Start your online business · Amazon · 2 min read
Amazon Dropshipping 101: A Beginner's Guide
Short answer
Dropshipping on Amazon is allowed only if you are the seller of record: your name must appear on packing slips and invoices, supplier details must be removed, and you handle returns. Buying from another retailer and having it ship straight to your Amazon customer is prohibited.
Amazon has huge built-in traffic, which makes it tempting for dropshippers. It also has strict rules and performance standards. Here is how to do it within the rules.
What Amazon's policy says
Amazon's drop shipping policy allows dropshipping when you:
- Are the seller of record for every order.
- Identify yourself as the seller on packing slips, invoices and external packaging.
- Remove third-party information (the supplier's name, prices or branding) before shipping.
- Accept and process returns.
- Comply with all other Amazon policies.
It prohibits buying products from another online retailer and having that retailer ship directly to your customer, and shipping orders with packing slips or other information that names a seller other than you.
How it works in practice
- You list a product, or add an offer to an existing listing.
- A customer orders on Amazon.
- You order from your supplier, who ships to the customer in neutral or your branded packaging.
- You upload tracking to Amazon.
- You handle customer service and returns.
Costs to plan for
| Cost | Notes |
|---|---|
| Selling plan | Individual (per item sold) or Professional (monthly) |
| Referral fee | Percentage of sale price, varies by category |
| Product cost | Paid to supplier |
| Shipping | Supplier or carrier |
| Returns | Your responsibility |
| Ads | Optional, often necessary |
Finding suppliers
- US-based wholesalers and dropshippers for faster delivery. See 5 best USA dropshipping suppliers.
- Brands willing to authorise you as a reseller.
- Avoid restricted brands and categories that need approval.
Performance metrics
Amazon tracks late shipment rate, valid tracking rate, order defect rate and cancellation rate. Slow suppliers drag these down quickly, and poor metrics can lead to suspension.
Dropshipping vs FBA
Many sellers move to Fulfillment by Amazon (FBA), sending stock to Amazon warehouses. It costs more upfront but gives Prime eligibility and handles shipping and returns.
Common reasons dropshippers get suspended
- Packing slips or invoices from another retailer in the box.
- Late deliveries that push late shipment rate above Amazon's targets.
- Invalid or missing tracking.
- Listing restricted or counterfeit items.
- Customer complaints about item condition or authenticity.
- Inventory not actually available when ordered, leading to cancellations.
Reading Amazon's policies on product authenticity and restricted categories before listing anything saves trouble later.
Choosing products for Amazon dropshipping
Products that work better tend to be lightweight, durable, not seasonal, not dominated by Amazon's own listings, and available from a reliable domestic supplier with stock visibility. Avoid categories that need approval unless you have it, and avoid brand-name goods unless the brand authorises you to sell them.
Building toward a brand
Many sellers use dropshipping to learn the platform, then move to private-label products sold through FBA or their own store. Owning a brand gives control over listings, pricing and customer experience, which reselling cannot.
Is it worth it?
Amazon dropshipping can work with reliable domestic suppliers, decent margins and careful policy compliance. For more control over branding and customer relationships, compare with your own store in dropshipping vs wholesale and read what should I sell on Amazon.
Frequently asked questions
Is dropshipping on Amazon legal?
It is allowed under Amazon's drop shipping policy if you follow its rules. Breaking them can get your selling privileges suspended.
Can I dropship from AliExpress to Amazon?
It is risky. Long delivery times hurt Amazon's performance metrics, and if packaging shows the supplier's name or prices, you break Amazon's policy.
What do Amazon sellers pay?
A selling plan (Individual per-item fee or Professional monthly subscription), referral fees on each sale, and fulfilment fees if you use FBA. Check Seller Central for current rates.
Sources and further reading
Platform features, prices and policies change. Check the official help pages linked above before you act on a detail that matters to your store.