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Let’s Imagine that you have decided to launch an e-commerce business on Amazon (we hope it’s not just out imagination!). One of the most vital choices that you have to make and which will have a colossal impact on your entire operation, is choosing the right business model. For making the right decision, first you should be aware of the type of Amazon business models that exist, and learn the main differences between them.

For building a successful business on Amazon, you have to figure out which Amazon business model suits you more; therefore, we recommend that you read our Oceanic Zoo blog in order to have a better understanding about all the minor details that you should consider when you are jumping into this industry.

Here They Are!

First of all, we would like to stress that Amazon provides its sellers with tons of opportunities for starting a business on its platform. That’s because the more you succeed, the more money Amazon will have. Therefore, there are lots of Amazon business models and all you need to do as a seller is to choose the one which suites you more. Currently, there are nearly six varieties of Amazon’s business models:

  • Private Label
  • Wholesale
  • Retail Arbitrage
  • Online Arbitrage
  • Dropshipping
  • Handmade

Private Label

With more than 73% users, Private Label is one of the most popular and widely used Amazon business models. Even Amazon sells private label products with its Amazon Essentials products. Running Private Label on Amazon is quite simple. You buy unlabeled products in bulk, and put your logo or the name of a brand on it. For launching a Private Label business on Amazon, you should implement the following actions:

  • To research the Amazon market in order to understand which kind of products are high-demanded among Amazon’s sellers
  • Reach out to the manufacturer for creating products
  • Create new listings
  • Promote your products on Amazon

If you want to simplify this process, we highly   recommend that you use FBA. In this case, Amazon takes care of lots of crucial aspects such as storage, packing, and shipping.


Another popular business model among Amazon sellers is Wholesale, since it allows the seller to run a safe and, at the same time, profitable business on Amazon. The entire process of wholesaling consists of a few simple steps:

  • First, you should find wholesale suppliers
  • You purchase low-cost products in bulk
  • Resell them as individual units on Amazon

Retail Arbitrage

If you decide to start doing Retail Arbitrage on Amazon, you should prepare yourself. This business model is one of the easiest and most dangerous ones at the same time. With this business model, your main way of sourcing is through brick-and-mortar stores. You find low-cost products and resell them through Amazon; the difference between two prices will be your profit.

Online Arbitrage

There is not much difference between Retail and Online Arbitrage. The main concept is the same; however, with Online Arbitrage, you are sourcing goods from online marketplaces and websites. Again, the difference between prices will be your revenue. However, you should be extra careful with these two business models, since once Amazon decides to check your supply chain and ask you to provide invoices, you risk facing serious issues within your business.


Dropshipping on Amazon is one of the easiest ways to build your e-commerce business without putting much effort and investment. Here you should not keep your inventory; all you need to do is to list products, and once you get the order, transfer them to your consumers. However, before jumping into this business, try to ensure that you find high-demanded products, and that the suppliers with whom you are going to work are valid and trustworthy.


If you are a talented person who creates unique and interesting products, and also wants to make a profit from them, then the Handmade business model is what you really need. Everything, from jewelry to home décor, is allowed to be sold in this segment. Just create listings for your unique products and get the ball rolling!

Amazon provides its sellers with a wide chain of business models; all you need to do is to choose the best one which will help you succeed in your e-commerce business. Nowadays, there are lots of professional services which help sellers launch their business on Amazon by choosing the best options; therefore, it is better to consult a professional who will guide you in the right direction before taking any actions.

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