Does Walmart Allow Dropshipping? A Step-by-Step Guide

Does walmart allow dropshipping? dropshipping has become a popular eCommerce business model due to its low start-up costs and convenience. Entrepreneurs can sell products without maintaining inventory, relying instead on suppliers to fulfill orders directly to customers. If you’re interested in dropshipping through Walmart’s platform, this article will provide a comprehensive look at Walmart’s policies and how dropshipping works within its ecosystem.

What Is Dropshipping?

Dropshipping is a retail model where sellers act as intermediaries between customers & suppliers. When a customer orders on the seller’s online store, the seller forwards the order details to a supplier, and who ships the product directly to the customer or buyer. The seller earns a profit based on the difference between the product’s retail price and the supplier’s wholesale cost.

This business model has gained traction due to its minimal overhead costs. Sellers don’t need to invest in inventory or storage facilities, making it a low-risk entry point into eCommerce.

Understanding Walmart Marketplace

Walmart Marketplace is Walmart’s e-Commerce platform that permits 3rd-party sellers to list & sell products directly to Walmart customers. Unlike Amazon, Walmart Marketplace has stricter policies & a more selective onboarding method. Sellers need to meet high standards for product quality, shipping efficiency, and customer service.

While Walmart Marketplace enables third-party selling, it’s important to distinguish between Walmart as a dropshipping supplier and Walmart Marketplace as a platform for listing your products.

Does Walmart Allow Dropshipping?

The short answer is yes, but with restrictions. Walmart allows dropshipping in two main ways:

1. Dropshipping as a Supplier: You can use Walmart’s inventory to fulfill your orders. This approach involves purchasing products from Walmart and having them shipped directly to your customers. While this is technically allowed, it comes with limitations, such as price markups and compliance with Walmart’s terms of service.
2. Dropshipping on Walmart Marketplace: As a seller on Walmart Marketplace, you can list products that are fulfilled by third-party suppliers. However, you must comply with Walmart’s stringent policies regarding customer satisfaction, shipping timelines, and product authenticity.

Dropshipping from Walmart as a Supplier

Using Walmart as a supplier for dropshipping involves purchasing products from Walmart’s website and shipping them to your customers. This system is often referred to as “retail arbitrage” dropshipping. While possible, it’s not always a sustainable or scalable option due to several challenges:

• Pricing: Walmart’s competitive pricing makes it difficult to achieve significant profit margins when reselling its products.
• Policy Violations: Reselling Walmart products without explicit permission can lead to account suspensions on platforms like Amazon or eBay.
• Customer Experience: Walmart-branded packaging can confuse customers and harm your brand image.

Dropshipping on Walmart Marketplace

If you wish to become a seller on Walmart Marketplace, you can use a dropshipping model by partnering with third-party suppliers. This approach aligns more closely with Walmart’s policies, but there are specific requirements you must meet:

1. Seller Application and Approval: Walmart requires prospective sellers to apply for a Marketplace account. The application process involves sharing your business details, product categories, and eCommerce experience. Only reputable sellers with a track record of quality service are approved.
2. Product Quality Standards: Walmart expects sellers to offer high-quality products. This includes accurate product descriptions, clear images, and compliance with U.S. safety standards.
3. Shipping and Fulfillment Requirements: Timely order fulfillment is crucial. Sellers must provide tracking information and adhere to Walmart’s shipping policies, including free two-day shipping for eligible items.
4. Customer Service: Walmart prioritizes customer satisfaction. Sellers must respond promptly to customer inquiries and resolve issues efficiently. Negative reviews or bad performance metrics can lead to account suspension.

Benefits of Dropshipping on Walmart Marketplace

Selling on Walmart Marketplace through a dropshipping model offers several advantages:

• Wide Customer Base: Walmart is a trusted brand with millions of active online shoppers. Listing your products on its platform provides exposure to a vast audience.
• Lower Overheads: As a drop shipper, you don’t needs to invest in inventory or warehousing.
• Scalability: By partnering with reliable suppliers, you can expand your product catalog and scale your business quickly.

Challenges of Dropshipping on Walmart Marketplace

While dropshipping on Walmart Marketplace has its benefits, it also comes with challenges:

1. Strict Compliance Requirements: Walmart’s policies are more rigid than other eCommerce platforms. Sellers must maintain high performance standards to avoid penalties.
2. High Competition: Walmart’s competitive pricing strategy makes it challenging for new sellers to stand out and attract customers.
3. Profit Margins: Dropshipping inherently has lower profit margins compared to wholesale or private label models. Sellers must carefully select products with a healthy markup to remain profitable.
4. Supplier Reliability: Partnering with unreliable suppliers can lead to delayed shipments, stockouts, and customer complaints. Vet your suppliers thoroughly before listing their products on Walmart Marketplace.

How to Start Dropshipping on Walmart Marketplace

Here’s a step-by-step guide to get started with dropshipping on Walmart Marketplace:

1. Apply for a Seller Account:
   • Visit the Walmart Marketplace application page and complete the application form. Include details about your business, product categories, & operational capabilitie.
2. Partner with Reliable Suppliers:
   • Select suppliers with a proven track record of timely order fulfillments & high-quality products. Tools like Spocket, Oberlo, or CJDropshipping can help you connect with reliable suppliers.
3. Optimize Product Listings:
   • Create accurate and appealing product listings. Use high-resolution images, detailed descriptions, and keywords to improve visibility.
4. Integrate with Walmart’s Systems:
   • Use Walmart’s APIs or third-party integrations like Shopify or Deliverr to manage inventory, pricing, and order fulfillment.
5. Monitor Performance Metrics:
   • Track your seller metrics closely, including on-time shipping rates, customer feedback, and return rates. Regularly review and adjust your operations to meet Walmart’s performance standards.

Alternative Approaches: Walmart Fulfillment Services (WFS)

If you want to simplify logistics, consider using Walmart Fulfillment Services (WFS). WFS is Walmart’s version of Fulfilled by Amazon (FBA), where Walmart stores and ships your products. While this isn’t traditional dropshipping, it eliminates the need for you to manage shipping, allowing you to focus on product selection and marketing.

Conclusion

Does Walmart allow dropshipping? but success on the platform requires careful planning and strict adherence to its policies. Whether you’re leveraging Walmart as a supplier or selling through Walmart Marketplace, focus on maintaining product quality, timely shipping, and excellent customer service.

While the business model presents challenges, it also offers significant opportunities for entrepreneurs willing to invest time and effort into building a reliable and reputable operation. By understanding does Walmart allow dropshipping rules and setting up a robust dropshipping system, you can tap into one of the world’s largest retail ecosystems and build a profitable eCommerce business.