A Step-By-Step Beginners Guide Start An Amazon Dropshipping Business In 2022

Are you looking for Amazon dropshipping business opportunities? Do you want to build your private label brand, but need guidance and help? Then this article is all about Amazon’s drop shipping success. There are quite a few strategies to consider to rise above the competition and stand out.

Amazon dropshipping is possibly the most attractive type of online business because of the low entry barrier. It’s indeed an enticing opportunity for entrepreneurs to earn good cash with just a few bucks in capital and efforts. Amazon dropshipping is not a scam but a good investment opportunity, which should be fully exploited while it lasts.

Dropshipping with Amazon can seem like a tough task, but once you’ve got the basics down, it’s a piece of cake. Here is everything you need to know on how to make money drop shipping with Amazon, in one concise guide. let’s get started, shall we?

•What is Dropshipping?

Before we discuss Amazon dropshipping, let us give you a quick overview of how dropshipping works in general.

Dropshipping is a business model where you sell products to customers without buying and storing the inventory yourself or without having to carry or ship the goods.

The product manufacturer is responsible for producing the product, keeping the list, and shipping the goods to the customer.

Your job as a dropshipper is to maintain an online store where you manage everything related to customers, from taking their orders, placing those orders with your supplier, and managing customer service.

 

•What is Amazon Dropshipping?

Amazon dropshipping is a type of e-commerce operation in which a seller does not keep physical stock of items for sale. Instead, the seller goes about finding and purchasing items from other sources (like wholesalers) and then lists those products for sale on Amazon. When an item sells, the seller purchases it from third-party suppliers and has it shipped directly to the customer.

The term “dropshipping” comes from the fact that the seller never actually holds or ships the product.

With this method, you can sell your own branded products on Amazon, or you can take advantage of reselling opportunities through the Amazon FBA (Fulfilled by Amazon) program.

•Is Amazon Dropshipping Lucrative?

Yes, It can be. The average drop shipper sells at a 10% to 30% margin, but if they use Amazon’s platform, the platform will take 15% off their top-line revenue. If you sell at a 30% margin, your net margin after selling a product on Amazon will be 15%, which is decent considering the wide range of audience base you’ll be able to tap into.

Note! Winning the Amazon Buy Box can increase your margins, but it’s competitive and shouldn’t be something you focus on at first.

 

•How to start Amazon dropshipping e-commerce business in 6 steps

The following steps will show you how to start a dropshipping business as a beginner:

1. Open an Amazon seller account

Opening a seller account on Amazon is free. To open an Amazon seller account, go to sellercentral.amazon.com. You will be asked for information about your business such as address and tax information as well as other identity and credit card information.

2. Get approved in your product category

The crucial step in starting your Amazon dropshipping business is to get approved in your product category.

Fashion, beauty, and jewelry are a few of the widely-known niches that require approval before setting up your Amazon store. You can find out if your products need approval by looking at the Product Category Requirements page. If you do need to gain approval from Amazon, make sure you follow the instructions carefully so that you can get started selling on Amazon as soon as possible!

3. Choose an e-commerce business platform

Consider using Shopify as your e-commerce platform. As Shopify recently joined hands with Amazon, using their e-commerce platform would be the best. Shopify allows sellers to add Amazon as a sales channel to simplify managing orders on both two platforms.

If you’re yet to have a Shopify store, you can sign up for a 14-day free trial and start your Amazon dropshipping business. today.

4. Connect your Amazon account to Shopify

After you’ve been approved! Now, it’s time to connect your Amazon account with your Shopify store.

On the left panel in your Shopify account interface, scroll down until you see ‘Sales Channels.’ Click on the + sign beside it.

You’ll see a pop-up appear with a list of options. Amazon should be at the top of the list. Click on ‘Add Channel.’
Once you’ve clicked on that, continue by hitting ‘Connect to Amazon.’

5. Create an Amazon product listing

To create a listing for each of your products, Here’s how;

-Click on the Amazon sales channel link.

-In the left panel, you’ll see the option to ‘Create Listing.’ Click that button.

-You’ll be prompted to select a product—either one of yours or one created by another brand that you want to sell as a drop shipper. If you make your product, you’ll need to purchase UPC codes and then select ‘This is my brand of products’ before continuing through the process. If you are listing someone else’s product, simply select the option that says ‘This product is made by another brand.’

-Then, you’ll search for the product to become a vendor for that SKU. Once you’ve found the product, click on ‘Select.’

-Lastly, finish up by clicking ‘Publish’.

Note! If you’re new to Amazon dropshipping, you may not be able to list all your products immediately. Amazon will limit the number of new ASINs ( Amazon Standard Identification Numbers) you can create each week until you sell more on the platform.

 

•How Much Does It Cost to Start Dropshipping on Amazon?

To drop-ship on Amazon, everyone is required to sign up as a seller on Amazon’s website. Their plan costs $0.99 per unit sold, but the Professional plan charges $39.99 for all items regardless of the number of items sold

Amazon has variable dropshipping fees according to product type. Amazon charges a fee, usually 10-15% of the price of the product. This may not be advantageous if you’re working with a smaller margin.

•List of Amazon Dropshipping software

Here are some software tools to assist you when you’re learning how to start dropshipping on Amazon.

Merchant Words – Merchant Words is a keyword research tool that allows you to view keyword search volume and data. The pro plan pricing costs $30 per month.

FeedCheck – This tool allows you to view all your product reviews in one place. It is a great tool if you have a large selection of Amazon products. You can monitor competitors’ products, and provide better customer service by working on improving your product reviews. The pricing plan starts at $19 per month.

Shopify – Shopify can be used to add Amazon as a sales channel to your store. You can also use Shopify to track your products and let you know when you have Amazon sales that need to be fulfilled. If you use Shopify, make sure that you don’t choose FBA for shipping your inventories.

Sellery – This dropshipping tool has strategies that help you win the Amazon Buy Box. It also allows you to run pricing experiments to stay competitive while making more profits. You can try it for free.

Feedback Express – This tool helps you get more reviews on your Amazon store and remove negative reviews so you can keep a high rating on your products and store. Customers who are known for leaving negative reviews can be blacklisted as well. The pricing plan starts at $20/month.

Amazon volume listing tools – Amazon offers several tools to simplify your seller experience. The tools make it easy to download spreadsheets for order and inventory information. The tools also allow you to modify pricing and product quantity easily.

What Are The Benefits Enjoyed By Amazon Dropshippers?

No warehouse cost – One advantage of having an Amazon dropshipping business is that you don’t pay for the cost of a warehouse. Some Amazon sellers choose to make their products FBA (Fulfilled by Amazon). With FBA, sellers ship their goods to Amazon and Amazon sends them to customers using the sellers’ descriptions.

Amazon Suppliers – Amazon buys products in large quantities from many European suppliers and then stores them in their warehouses, ready to ship to consumers. They also handle returns and customer service in various languages for all Amazon suppliers. With Amazon, suppliers, and even small businesses can grow quickly and operate worldwide. In addition, Amazon suppliers receive help from account managers to give strategic guidance on how to maximize profits for the long term.

Large audience to sell to – Amazon has 300 million active users. Selling products through Amazon can bring in huge returns. Selling the right product at the right price can mean luring in new customers. Another advantage is the ability to reach new customers your store wouldn’t have reached otherwise. This will help you expand your target audience. You might even discover a whole new audience you hadn’t even known was interested.

Multiple categories to choose from – Amazon has over thirty categories you can choose from. You may decide to sell in three, four, or five niches or as many niches as you want. There’s no limit to how many niches and categories you can cater for.

Take, for instance, if you sell in the Electronics and Tools/Home Improvement categories simultaneously, nothing is stopping you from serving numerous consumers.

 

Amazon-to-eBay drop shipping arbitrage

An old dropshipping model that’s still around is buying products from Amazon FBA to resell on eBay. While this may be a legal model, it’s generally frowned upon by platforms and even the buyers—and you only walk away with a little margin of profit.

The problem with this model is that many drop shippers take advantage of it by buying products from Amazon at a low price, then selling them on eBay or another platform at a higher price. Sometimes these products are listed as new even though they’re used, damaged, or defective.

Let’s take a look at it from the customer’s perspective: You purchase a nice pair of shoes on eBay for $20. You waited a week, and then when FedEx knocks on your door, the pair of shoes shows up in an Amazon box. Curious, you go on Amazon only to discover that the same type of product is available at a cheaper cost than what you purchased it for on eBay. How would that make you feel about the business you bought it from? It makes you feel like they had been taken advantage of. In this scenario, you can’t expect a repeat purchase

The Amazon-to-eBay arbitrage model ultimately benefits only one party: the drop shipper. eBay does not support this business model and allegedly has banned companies that employ this strategy.

 

Bonus Tips for Succeeding in Amazon dropshipping business

Here are a few bonus tips for making the most of your Amazon dropshipping business:

Win the Buy Box

The most important thing you can do as a drop shipper is won the Buy Box. If you win the Buy Box, you’ll maximize your sales like the pros.

To win the Buy Box, you need to have a high seller rating, ship quickly, have low shipping costs, and have a low refund rate. It’s also helpful to respond to customer queries quickly and leave positive feedback for others.

Don’t depend on Amazon alone

Don’t rely solely on Amazon. Explore other platforms, too. Having Amazon as one of many sales channels increases your odds for sales and minimizes risk.

Shopify enables you to sell on your website, as well as through Instagram, Facebook Messenger, and Facebook Shops. In addition, if your customers recognize your brand name on Amazon, they’re more likely to trust you and buy from you there too.

Aim to have a 95% seller rating or higher.

Aim for a 95% seller rating. A high seller rating can help you win the Buy Box, boost your chances of appearing in organic searches, and helps customers trust that you’re selling authentic products.

keyword research

Optimize your product pages using popular keywords to boost your organic rankings and improve your conversion rate

You can use Merchant Words tools to research popular keywords and, if you’re running Amazon ads, you will have access to a supply of keywords to optimize your product pages. Using this information will help you rank high on Amazon organically and help you target customers with ads better

Price your products accordingly

When you’re pricing your products on Amazon, one of the factors to consider is the cost of Amazon fees. If you have low margins, you probably can’t afford to pay Amazon’s monthly fees.

Offer a better coupon discount than competitors

As a seller on Amazon, you can offer special deals and discounts to customers by creating an Amazon coupon. Promoting the coupon to coupon sites can help you drive prospective customers to your listing. As long as you have factored your cost of doing business into the price of your coupon, you should be able to make enough with each sale to remain profitable

Here’s a Pro tip: Include the brand name as the first word in your titles. Blueboard found that 93% of best-selling Amazon products started with the name of the brand.

•Conclusion

Hopefully, this step-by-step beginners’ guide on how to make money online through Amazon FBA has provided you with helpful information and proven effective in teaching you how to start making money online today.

Don’t expect your dropshipping business to immediately explode. At first, you won’t sell much. Your profits will likely be very low at first as well. Furthermore, if you’ve never sold anything online before, it can take a lot of time and effort to set up your store properly. However, once your store gets up and running smoothly, you’ll realize that starting an eCommerce business is not a difficult task at all. It’s becoming easier by the day due to innovative new tools that are available for entrepreneurs.

Now it’s up to you to take action and start building your own business. Start small, get your feet wet, build up experience, and then expand. Make sure you don’t run out of money before expanding!