Dropshipping with Amazon: 6 Advantages,5 Disadvantages

In 2021 dropshipping with amazon is rapidly increasing. Dropshipping is when the seller sells products to customers without carrying the responsibility of manufacturing or shipment of products. The seller lists the product items on his website or online store and provides products to the customers by contacting the manufacturer. Dropshipping with Amazon is a little trickier than traditional dropshipping.

How to do Dropshipping with Amazon:

How to do dropshipping with Amazon

When you want to Dropshipping with Amazon you have to consider many facts regarding dropshipping. Amazon has a different policy regarding dropshipping. To start the dropshipping with amazon you need to consider the following rules of amazon:

  • That your customers will not know that you are using another retailer’s product.
  • If you use dropshipping you can’t let the delivered product show any information of the retailer. The packaging on the product or any other contact information should show your details only.
  • The manufacturer or retailer should ship the product under your name.
  • You should be responsible for accepting and processing customer’s returns for the product.
  • For this type of dropshipping you need to have a contract with your retailer to deliver the product under your store or your name, so as the on delivery the customer will not be confused to see unfamiliar contact.

You should comply with amazon’s dropshipping policy. Other than this type of dropshipping you can also take part in fulfilled by Amazon (FBA). In this program, your product is stored in an Amazon warehouse so as to provide increased delivery speed. Your product is stored in amazon’s storage place and you will have to pay a certain price for it to increase the delivery speed and have a large number of returning customers.

Advantages of dropshipping with Amazon:

Dropshipping with amazon contains many advantages for sellers. The advantages of using dropshipping with amazon are:

1.Low-cost Startup:

Low-cost Startup

As the above and explained in the previous article, the method of dropshipping is very clear to you. By dropshipping, you will be able to sell the products without actually spending money. When a customer purchases a product from your store and makes a payment. Then you will use some portion of the payment and buy the product from the manufacturer. The manufacturer will deliver the product to the customer under your name.

2.Easy to work:

As you only take orders from customers then you will only have to manage the orders of product. You need not worry about the storage and manufacturing of products. All you have to do is manage the orders. You don’t need to worry about how to deliver the product because retail or manufacturer will deliver the product to customers. You only need to ensure that the product is delivered to customers on time.

3.Access to a larger audience:

Everyone knows that Amazon has a larger customer base. This larger customer base will provide a little push to your business. You will start earning more quickly than in an offline store. So, amazon provides you larger customer base which will be a lot beneficial to you. You can use this to increase your offline store sale or dropshipping too.

4.Easy to start:

The dropshipping with amazon is easy to start. You don’t need to purchase anything for the manufacturing of products neither you need any place for storage of products. You only need to have a working internet connection. You only need to find a retailer and start your business with Amazon.

5.Fully automatic business:

In dropshipping you need to manage your customer’s orders, stock available to the retailer and provide the products that need to be delivered information to the retailer. Nowadays in 2021, there are many software and apps which manage these things for you. They maintain these details for you and notify you from time to time if anything important which can be solved only by you happens.

6.No Marketing Cost:

No Marketing Cost

As in amazon, no product is selected only with its name or marketing. Every product is purchased according to its customer reviews. So this will provide you an option to sell your product without marketing. This will save your marketing cost. Even if you need to marketize your store or products, you will need a lesser amount for marketing.

Disadvantages of dropshipping with Amazon:

Dropshipping with amazon has many good advantages but it also contains some disadvantages which will affect your business a lot. You need to see through the disadvantages too before starting any business such as dropshipping with Amazon. The Disadvantages of dropshipping with Amazon are:

1.Listing fees:

As to get this large customer base you will need to pay a price too. You need to pay some listing charges and amazon commission fees too. These charges depend on the product and can be between 10% to 15%. If you have a lesser number of margins in profit then it will not be much profitable to you. You wouldn’t be able to survive in your dropshipping business.

2.No customization:

If you want to leave a good impression on your customers then you would want to try customization. But with dropshipping with amazon you will not be able to get customization. You will be limited to do customization through amazon policy. So will not be able to get a good hand on your customer’s heart.

3.Greater competition:

For dropshipping with amazon, amazon has a large customer base. A lot of people selling things on amazon. As there are more and more people selling one type of product, this will increase overall competition. To overcome the competition, you may spend more money on other tactics. This will not let your business grow as you will spend money in other directions than you should for more opportunities.

4.No personal interaction with customers:

As you will be selling products online through Amazon. You will be able to get a lot of customers but you will not be able to personally interact with customers. This will not let you leave a mark on the customer’s heart and mind. Due to this, they will not be your more returning customers. No personal interaction with customers is a big disadvantage of dropshipping with Amazon.

5.Low-profit margins:

As there is more competition you will be in a continuous race with other competitors. Those will try to sell their low-quality product at a lower price than your high-quality product’s price. Use of this type of tactic or some other like marketing will decrease your profit margins.

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