Can one really make money online by selling stuff on Amazon?
That was the question I set up out to explore when I heard there is a training to teach how you can make money online by buying products from sellers and selling them at a higher price on Amazon. The course claims that you can do this without holding inventory, no need to worry about packing, no shipping required and best of all NO spending on advertisement!
Can this be true? Can one really make money online without all the hassles mentioned about above? Is there a catch? That was what I set up to explore when I attended the free 2 hours Drop Shipping Course Preview conducted by Andy Lee.
First, here is their Make money online pitch
- It is a simple process that even a 62 years old aunty with very little computer skill is able to earn money from amazon ecommerce.
- No spending on Advertisement. You find buyers by optimizing page inside Amazon.
- One just needs to spend 2 hours per day.
- they will show you how to source for profitable products. (This is very key!!)
- Absolutely no need to keep any inventory.
- No packaging, No Shipping, No postage to worry.
- They have many students testimonial where their sales range from 5 figures to 6 figures a year.
Absolutely enticing right? Read on to know the catch…
But how does one make money?
The money making concept is very simple. You look for a seller that is selling on other online e-commerce platforms like ebay and list the exact same item on Amazon. When an Amazon buyer buys what you listed, you simply go over to the seller and buys that product and ask him to ship directly to your Amazon buyer! That’s it! you earn by pocketing the price difference. The technical term for this kind of business is called “ARBITRAGE DROPSHIPPING ECOMMERCE”. Arbitrage means to take advantage of price differences between markets. Drop shipping means to sell a product and then have it shipped directly from the wholesaler or manufacturer.
Wait! Why wouldn’t the Amazon buyer go over to ebay and buy the same product at a cheaper price? It is just a matter of a few clicks, right? They could. But many don’t. Many don’t do research and many tend to stick on a familiar e-commerce website once they trust it. Take me for an example. I buy mainly from Q0010 as I have many successful purchases and is familiar with the whole process. Plus, they have all my credit and shipping records. So there is definitely a barrier for me to buy the same thing from a different e-commerce site.
So what does it take to make some money online via drop shipping?
I have personally talked to a few students (a few aunties and 1 uncle) about this course and asked if they have made their first dollar. Most of them told me that the concept taught by Andy is practical and works. But like many other new skills, one have to put in lots of effort in the first few weeks/months before getting some good traction. But once you have learned the skills and have successfully set up a few items for sale, it is just a matter of finding another product and repeat the process.
Andy (the founder and trainer) told the class that he has over hundred of items listed on both the e-commerce sites (eBay and Amazon) and have an annual turnover of $3.2M. So, with an average of 20% margin, we are looking at ~$600k a year income. Not too shabby I must say. He builds up this level of income over a period of 2 to 3 years.
Here is what I think one need to have to be successful in this:
- Hungry to be successful. It will be painful at the start with steep learning curve. So perseverance is required. Andy says there will be a lot of hand holding and helpers to get the student going. But I dont think it will be a walk in the park.
- Good clean laptop (apparently Amazon tracks your PC IDs) and credit card. Credit card requirement might be an issue for retirees if they don’t have a regular income.
- You will need around ~$2K to $3K for the course fees and around $95 monthly for account management.
After attending the preview and talking to some of the students, I think the concept of making money via arbitrage works. If you google around, you will see many other overseas 3rd parties also offer similar services. Yes, you could learn the concept and method on your own online. But I think one will gain a lot more from LIVE classes since there are quite a bit of detail you need to know. Especially if don’t want to make any mistake and get your Amazon account banned.
If you are keen to find out more about using arbitrage dropping to make some money online, I highly recommend you to go to his preview and check it out yourself. Go to this Andy one as I know there are other local players that are not as good. He holds preview regularly, so can drop me a message and I can PM you on the dates and location.