Dropshipping is a perfect strategy to sell through the Internet without storing stock and with minimal investment. Today, it is possible to do dropshipping in very different sales channels, but doing dropshipping on Amazon is one of the preferred options.
Doing dropshipping on Amazon can be a great solution to increase sales of your online business, but it is essential to be clear about certain aspects before working in a marketplace, not only Amazon but also eBay or similar.
There are different marketplaces for dropshipping. If Amazon is yours, do not miss these valuable keys that can help you to start dropshipping on Amazon.
If you are wondering how to start a dropshipping business on Amazon, we will show you everything you need to know.
How to start dropshipping on Amazon step by step
Now that we have seen the basic points, we are going to delve a little into this sales channel.
Make sure you have all the legal documentation
Before registering your seller account, you have to make sure you have all the permits and licenses to operate legally. If you sell tangible goods (physical products), you will need a sales permit.
This will enable you to collect a sales tax from your customers. In some places, this permit is also required for companies selling services.
Get advice on the government page and the site of the tax collector for your country. Surely, there you will also find other useful resources and tools.
Legally registering your company name, phone and address might seem like fun, but in practice, it is a legal process that requires a lot of documentation and could have major repercussions in the future.
The account creation process
1. Create a seller account on Amazon clicking here. The next you have to do is click on "Start Selling", after that, click on "Register Now".
2. Enter the name of your business, type of business and where it is located. Later, you must choose if you want to sell only in the United States or on the five platforms that Amazon has in Europe (United Kingdom, Germany, France, Italy and Spain).
3. Enter the registration number of the company and its jurisdiction. Add the registered business address. Then you must provide your phone number to send a 4-digit PIN to verify your account, either by call or SMS.
4. Then you must complete all contact information and bind the credit card.
5. Preview the W-8BEN content.
6. Provide an electronic signature. It is recommended not to send the form by mail.
7. If you selected the electronic signature, you must confirm the system alert message to inform him that his information will take effect immediately. If you did not agree to provide electronic signatures, then your information will only become effective after receiving your mailed form (7-20 business days).
8. Generate the W-8BEN form
9. Fill in the product information.
10 Choose the niche of your eCommerce among all the sales categories.
11. Once you have created your account, you must synchronize it with the catalog of your dropshipping provider.
Synchronization with Amazon is a key aspect when doing dropshipping with this platform.
There are dozens of aspects that have to be automated if you want the data that your client displays to be correct. And we are not just talking about product descriptions. We talk about the stock of the items, the prices... All the information that your dropshipping provider manages must be integrated with the Amazon marketplace.
For this, there are several options:
· Synchronization through CSV: Your provider will allow you to download a series of CSVs, which you will have to upload to your Amazon account so that the information is uploaded to your account. There is a CSV for product information, and another for stock and prices. Amazon has its own CSV structure, and you should stick to it. Ideally, your provider will give you the CSVs already in the format to sell on Amazon. If it does not, you must adapt them (which we do not recommend)。
· Synchronization through API: API is a more automated option, but requires programming knowledge. If your dropshipping provider has an API, you can develop the integration yourself. If you do not have the technical knowledge, you must hire a developer to do it for you.
· Synchronization with automatic tools: Some providers offer platforms with which to synchronize your account automatically. BigBuy, for example, has its Multi-channel Integration Platform. This tool allows you to sync your Amazon account without having any technical knowledge and without developing any integration.
1. Create an Amazon wishlist and add all those products you have chosen. Make sure they are all labeled Amazon Prime. In this way, you ensure that the product is in a warehouse owned by Amazon and that the shipment is made by this company.
2. Do you already have all the chosen products? Register them in your store. Optimize product sheets with images, worked descriptions, etc.
3. Choose a product price that gives you a sufficient margin, but that is competitive (yes, we know it is not so easy, but it is what you have to sell!). Remember that the margin has to cover the advertising costs that you are going to incur.
4. Once the products are published in your eCommerce, publicize your store on Amazon. How to do it is up to you: social media campaigns, SEO, AdWords, email marketing... There are dozens of options with which to promote an eCommerce.
5. When you register a sale, go to your Amazon account and request the same item for your customer. Enter the customer's address and contact details as the recipient of the shipment.
6. When ordering, be sure to check the "Order as a Gift" option in the cart. This will remove the price from the invoice. You can even add a personalized note from your store.
7. Use your own address and billing information. But for shipping information, the address of your customers where you want the package to be delivered. We have called this system "dropshipping with Amazon" because Amazon will send the package directly to the customer.
The cost of dropshipping
When selling on the Amazon marketplace, you must pay this platform the following:
If you want a Pro Seller account, you must pay a fixed cost of $ 39 + VAT (value-added tax) per month. This option is intended for those who sell more than 40 items per month.
If you want an Individual Seller account, you do not have to pay a fixed monthly cost, but you must pay a fee of $ 0.99 for each sale. This option is intended for a sales volume of fewer than 40 items per month.
Whichever option you choose, you must pay Amazon an extra commission that varies according to the category of the item sold. For example, Kitchen products have a commission of 15%, video game consoles 8%, and computer products 7%.
Set up dropshipping on Amazon
You set the standard or express shipping options, which will largely depend on what your dropshipping provider offers you.
· Standard Shipping: The logical thing to do is to set standard shipping to 4-5 days. Generally, suppliers will be able to meet these deadlines (unless you work with Asian suppliers, such as Aliexpress, which we do not recommend because it will not meet Amazon's requirements and it is more than likely that they will end up closing your account).
· Express shipping: Few dropshipping providers will be able to meet urgent deadlines of 24-48 hours. However, some of them are logistically prepared. Please check with them and, if possible, offer expedited shipping. These fast shipping times are proven to multiply the conversion in eCommerce.
Carriers register directly with Amazon, without using a CSV.
How Does GoTen Help with Amazon Dropshipping?
Online sellers can easily find the top-selling products on Amazon by checking them out in "Platform Top Sellers." Amazon sellers can also take advantage of GoTen’s big data-based product research, promotional events, and clearance to gain large profit margins while benefiting the free membership and huge discounts.
More importantly, instead of paying an excessive amount for Amazon FBA, working with GoTen.com is a much better choice because GoTen has over 450,000 square meters of local US/UK warehouses and offers fast and free delivery. Additionally, you don’t have to deal with multiple dropshipping suppliers and you can get help at any time with our 24/7 customer service. The after-sales period is up to 3 months to keep you worry-free!
Chosen and trusted by over 20,000 sellers and suppliers, GoTen can effectively make your dropshipping business easier!
Too long? We tell you the conclusions
Dropshipping on Amazon is an excellent option to earn money online. In this article, we have seen several important aspects to sell in the Amazon marketplace.
There are many advantages related to dropshipping on Amazon. You will have a great brand behind, with a lot of experience in online sales, and you will be able to take advantage of all the power of this leading eCommerce company.
There are also downsides related to selling on Amazon: Although the cost will vary depending on the type of account you choose, you will have to pay a commission per sale and, if you have a Pro account, a fixed monthly cost of $ 39.
The shipping you set is essential. Find a logistics-powerful provider, and set realistic shipping times.
Although many use dropshipping on Amazon as the only sales channel, the truth is that it works better as one more piece of a comprehensive digital strategy. Your own eCommerce, marketplaces, social networks... The more elements you add, the more chances you have of reaching your potential customers (and converting).
The ideal is to find that perfect "formula" for your business, with which to reach your potential client and maximize sales.