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Your Guide to Becoming a Preferred Shipper

The e-commerce industry is booming and expected to grow exponentially in the coming years. The digital marketplace is ever-changing as new entrepreneurs find ways to deliver products to customers.

Dropshipping is a hot topic in the business world, sparking some debate.

Many people have mixed feelings about dropshipping, its efficacy, and whether it can be turned into a profitable side hustle. While some people think the dropshipping business model is one of the future, others believe it’s a total scam.

Let’s explore more about dropshipping on Amazon, whether it’s legit or a get-rich-quick scheme, and some of the pros and cons of Amazon dropshipping.

What Is Amazon Dropshipping?

Dropshipping is a type of fulfillment option where individuals purchase products at wholesale prices and resell them to customers at a higher price to earn a profit. The model is typically associated with low overhead costs and low capital investments, which is why entrepreneurs are attracted to dropshipping. Dropshippers do not have to worry about storing products or managing inventory, as the products ship directly to customers from the manufacturer.

Additionally, Amazon has strict dropshipping policies listed on its website, highlighting how dropshipping should be handled when selling on Amazon’s Merchant Fulfilled Network (MFN).

Some people who have tried dropshipping methods but failed to earn enough income tend to call dropshipping a scam. However, there are some dropshippers who’ve managed to earn seven figures.

Generally speaking, dropshipping in itself is not a scam, but sometimes scammers will use dropshipping to gain the upper hand over customers. Some people will advertise designer or high-quality products when, really, the products often don’t measure up to customer expectations.

For example, some products may have different materials, the stitching could be all wrong, or the product doesn’t function properly. Others will act as life coaches who scam wannabe dropshippers with get-rich-quick advice at costly seminars. The FTC even warned consumers about a company in 2018 that took advantage of many people hoping to make money as Amazon sellers.

Keep in mind that using middlemen to sell products has been a common practice for decades now. Still, there’s been recent hype about dropshipping, especially across social media channels. For example, some dropshippers are using their platform on social channels like TikTok to share their positive experiences with others and convince others to give dropshipping a try.

Pros of Dropshipping

• Lower startup costs and risk
• Easy scalability and expansion to new markets
• Greater customer engagement and lifetime value
• No storage or logistics costs
• Quick product listings

Cons of Dropshipping

• Dropshippers can run into supplier coordination issues
• Highly competitive markets
• Complex order processing
• Reduced shipping visibility

It’s clear that dropshipping has advantages and disadvantages, and it’s critical for anyone interested in dropshipping to consider all of these factors before jumping in headfirst.