Amazon Sellers Lawyer – Paralegal Discussions – What Sellers NEED to KNOW About DROPSHIPPING in 2021
Anthony – Hello, everyone. Welcome to another session of our Amazon Sellers Lawyer paralegal discussions. Today, we’re talking about dropshipping because dropshipping has been a very hot topic throughout Amazon’s selling history. A lot of sellers are dropshippers and we actually see a lot of clients who are dropshippers. So we’re going to go around the room and get everybody’s opinion on it.
Briana – So a big indication at Amazon on someone who is dropshipping is when someone is not identified as the seller of record on their products. If a customer is expecting something from you as a seller and they receive their package but it’s in a Walmart box and they raise concern on that, you’re going to get a dropshipping violation from Amazon. So even if you do source your products from Walmart, from Sam’s Club, from Barnes and Nobles, wherever you source your products from, it’s really important that you ensure you’re the seller of record. So all your packing slips, your packaging, everything should say your brand’s / store’s name and no one else’s because that’s the biggest indication to Amazon that you are dropshipping.
Chris – Amazon’s made a really big effort recently to crack down on dropshipping. Make sure that your invoices predate your customer orders. If you have a customer that orders from you on the 10th, you want to make sure you have received merchandise that you’re going to sell before the 10th.
Max – You should also ensure that you are the one processing customer returns. You shouldn’t be letting a third party do it. You need to be in charge of processing complaints of damaged goods and, really, any customer concerns. It can’t be anyone else’s job. It has to be you.
Anthony – Just to get everyone’s general feeling, on a scale of one to five, what do you think of the chance of likelihood of Amazon actually detecting dropshipping on a dropshipper, from your experience? I will go first. I think I will give it a four out of five that, if you’re dropshipping, you’re very likely to be detected.
Chris – I think so as well. I think you’re very likely to get caught and you want to make sure that you don’t open yourself up to bigger problems with Amazon by trying to get away with it, by falsifying some documents to make it work for you.
Anthony – What about you Max? In your experience, what are some ways that you think dropshippers could get into trouble with Amazon?
Max – If there’s any sort of problem along the line – from where you’re sourcing from, to the customer, and you’re not the one receiving that call, then it’s going to be a red flag for Amazon, especially now that they’re cracking down.
Anthony – Especially if the customer receives a package that, like Briana was saying before, that says Walmart on it instead of Amazon or your company, they could very well just inform Amazon on that and Amazon will be onto it.
Brian – Amazon is a customer-centric platform. So with enough customer complaints on the same issue, they will take the time out to figure out what’s causing it and you will receive a notification. So back onto that last question out of five, definitely a 4.5. You guys were generous.
Anthony – I think all of you are right. Amazon does have systems in place to detect dropshipping, not only from customer reports, but also through various metrics on their accounts. These things could be measured. I want to just talk about how you could avoid dropshipping violations or how to actually dropship property because Amazon actually allows … I wouldn’t say drop shipping, per se, but somewhat similar to dropshipping where if you are ordering a product and then repackaging the product and then shipping it to the customers after you receive the order for that product on Amazon, it’s similar to dropshipping where you don’t have the product, the inventory, but you are able to source the product after you receive the order. Then, by making sure that none of the third party’s information and logos are on the product before you ship it to the Amazon customer, that is a way to ensure the legitimate form of dropshipping that Amazon allows.