Amazon FBA vs Shopify Dropshipping. Which eCommerce business should you start?
I’ve heard this question more than I could even remember to count.
It is no secret that eCommerce is a very lucrative venture anywhere in the world, even in Nigeria.
Amazon and Shopify happen to be two of the biggest eCommerce platforms in the world, where anyone from anywhere could start a profitable eCommerce business.
eCommerce is what has birthed the concept called dropshipping, which is widely regarded as the arbitrage of eCommerce businesses.
Most eCommerce enthusiasts are usually caught between starting with Amazon or dropshipping with Shopify.
And that is the essence of this post.
In this article we’ll compare and contrast between starting with Amazon FBA or dropshipping with Shopify from Nigeria.
While both options are great, this article will provide more clarity on which is more doable from a Nigerian perspective.
Let’s do a side-by-side comparison on both business ventures.
Product Range
Both Amazon FBA and Shopify dropshipping give you room to sell a wide range of products online.
But there is a little distinction.
While there’s room to sell virtually anything on Amazon FBA by sourcing from a wide range of global stores, Shopify dropshipping could limit how much products range you could offer due to limited supplier contracts.
For example, with Amazon FBA, you could buy from AliExpress, Alibaba, and thousands of other cheap stores to resell on Amazon.
But Shopify dropshipping requires that you have a supplier that automatically receives your customer orders and supplies them.
Shopify offers a supplier marketplace known as Oberlo, which provides opportunities to dropship virtually any product you want.
Yet, there is still a lack of product supply flexibility and quite some limitations when using Oberlo with Shopify dropshipping compared with Amazon FBA.
Startup Costs
Amazon FBA obviously requires you to have your inventory stored with Amazon’s fulfilment centres.
So, you’ll need to make an initial outlay to purchase some products to start with.
On the other hand, Shopify dropshipping doesn’t require you to have any product inventory upfront.
Once you have some products you want to dropship from Oberlo, you can create catalogues for the products on Shopify in a matter of minutes.
When a customer orders for the product on your Shopify website, Shopify would take out your cut and automatically forward the order to the supplier on Oberlo to fulfill.
So essentially, you could start Shopify dropshipping with almost zero capital.
Branding
Amazon FBA is designed around the Amazon brand, which gives little room for personal or business branding.
With Amazon FBA, all your products would be listed on the Amazon website, which gives little room for brand distinction.
On the other hand, Shopify gives you room to build a unique website on a unique domain, and with a unique brand that fits your business.
Customers wouldn’t even know that your business is built on Shopify and around Oberlo dropshipping.
So, if you are particular about branding for your eCommerce business, then Shopify might offer the better option.
Ease of Growth
Now, when it comes to making money on both platforms, which do you think is easier?
Well, Amazon is one of the most popular eCommerce websites in the world. Millions of buyers come to Amazon daily to purchase items.
So, having your products on Amazon gives you way more leverage to start making money ASAP without spending much on a marketing budget.
With Shopify, you are likely starting an eCommerce brand from scratch and would need to invest in marketing at the initial stage.
Operations from Nigeria
Operating an Amazon FBA business from Nigeria would likely be more expensive and difficult to manage than a Shopify dropshipping business.
With Amazon FBA, if you don’t have someone on ground in the U.S. you’d have to get a virtual shipping address and a shipper to help you ship products to Amazon’s fulfilment centers.
Sometimes, you’d also have to deal with customs, which comes with additional costs.
But with Shopify dropshipping, you only have to find the right products from Oberlo and put them up on your Shopify catalogue.
eCommerce vs Passive Income
While both Amazon FBA and Shopify dropshipping are great eCommerce businesses anyday, I’d choose the one that gives me passive income.
The goal is to work less and do more fun things with your time.
Also being from Nigeria, there are just too many limitations that would limit how you maximize the opportunity with Amazon FBA.
So, I’d choose dropshipping with Shopify for the ease of finding and managing products, and making sales.