Most people think of stocking up products and establishing themselves as full-fledged retailers when they consider selling on Amazon. But what if you lack the resources to buy inventory or does not have the storage space to keep it? What if you simply want to float around before diving in?
There are many strategies for selling on Amazon without keeping any inventory. We’ll walk you through each step required about how to sell on Amazon without inventory.
Read on to learn everything you need to know about selling on Amazon without inventory, whether you’re just getting started or seeking for new methods to expand your business.
Benefits of Selling on Amazon Without Inventory
Most tend to associate Amazon with a website where they can purchase almost anything they need, including books, clothes, and technology.
However, many individuals are unaware that Amazon is also a powerful resource for sellers.
For companies wishing to sell without inventory, Amazon has a number of benefits.
This is a game-changer since the conventional strategy of purchasing inventory and then selling it to clients is just not practical for many firms.
Thankfully, there is still a choice: sell stuff on Amazon without inventory. There are various benefits to this type of business model: You should know about the benefits before you learn about how to sell on Amazon without inventory.
- Up-front Investment Not Required
Selling without inventory removes the need to make an upfront investment in stock, releasing cash flow and lowering risk.
- More Flexibility
Businesses can get products through dropshipping from a variety of sources, which can help to maximize profitability.
- More Time for Marketing and Customer Service
Businesses may concentrate on marketing and customer service rather than fulfillment and logistics with a no-inventory approach. In other words, selling on Amazon without stock can be a smart strategy for expanding your business.
- A Huge Consumer Base
One of the biggest advantages is that users have access to Amazon’s large and active consumer base. Amazon gives sellers access to more than 310 million active users, who are many prospective customers.
- Reliable and Secure
Buyers and sellers trust Amazon because of its reputation as a secure and dependable transaction platform.
- Sellers’ Protection
Finally, Amazon provides sellers with security against chargebacks and fraud, reducing risk. Selling stuff on Amazon without inventory can be a great method to launch or expand your business for all of the above reasons and more.
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How to Sell on Amazon without Inventory
There are 4 best ways about how to sell on Amazon without inventory. They are explained with details below:
- Fulfillment by Amazon (FBA)
- Seling Digital Products
- Amazon FBM and Third Party Logistics (3PL)
1. Fulfillment by Amazon (FBA)
Fulfillment by Amazon, or FBA, is the preferred shipping method for the majority of Amazon third-party sellers. FBA is for you if you don’t like packaging products, keeping them in your garage, applying labels (in accordance with Amazon’s specifications), and sending out individual units each time an order comes in.
When your stock is prepared for dispatch under the Amazon FBA program, all you need to do is ship it to the closest fulfillment facility. Following that, Amazon will choose, package, and safely store your products inside a warehouse before delivering them to customers’ addresses.
In other words, you may devote more time and effort to creating a beautiful store and marketing your products both on and off Amazon.
- Increased sales: Amazon FBA Sellers are eligible for two-day free shipping with Amazon Prime. Your product will be more visible to the global audience of more than 200,000,000 Amazon Prime customers, which can lead to increased sales.
- Free of cost customer support: Amazon has a reputation for providing excellent customer service and holds non-FBA sellers to that standard. FBA allows Amazon to handle customer support for you and takes away your responsibility of answering customer questions.
- Access large Amazon storage centres: FBA sellers have safe access to large Amazon fulfillment centers located all over the country. Amazon will pack and ship your products every time an order arrives. You don’t even need to do anything!
FBM (Fulfillment by Merchant) is an alternative to FBA where you list products on Amazon but take care of product storage, packaging, shipping, and customer support on your own. FBA takes precedence over FBM unless you want to sell large or heavy items.
Recently, dropshipping has become more popular for running Amazon business. Dropshipping with Amazon might be an excellent way to start an online business. A consumer purchases one of your products, and you order it from your supplier and have it dispatched directly to the customer. It’s a rather simple process. Dropshipping with Amazon might be an excellent method to start an online business.
Pros of Amazon Dropshipping
- Dropshipping permits you to sell products with no inventory, which means you don’t need to worry about the cost of storage or the possibility of product loss.
- It is easier to start dropshipping as there is no need to buy inventory at the beginning.
- In addition, dropshipping allows you greater flexibility in the items you are able to provide since you’re not restricted by the products you’ve got available.
- Dropshipping can also allow you to sell on different sales channels like Amazon, Walmart, and Etsy as well as your website’s eCommerce or on social media to increase your customers.
- Since all transactions are conducted via the web, and the company or wholesaler handles the fulfillment dropshipping allows you to run your business wherever you have Internet access.
- Because you don’t need to purchase inventory upfront You have more the ability to grow and expand the business you want at your personal speed.
Cons of Amazon Dropshipping
- The competition can make it difficult to find the right items for your eCommerce business.
- Dropshipping is less profitable than selling the products that you have in stock since multiple competitors typically have the same product making it difficult for sellers to lower profits in order to be competitive.
- Furthermore, it could take longer to deliver products through dropshipping, which could result in unhappy customers.
3. Seling Digital Products
Since Amazon is a virtual marketplace, it makes sense that virtual items would be available there. And the absence of physical inventory is one of the best aspects of selling digital products.
Digital products kind of mix the advantages of dropshipping and private label selling, giving you the option to launch an Amazon business (not having to purchase, store, prepare, handle, and ship physical stock).
You can sell the following kinds of digital products on Amazon:
On Amazon, you may sell both physical books and eBooks. Comic books, textbooks, collectibles, hard copies, and other physical books are sold through FBA or FBM. However, the only way to sell digital versions is through Amazon’s Kindle Direct Publishing (also known as KDP) program.
On Amazon, aspiring painters, accomplished photographers, and people with excellent design skills can upload and sell their artwork. Similar to KDP, you don’t need to keep inventory on hand because Amazon will construct a product description page, print your design on various items, ship inventory, and deal with customer support at no additional cost.
Depending on the market and the sort of product, you can get royalties as a creator of digital art work. Visit the official Merch on Amazon page when you’re ready to register for the program. You won’t be able to sell right away because it’s an invite-only platform, but don’t let that discourage you from applying.
Consider yourself to be musician? Create a TuneCore account right now. Apple Music, Spotify, TikTok, and more than 150 streaming and download retailers around the world are just a few of the outlets that TuneCore is meant to help artists, labels, and managers promote their music through.
Start by completing this brief registration form, then begin submitting your music. As long as you follow Amazon’s approved format and style guidelines, you are permitted to distribute music there.
4. Amazon FBM and Third Party Logistics (3PL)
Working with Third Party Logistics (3PL) service providers is necessary if you wish to sell on Amazon without maintaining inventory (and avoid paying the additional Amazon seller fees). These service providers take care of customer service, packing, shipping, and even storage on your behalf (some 3PL service providers offer the package as the FBA program).
when: FBM merchants use third-party fulfillment
- Amazon has inventory storage limitations. You are not allowed to ship all of your inventory to fulfillment centers, or to Amazon.
If working with 3PL service providers is less expensive than using Amazon FBA, you should consider doing so—but don’t rely on it. With one of the largest global logistics networks spanning several continents, Amazon has a wealth of knowledge when it comes to shipping products.
Additionally, if Amazon makes a mistake during the delivery process, they’ll admit it and give you a refund; however, if a 3PL service provider is at fault, Amazon might not be as accommodating.
One of the best methods to earn money online without keeping inventory on hand is through Amazon FBA. Without investing in inventory, it is still feasible to make money, but you won’t be able to build an asset and you won’t be able to grow your business.
Aside from quick money-grab schemes, Amazon dropshipping is a method of making money without investing in inventory that costs thousands of dollars,
With Amazon’s FBA, or Fulfillment by Amazon, program, you no longer need to own a warehouse to operate on the site; instead, Amazon picks, packs, stores, ships, and provides customer service on behalf of independent sellers.
The second choice is to work with a third-party logistics (3PL) service provider who essentially performs what Amazon FBA does. However, it will be challenging to find a 3PL service provider that can match Amazon’s shipping timeframes, provide a better price plan, or both given the size and complexity of Amazon’s logistics infrastructure.
The choice between FBM and Amazon FBA comes down to whether you want Amazon to handle and fulfill your orders or a third-party storage and handling services provider (for sellers who own inventory but don’t want to store it at their premises).
Paying the FBA costs instead of a 3PL service provider makes more sense because you can use the superior shipping services, as well as advertise your products, make new offers, and manage inventory from a single dashboard.