Tips for success if you use dropshipping to sell with Amazon

Let’s cover some common dropshipping guidelines to avoid mistakes.

1. Make sure you’re the seller of record

To dropship on Amazon without penalty, you must be the seller of record. The seller of record is the person who is registered to sell the product to the end customer.

You’re responsible for setting the price, recording sales and revenue, handling returns, and paying sales taxes. In this scenario, you own the products before the dropshipping supplier ships them to customers.

2. Avoid ecommerce or retail sites

It’s tempting to use an ecommerce or retail store to supply products for your dropshipping business. If you do, however, you won’t be the seller of record.

Retailers are unable to list anyone else as the seller of record. So when these products ship directly from their stores, the packaging, invoices, and other shipping materials will contain the retailer’s information.

This is against Amazon’s dropshipping policy because it causes confusion for customers.

3. Make the customer experience seamless

One mistake Amazon sellers sometimes make when dropshipping is not taking accountability for the customer experience. When you become a dropshipper, you’re not selling as Amazon—you’re selling as your brand.

You’re not anonymous, which means customers will attribute your great (or poor) customer experience to your brand. This can hurt reviews and sales in the long run. To prevent fallout with customers, ensure they know who to contact for support. Include your contact information (e.g., email and phone number) with the product packaging so customers don’t wonder whether they should contact Amazon or the dropshipping supplier.

Also, check to make sure any manufacturers, suppliers, and dropshipping companies you work with don’t mind putting you as the seller of record.

Note that it’s prohibited to create an Amazon product listing for an item already on another retailer’s site (e.g., Sam’s Club, Target), take the order through Amazon, and then enter the order into the third-party retailer’s system so they can then ship it.

What to look for when you select a dropshipping supplier

Once you’ve found a dropshipping supplier that’s willing to list your brand on packaging, mailing slips, and invoices, here are some other factors to consider.

A good dropshipping supplier…

…doesn’t ask for control of your Amazon account.

Once you know you’ll be the seller of record, it’s time to set up an Amazon account. Remember that you’re responsible for the account, so don’t give access to a third party. If you provide access and they remove you, then you’ll lose control over the account.

If a dropshipping company requests access, then shop for a different vendor.

…has proof of authorization to sell products from specific brands.

Next, make sure the supply chain is in order. Ask the dropshipping supplier where they receive products from and whether they have letters of authorization from the respective brands or manufacturers. Check the authorization to ensure it comes directly from the product source.

Before moving forward with the supplier, confirm authorization is legitimate. Third-party suppliers generally receive authorization to sell products. You can review purchase documentation (such as an invoice and letters of authorization) to confirm this. Letters of authorization commonly state something like, “Supplier ABC is authorized to sell products under XYZ brand name.”

If a supplier is unable to provide invoices or letters of authorization, then don’t take any chances. Ensure they can prove they’re legitimately selling products so you don’t end up suspended from Amazon or in legal hot water.

…has dropshipped with Amazon sellers before.

As a bonus, you can ask the supplier if they’ve worked with Amazon sellers before. If so, ask for shipment histories to prove it. Avoid headaches by working with a dropshipping vendor that has experience with Amazon sellers and is aware of the process and applicable policies.

…offers customer service support

You’re responsible for customer satisfaction, and you’ll likely need cooperation from the dropshipping company, so it’s cohesive.

When dropshipping products, you don’t have complete control over inventory, since it’s coming from elsewhere. However, you’re still responsible for processing customer returns and refunds. Check to see whether the dropshipping supplier can receive and document returns within Amazon’s returns policies.

If the supplier will be handling returns, check to make sure they have the ability to document the return accurately. That includes taking images, identifying any damage, and noting the reason for the return.

Did you know?

Seller University provides free training from Amazon

Seller U courses, videos, and webinars answer your questions about selling in the Amazon store with step-by-step explanations and strategies to grow your business. The catalog is updated regularly by a dedicated team of Amazon learning professionals. Find Seller University when you sign in to Seller Central (under “Learn”), or check out the Seller University YouTube channel.

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