a price to your drop shipped items, include Amazon fees.
If you’re an individual seller, you’ll pay $1 for every sale you make. But if you’re a professional seller, you’ll pay an 8-15% referral fee, depending on the items you sell.
Note: If you are new to dropshipping on Amazon FBA, Amazon restricts the number of products you can list until you begin to sell more on the platform.
6. Receive Orders And Send Them To Your Suppliers
Once you’re done listing products, publish them. That way, you can receive orders and send them to your suppliers. However, you’ll need to promote your Amazon store to gain visibility.
You can Promote your store on any social channels you have. You can also include Amazon ads through the Amazon Pay-Per-Click.
This will help create ads for your product to help your product appear in Amazon search results. Thereby promoting your stores to new eyes and increasing sales.
7. Automate Your Business
Lastly, to begin dropshipping on Amazon FBA, you need to automate your business. There are several reasons why you should automate your business:
- It makes it easier to run your business
- It gives you time to run your business
- With automation, you get to make money even while you’re not working
How to Automate Your Amazon FBA Business
- Here’s how you can automate your Amazon FBA business:
- Understand how Amazon FBA works
- Create a listing for your products and publish them
- Use the Amazon PPC software tool to manage your bids and optimize your spending. This tool will ensure your ads are seen frequently for the best price
- Use the inventory management software to calculate how many units you should order from your supplier and when.
- Use Amazon ads management to take care of ads creation, management, and reports. This tool will signal you when your inventory is running low and help predict how much inventory you need. It’ll also help you optimize your price range
- Use the bookkeeping software to automate your finances and any software of your choice to automate your payouts—as this is the primary reason you chose to start dropshipping on Amazon FBA
Conclusion
To dropship on Amazon FBA as a newbie, understand how drop shipping on Amazon works, create an Amazon seller account, find a product you wish to sell, and get approved in your product category.
Once approved in your product category, create and publish an Amazon product listing. This way, you can begin to receive orders and send them to your suppliers. Lastly, do not forget to automate your business. It’ll help you grow your Amazon FBA smoothly.
