Amazon FBA vs Dropshipping

I could use your help as well. Amazon sounds like a great option but seems a little confusing with drop shipping. Drop Shipping sounds like a great option as I have limited time and no start up money. Also, Amazon's program where they take care of everything on their end. Not sure how it all works. I have read through training and still unsure where to start without a lot of risk. Thanks For any Help!

Hi Bryan and welcome to the forum,

Dropshipping is of course a very low cost way to get into the market, that's its big draw. Of course one of its big drawbacks is super tight competition and limited margins. Another advantage it offers is that you don't need fulfillment services such as Amazons warehousing service because your dropship supplier essentially provides you with that service.

Fulfillment services are designed for wholesalers, those who buy in large volume to secure the best price. It then provides them with warehousing space for storage and of course, dispatch facilities to get orders out to customers. With dropshipping, there is no stock to warehouse, the dropship supplier holds the stock for you and of course also then dispatches it direct to your customer.

So with dropshipping, you are essentially acting as an sales agent selling someone else's product. You do all the marketing, you get the sales and fro there, it's all down to the supplier to complete the transaction.

So is there a way to get started as a drop ship business without any upfront costs... If so how and if not wha would be my best option?

While it's getting very common for dropshippers to charge either an account fee upfront or a monthly fee, the great part about dropshipping, you're costs are essentially limited to your marketing. That said, if you're going to be selling on a platform like eBay then you have to be careful not to get too carried away. A big rookie mistake is that people rush in and list 100s of products because they think, well it's not costing me anything and it's increasing my chances of getting a sale, but of course the kicker comes when you get the eBay listing fee charges.

If you use that method, but don't price competitively enough to create sales volume, then those listing fees can drag you under real quick. When listing a dropshipped item, you also have to be very careful to calculate your costs. Listing costs, final sales costs, payment gateway costs, shipping costs and anything else related to the sale or again, you can end up loosing money on a sold item.

How to get started, well that comes down to research. You have to research your products, research your competitors and then research suppliers. When you've found products that you want to go with, then start listing.

Hi

I would like to clarify the FBA, how does it work with dropshipping method? Do they go together or they are totally different thing?

As we know that getting third party (online retailers) to do the fulfillment is not allowed in Amazon. How that FBA can them resolve the problem for us? Is it something like: we make order at dropshipping suppliers > they send to Amazon for FBA > Amazon then ship to client?

Your reply is highly appreciated by us, we are so confusing here..

Tue Feb 18, 2020 3:20 pm
Hi

I would like to clarify the FBA, how does it work with dropshipping method? Do they go together or they are totally different thing?

As we know that getting third party (online retailers) to do the fulfillment is not allowed in Amazon. How that FBA can them resolve the problem for us? Is it something like: we make order at dropshipping suppliers > they send to Amazon for FBA > Amazon then ship to client?

Your reply is highly appreciated by us, we are so confusing here..

Hi.

We've run an Online Seller Program for several years exclusively for Amazon FBA sellers. First let me say you want to avoid drop shipping with Amazon in general, it's very dangerous for the health of your Amazon account. I know it's possible to do drop shipping in the regular Marketplace, but only a few actually do it well, and is definitely not for newer sellers. As far as Amazon FBA it's totally different, you are actually sending product to Amazon warehouses. Amazon FBA is also not very easy, but can be very good after you can establish your account. You can read more about it on our website at Link hidden: Login to view in the About Online Seller Program section, and if you are interested in our service which has a very small investment you will want to go over our FAQ section.

I know some may say well $600 is not a very small investment, however the truth is it is a very small investment for Amazon FBA. We only charge for the cost of inventory, our actually services which include picking, listings, prepping, packing, and shipping to your Amazon FBA account are Free.