Quick answer: Amazon allows dropshipping only when you are the seller of record and nobody else is identified on packing slips, invoices, or packaging. Buying from another retailer, including Amazon or another Amazon seller, and having them ship directly to your customer is strictly prohibited. Online arbitrage itself is not banned, but retail receipts often cannot prove authenticity the way supplier invoices do. When an account is suspended, the Business Solutions Agreement lets Amazon withhold payments while it determines risks persist. Getting funds released depends on resolving the suspension or the violation behind it.
Arbitrage and dropshipping sellers are suspended for reasons that are easy to miss: a retailer’s packing slip in the box, a supplier’s name on the package, or documents Amazon cannot verify. This guide explains Amazon’s rules and what to do when your funds are being held, based on Amazon’s policies.
Amazon’s Drop Shipping Policy
Amazon states that drop shipping, allowing a third party to fulfill orders on your behalf, is not acceptable unless it is clear to the customer that you are the seller of record. Amazon lists these as violations:
- Buying products from a third party, including Amazon or another seller, and having that third party ship directly to customers when the shipment does not identify you as seller of record or shows anyone else on packing slips, invoices, or packaging. Amazon says this is strictly prohibited without exception.
- Shipping orders with packing slips, invoices, packaging, or other information showing a seller name or contact information other than your own.
What a compliant dropship setup needs
If you use another company’s fulfillment service, a third-party logistics company, or a drop shipper, Amazon requires that you:
- Have an agreement with your supplier where you are the only seller of record and the only entity identified on packing slips, invoices, packaging, and any information provided with the products
- Remove any packing slips, invoices, packaging, or information identifying a different seller or supplier before shipping
- Remain responsible for accepting and processing customer returns and comply with the Business Solutions Agreement and Amazon policies
Amazon says violations may result in a restriction of your ability to sell using the Merchant Fulfilled Network.
Arbitrage vs Dropshipping: Where the Risks Are
| Model | Main Amazon risk | What Amazon looks for |
|---|---|---|
| Retail arbitrage shipped to customers by the retailer | Violates the drop shipping policy | You must be the seller of record with no other seller identified |
| Online arbitrage stock you hold and ship yourself or via FBA | Authenticity and IP complaints | Records showing authenticity or authorization, such as invoices |
| Wholesale dropshipping with a supplier agreement | Packaging or paperwork naming the supplier | A supplier agreement making you the only seller of record |
Why Funds Get Held
The Business Solutions Agreement allows Amazon to withhold payments for as long as it determines that risks persist where your actions or performance may result in returns, chargebacks, claims, disputes, policy violations, legal violations, or other risks. It also says that to be eligible for disbursement you must refrain from deceptive, fraudulent, or illegal activity and stay compliant with Amazon’s Program Policies.
For authenticity cases, Amazon’s Anti-Counterfeiting Policy says Amazon does not pay sellers until it is confident customers received authentic products, and may withhold payments if an account sold inauthentic goods.
How to Get Your Money Back
Resolve the violation first
Funds follow the account. Appeal from the Account Health page with the root cause, the changes you made, and how you will prevent it from happening again.
For drop shipping violations
Explain how orders were being fulfilled, stop any fulfillment that identified another seller, and show the new process: a supplier agreement naming you as sole seller of record, removal of third-party paperwork, and your returns process.
For authenticity complaints
Provide supplier invoices covering the ASINs and timeframe requested. Amazon allows pricing to be removed, but no other edits. If you only have retail receipts, be honest about it, and show how you will source going forward.
Keep fulfilling and refunding
Amazon’s A-to-z Guarantee policy says claims can be granted automatically if an account is deactivated while orders are outstanding or customers have issues, so keep handling open orders and returns where you can.
Our Amazon suspension and reinstatement team handles arbitrage and dropshipping suspensions. If funds are held through a payment processor rather than Amazon, see our merchant processor disputes service.
Frequently Asked Questions
Is dropshipping allowed on Amazon?
Only when you are the seller of record and no other seller is identified on packing slips, invoices, or packaging.
Can I buy from another retailer and have them ship to my Amazon customer?
No. Amazon says having a third party, including Amazon or another seller, ship directly to customers without identifying you as seller of record is strictly prohibited.
Is online arbitrage allowed on Amazon?
Amazon does not prohibit it outright, but products must be authentic and you must be able to provide records of authenticity when asked.
Why is Amazon holding my funds?
The Business Solutions Agreement allows Amazon to withhold payments while it determines that risks such as claims, chargebacks, or policy violations persist.
How do I get held funds released?
Resolve the suspension or violation behind the hold through an appeal on the Account Health page.
Get Help Releasing Your Funds
Submit your case for a free assessment, or book a consultation.
Sources
- Amazon Seller Central, Drop Shipping Policy
- Amazon Seller Central, Amazon Services Business Solutions Agreement
- Amazon Seller Central, Amazon Anti-Counterfeiting policy
- Amazon Seller Central, Amazon’s A-to-z Guarantee claims
