Can you dropship private label products?

Q&A ProCategory: Amazon SellersCan you dropship private label products?
Luvenia Galland asked 4 years ago
1 Answers
Dani Avitz Staff answered 4 years ago
Although private label products may provide greater opportunity, they are riskier than branded products. Here’s why:
  1. They are typically more expensive, since you need to find a product, purchase it in bulk, store it in a warehouse and brand it.
  2. Building your private brand takes a lot of time, and it will be a while before you see positive results.
  3. Private label products are generally less trusted than the more familiar branded products. Therefore, they are tougher to sell.
Dropshipping, in comparison, requires much less financial commitment. When a customer buys your product, you simply forward the order to your manufacturer, who will then fulfill the order for you. But the lower investment comes with disadvantages: You must rely on your manufacturer and profit margins are usually lower.As you can see, dropshipping is basically just a different form of order fulfillment. So it is possible to dropship private label products. The difference to the ‘ordinary way’ of private labeling is that you do not purchase the products from your supplier in bulk. This avoids large upfront investments and saves you the cost of having to store the products in a warehouse.However, it might be difficult to find a manufacturer who is willing to do this. It is likely that you first need to start building a long-term and mutually beneficial relationship with your supplier. Once you have such a relationship established, the supplier is likely to trust you and will be willing to manufacture your products just-in-time. Besides, not every type of product is suitable for dropshipping because the product needs to be able to be produced quickly.If you want to take the guesswork out of researching your next best-selling product, you should take a look at Algopix. It’s a product market research platform supporting a total of 16 marketplaces, including Amazon, eBay and Walmart. The advanced algorithms provide actionable insights such as the recommended market price, a detailed expenses breakdown, a competition analysis, the product demand level and profit as well as sales estimations.Make better decisions about what to buy and where to sell with Algopix!