Start selling with AliDrop today

​Starting a profitable Amazon dropshipping business in 2025 presents a compelling opportunity for entrepreneurs. The global dropshipping market is projected to reach $459.6 billion by 2025, reflecting a robust growth trajectory. Notably, approximately 34% of Amazon sales are fulfilled by dropshippers, underscoring the viability of this business model on the platform. 

By understanding the intricacies of Amazon's dropshipping policies and leveraging effective strategies, sellers can tap into this expansive market and build a profitable venture

What is Amazon Dropshipping?

Amazon dropshipping is a retail fulfillment model where sellers list products on Amazon without holding inventory. Instead of managing stock, sellers purchase items from a third-party supplier, who then ships them directly to the customer. 

This business model allows entrepreneurs to operate an eCommerce store with minimal upfront investment, leveraging Amazon’s extensive customer base.

Amazon Dropshipping Rules & Policies

Amazon permits dropshipping, but strict policies must be followed to avoid penalties:

• The seller must be the seller of record on all invoices, receipts, and packaging.
• No supplier-branded shipments (e.g., direct AliExpress packages are not allowed).
• Returns and customer service must be handled by the seller, not the supplier.

Many sellers use AliDrop or Spocket to find reliable, Amazon-compliant suppliers.

Pros & Cons of Amazon Dropshipping

Pros

• No need for inventory storage, reducing overhead costs.
• Access to Amazon’s large customer base, increasing sales potential.
• Low startup costs with no upfront inventory investment.
• Easy scalability by expanding product listings without stock limitations.

Cons

• Strict Amazon policies and violations can result in account suspension.
• High competition in most dropshipping niches.
• Lower profit margins due to Amazon’s referral fees (typically 15% per sale).

How Much Does it Cost to Dropship on Amazon?

Starting an Amazon dropshipping business requires understanding the costs involved. While dropshipping eliminates the need for inventory storage, sellers still incur various fees, subscription costs, and marketing expenses. Below is a breakdown of all essential costs associated with Amazon dropshipping and how to budget effectively.

1. Amazon Seller Account Fees

To sell on Amazon, you need a Seller Central account, which comes with two pricing plans:

• Individual Plan: $0.99 per item sold.
• Professional Plan: $39.99 per month (recommended for sellers planning to sell over 40 products per month).

If you are starting with a small volume, the Individual Plan works, but as your sales increase, the Professional Plan is more cost-effective.

2. Amazon Referral Fees

Amazon charges a referral fee on every sale, which varies by product category. The average referral fee is 15%, but it can range from 8% to 45%, depending on the product type.

Referral Fee Examples:

• Books: 15%
• Consumer Electronics: 8%
• Beauty & Health: 15%
• Home & Kitchen: 15%

For a $25 product with a 15% referral fee, the Amazon fee would be $3.75 per sale.

3. Fulfillment Costs (FBM vs. FBA)

With dropshipping, most sellers use Fulfillment by Merchant (FBM), where the supplier ships the product directly to the customer. 

However, some choose Fulfillment by Amazon (FBA) to store products in Amazon’s warehouse for faster shipping.

• FBM Costs: No warehouse fees, but sellers must pay for shipping and handling.
• FBA Costs: Amazon charges fulfillment fees based on product size and weight.

Example FBA Fulfillment Fees for Standard-Size Items:

• Small (under 1 lb): $3.22
• Medium (1-2 lb): $4.75
• Large (2-3 lb): $5.85

For a $25 product using FBA, total Amazon fees (referral + FBA) could be around $8–$10 per sale.

4. Product Costs (Supplier Pricing & Shipping Fees)

Since dropshipping relies on third-party suppliers, the cost per product varies based on the supplier and shipping time.

• AliDrop Suppliers (AliExpress) – Low-cost products with extended shipping times.
• Spocket Suppliers (US/EU-based) – Faster shipping but slightly higher product costs.

A good rule of thumb is to aim for a profit margin of at least 30%-50% after accounting for product cost, shipping, and Amazon fees.

Example Cost Breakdown for a $25 Retail Price Product:

• Supplier Cost: $8
• Shipping: $3
• Amazon Referral Fee: $3.75
• FBA or Handling Fee: $4
• Net Profit: $6.25

5. Advertising & Marketing Costs

Since Amazon is a competitive marketplace, sellers often invest in Amazon PPC (Pay-Per-Click) advertising to drive traffic.

Amazon PPC Ad Costs:

• Cost-per-click (CPC) varies between $0.30 to $2.00, depending on competition.
• A typical beginner budget for PPC ads is $5–$20 per day.

If you're selling a new product, expect to spend at least $150–$300 per month on ads to gain visibility.

6. Additional Costs to Consider

• Product Research Tools: Dropshiptool, AliDrop, or Spocket help find profitable products. Some offer free trials, but premium plans cost $20–$100 monthly.
• Branding & Packaging: Custom branding or private labeling add $1–$3 per product if sourced from manufacturers.
• Return & Refund Costs: Amazon requires sellers to manage returns, which can add unexpected expenses.

Total Estimated Cost to Start Amazon Dropshipping

Is Amazon Dropshipping Profitable?

Amazon dropshipping can be highly profitable when executed correctly. With millions of active buyers and global reach, Amazon provides an opportunity for sellers to build a scalable eCommerce business without holding inventory. 

However, success depends on product selection, supplier reliability, pricing strategy, and marketing efforts.

Profitability Factors in Amazon Dropshipping

Several factors determine how profitable an Amazon dropshipping business can be:

1. Amazon’s Large Customer Base

Amazon has over 300 million active customers, making it one of the largest eCommerce platforms in the world. This means:

• Higher conversion rates due to buyer trust.
• Consistent traffic without heavy reliance on paid ads.

Sellers who optimize their listings with SEO, competitive pricing, and fast shipping options can increase sales without excessive marketing costs.

2. Amazon Fees & Profit Margins

Amazon charges various fees, which impact overall profitability:

• Referral Fee: 8%–15% per sale.
• FBA Fulfillment Fee: $3–$10 per order (if using FBA).
• Subscription Fee: $39.99/month for the Professional Plan.

A typical Amazon dropshipping profit margin is 15%–30%, but selecting high-margin, low-competition products can push profits higher.

3. Product Costs & Supplier Pricing

The cost of sourcing products directly affects profit margins. Using low-cost suppliers from AliDrop (AliExpress) or Spocket (US/EU suppliers) helps maintain higher margins while ensuring fast shipping and quality control.

Example Profit Breakdown for a $50 Product:

• Supplier Cost: $20
• Amazon Referral Fee (15%): $7.50
• FBA or Handling Fee: $5
• Total Cost: $32.50
• Net Profit: $17.50 per sale

4. Marketing & Advertising Costs

While Amazon provides organic traffic, sellers often invest in Amazon PPC (Pay-Per-Click) ads to increase visibility. A typical PPC budget starts at $150–$300 per month, but with optimized listings and strong SEO, reliance on ads can be reduced over time.

5. Competition & Pricing Strategy

Amazon’s marketplace is highly competitive. Profitability depends on:

• Niche selection – Selling unique or high-demand products minimizes competition.
• Dynamic pricing tools – Adjusting prices based on market demand can improve sales.
• Customer reviews & ratings – Positive reviews increase conversion rates.

Is Amazon Dropshipping Worth It?

Amazon dropshipping is profitable for sellers who focus on:

• Finding high-margin products from reliable suppliers like AliDrop & Spocket.
• Optimizing listings with strong SEO and compelling descriptions.
• Managing costs efficiently by choosing the right pricing strategy.
• Using Amazon PPC wisely to drive sales without overspending on ads.

How to Start Dropshipping on Amazon?

Dropshipping on Amazon is an accessible and scalable way to start an eCommerce business without holding inventory. By leveraging Amazon’s vast customer base and working with trusted suppliers, sellers can build a profitable business with minimal upfront investment. Below is a step-by-step guide to getting started with Amazon dropshipping successfully.

Step 1: Understand Amazon's Dropshipping Policy

Amazon allows dropshipping, but sellers must comply with strict policies to avoid account suspension. Key requirements include:

• You must be the seller of record on invoices, packaging, and receipts.
• No direct shipments from suppliers with their branding (e.g., AliExpress-branded packages).
• You are responsible for returns and customer service, not the supplier.

Violating these rules can result in account suspension, so partnering with Amazon-compliant suppliers like those on Spocket or AliDrop is recommended.

Step 2: Choose a Profitable Dropshipping Niche

Selecting the right niche improves profitability and minimizes competition. Some of the best niches for Amazon dropshipping include:

• Eco-friendly & sustainable products
• Home office & productivity gadgets
• Health & wellness products
• Personalized & custom accessories
• Smart tech & pet care products

Using product research tools like Dropshiptool, AliDrop, and Spocket can help identify trending and high-margin products.

Step 3: Create an Amazon Seller Account

To sell on Amazon, you must create a Seller Central account. Amazon offers two selling plans:

• Individual Plan: $0.99 per item sold (for small-scale sellers).
• Professional Plan: $39.99/month (recommended for sellers handling 40+ sales per month).

A Professional Plan is ideal for those looking to scale and maximize profits.

Step 4: Find Reliable Dropshipping Suppliers

Your supplier will handle inventory, shipping, and order fulfillment, so choosing a reliable supplier is crucial. Popular dropshipping suppliers include:

• AliDrop (AliExpress Suppliers) – Lower-cost products, but longer shipping times.
• Spocket (US/EU-Based Suppliers) – Faster shipping with premium-quality items.
• CJ Dropshipping – Variety of suppliers with competitive pricing.

Partnering with trusted suppliers ensures faster fulfillment, quality control, and better customer satisfaction.

Step 5: List Products on Amazon

Once you have sourced a product, the next step is to create a compelling product listing with:

• SEO-optimized title – Use relevant keywords for Amazon search rankings.
• High-quality images – Product photos should be clear and professional.
• Detailed product description – Highlight features, benefits, and use cases.
• Competitive pricing – Analyze competitor prices to position yourself effectively.

Optimizing product listings increases visibility and conversion rates.

Step 6: Set Up Pricing & Profit Margins

To ensure profitability, calculate costs and set a competitive selling price. Consider:

• Supplier cost
• Amazon referral fee (8%-15%)
• Fulfillment fees (FBA or FBM)
• Advertising costs (PPC campaigns)

A healthy profit margin for Amazon dropshipping is typically 15%-30% per sale.

Step 7: Manage Order Fulfillment (FBM vs. FBA)

Dropshippers on Amazon use either:

1. Fulfillment by Merchant (FBM) – The supplier ships directly to customers.
2. Fulfillment by Amazon (FBA) – Amazon stores and ships your products.

Most dropshippers use FBM to avoid FBA storage fees, but FBA can increase visibility and Prime eligibility.

Step 8: Market & Scale Your Dropshipping Business

To increase sales, marketing, and advertising are essential. The best strategies include:

• Amazon PPC Ads – Run pay-per-click campaigns to boost product visibility.
• SEO Optimization – Use relevant keywords in product descriptions.
• Social Media Marketing – Promote listings via Instagram, TikTok, and Facebook.

Scaling involves adding more products, optimizing pricing, and improving fulfillment efficiency.

How to Choose a Dropshipping Supplier?

Choosing the right dropshipping supplier is critical for success. A reliable supplier ensures fast shipping, high-quality products, and seamless fulfillment, directly impacting customer satisfaction and profitability. With so many supplier options available, selecting the best one requires careful evaluation. 

Below is a step-by-step guide on how to choose a trustworthy dropshipping supplier, with Spocket and AliDrop as the top recommendations.

1. Prioritize Fast and Reliable Shipping

Shipping time significantly affects customer satisfaction and repeat sales. Many customers expect delivery within a week, making fast shipping a priority.

Best Supplier Choices: Spocket & AliDrop

• Spocket connects with US & EU-based suppliers, offering fast domestic shipping (2-5 days) compared to AliExpress (15-30 days).
• AliDrop allows direct sourcing from AliExpress, giving sellers access to millions of affordable products.
• Both platforms provide reliable tracking and automation, ensuring smooth order processing.

Other Options:

• CJ Dropshipping – A mix of US, EU, and Chinese suppliers with flexible fulfillment.

2. Check Product Quality & Supplier Reputation

Low-quality products lead to negative reviews and high return rates. Partnering with trusted suppliers ensures customer satisfaction and brand credibility.

How to Check Supplier Reliability:

• Read customer reviews and ratings.
• Order sample products before listing them in your store.
• Choose suppliers with a proven track record in your niche.

Spocket & AliDrop's Advantages:

• Spocket's pre-vetted suppliers ensure high-quality products with branded invoicing.
• AliDrop provides access to AliExpress's top-rated sellers, ensuring a wide range of options.

3. Ensure Competitive Pricing & Profit Margins

A supplier should offer wholesale pricing that allows for high profit margins after deducting shipping costs and platform fees.

How to Find the Best Pricing:

• Compare multiple suppliers for the same product.
• Look for bulk discounts or special pricing for dropshippers.
• Check if the supplier has a low MOQ (Minimum Order Quantity) to start small.

Spocket & AliDrop’s Competitive Pricing:

• Spocket offers exclusive supplier pricing with dropshipper discounts.
• AliDrop provides direct factory pricing from AliExpress suppliers, helping keep costs low.
• Both platforms cut out middlemen, reducing additional fees.

4. Choose a Supplier with Automation & Integrations

Manual order fulfillment can be time-consuming and inefficient. Automation improves efficiency and helps scale operations smoothly.

Supplier Features to Look For:

• Automated order syncing with Shopify, WooCommerce, or other platforms.
• Real-time inventory updates to prevent overselling.
• Seamless order tracking to enhance customer experience.

Why Spocket & AliDrop Are the Best Choices:

• Spocket integrates seamlessly with Shopify, WooCommerce, Wix, and BigCommerce.
• AliDrop provides automated order fulfillment for AliExpress products.
• Both platforms offer real-time stock updates and easy product imports.

5. Verify Customer Support & Return Policies

Reliable supplier communication ensures quick issue resolution and minimizes order disputes. Clear return and refund policies protect both sellers and customers.

What to Check:

• 24/7 customer support availability.
• Flexible return policies to handle refunds.
• A dedicated support team for dropshippers.

Spocket & AliDrop’s Supplier Support Benefits:

• Spocket has a dedicated support team for dropshippers and ensures clear refund policies.
• AliDrop provides direct communication with AliExpress sellers for faster issue resolution.
• Both platforms offer direct supplier contact for handling disputes.

Top Amazon Dropshipping Tools

Running a successful Amazon dropshipping business requires the right tools to streamline operations, automate tasks, and optimize profitability. From product research and supplier management to pricing automation and customer service, using the best dropshipping tools can give sellers a competitive edge.

Below are the top Amazon dropshipping tools, with AliDrop and Spocket as the best options for sourcing products efficiently.

1. AliDrop – Best for Product Sourcing & Automation

AliDrop is a powerful dropshipping tool that connects sellers with millions of products on AliExpress, allowing them to easily import and automate order fulfillment.

Key Features:

• One-Click Product Import – Easily add products to your Amazon store.
• Automated Order Processing – Orders are sent directly to AliExpress suppliers.
• Custom Store Creation – Build a fully automated dropshipping store.
• No Monthly Fees – A one-time payment makes it cost-effective.

Why Use AliDrop for Amazon Dropshipping?

• Access to a vast product catalog from verified AliExpress suppliers.
• Complete automation reduces manual work.
• No middleman fees, keeping profit margins high.

2. Spocket – Best for Fast US/EU-Based Suppliers

While AliDrop focuses on AliExpress suppliers, Spocket provides access to high-quality, fast-shipping suppliers in the US and EU.

Key Features:

• Faster Shipping – 2-5 day delivery from local suppliers.
• High-Quality Products – Premium selection compared to AliExpress.
• Branded Invoicing – Allows customization to strengthen brand identity.
• Automated Order Fulfillment – Syncs seamlessly with Amazon.

Why Use Spocket for Amazon Dropshipping?

• Ideal for sellers who want fast shipping and better product quality.
• Helps avoid long AliExpress delivery times, reducing refund requests.
• Easier to compete with FBA sellers due to quicker fulfillment.

3. Jungle Scout – Best for Product Research

Jungle Scout helps Amazon sellers find profitable, low-competition products with accurate sales estimates and trend analysis.

Key Features:

• Product Research Tool – Discover trending, high-demand products.
• Sales & Competition Analysis – Estimate monthly revenue and sales trends.
• Keyword Research – Find SEO-optimized keywords for product listings.

Why Use Jungle Scout?

• Helps avoid high-competition products.
• Ensures profitable product selection with real sales data.
• Improves Amazon SEO rankings through keyword optimization.

4. Helium 10 – Best for SEO & Listing Optimization

Helium 10 is an all-in-one Amazon seller tool that helps with keyword research, listing optimization, and competitor analysis.

Key Features:

• Keyword Research Tool – Finds high-ranking Amazon keywords.
• Listing Optimizer – Helps create SEO-friendly product descriptions.
• Competitor Insights – Tracks successful sellers for strategic pricing.

Why Use Helium 10?

• Boosts Amazon rankings, leading to more sales.
• Reduces PPC ad spending by targeting the right keywords.
• Helps outperform competitors with data-driven insights.

5. AutoDS – Best for Price & Inventory Automation

AutoDS is an essential tool for price monitoring and inventory management, ensuring sellers stay competitive and avoid stock issues.

Key Features:

• Price Monitoring – Adjusts prices automatically based on competitor trends.
• Inventory Syncing – Prevents overselling by updating stock levels in real time.
• Auto Order Fulfillment – Sends orders directly to suppliers.

Why Use AutoDS?

• Helps maximize profit margins with price automation.
• Prevents stockouts by syncing supplier inventory with Amazon.
• Saves time by automating order fulfillment.

6. ZonBase – Best for Amazon PPC & Advertising

ZonBase specializes in Amazon PPC (Pay-Per-Click) ad management, helping sellers run profitable ad campaigns without wasting money.

Key Features:

• AI-Driven PPC Optimization – Adjusts bids for maximum ROI.
• Competitor Ad Tracking – See what’s working for top sellers.
• Listing Analyzer – Checks product listings for conversion improvements.

Why Use ZonBase?

• Reduces advertising costs while increasing visibility.
• Helps maximize conversions with optimized ad campaigns.
• Boosts organic traffic, lowering reliance on paid ads.

Conclusion

Amazon dropshipping is a scalable and low-investment business model with high profit potential. By using trusted suppliers like AliDrop and Spocket, sellers can access high-demand products with fast shipping while leveraging Amazon’s massive customer base.

Success depends on choosing profitable products, optimizing listings, and automating fulfillment. While competition is high, using the right SEO, pricing, and marketing strategies ensures sustained growth and profitability. With the right approach, Amazon dropshipping remains a profitable opportunity in 2025 and beyond.