amazon or dropshipping

by InWait
40 replies
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I've decided on a specific type of product for an online store. I want to do dropshipping - I have a worldwidebrands account - but I'm having trouble finding products that I'm happy with.

So as an alternative I'm considering amazon. But I'm worried about it looking less professional, especially with customers having to go to a separate site to complete orders. I also feel as though I'm going to have less control overall.

Are these valid concerns or am I over thinking this?
#amazon #dropshipping
  • Profile picture of the author ItsChrissy
    Lots of people make money from Amazon, either through sending them directly to Amazon, or by having an Amazon Astore, so I'm not sure that's a valid concern.

    My understanding of drop shipping is that you are basically the seller, with the drop shipper simply fulfilling the orders. In that case, you're going to have to deal with any customer service issues that may arise, returns etc.

    Whereas with Amazon, people know and trust Amazon already, and once the person buys through your link, you don't have anything else to do apart from get paid

    Hope that helps

    Chrissy
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  • Profile picture of the author fuzzycorleone
    I'm having the same problem. I'm just having a hard time finding a drop shipper for my particular niche.
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  • Profile picture of the author imdomination
    Amazon is definitely easier than dropshipping. Literally the only thing you need to do is send the user to a third party site and collect a cheque. Plus with dropshipping, unless you're going into a tiny niche with big margins, you're going to make the same kind of profit.

    I'd do amazon only on the basis of the less work involved.

    And as an even bigger bonus, Amazon have the branded trust already, so users who may not buy from your random site will be much more likely to buy from Amazon.com, a site which they have probably bought from in the past.
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  • Profile picture of the author Amy Harrop
    Have you considered FBA-Fullfillment by Amazon? You would buy the products directly-wholesale, and send them to the Amazon warehouse. They would be listed on Amazon and you can also list them on your site and have Amazon fulfill all of your orders on your site or other venues you list. Of course it really depends what you sell, as Amazon doesn't accept everything for fulfillment. But there are many more opportunities out there to buy wholesale then to find good drop-shippng products.
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  • Profile picture of the author Shawn Wilson
    There are different things you need to consider going either Amazon or Ecommerce. Ecommerce might be more of a pain in the butt, but the value and long term success I think outweighs the hurdles.

    If you build it correctly and market it to it's full potential, you could at some point sell it for possibly six figures.

    I have an ecommerce store in a building phase right now as I'm concentrating on other projects. However, I highly recommend this site for everything you need to create, market, source, etc your ecommerce store and it's free. He's also a warrior.

    http://www.storecoach.com/
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  • Profile picture of the author paulie123
    Amazon is definitely to way to go. What most people do not know about dropshipping is that those who are most successful are businesses. It is a B to B model and not really an IM (or individual) to B model. Many people think it is a IM to B model.
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  • Profile picture of the author denisjor
    I'm with Chrissy....Amazon already has the reputation. Don't reinvent the wheel. Let them do all the work and you become an affiliate and just get a check.

    They handle refunds and complaints if there are any.
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    • Profile picture of the author Robert Mangan
      Well, I'm with Shawn on this one.

      I believe a lot of people elect to be an affiliate for Amazon because it's a lot easier than setting up an ecommerce store, finding the suppliers and then finding the traffic.

      But, as Shawn says, with your own ecommerce store you have the potential to own a real business that others will want to buy and for a nice price.

      storecoach.com is a great place to learn all the ins and outs of setting up an ecommerce store that uses the drop ship model - and the resources are all free.

      Robert
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  • Profile picture of the author dcristo
    Promoting products sourced from the worldwidebrands dropshipper directory is a strategy that may have been profitable in 2005 not today.

    Today a successful dropshipping strategy requires selling a unique product which can take a lot of work sourcing the product. The best dropshippers are often wholesalers that are not even familiar with the term dropshipping. If you pitch to the wholesaler what the process is all about and how you can sell a lot of their product through this arrangement, some will listen to you.

    But dealing with dropshippers sourced from popular dropshipping lists won't make you a cent. These guys are just middleman that are cutting into your profits, and while the convenience of not having to carry inventory sounds good, you'd need to sell very high volume to make it worthwhile for you, which is unrealistic in most competitive niches, but it'd also depend on your marketing skills.

    Affiliate marketing is a heck of a lot easier though, and if you're just getting started, likely the best option. Promoting products on another site like Amazon is not a turn off for buyers, it can in fact be a positive thing, since Amazon is a trusted brand.
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    • Profile picture of the author LilBlackDress
      Originally Posted by dcristo View Post

      Promoting products sourced from the worldwidebrands dropshipper directory is a strategy that may have been profitable in 2005 not today.

      Today a successful dropshipping strategy requires selling a unique product which can take a lot of work sourcing the product. The best dropshippers are often wholesalers that are not even familiar with the term dropshipping. If you pitch to the wholesaler what the process is all about and how you can sell a lot of their product through this arrangement, some will listen to you.

      But dealing with dropshippers sourced from popular dropshipping lists won't make you a cent. These guys are just middleman that are cutting into your profits, and while the convenience of not having to carry inventory sounds good, you'd need to sell very high volume to make it worthwhile for you, which is unrealistic in most competitive niches, but it'd also depend on your marketing skills.

      Affiliate marketing is a heck of a lot easier though, and if you're just getting started, likely the best option. Promoting products on another site like Amazon is not a turn off for buyers, it can in fact be a positive thing, since Amazon is a trusted brand.
      I think you make excellent points. With Google as erratic as it is, I took a look at dropshipping and felt there were many issues there also. Being an affiliate really helps minimize the risks.
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  • Profile picture of the author adixon1989
    Also with drop shipping you're able to choose the selling price of goods so its possible to achieve a higher profit margin
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    • Profile picture of the author dcristo
      Originally Posted by adixon1989 View Post

      Also with drop shipping you're able to choose the selling price of goods so its possible to achieve a higher profit margin
      If you're not selling a unique product it's a moot point, since most consumers will choose which product they buy based on price. One of the advantages of selling a unique product is that you don't have to compete based on price. Not only is it less competitive, you can set your own pricing point.
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  • Originally Posted by InWait View Post

    So as an alternative I'm considering amazon.
    Most of my income comes from Amazon marketing. They convert well because they are such a well known brand!

    I would give them a go if I was you.
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  • Profile picture of the author Robert Mangan
    dcristo,

    I'm selling products from my site that can be bought direct from the manufacturer as well as Amazon (and it's third party sellers).

    My products are far from unique and are well-known brand names in my niche.

    I still manage to make a profit and as my SEO work continues I will make more sales and more profit.

    Yes, drop shipping and ecommerce is a lot harder that affiliate - at least in setting up your website and listing products but, and this is my personal view, retailing products is a much more rewarding and potentially more profitable business.

    Anyhow, I wish InWait all the best in whatever path he selects.

    Robert
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  • Profile picture of the author Michael Franklin
    Originally Posted by InWait View Post

    So as an alternative I'm considering amazon. But I'm worried about it looking less professional, especially with customers having to go to a separate site to complete orders. I also feel as though I'm going to have less control overall.

    Before I got into full swing with Amazon, I did the dropshipping route and I will say that it was actually more hassle. Yes, there's good money to be made from dropshipping however you really save yourself so many steps in the whole selling process by just focusing on setting up the site and getting it ranked....Not having to deal with the processing end of selling goods is such a BIG relief! I can tell you that firsthand!
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  • Profile picture of the author dcristo
    Robert, may I ask what is your USP? How do you differentiate yourself from your competitors so that you don't have to compete on price? I am assuming you sell thousands of products and don't rely on one drop shipping source?
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  • Profile picture of the author Ronno99
    You might test with Amazon, taste some paid traffic, see what converts, and then if things look good then look to source products directly.
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  • Profile picture of the author Robert Mangan
    dcristo,

    you can easily found out all about my store and my USP - hint: just follow my signature.

    Actually, my niche is full of other retailers that operate 100% drop ship. Also, many of the bricks and mortar stores also run their online store on a drop ship basis - many people don't seem to realise that bricks and mortar stores run their online business on a drop ship model.

    And yes, a lot of people that visit my site are doing comparison shopping - it's a major thorn in my side. But also, many customers don't compare prices and they buy despite me being more expensive than other sites.

    Finally, I am able to compete price-wise on many of the products I sell. There are several reasons for this: 1) some distributors/manufacturers have MAPPs in place so it's a level playing, so I can easily compete against the likes of Amazon. If you visit my site you'll find out how I'm able to get orders for MAPP items whereas Amazon doesn't. 2) A lot of other online retailers operating on a drop ship basis are buying products at the same price I am, so I can go as low as most other sites - obviously, some sites sell items at a loss, which is something I don't do.

    I hope this answers some of your questions.

    Robert
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  • Profile picture of the author YasirYar
    Go with Amazon because they have established a truly great working system which has been tested over and over again. What I dislike about world wide brands is that they don't let you look at available products till you register and later you only get disappointment. while Amazon is more open and have nothing to hide.
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  • Profile picture of the author joeshmo1946
    comparing Amazon with an ecommerce dropshipping site is like comparing apples to oranges. they both have advantages and disadvantages and although I have several Amazon sites that do very well, I'm also thinking about creating an ecommerce site in the future, in which I will have products dropshipped as well as post some of my own things which can potentially give me a better return than posting on ebay etc.

    I'm a collector of model trains so I often buy and sell on ebay and other auction sites.

    Amazon and affiliate sites are great. All I do is get them ranking high in Google and other search engines, do some other promotional stuff every now and then and I get plenty of sales hands free. No worries about shipping, returns, or any of that other stuff like others have mentioned. Remember also that with dropshipping you need a very reliable source. If they don't ship a package out on time or something else happens you'll be the lucky one getting all the grief from it.

    Resale can be excellent on a popular ecommerce site along with lots of other benefits. customers stay on your site instead of navigating away from it. Its your and you own it. Personally, that would give me a little bit more sense of pride and accomplishment.
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  • Profile picture of the author Daystar11
    Who says you can't do both? You can quickly start with Amazon, and see how you like it. You can have some sites up, while you are developing your dropshipping business, and perhaps even eventually link the two.
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  • Profile picture of the author wolfmmiii
    I see that you mentioned the word "control". Although you do relinquish some control when affiliate marketing for someone else, you also have very little control when drop-shipping. Many an eBay seller has been hammered because of lack of control of delivery times.

    I do very well with Amazon so I'd recommend going with it.
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    • Profile picture of the author OnlineStoreHelp
      I run several online and drop shipping businesses and they have always been profitable and easy to deal with. There is an ease with an Amazon web store but at best you get maybe 15% return on everything that sells. If you are starting out its even less, 4% till you hit sales figures. I don't go into a dropship business unless it has at least an average 40% gross margin.

      I can't speak towards Worldwide Brands since every time I tried the demo and looked for the Niche's I was working in, I could never find the suppliers and drop shippers I wanted (it would come up either one or zero). I found it much easier and productive to find the suppliers myself and you would be surprised how easy it is.

      I started doing this with Deal a Day sites and have started to expand out to full retail stores. Spend a good amount of time exploring a profitable Niche and dropshipping can do very good for you.

      If you wanted to combine the two, Amazon does have an OK ecommerce host. Not my host of choice but makes it easy to post your products on the Amazon.com platform
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  • Profile picture of the author itejsin
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    • Profile picture of the author kbraden09
      I would be interested in that list of dropshippers and wholesalers...Thanks and regards,
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  • Profile picture of the author ebaypowerguru
    Hey!

    They are completely valid concerns, I remember when I was starting out a long time ago, I was asking similiar questions.

    Firstly, on deciding whether to go for eBay and amazon, why not simply go for both. They are both great platforms to sell on and are very profitable.

    Regarding which products to choose, what is your passion? What do you really, really love doing. Let's say it is playing football. They sell products football products. It always best to sell products that you love and have a knowledge on so you can answer any questions your customers may have and also pass on your enthusiam.

    Hope this helps and if you have any further questions feel free to ask!

    Kindest Regards
    The eBay Power Guru

    Originally Posted by InWait View Post

    I've decided on a specific type of product for an online store. I want to do dropshipping - I have a worldwidebrands account - but I'm having trouble finding products that I'm happy with.

    So as an alternative I'm considering amazon. But I'm worried about it looking less professional, especially with customers having to go to a separate site to complete orders. I also feel as though I'm going to have less control overall.

    Are these valid concerns or am I over thinking this?
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  • Profile picture of the author al graham
    Amazon if you want peace of mind and an easy steady flow of business. Drop shipping is a little hit and miss but the profits are better.
    As in all business, the more risks and commitment you are willing to take and put in, the greater the rewards! If you want to sleep at night go for the Amazon. If marketed int he right way, this format will be fine.. it is a tried and tested and reliable format!
    I wish you luck with your direction.
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  • Profile picture of the author matrixmgmt
    To start out you should follow this simple model:

    1. Get an Amazon Prime Account ($75/year) - gives you free 2-day shipping
    2. Research hot products trending on Ebay - electronics do very well
    3. Find the product on Amazon (make sure it's sold under Prime)
    4. Start a 30 day ebay auction with a minimum buy equal the Amazon price (copy all the product description and images into the auction)
    5. Watch the auction and answer the questions to make sure you get positive feedback
    6. Item sells above the minimum price - Go to your Amazon account buy it and ship it to the seller using the Prime 2-day shipping (make sure to suppress the invoice as part of the checkout)

    I successfully used this method to earn a few thousand dollars a month starting out. It's easy and fun to watch how stupid people get caught up in Ebay and bid for items higher than they can get them at Amazon.
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    • Profile picture of the author fuzzycorleone
      Originally Posted by matrixmgmt View Post

      To start out you should follow this simple model:

      1. Get an Amazon Prime Account ($75/year) - gives you free 2-day shipping
      2. Research hot products trending on Ebay - electronics do very well
      3. Find the product on Amazon (make sure it's sold under Prime)
      4. Start a 30 day ebay auction with a minimum buy equal the Amazon price (copy all the product description and images into the auction)
      5. Watch the auction and answer the questions to make sure you get positive feedback
      6. Item sells above the minimum price - Go to your Amazon account buy it and ship it to the seller using the Prime 2-day shipping (make sure to suppress the invoice as part of the checkout)

      I successfully used this method to earn a few thousand dollars a month starting out. It's easy and fun to watch how stupid people get caught up in Ebay and bid for items higher than they can get them at Amazon.
      There are numerous problems with this setup. First off, it's against Amazon's TOS to take advantage of Amazon's prime service for drop shipping. Also, when you buy products from Amazon and have them shipped to various different addresses then it will put your account under investigation for suspicious activity (Amazon doesn't like to be used as a drop shipper).

      There's also the issue with flow of money. When you sell something on ebay the money goes into your paypal account. Buying from Amazon would be impossible since they don't accept paypal. This wouldn't work unless you get a paypal mastercard.
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  • Profile picture of the author Randall Magwood
    I would go with Amazon first. With dropshopping, you have to pay for the product before you have the money that you get from sales.... unless you're selling on ebay, have a Paypal debit card, and can pay for a product that needs to be dropshipped. Plus... dropshipping shipping fees are high. Just another reason why you should choose Amazon.
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    • Profile picture of the author wizzard74
      Originally Posted by Randall Magwood View Post

      I would go with Amazon first. With dropshopping, you have to pay for the product before you have the money that you get from sales.... unless you're selling on ebay, have a Paypal debit card, and can pay for a product that needs to be dropshipped. Plus... dropshipping shipping fees are high. Just another reason why you should choose Amazon.
      No you don't have to pay for the product first, you get the money from the customers first when they place their orders, then you place the order with the dropshipper.
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  • Profile picture of the author TollFreeService
    Amazon would be an affiliate business. Dropshipping would be a retail business.

    It really depends on:

    Can you find a good company that is willing to dropship products for you?
    Do you want to deal with accepting payments, customer service, returns, etc?
    Do you want to run your own business or just a website that gives you a 1-time commission?

    If you really want to run your own store, starting out by dropshipping is the way to go (provided you get a good company willing to dropship for you).
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  • Profile picture of the author getty
    I think you would look more credible using Amazon or Google Checkout. I tend to see Amazon as a leading figure in that kind of industry. So, yes I am for your idea.
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  • Profile picture of the author Zeus66
    I had a pretty good online store for a couple years before I sold it. I simply found a good online seller and signed up for their wholesale (dealer) program. I had been an affiliate of theirs through Commission Junction previous to that, but the commissions were not satisfying so I figured why not try their drop shipping and mark up the prices to earn more per sale. I didn't follow any guides or read a lot of forum posts. I just did it. And it worked. I just had the occasional return to deal with and had to answer a few emails per day, but I sold plenty of items - even though my prices were often a bit higher than Amazon or other competitors.

    See, we think like marketers too much on this stuff. A lot of buyers are pretty ignorant about this stuff and will just buy from the first place they find what they want (as long as the price isn't ridiculously high).

    Be sure to put your buyers on an email list (not easy to do when you're an Amazon affiliate). Now you're building a real business full of repeat buyers.

    John
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  • Profile picture of the author goindeep
    ALWAYS test with amazon and or eBay first where possible to see if your product sells and how much of a price you can sell for. You should heed that advice.

    I once told a good friend that before he spent his thousands on his ecommerce site and thousands on product that he do the same. He didnt listen... now he's broke.
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  • Profile picture of the author MaryPabalates
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    Well, Amazon is a trusted shopping site, if you join it then you can make money from it, if you follow its guidelines, training, advice and latest tutorials as well.
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  • Profile picture of the author KuanYew
    but the affiliate program i believe comes with a standard 5% referral commissions across all the products, just to set your expectations right
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  • Profile picture of the author KingMedia
    Drop shipping VS Amazon...

    Amazon
    - Amazon limits you to region. If you are US based, all your sales from other countries will not count!
    - Their commission is very low (4%)
    - Some states in the US have been amazon affiliate slapped (who's next?)
    - Try using Adwords with an affiliate site - they will slap you for life.
    - Easy to do, IF you can get a product that sells well.

    Drop Shipping

    - more control
    - have a website, sell on amazon, ebay, facebook, google shopping, etc...
    - PPC friendly (choose a niche with low PPC & you got gold)
    - much harder work - but it's under your control for yrs to come
    - finding REAL drop shippers is challenging

    I made $2.34 with amazon last month
    I made $$$$ with drop shipping on all of the above - yeah, it's hard work, but worth it if you run it like a REAL business (as if you were a brick and mortar retailer) - takes a lot more research on products and consumer thinking and buying habits.

    Worldwide Brands and SaleHoo is who I use plus do my own research for more on my own. eventually the goal is to get a small where-house and ship my own stuff that I buy through my web biz. Much lower wholesale cost to me thus meaning more profit at the end of the day.

    Gotta look at the big picture. Amazon and CJ are great for starting out, but the real money is buying wholesale and selling retail using IM as the backbone (for me anyway) as I got sick of being slapped around by google, amazon, CJ vendors, etc.

    This is just my experience, hope it helps a bit.
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  • Profile picture of the author arwa99
    I also built a amazon astore
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    • Profile picture of the author joeshmo1946
      I would go the easier route and just do a few quick amazon sites first. No worrying about tax ids, shipping, customer service etc etc. Ranking sites through organic search is the same whether the site is a dropshipping site or an affiliate site, so you could get your hands dirty by promoting a few amazon sites first, and then trying your hand at dropshipping when you are ready for that step.
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