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My Journey into Wholesale Dropshipping on Amazon

When I first started my wholesale dropshipping business on Amazon, I was faced with the challenge of finding reliable suppliers and profitable products. I quickly realized that working directly with wholesalers offered significant advantages over retail suppliers. From higher profit margins to avoiding branded boxes and receipts, dropshipping wholesale products seemed like the way to go. In this blog post, I want to share my personal experience and the strategies I used to start a successful wholesale dropshipping business on Amazon.

Finding Profitable Wholesale Products

The key to finding profitable wholesale products is to reverse engineer other sellers who are already successfully selling branded products on Amazon. I began by searching for brands that exclusively sold their products on other websites. Cobalt and Mainstays are two examples that come to mind off the top of my head. If I found these branded products listed on Amazon, it meant that the sellers were either dropshipping them from the supplier or reselling them second-hand. More often than not, it turned out to be dropshipping.

Another effective method was to find a list of wholesale suppliers first and then determine if they offered dropshipping services and had profitable products. Supplier directories like SaleHoo, Inventory Source, and Spark Shipping provided valuable information. Trade show websites also listed suppliers worth exploring.

Working with Wholesale Suppliers

Once I identified potential wholesale suppliers, I ensured they met two crucial criteria: no minimum order quantity and order fulfillment services. These factors were essential indicators that the suppliers would dropship the products. After signing up with a supplier, I obtained their product catalog, which contained a comprehensive list of their products along with prices and product identifiers like SKUs or UPCs.

To identify profitable products quickly, I used a software called Scan Unlimited. This powerful tool compared Amazon's catalog with my supplier's products, allowing me to determine which items were worth listing. (You Can Try Scan Unlimited Free Here) It was essential to list as many profitable products as possible because even though not all products would sell consistently, having a diverse range increased the chances of generating sales.

Determining Profitability and Pricing

Assessing the sales potential of a product was crucial. I used software like the Jungle Scout Chrome Extension to gauge a product's sales performance. Even if a product seemed profitable, it was essential to ensure that it had a history of sales on Amazon. Listing products with little to no sales was not worthwhile. Sales on specific products can change weekly as buy boxes rotate and Amazon shares sales with other sellers. Therefore, it was essential to build a portfolio of profitable products to achieve consistent sales.

Determining the break-even price, the lowest price at which I could sell a product and still make a profit, was another crucial step. I used the free Amazon FBA calculator provided in Seller Central to calculate this price. Setting the break-even price as the minimum price in my repricer ensured that I never sold a product at a loss while trying to win the buy box. While various repricer options were available, I found the free one in Seller Central sufficient, especially for beginners.

Building a Sustainable Wholesale Dropshipping Business

Monitoring stock levels of products was important to avoid selling out-of-stock items. While I typically recommended SKU Grid for this task, it was more suitable for retail suppliers. When dropshipping wholesale products, saving the URL links of listed products in a spreadsheet and checking them manually once a week sufficed because wholesale suppliers usually didn't change prices or go out of stock as frequently as retail suppliers.

It's crucial to avoid fully automated dropshipping services or software that work with one or a few retail suppliers. These services may lead to account suspensions and intense competition with other sellers using the same suppliers and software, resulting in price wars. Building a sustainable wholesale dropshipping business requires dedication and consistency. Avoid shortcuts and focus on implementing the strategies I've shared in this blog post.

Starting a wholesale dropshipping business on Amazon can be a rewarding venture. By working directly with wholesalers and following the strategies outlined above, I was able to build a sustainable and predictable business model. It required effort, research, and patience, but the results were worth it. Remember, there are no shortcuts to success. Take the time to establish a solid foundation, and you'll be well on your way to achieving your entrepreneurial goals.

If you'd like to watch the complete video explanation of this, check it out below.

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