What Is Amazon Drop Shipping?
Amazon Drop Shipping is very simple: – it is just a process of using Amazon as a business platform for your drop shipping store. Clearly, everyone knows Amazon, and it is a world giant when it comes to online retail. Therefore, it is the perfect platform for entrepreneurs to sell their products to online customers.
Amazon drop shipping basic steps include:
• Sigh up as a seller
• Import product by listing them on your Amazon account
• The customer purchases a product
• You then submit the order to your dropshipping supplier such as SS Nutra Drop Shipping
• The shipping supplier packs and ships the product to the end-user
How is the profit calculated for dropshipping on Amazon? Well, this is the formula:
Profit = Retail Price – (Wholesale price + Fees and Costs)
Remember, retail cost/price is the amount the customer will pay for the item. The wholesale price/cost is the amount you pay from the supplier. Fees and costs are additional expenses you will incur for your online store (it includes membership fees for the dropshipping supplier, the actual shipping fees, and Amazon Seller Plan). With a dropshipping model, you do not have to worry about inventory storage fees.
Amazon drop shipping is a very popular mode with online retailers simply because it comes with many advantages. For example, let us go through some of the Google Trends data.
Since January 2012, Amazon drop shipping search interest has increased steadily. This means that compared to other retail methods on Amazon (of course, there are several retail methods you can sell on Amazon): Amazon dropshipping is the most favored. You can also choose FBA (Fulfillment by Amazon), where your stock/product/inventory is stored at Amazon fulfillment centers. The packing and shipping will be handled by Amazon staff.
You can easily sell on Amazon if you are still using Shopify as a business platform for your dropshipping store. This is made possible by the fact that Shopify allows users to add Amazon as a Sales Channel. As such, the platform makes managing orders easy and convenient for you as it allows you to push Shopify product listings to your Amazon store. Remember, you must have an Amazon seller account and pay the seller fees. Nonetheless, it is an excellent way to maximize product reach.
What Are The Benefits Of Amazon Drop Shipping?
Amazon drop shipping offers many benefits. Some of the benefits include:
- Low Operational And Startup Costs
With Amazon drop shipping, all you have to do is invest in an Amazon Professional Seller Account, which is $39.99/month, and then select a dropshipping supplier. When you compare the cost, you will notice that this option not expensive for online resellers. It is important to note that normal expenses of running a retail operation do not apply to a dropshipping store. For example, with dropshipping you do not have to worry about shipping inventory, packing, or storing costs; Your dropshipping supplier takes on these costs. Furthermore, it is a business model that comes with low risks. That is because you do not have to stock the items, and as such, never end up with a surplus of dead stock.
- A Wide Customer Base
For you to be successful, the store needs customers. This a point that may seem obvious, but something that needs to be emphasized. The more customers to your store, the greater the potential for a higher profit. For this reason, one of the main benefits of Amazon dropshipping is the massive customer base. It is a massive online retail, with a recorded number of over 300 million active users. In fact, Amazon offers the chance to connect with customers that it would be otherwise difficult to reach with other retail platforms.
- The Trust Consumers Have On Amazon
The name or Brand name plays a huge role when it comes to products. As such, consumers recognize the name and trust Amazon. The trust comes from the success amazon has when it comes to online shopping. According to research conducted by Feedvisor back in 2019, 89% of consumers agreed that they are more likely to buy a product from Amazon compared to any other platform. This consumer trust extends to third-party sellers including drop shippers on Amazon. What does this mean for you? Well, by simply having a product on the Amazon website, you get access to a huge database of potential consumers.
- Access To Different Niches
Amazon is a platform with different kinds of products, which makes it easy for you to target a specific niche. You have the option to target multiple niches as well. Remember, like any business, choosing the right niche is very important and plays a huge role in your success. Choosing a niche allows you to target audiences and focus on that specific group of customers. Also, it allows you to choose a less competitive niche. With this in mind, you should note that Amazon has over 30 categories to choose from. Therefore, with a good selection of products, and the right supplier, you can target several niches and enter into different new markets.
How To Dropship On Amazon
If you are searching for a great means to make cash online, then dropshipping from Amazon is the best place to start. It does not matter if you want to do it part-time or full-time, you will still be able to earn something. Everything will rely on the way you have set up your store, the kind of products you are selling, and the time you put into it. The good news is that getting started is simple, and you get to learn how to sell on Amazon for free.
What do you need to start dropshipping on Amazon? Let us look at the step by step guide so that you can start making some money.
- Set Up An Account
This is a straightforward and quite obvious point. You cannot retail any product on Amazon without setting up an account. You can create an account as an individual or professional. You should note that fees differ in each mode. What does this mean? If you open an individual account, you will be charged $0.99 for every sold item. If you open a professional account, you will pay a subscription fee of $39.99/month (you will not pay the $0.99 per item sold).
If you are considering the dropshipping store, it is wise to consider opening a professional account. That is because the $0.99 per item fee can eat away your profits. Furthermore, a majority of drop-shippers have the goal of selling in high volumes. For this reason, it would be better to invest by signing up with a professional account.
Registering or signing up with Amazon is easy. All you have to do is go to Amazon Seller’s Central and fill in the requirements.
- Finding An Amazon Drop Shipping Supplier
After creating an account, the next step is finding an Amazon dropshipping supplier that can store and ship the products to your customers. The good news is that there are so many tools you can use to find a dropshipping supplier. You will want to choose a dropship with the right inventory and offer a competitive membership price. Do not forget the formula. Your profit will be affected by what you will have to pay both in terms of fees/costs and dropshipping supplier main product price.
Also, you have to make sure that your dropshipping supplier has integrated fully with Amazon, to make the process easy and convenient. Remember, Amazon drop shipping is different from Amazon FBA. Do not allow yourself to be confused with the two. You may use an online directory to find a dropshipping supplier. Below is a list of well-vetted dropshipping suppliers.
• Wholesale Central
NOTE: aside from Wholesale Central, all other drop shipping demand membership cost in order for one to access the directory. To get more profit, you have to try; and save every dollar while introduction your Amazon dropshipping store rather than forking out cash to these directories. For this reason, it would be wise to identify the product type you want to sell first and then do a 5-minute Google search to identify the dropshipping supplier.
For instance, GreenDropShip is a top-rated dropshipping supplier that integrates easily with Amazon. It offers over 20,000 organic and natural products to choose from; a majority of them are made in the USA. Today, organic and natural products have become extremely profitable, and therefore, such a supplier can be the best option since their inventory falls under wide categories.
- Choose The Right Products
For you to be a successful Amazon seller, you have to find the right product. Do not forget that Amazon has over 30 broad categories of products, with multiple niches. You can explore these options by using the general search function on the Amazon page. In fact, this is an excellent starting point and does not require a seller to set up an account yet.
On the other hand, there are tools you can use to find the right product. A good example is Jungle, which can be used to find a profitable and the right niche for your Amazon dropshipping. However, you have to ensure the product you find goes hand in hand with the inventory that the supplier owns. If a product matches the following criteria, it will be easy for you to sell them:
• The product has a niche score of at least 7
• The competition is low
• Have at least 100 unit sales per month
The good news is that you can also use the free Google Trends tool. This tool helps identify any emerging trend on the google search engine, including any profitable niche. For example, look at the search interest for essential oils in the past 8 years. You will see that it has a steady increase in the search interest. This means the niche has a lot of profitable products for Amazon dropshipping store.
- Import The Products Into Amazon
The moment you have identified the niche and products you wish to sell; you must now find a supplier that carries the products. You should note that certain products require Amazon approval, such as fashion products. Fashion related products such as jewelry, clothes, and beauty products require approval from Amazon before you start selling. You can check specific Amazon approval requirements for every category.
For you to add a supplier product to your Amazon catalog, you have to import them first. If you are using external suppliers like GreenDropShip, you have to:
• Sign up for a dropship membership with the sales representative
• Download the product feeds and chose the items you want to sell
• Upload the product feed into your Amazon store
Clearly, SS Nutra Drop Shipping makes the process easy and convenient. This is the primary reason it is imperative to select a dropshipping wholesaler that is fully integrated with your Amazon Dropshipping store.
- Listing Of Inventories
After importing the product, the next step is creating an Amazon listing by adding necessary but specific information in the inventory. If you are using a dropshipping supplier such as SS Nutra Drop Shipping, then it would be wise to use high-resolution images. Do not forget to include accurate product descriptions for each inventory. The importance of listing is – helping retailers craft informative information that will attract the attention of an online shopper. Amazon has strict rules regarding images.
You have to optimize the product title. A good example is using the product’s brand name as the first word of the title. Remember, customers are interested in Size, Model, Color, Quality, and Quantity. For this reason, ensure the information can be found easily by any potential customer. You can also research to know the best way to optimize the product page for the search engine. You can take advantage of tools like Google Keyword Planner or Merchant Words.
Do not forget to choose the right shipping method. Remember, you are the seller, and your customers do not know that the dropshipping supplier is the one shipping the products. As far as the customer is concerned, you will be the one packing and shipping the items. This is a benefit of using drop shipping for your Amazon store because you get to divide the labor with the supplier.
- Begin Selling
After entering all product details, you complete the process by clicking ‘Save and Finish’. After this, you are ready to sell the products. The moment you get a sale; it is important to make sure that Amazon is charging you the correct amount for shipping fees. There are cases where item description such as color on identical product has caused Amazon to charge inaccurate amount for shipping. Also, weight information could be incorrect. For this reason, it is paramount to ensure that the shipping charges are correct.
Successful Amazon Drop Shipping Tips
Setting up an Amazon dropshipping store is not enough to be successful. There are a few tips you can follow to improve your chances of being successful. Below are simple tips that will help drive sales and profits:
• Have A Competitive Price
Pricing plays a huge role in any business. Of course, your price must be higher than that of the wholesaler for you to get a profit. However, the price should not be too high that it makes online shoppers look for the product somewhere else or to another third-party seller. Everything is all about balance, and it takes a little practice.
• Get The Buy Box
Buy Box is simply the ADD TO CART option and getting it puts your name next to it. This is very important because a majority of Amazon sales come from the Buy Box. To be approved, you must have a high seller rating of at least 95%.
• Keep The Seller Rating High
Having a high rating is important as it creates trust easily for any online shopper. It also proves that you have a high customer satisfaction rate. Therefore, to maintain a high rating, ensure that you choose a supplier that ships products quickly and effectively.
• Create Amazon Coupon
You can create an Amazon coupon by logging in to your Seller Central Account and selecting the Coupons option from the Advertising Menu. With this option, you can create a new coupon and determine the amount of discount you are willing to offer. Remember, everyone loves a good deal, and this can be a great way to build a customer base.
• Take Advantage Of Amazon Advertising Campaign
Advertising can help reach potential customers at any stage of an online shopping process. With Amazon advertising, you get services such as video, audio, and sponsored product ads. Furthermore, they have a competitive CPC (cost per click). As such, your product will show up at the top of an Amazon search.
The Best Amazon Drop Shipping Tools
Choosing Amazon dropshipping store means that you do not have to deal with stock or inventory management. With this in mind, let us look at the list of tools and apps that will be helpful for online sellers. These can be used in any kind of Amazon selling; however, they are more valuable if you are starting your shipping store.
- Price Tracking
Let us begin with tools that will allow you to compare prices with various other products. Such apps or tools are important for online venders because it permits them to see how much other sellers are charging for the same product. Do not forget, Amazon drop shipping is a crowded marketplace, and as such, you need to be able to compete with others. For this reason, to increase your customer base, consider having a competitive price. Therefore, which are the best price tracking tools? Well, they include: –
The best thing about this tool is that it is free and important for any dropshipping store from Amazon. Furthermore, it comes with a vastly customizable amount history graph with settings that can be set to show a given product history for up to 12 months. It is also featured with a slider bar to display price history from other third-party sellers. Camelcamelcamel allows sellers to see the top price drops for a given product. You can also sign up for alerts so that it can alert you as soon as a product drops in price.
Camelcamelcamel is a tool that is available as a browser extension for Safari, Firefox, and Chrome. Nevertheless, for the tool to perform at maximum efficiency and convenience, you should consider using the chrome extension known as Camelizer.
This is another free tool that can be used to track prices. Keepa’s price analysis is granular compared to Camelcamelcamel. In other words, its price tracking is more detailed. However, it does not track back far back like Camelcamelcamel.
Nonetheless, it has a highly intuitive user interface and uses 4 primary colors to keep track of the prices. These colors include:
Blue – Used Items
Blue – New Items
Orange – Amazon Marketplace
Green – Sales rank of a given item
This tool is featured with visual graphs, price history, current deals, available alerts, and constant updates on various products. It does also available as a browser extension like Safari, Chrome, Firefox.
Although both of these tools are free, you can upgrade to a premium one by paying $20 per month. Furthermore, some advanced functions need payment, such as ‘sales rank history’ and ‘sales rank number’. Sales rank number is vital information for Amazon sellers. It plays a huge role in how fast or slow a given item will sell on Amazon.
- Product Research
Research is king. What does this mean? It simply means that it plays a central part in having a popular Amazon dropshipping store. The research includes both market and product research. What does this mean? Well, for your product to be popular you have to understand your targeted audience first so that you can choose a product that will solve their problem or satisfy their needs.
Furthermore, you will need research to know and identify current trends in the marketplace. You will need to choose a product that offers an excellent sales record. In other words, you need a product that is not-expensive, comes with a competitive price, and gives you a healthy profit margin. Some of the best tools include: –
This is a very important tool for online sellers. With this tool, you will get to learn more about search trends. This will include any historical data for a particular product that can be adjusted to a specific timeframe. Remember, things online shift very quickly, and it is equally important to change with the times or be up-to-date with current changes. Therefore, tracking these various trends can give you a richer understanding of a customer’s behaviors and how the market changes.
Furthermore, it comes with a related topic feature or function, which can be used to find other potential niches that you may not know. The tool allows you to analyze anything even before you start your store. Google Trends is a free tool to use.
This is a free tool that is used to scrape or collect data from Amazon listings. As such, when an Amazon seller uses Octoparse, they can extract valuable information using ASIN/UPC numbers on different products; including:
This tool comes with an in-built Amazon task outline with pre-set mining data fields. What does this mean? Well, it simply means that a seller can extract data without having to resort to coding or rule-setting. Let’s not forget the fact that this tool easily exports the information in several formats that include CSV, HTML, and Excel. For this reason, it makes it easy for you to analyze and look over the details so that you can choose the right marketing strategy.
• Unicorn Smasher
This is another free Amazon product research tool that was developed by AMZ Tracker. This tool allows sellers to speed up and maximize their Amazon product research. Its analysis includes: –
Monthly sales estimate
The benefit of Unicorn Smasher takes all this information and calculates the ‘Opportunity score’ for any particular product. Having access to such useful information can help sellers predict the profitability of a given product, and then work on the best strategy for their store. This tool is also available as a browser extension for Safari, Firefox, and Chrome.
- Paid All-In-One Tools
Just like almost everything online, you have the option of choosing a paid all-in-one tool for your Amazon dropshipping store. These tools are designed to perform multiple tasks and often complex. Remember, these tools offer a paid service mostly through a membership fee every month. The truth is that some can be a bit pricey. Nevertheless, they help sellers to track all kinds of valuable information to help them become successful entrepreneurs. Some of the best-paid all-in-one tools include: –
This is a premium all-in-one tool that does several important tasks for a seller. Some of the key areas AMZScout covers include: –
Amazon Fee Calculator
This tool is particularly helpful when it comes to product tracking and searches. In other words, it is an excellent tool that will help Amazon dropshipping stores to track and identify hot products on amazon. This tool has the ability to breakdown the information down into several levels, such as by year, month, week, and day. If your dropshipping store is holiday driven or base (for example Christmas gifts), this tool allows you to target that specific season or holiday.
It is important to note that AMZScout comes in 2 basic forms which are – the web app which is a program that runs off the AMZScout website and the Pro Extension for chrome plug-in. Out of the two, the web app is a more basic form of the tool and has been stripped down. However, the chrome extension is detailed and offers all information in real-time. The web app will cost you $30 per month while the Pro Extension comes with a one-time fee of $199. There is a reason why this product comes with such a high price tag. it is not only powerful in delivering the information needed, but you can target a specific entity such as a product.
This is a tool that is extremely popular with Amazon sellers, and it only comes as a browser extension only for chrome. This is a very powerful web-based software that covers multiple areas that are considered to be important for a successful Amazon store. Some of these areas include: –
Academy (comes with tutorials for sellers, which ranges from introductory to advanced)
The thing that makes Jungle Scout unique is its extensive Product Database. It gives you the ability to sort through over 70 million products by setting advanced and fine-tuning filters, and then take the information from the database and further analyze it. This is a helpful feature that helps sellers find high-profit, low-competition, and high-demanding niches in the market. When using this tool, you have the power to sort through the data using filters such as competition level, the number of units sold every month, and the niche score. Remember, these are just but a few features that make this product the most popular today with Amazon dropshipping stores.
For you to make the most out of Jungle Scout’s helpful features, you will spend anywhere from $30 to $70 per month. The one-time chrome extension fee ranges between $97 to $197. By comparing the cost with others, the truth is that this product is a bit expensive but a master-class in delivering the information needed to becomes a successful seller. if you are serious about drop shipping, then this is a tool you must consider, especially if you are looking to make a profit.