Amazon Dropshipping in India: Start, Scale & Succeed with Zero Inventory

Published on: October 27, 2025

If you want to start an online business without buying stock or don’t want to take the burden of storage and shipping, then Dropshipping is one of the best options. You need to list products on Amazon, and when someone buys from your listing, your supplier ships directly to them. You keep the profit without ever physically touching the product.

In 2025, Amazon India will allow dropshipping, but you need to follow some strict rules. If you do it right, you can build a profitable business with low risk and zero inventory. This guide helps you to set up, find suppliers, list products, and scale smartly.

What Is Amazon Dropshipping?

Amazon dropshipping is a business model where you sell products on Amazon without physically storing the product. When a customer places an order, forward it to your supplier. Who then packs the product and ships it directly to the buyer. You act as the middleman and earn the difference between your selling price and the supplier’s cost.

Learn More: How to Start a Dropshipping Business: Step-by-Step Guide

Is Dropshipping Allowed on Amazon India?

Yes, but with some conditions. Amazon has a strict Drop Shipping Policy. You must be the seller of record, meaning your business name appears on all invoices, packing slips, and shipping labels—not your supplier’s. The customer should always see you as the seller, never a third party.

What Amazon Allows

You’re listed as the seller on all documents and packaging.
Use neutral or your own branded packaging with no supplier names visible.
Have a clear written agreement with your supplier stating you’re the seller of record.
Handle all customer service, returns, and complaints yourself.
Follow Amazon’s terms of service and all policies without exception.

What Amazon Does NOT Allow

Buying from another retailer (like Flipkart or another Amazon seller) and shipping directly to customers.
Packaging or documents showing another company’s name, logo, or contact details.
Anything that confuses the customer about who the real seller is.

Legal Requirements to Start Dropshipping in India

GST Registration: You must have a valid GST number to sell on Amazon India—no exceptions, even if your turnover is low. You’ll charge GST on every sale and file monthly or quarterly returns.
Business Registration: Register your business as a sole proprietorship, partnership, LLP, or private limited company. It builds trust and makes supplier relationships easier.
PAN Card: Required for GST registration and opening your Amazon seller account.
Business Bank Account: You need a current account in your business name to receive payments from Amazon.
Import Export Code (IEC): If you source products from outside India, you need an IEC from DGFT. It’s a 10-digit code that lets you import goods legally. The online application costs around ₹500.

Learn More: Top 10 Best Dropshipping Business Ideas 2025

Step-by-Step: How to Start Amazon Dropshipping in India

Step 1: Register Your Business and Get GST

Choose your business structure, register locally, and apply for GST on the GST portal. You’ll need your PAN, address proof, and bank details. You’ll get your GSTIN in a few days.

Step 2: Open an Amazon Seller Account

Go to Amazon Seller Central India, click “Register Now,” and provide your business name, GST number, PAN, bank details, and contact info. Complete the verification and you’re in.

Step 3: Find Reliable Suppliers

Look for suppliers on Qikink, IndiaMART, TradeIndia, or Alibaba if you’re sourcing internationally. Check product quality by ordering samples. Negotiate pricing and get a written agreement that you’re the seller of record with no third-party branding on shipments.

Step 4: Research Winning Products

Use tools like Jungle Scout, Helium 10, or Amazon’s Best Seller lists to find products with good demand, manageable competition, and healthy margins. Avoid restricted items like medicines, weapons, and counterfeit goods.

Step 5: Create Product Listings

Write clear, keyword-rich titles that describe what you’re selling.
Upload high-quality images showing the product from multiple angles.
Use bullet points to highlight key features and benefits.
Add detailed descriptions with specs, size charts, or usage instructions.
Amazon’s “Enhance My Listing” AI tool can help improve your copy.

Step 6: Price Competitively

Calculate all costs: product cost, Amazon fees (referral and closing fees), shipping, packaging, GST, and payment gateway charges. Add your profit margin, then compare with competitors and adjust to stay competitive without losing money.

Step 7: Fulfill Orders Smoothly

When an order comes in, forward the details to your supplier immediately. Make sure they ship with your business name on all documents and packaging. Update the tracking info on Amazon so customers can track their orders.

Step 8: Manage Customer Service and Returns

Reply quickly to customer questions. Handle returns per Amazon’s policy. Work closely with your supplier to fix any quality or delivery issues before they hurt your ratings.

Amazon Dropshipping in India Key Costs to Budget For

Amazon Referral Fee: 5-20% per sale, depending on category.
Closing Fee: ₹20-₹50 per order in some categories.
Shipping Costs: Paid to supplier or courier.
GST: 5-28% based on product type.
Payment Gateway Fee: Around 2-3%.
Return Shipping: You may cover reverse logistics if customers return items.

Common Challenges

High Competition: You’re competing with thousands of sellers, including Amazon itself.
Thin Margins: Fees and shipping costs can eat into profits, especially on cheap items.
Supplier Issues: Late shipments or poor quality hurt your seller ratings.
Strict Policies: One violation can lead to account suspension.
No Inventory Control: If your supplier runs out of stock, you can’t fulfill orders.

Tips to Succeed

Pick a Niche: Focus on specific product categories where you can build knowledge and differentiate.
Test Small: Start with a few products, see what works, then scale the winners.
Build Supplier Relationships: Communicate clearly and negotiate better terms as you grow.
Optimize for Amazon Search: Use relevant keywords in titles, bullets, and descriptions.
Watch Your Metrics: Track order defect rate, late shipment rate, and customer feedback.
Use Amazon Ads: Sponsored Products ads boost visibility.
Deliver Great Service: Fast replies and smooth returns lead to better reviews and repeat buyers.

Amazon Dropshipping in India: Pros and Cons

Pros

Low startup cost—no inventory to buy upfront.
No warehouse needed—suppliers handle storage and shipping.
Test multiple products quickly.
Access to Amazon’s huge customer base.
Easy to scale as you grow.

Cons

Thin profit margins due to fees and competition.
Dependent on supplier reliability.
Strict Amazon policies—account suspension is a real risk.
Hard to build a unique brand with generic products.
You handle customer complaints even though you don’t control fulfillment.

Helpful Tools

Jungle Scout: Product research and competition analysis.
Helium 10: Keywords, listing optimization, profitability calculator.
Qikink: Indian supplier for print-on-demand and dropshipping.
Amazon Seller Central: Your dashboard for listings, orders, and performance.
Google Sheets/Excel: Track costs, margins, and supplier stock.

Conclusion

Amazon dropshipping in India is a real way to start an online business with minimal investment and no inventory hassles. You can make it a successful online business. Although success depends on following Amazon’s strict policies, working with reliable suppliers, researching profitable products, and delivering excellent customer service.

Stay compliant with GST and business registration. Start small, test products, optimize your listings, and scale gradually. With the right approach, patience, and consistent effort, you can build a profitable dropshipping business on Amazon in 2025 and beyond.

FAQs: Amazon Dropshipping in India

Is dropshipping legal in India?
Yes, as long as you comply with GST, tax laws, and Amazon’s policies.
Do I need GST to sell on Amazon?
Yes, GST registration is mandatory for all sellers on Amazon India.
Can I dropship from China via Amazon?
Yes, but you need an IEC code, and you must follow customs rules and Amazon’s seller-of-record policy.
How much money do I need to start?
You can start with ₹10,000-₹50,000 to cover seller registration, tools, marketing, and working capital.
What products should I avoid?
Stay away from medicines, weapons, counterfeit goods, and anything requiring special licenses.
Can I use Amazon FBA for dropshipping?
FBA is different. With FBA, you send inventory to Amazon’s warehouses. Dropshipping means your supplier ships directly to customers.
How do I find good suppliers?
Use Qikink, IndiaMART, TradeIndia, or contact manufacturers directly. Always order samples before committing.
What if my supplier ships late?
Late shipments hurt your seller rating. Have backup suppliers and notify customers quickly if there’s a delay.