Direct Sales Model
The Completely Passive Income Model
In Dropshipping, our team will run your entire business with no marketing expense and no inventory. We open distributor contracts with dropship vendors in the USA for your store. We list their products on your storefront and every time you get an order, the vendor will ship the product directly to the customer. We only pay the vendors after they’ve shipped the products which means you never buy inventory in this business model. It’s the lowest-risk model you can run on Amazon.
Features At A Glance:
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Our team will open multiple distributor contracts to ensure we diversify our product offering. Your store will sell products from multiple niches such as Cosmetics, Pet Supplies, Appliances, Electronics, and more.
Dropshipping stores are easier to scale compared to FBA stores due to the simplicity of the business model. The supplier is handling 100% of fulfillment so we can list up a large product catalog and make profit on what sells, however the supplier will charge a premium for this luxury which is why your average ROI will be between 20-25% compared to a minimum ROI of 25-30% in FBA
When Amazon's compliance department asks to verify our account with distributors or asks where we source products from, we can easily provide Distributor Names, Invoices, Letters Of Authorization From Brands, Account Numbers, Contracts, and more.
Don't want to buy products and take on inventory risk? You're in the right place. This program is designed to carry minimal operating risk so you never purchase inventory unless we've already sold it. Anytime you pay for a product, it's guaranteed ROI
No middle-man warehouse needed. Our vendors will ship your products directly to the customer. Most vendors we use have the same shipping guarantees as Amazon with same day or one day shipping.
Dropshipping stores are easier to scale compared to FBA stores due to the simplicity of the business model.
Although they achieve higher revenues, they do have a smaller average margin compared to FBA.
Rest assured this is 100% a passive investment. Our team of hundreds of experts will handle listing products on your business, repricing listings, placing orders with distributors, customer service, and everything else in between
At any point in time, you can login to your client portal and see exactly which brands we have applied to be authorized distributors for, which brands we have been approved for, sales data, and all other relevant information for your business.
We work with nothing but the top tier brands in the USA. When we sell their products, we don't need to pay to advertise. The brands will handle all the marketing for us
We don't have returns ship to our Clients home like other agencies do. All your warehouse needs are included in our programs free of charge. This includes return processing, product inspection, fulfillment of returns, and much more
League Of Ecom has all the required documentation to get your business ungated for top tier brands and restricted categories.
*Note: We've seen many agencies claim they can get your business ungated for specific brands, however being ungated for a brand on Amazon DOES NOT mean you you have approval to sell their products. Your business still need a distributor contract with an authorized retailer to sell branded products
We Don't Believe In A Cookie-Cutter Business Model.
Each store we accept into our programs is tailored towards the Client. First we need to understand what your goal for the business is. Is it to grow your wealth? Is it to be a supplemental form of income, or are you looking to replace your income entirely? What are your profit goals per month? Contact us and our Leadership Team will sit down with you to understand your current financial situation and where we can help!
Once we understand exactly what your needs are, we will curate a custom business plan given the current season, contracts available, and a handful of other important factors to finalize a working capital amount. This way once the business is active, there is no miscommunication with expectations
Why Engaging With Us Makes Business And Financial Sense, With A No-Risk Guarantee.
Financing Available Through American Express
Even if you're a brand new corporation, our American Express Reps can secure over $100,000 in business credit for your corporation
100% Amazon Approved Model
Our dropshipping program is the ONLY ONE available that is 100% legal on Amazon. We use authentic distributors in the USA with all the proper licensing and documentation to dropship brand name items.
Exclusive USA-Based Dropship Distributors
We are the only agency in the USA that is licensed to dropship popular brands such as Dell, Lenovo, Samsung, Belkin, and thousands more.
24 Month Money-Back Guarantee
We are confident in our ability to build you a profitable passive income asset which is why we offer a 24 Month Money-Back Guarantee
Picking The Right Program For You
Compare Both A Dropshipping and FBA Fulfillment Model And See What’s Best For You.
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Must have $25,000 in credit available or have a minimum credit score of 710 to qualify
When you sell a product on Amazon, the revenue generated from the sale is not immediately deposited into your bank account. Amazon holds your funds inside of your Amazon Account until the product has been delivered AND a couple days have passed. This allows Amazon customers time to raise any concerns if your product is counterfeit or if they received a box full of rocks.
Once a few days pass with no red flags raised, Amazon will pay you. This is why credit is important in this business model. You need to be have enough credit to sustain sales from the day we order a product to the day it delivers, plus a few more days. We exclusively use USA-based distributors so all your products will have same day or one day shipping.
If you have a good credit score or a lot of available credit you don’t currently use, then this program would be the most beneficial for you.
To operate a Dropshipping business, we require a minimum of $25,000 in lines of credit (American Express, Visa, Mastercard, etc) to cover product cost. Since we only order products AFTER they have sold, each purchase on your credit card is guaranteed ROI.
The more credit you have available, the higher we can scale your business.
*This does not include initial start-up cost
In almost all cases, only products fulfilled by Amazon themselves have Prime Shipping. Since Dropshipping products are shipped from a third party distributor, dropshipping products are not eligible for Prime Shipping.
The ability to sell Prime products is a deal-breaker for many clients which is why they opt into our FBA Program instead of Dropshipping
Dropshipping stores are easier to scale compared to FBA stores due to the simplicity of the business model. FBA requires shipping to warehouses and waiting for shipping times while Dropshipping only requires us to conduct analytics and list profitable products.
The downside of having a supplier handle 100% of your fulfillment is you don't have control over your inventory or inventory levels which opens up risk for selling products which are out of stock, shipment delays, etc.
Although you can achieve a higher revenue in this business model, you do have a smaller ROI compared to FBA.
Dropshipping is no doubt the SAFEST way to scale an Amazon business when it comes to operating risk. We never buy inventory in this model so if we hypothetically listed 10,000 products on your store and only 5000 sell, there is no loss. Even if none sell, there is still no loss. It does not cost money to list products and since we aren't holding inventory in our own warehouse or Amazon's warehouse, there is no storage fees or any other associated fees
There are many key aspects in this fulfillment model where we rely on third-party companies. The distributors we open contracts with house the inventory in their warehouses and we rely on their stock updates to ensure we only sell products which are in stock.
We rely on distributors to ship products on time and ensure packages are picked up by carriers, products are not damaged, etc.
These distributors are large, professional corporations in the USA, however mistakes do happen and when they do, Amazon will look to us for answers since we are the ones operating the Amazon account, not the distributor. With many factors out of our control, this model is more prone to minor problems such as products delivering late, damaged goods, etc. Rest assured, we are in constant communication with distributors and customers to prevent any of these issues and take a pro-active approach to your ensure your business scales smoothly.
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In recent months, we have seen a large surge of investors new to e-commerce under the impression they can run an FBA business using a credit card, line of credit, etc. What's worse is we've seen other agencies continue to feed these lies to investors and once the business starts, it comes crumbling down quickly. We wrote a blog on using credit for FBA and why it's a very bad decision to do so. The full article can be found in the "News" section of our website. For your convenience, a summary is below:
From the moment you pay for a product, it can take up to 15 days for it to reach Amazon's fulfillment center and be active for sales. It is impossible to sell out of all FBA inventory, have each order deliver, wait a few days to receive the payout from Amazon, and pay off a credit card bill all in the remaining 15 days until your statement is due.
The average Inventory Cycle is about 6-8 weeks. From the moment you pay for inventory, you should expect to fully realize the ROI within 30 days of the product reaching an Amazon fulfillment center (estimating a 30 day sellout time, plus 1-2 weeks to receive the last payment).
You do NOT want to pay interest on a Wholesale Purchase which is why FBA is a cash based program. You will pay for inventory by sending wire transfers directly to brands.
Rare exceptions to this are outlined in the article.
To scale an FBA business, we require a minimum of $20,000 in operating cash, however we aren’t starting the business off with a $20,000 inventory purchase.
First, we need to verify analytics to make sure we have accurate sell out times, then start to scale. The first few months we are ordering a large variety of small batches of products. Every store gets at least a dozen products to start. Larger stores can get up to 2-3 dozen products
Once we verify analytics with these small batches, we can test more products and repurchase previous inventory in larger quantities. At the end of every inventory cycle, we are reinvesting that capital back into the business to reorder inventory so the store can grow organically.
Below is your estimated inventory spend per month during each phase of your business. Remember you can reinvest capital from previous months back into your business:
Months 1-3: $5000 Minimum
Months 4-6: $10,000 Minimum
Months 7-9: $20,000 Minimum
*This does not include initial start-up cost
In almost all cases, only products fulfilled by Amazon themselves have Prime Shipping. In FBA, we are ordering products wholesale and delivering them to an Amazon facility to Amazon can fulfill each order, hence the name FBA (Fulfilled By Amazon). All products sold in this program are eligible for Prime shipping.
FBA is a bit slower to scale compared to dropshipping due to the nature of a wholesale business model. We need to wait for shipments to deliver to the proper warehouse, product prep, and Amazon must process the inventory before its active for sale.
The plus side of this is we get a larger ROI as mentioned below, but it also becomes a more stable business compared to dropshipping. Since we have guaranteed inventory, it's impossible to sell "out of stock" products and since Amazon is handling 100% of fulfillment, they take full responsibility if products are damaged in transit, delivered to the wrong address, etc. You don't get the same protections in dropshipping as you do with FBA.
When you purchase inventory, you take on inventory risk. There is no way around it, however we can mitigate this risk in multiple ways.
- Contract Terms: Each contract we open for your business includes clauses which allow is to either return products, sell to brick and mortar locations, liquidate on other marketplaces, sell to other Amazon sellers, and more. We never have clients sit on inventory that doesn't sell.
- 30 Day Sell Out Time: At no point in time will your business have more than 30 days worth of stock. By limiting inventory to 30 days worth, we can easily adjust and scale up or scale down products as needed.
- Each product has over 24 points of analytics we review to ensure we mitigate risk as much as possible. These analytics are shared with you inside of the Client Portal before every purchase.
FBA is the most stable form of fulfillment. We are purchasing a set amount of inventory and this inventory is counted and logged upon shipment from the distributor, entrance into our facility (if product prep is needed), leaving our facility (if product prep is needed), and Amazon does a final inventory count before making the listing active.
It is impossible to oversell inventory or not have enough stock for orders. Returns and customers service are handled 100% by Amazon. If your customer has any issues, they will be instructed to contact Amazon Customer Support directly. With Amazon handling this part of the business, it creates stability in the model and makes it sustainable long term.
Our Pricing Model And Options
Start Up Fee And Profit Sharing
We Make Money Together
Your Start-Up Fee covers all your initial business expenses including your corporation establishment, business licencing, website hosting / domain / SSL certificate, distributor contract labor and contract application fees. Once this payment is complete, we have a profit sharing split of 65 / 35 (65 Yours/35 Ours).
We do not collect profit sharing for the first six months of the program. The Start Up fee covers all expenses excluding products for the first six months. For exact pricing information, please contact us, schedule a meeting, or join one of our free webinars below