Amazon Dropshipping 2024: How to Start Dropshipping on Amazon

Your business venture plan is undoubtedly incomplete without the thought of ‘Dropshipping.’ Known as the most popular business model for Amazon, dropshipping is definitely an easy startup choice. 

The global reach and dynamic model make it a perfect choice for new and experienced business owners. But before you begin, it’s essential to understand how it works. We will help you get started and help you find answers to how to start dropshipping on Amazon in 2024. Here’s everything you need to know to get your Amazon dropshipping business up and running.

What Is Amazon Dropshipping?

In simple terms, dropshipping is a business model where you sell products to customers without holding any inventory. Instead, when a customer buys something from you, you purchase the item from a third-party supplier, who then ships it directly to the customer. You’re essentially a middleman.

To start Amazon dropshipping, there are a few guidelines that you must follow. As a drop shipper, you should manage listings and ensure top-notch customer satisfaction. Make sure that every order is fulfilled correctly. 

This business model is appealing because it doesn’t require a heavy upfront investment in stock, warehousing, or shipping.

Now, let’s get into the specifics of how to dropship on Amazon and build a successful business in 2024.

Step 1: Create Your Amazon Seller Account

To begin your Amazon dropshipping business, you need to have a seller account. There are two types of accounts:

• Individual Seller Account: No monthly subscription fee, but Amazon charges $0.99 per item sold. This is the best plan if you’re selling fewer than 40 items per month.
• Professional Seller Account: Costs $39.99 per month, regardless of how many items you sell. This plan is the perfect choice if you wish to sell 40 items a month.

If you’re serious about starting dropshipping with Amazon and plan to scale, the Professional Seller Account is likely the best option. This account also comes with more features, such as access to advanced selling tools and Amazon’s advertising platform.

Step 2: Understand Amazon’s Dropshipping Policy

Amazon business startup does seem appealing but it has strict rules about how you conduct your business. Understanding and adhering to Amazon’s dropshipping policy is critical to avoid penalties or, worse, getting your seller account suspended.

Here’s what you need to know:

• You must be the seller of record of your products.
• Your packing slips, invoices, and external packaging must identify you as the seller.
• You are responsible for processing returns.
• You must handle all customer service inquiries related to your products.

Violating Amazon’s dropshipping policy can lead to account suspension. Make sure that your supplier is fulfilling the orders to be the primary seller in the eyes of the customer.

Step 3: Research a Profitable Niche

The choice of niche determines your success in the Amazon dropshipping business. The market on Amazon is vast, and competition can be fierce. You want to select a niche with a good balance of demand and competition. Here are a few tips on how to start dropshipping on Amazon with the right products:

• Browse Amazon’s Best Sellers: The best seller list gives you an idea of what products are trending and have high demand.
• Use Tools like Jungle Scout or Helium 10: For dropshipping with Amazon, you must use tools that help you analyze product demand, competition, and profitability.
• Avoid Highly Saturated Categories: While you want products that sell, avoid categories like electronics or clothing that have massive competition.
• Focus on Products with a Good Profit Margin: Don’t just go for the cheapest products. Consider items where you can add a markup and still be competitive.

Your niche should consist of products that you are passionate about or knowledgeable about. A niche that you care about will keep you motivated and engaged in your Amazon dropshipping business.

Step 4: Find Reliable Suppliers

Once you’ve chosen a niche, the next step is to search for reliable suppliers. This is the most crucial step in drop shipping. Reliable suppliers enable timely deliveries and 100% customer satisfaction.

Here’s how you can find one for your  Amazon dropshipping business:

• AliExpress: AliExpress is a popular option for dropshipping because of its wide range of products and reasonable prices.
• SaleHoo: SaleHoo offers a vetted directory of suppliers with a focus on reliability.
• Wholesale2B: It is a supplier directory that integrates with Amazon. You manage your inventory and orders pretty well with it.

When selecting a supplier, ensure that they offer quality products with estimated delivery time. You might also want to place a few test orders to evaluate their service.

Step 5: List Your Products on Amazon

Now that you’ve found a supplier, it’s time to list your products. This is one of the most critical aspects of your Amazon dropshipping business. A well-optimized product listing can make all the difference between a product that sells and one that doesn’t.

Here’s how to optimize your listings:

• Product Titles: write clear and keyword-rich titles.  You can try using terms like “Amazon dropshipping,” “how to dropship on Amazon,” and other relevant phrases to increase searchability.
• Product Descriptions: Write compelling and informative product descriptions. Highlight the product’s benefits and features in a way that solves customer problems.
• Images: Use high-quality images from your supplier, ensuring they are clear and show the product in use, if possible.
• Competitive Pricing: Since dropshipping often has lower profit margins, you’ll want to ensure your prices are competitive while still leaving enough room for profit.

Make sure to monitor your competitors and adjust your listings as needed to stay ahead in the Amazon marketplace.

Step 6: Manage Orders and Customer Service

One of the benefits of Amazon dropshipping services is that your supplier handles the inventory and shipping, but you’re still responsible for order management and customer service. Here are some essential tasks you’ll need to manage:

• Track Orders: Keep track of all customer orders and ensure your supplier is fulfilling them on time.
• Provide Customer Support: To be among Amazon dropshipping for beginners list, you need to address customer inquiries promptly.
• Handle Returns: Even though your supplier ships the product, you are responsible for handling returns and refunds.

A smooth, reliable order process ensures positive customer reviews. And you can see the results in the form of increased sales and a higher ranking in Amazon’s search results.

Step 7: Use Amazon Advertising to Drive Sales

To fully understand how to start a dropshipping business on Amazon, you need to explore advertising platforms. Start with Sponsored Products is an excellent tool for increasing the visibility of your listings. Advertising allows you to showcase your products to a broader audience, which can lead to increased sales.

However, be mindful of Amazon advertising costs. Start with a small budget, monitor your ads closely, and adjust them as needed. The key is to find a balance between your advertising spend and your return on investment (ROI).

Step 8: Scale Your Amazon Dropshipping Business

Once you’ve established a steady stream of sales, it’s time to scale your Amazon dropshipping business. Scaling can take several forms, including:

• Expanding Your Product Range: Introduce new products to your store to increase your sales potential.
• Optimizing Listings: Continuously update your listings with fresh keywords like “Amazon dropshipping for beginners” to stay competitive in search rankings.
• Automating Processes: As your business grows, you may want to explore using software to automate some of the more time-consuming tasks like inventory management and order processing.

 

Common Mistakes to Avoid in Amazon Dropshipping

1. Not Following Amazon’s Policy: Ignoring Amazon’s dropshipping policy can result in suspension.
2. Choosing the Wrong Suppliers: Inconsistent suppliers can lead to late deliveries and customer complaints.
3. Neglecting Customer Service: Customer service is essential in building a successful business. Don’t ignore it!

FAQs

• Is Amazon dropshipping allowed?

Yes, Amazon allows dropshipping, but you must follow their strict guidelines. It includes ensuring the seller of record, identifying packaging, and managing customer service.

• How much does it cost to start dropshipping on Amazon?

The cost to start dropshipping on Amazon is relatively low. You’ll need to pay for an Amazon seller account (either $0.99 per sale or $39.99 per month for a Professional account). Additional costs include supplier fees, shipping costs, and advertising if you choose to promote your products.

• How much profit can I make with Amazon dropshipping?

The profit margins for dropshipping are generally between 10% and 30%. Your exact profit will depend on factors like product cost, supplier fees, and shipping costs. While the margins may be thinner, you don’t have the burden of upfront inventory costs, which makes it a low-risk option.

• Can I dropship products from AliExpress to Amazon?

Yes, many drop shippers use AliExpress to find products to sell on Amazon. However, you must ensure that the shipping times are reasonable and that the supplier.

Final Thoughts

Answering the question – Is Amazon dropshipping business worthy in 2024?: Yes, it is!  As is the case with any other business, Amazon’s dropshipping business is booming due to many reasons. 

Starting from the right niche selection to sourcing quality products via suppliers, you need to keep a check on everything. Still, Amazon dropshipping provides fewer profit margins when compared to other business models. The comparatively low initial cost makes it a good choice for Newcomers or the novice group of growers.

And now, after knowing how to properly make use of dropshipping on Amazon, you can gather your plan. 

Bear this in mind: you cannot be successful at the flick of a switch. The fact that you are willing to work, stick to your work, and plan it out is what helps you perform and begin your Amazon dropshipping in 2024.