The toughest decision for sellers is where and when they should start their ecommerce business: Amazon FBA or Shopify dropshipping? Each has its advantages and disadvantages, which some sellers might not be aware of.
There are many online platforms that you can sell your products on, but Amazon FBA or Shopify are the most popular. It is important to understand the pros and cons associated with Amazon FBA or Shopify Dropshipping before you decide which platform you prefer.
Amazon FBA offers clear advantages over Shopify in terms of shipping fees, returns policies and customer reviews. However, if simplicity is your goal or you want more control over the products that you sell, Shopify may be a better option. While it is a personal choice, it is important to understand the pros and cons of each service before you make a decision.
This article will show you the differences between Amazon FBA and Shopify Dropshipping, as well as the best e-commerce platform to use for your business.
What is Amazon FBA?
Amazon’s FBA Program allows you to sell goods on Amazon’s online platform. If you can source high-demand products, selling products on Amazon can make you a lot of money. Amazon FBA makes it easy for small businesses to sell products on Amazon. You simply buy your inventory from the supplier and list it for sale on Amazon. They will then ship it directly to you.
Amazon’s FBA service will take care of the shipping and warehousing for your products so you can just fulfill customers orders. Amazon can ship your items to you from either your home or a warehouse.
FBA allows you to ship products already in stock. These products can also be shipped directly to Amazon. This is a great option if you are looking to save shipping costs. You can also choose to not have your products shipped free.
This is a great way to generate sales if you already have traffic to your website or social media accounts. Amazon branding will be required on your website so potential customers can also visit your Amazon store via your links.
Amazon’s nature means that it is not always easy. Amazon is home to hundreds of millions of customers. This means that even if your product meets their exact needs, they may not be interested in it. There is plenty of competition in every niche, so products need to be priced right to attract buyers.
Amazon sells a book for $24.99, and it has an estimated 100k+ BSR (Bestseller Rating) sales rank. This means that there are more than 100,000 books selling well than yours. Your product’s sales rank will not be above this level, and you won’t make any sales.
Although it is possible to sell on Amazon even if your sales rank is low, it can be challenging if you have an exclusive product such as jewelry or clothing, or traffic to your website. FBA is a great option as Amazon will handle all your orders.
How to Sell on Amazon With FBA
If you already sell on Amazon and want to increase your reach, Amazon FBA can be very simple and straightforward to set up. You can sign up for Amazon FBA on their website and list your products. Then, you can ship your items to their warehouse via Fulfillment by Amazon, and they will ship it to your customers.
You can also invest some of your profits in advertising and inventory to help you continue scaling up. This can be done by purchasing better products and promoting the store via paid social media ads. Once the sales are reached, it’ll be easier to increase your store’s organic reach through Amazon’s search engine. Also, you will rank higher in organic searches.
Dropshipping: What does it mean?
Dropshipping allows entrepreneurs to purchase products from wholesalers or retailers and then sell the merchandise directly to their customers. To sell products, entrepreneurs often create their own websites or an online shop.
Shopify Dropshipping is an excellent way to launch an eCommerce business without spending a lot upfront. This type of business requires no upfront investment except for your domain name, online store theme and web hosting package. It is easy to use and you can quickly set up an online shop and begin selling.
Dropshipping with Shopify means that sellers no longer have to worry about how merchandise is received and stored in their physical stores. The seller will receive an order through their website. It will then be sent to the factory or supplier they have chosen and shipped under their name.
Dropshipping shops can be made with Shopify by using many features, such as product collections and automated fulfillment. These features make it simple to set up online stores that are easy to manage.
Shopify is an excellent eCommerce platform that beginners can use. It has everything you need in order to set up an online shop and begin selling products. You don’t need to have any prior knowledge about Shopify or eCommerce platforms. It is also very easy to set-up.
How do I start selling on Shopify Dropshipping
Shopify dropshipping can be made easy by finding high-quality products in demand. You can find high-quality products at Alibaba, an online wholesale store.
A basic understanding of Shopify is necessary. This includes how it works backend, and which features and functions you have access to when you sign up. YouTube videos will help you to get familiar with the interface and show you how to build your store.
This type of business model requires high-quality images of the product to ensure customers understand what they are buying. High-quality descriptions are also essential to help convert sales.
Amazon FBA vs Shopify Dropshipping – What’s the Difference?
The difference is that Amazon FBA requires the merchant to ship their products to Amazon’s warehouses, where they will be kept until sold. Shopify dropshipping is a store owner’s only responsibility. They will simply need to find the suppliers and set up the shop for customers to buy online.
Amazon FBA is simpler to use because you don’t need to deal with wholesalers or intermediaries. Dropshipping with Shopify requires extensive research. If you don’t have the necessary technical skills, it can be challenging to set up your store and manage it. Shopify dropshipping can be a great option if you’re looking to quickly get your business started. There is no need to wait for products to arrive, or go through complicated procedures. In some cases, an Amazon FBA business can be combined with a Shopify dropshipping shop. This allows you to use your online store to bring in new customers and then send them to Amazon to make the actual purchase.
Amazon FBA is more expensive than Shopify dropshipping. However, this does not mean that it isn’t worth it as your products will be able to access Amazon’s vast traffic. Shopify dropshipping may be the best option for you if you are on a tight budget and want to sell your products at a lower price or at a profit.
Shopify Dropshipping and FBA have their place in online sales. They offer different solutions in certain areas. It all comes down to personal preference.
Amazon FBA: The Pros and Cons
Pros
- Traffic: Amazon is the largest global marketplace with more than 300 million users. Amazon is the only marketplace with such a large audience. Amazon FBA is a great way to grow your business if you are still developing your company and have little traffic.
- Storage, packaging, and shipping included: Selling on Amazon has the greatest advantage: you don’t have to worry about shipping, storage, or packaging. Amazon takes care of all these details so you can concentrate on sourcing the products.
- Multi-Channel Fulfillment: Multi-channel fulfillment is possible. Customers can make purchases from any of your ecommerce platforms and you can ship the product to them via Amazon FBA.
- Reputation of Ready-Made Brands: Amazon’s A+ rating and reputation can be leveraged to help you generate sales if your brand is still new. This will establish your business’s reputation at a very low price.
- Easy Setup for Online Store: Amazon FBA is one way to easily create an online shop. Amazon FBA offers many pre-made themes and templates that can be customized in just a few mouse clicks. This will save you both time and money. Amazon can also help you set up shipping rates to multiple countries, as well as courier selections, and handle tax information.
- In-built Customer Service, Returns and Refunds: Amazon acts as a buffer between your customer and you. If there are any issues with your order or the product, Amazon will take care of it. This saves you time and money. Amazon FBA provides customer service and returns. Excellent customer service is one of the best ways for Amazon to establish a reputation. This is already built into Amazon FBA.
- It’s easy to use the Platform Interface: Amazon FBA has a simple interface that is easy to use. The system has tutorials and guides that help sellers learn how to use it effectively.
Cons
- There is a lot of competition: Amazon is a huge marketplace with many sellers. Your products may be identical to others, as FBA only covers a small number of products. This will make it difficult to stand out and increase sales.
- There are a few layout design options: Amazon FBA offers only a handful of pre-made themes to your store. This makes it difficult to create an identity and image unique to your brand.
- It’s difficult to have your own brand: Amazon FBA makes it very difficult to create your brand. It will be difficult to add any information about your company and the store will look identical. Customers may not trust or remember you and this could make it difficult for them to purchase from you.
- Transaction fees of 15% to 40% Amazon charges anywhere from 15% to 40%, depending on the product category. This means that you will lose a lot of revenue. This can be avoided by focusing on high-priced products or using coupon codes.
- Shipping preparation is difficult: It can be difficult to organize all your shipping shipments if you sell many products. Shipping can quickly become overwhelming, which could impact your business.
- Simple Customer Returns: Amazon offers a return policy that is straightforward and does not require any questions. This could affect your sales and reputation. Customers trust Amazon products so they may not believe that you are selling defective goods.
- Difficult Tracking Inventory: Amazon FBA is a simple platform, but it can be hard to use. track inventory . You may not be familiar with Amazon FBA. The system tracks tracking only. SKU s. Items with an SKU are easier to track and monitor.
- Customer Support is not user friendly: Amazon customer service is difficult to use. It can take Amazon a while to resolve any issues with your product.
- The Customer List is not accessible: Amazon doesn’t allow you to view your customer list. This makes it difficult for you to follow-up with them and increase repeat customers.
The downside to this is that your products will be listed on the same page with other merchants with similar listings. They won’t be hidden in an online store with its own URL like Shopify. When people search for products on Amazon, they will see them. This encourages buyers to compare prices and ultimately choose the less expensive option.
Shopify Dropshipping: The Pros and Con
Pros
- Free 14-Day Trial: Shopify offers a 14-day free trial that allows you to test the system before signing up for an account. Once your shop is live on the marketplace, you only have to pay. It’s easy to test the platform before you commit.
- More than 70 easy-to-use templates: Shopify offers more than 70 pre-made templates, so you can have many options when building your store. This allows you to create a professional brand image that stands out from the rest.
- Make your own customized e-commerce website: Shopify allows you to create an e-commerce website that is customized. This will allow you to establish a brand identity and image. This will help you stand out among the rest, especially if your goal is to create products that are superior than others.
- It’s easy to create your own brand: Shopify allows you to create an individual brand. This will allow you to easily access information about the people behind your e-commerce store. Customers can trust you and make repeat purchases.
- There are many tools and apps available: Shopify is more than a place to drop shippers. You can also use Shopify for your own products and an online store. Shopify’s flexibility makes it easy to grow your business and keep things organized.
- Support from Quality Sellers: Shopify offers a fantastic seller support team that can assist you with any issues or problems with your account. The team is available to assist you with any problem or issue that may arise.
- Accessible Customer List: Shopify makes it easy to view your customer list. This will make it easier to follow up on repeat customers and increase sales.
- High Security: Shopify provides high levels of security for your business. SSL encryption is used to secure all payments and financial information are protected by a secure network.
Cons
- Monthly Fees: Shopify charges a monthly subscription fee to use the platform. However, if you’re selling products yourself or dropshipping, you can pay a lower monthly fee. Shopify may charge additional fees if you use the platform to develop products or do other work.
- Paid Apps for Most Features: Shopify offers many paid apps. This means that depending on the features you choose, they might cost more each month. This is a standard feature for many marketplace platforms. It means that you may end up spending more long-term than if your website was created through a web hosting company.
- There is no professional reporting included in the Basic Package. Shopify’s free package does not offer professional reporting, which can make it more difficult to track your business performance or compare you to other businesses.
- It is not available in other countries: Shopify is available only to businesses located in the US, UK and Canada. If you’re based elsewhere, you won’t be able open a shop or use Shopify.
- You can manage your own storage and fulfillment: You will need to create a fulfillment center or storage facility in order to sell your products on Shopify. You will need to store, ship, and deliver the orders. This can be difficult for new business owners with little experience.
- Manage Your Customer Service: Shopify doesn’t offer any customer support options for its basic package. You can still get premium customer service through third-party providers like Zendesk or Salesforce. This can provide some extra security for dealing with unhappy customers.
- Low Conversion Rate: Shopify doesn’t allow you to customize your landing pages, which could lead to lower conversion rates for customers who don’t know what to do once they reach your Shopify store.
- Sites with more apps, slower websites: Shopify is used daily by over 300,000 businesses. This means you will be sharing your server space. This can slow down your website and make it more difficult for customers to access the checkout page.
The downside to Shopify is that you will be responsible for managing your website or hosting. Shopify isn’t a website builder like WordPress and Wix. It’s an online storebuilder, so you will need to create the rest of your website using third-party providers. Shopify doesn’t provide technical support for users who are not using dropshipping.
Which is better for beginners?
It can be difficult to choose the right e-commerce platform for beginners. It all depends on your business goals, how much money you have available to invest and what time you want to spend. It is important to consider the features and support that your store requires to be successful.
If you have the resources and money, then both Amazon FBA or Shopify are worth considering. If you don’t have the resources or money to invest in both platforms, you can choose one and work on it until it grows. Then you can expand your reach with the second platform.
Shopify also offers a free 14-day trial, which you can sign up for to get to know the platform better before making any commitments. Amazon doesn’t offer a free trial. However, they offer paid options depending upon the type of account you wish to create.
Amazon FBA is better-known than Shopify. This means that it attracts more traffic and people who are interested selling on Amazon. Shopify, on the other hand is less well-known and therefore attracts less traffic. However, it may be easier for Shopify to rank at the top of search results. The success of your seller business will depend on how experienced you are and how hard you work. Both Amazon FBA dropshipping and Shopify FBA have their pros and cons.
Customer service is a key aspect of both Amazon and Shopify. Both businesses require that you go above and beyond to help clients to keep their business’s reputation high and sustainable. Shopify doesn’t offer any support or assistance in this area, while Amazon has its own customer service team that is available to help you whenever you need it.
It doesn’t matter which platform you choose, both can make your business dreams a reality. Your budget, your time commitment, and the features you value will all play into your decision. It’s up to your business to decide which model will work best for you. This comes down to your goals and the experience you desire for your customers and yourself.
Last Thoughts
Amazon FBA remains the eCommerce giant, but it is important to understand their weaknesses, including shipping costs and review system, before you decide that Amazon FBA would be the best option for your business. Dropshipping with Shopify can be a great alternative to Amazon or other platforms, but it is important to have a solid business plan.
You should also remember that Amazon FBA can be combined with Shopify Dropshipping, which is great for anyone who doesn’t want to commit to either of these models. This is a great way for you to create a variety of businesses.
Amazon FBA remains the best option for businesses, while Shopify is more suitable for people just starting out. It is a smart idea to try both Amazon FBA and Shopify before you commit to one or the other.
For your business, the most important thing is to be open-minded. There are many opportunities available, but some might not fit in the same box you originally thought of when you decided which type business to start. If you are open-minded and don’t limit yourself to one type of business plan, you never know what might be your next big idea.
