Are you enticed by the idea of selling on Amazon FBA but bewildered about where to start? Well, you’ve landed in the right place.
With a vast global market at your fingertips, Amazon provides an unparalleled platform for businesses, big and small, to flourish. Yet, the vastness can be intimidating and the competition tough. That’s where we come in.
Our guide will meticulously walk you through the Amazon selling landscape, breaking down the complex process into digestible chunks. We’ll begin with the ABCs of selling on Amazon and reveal the key elements crucial to your business’s foundation.
Next, we’ll dive into the sea of potential products, equipping you with the skills to spot that profitable gem that could be your ticket to success.
Ever wondered about the mystery that is sourcing products? We’ll unravel it, offering you a clear path from product ideation to having your product ready for sale.
Finally, once you’ve got the basics down pat, we’ll steer you through the advanced seller strategies. This is where you’ll learn how to outmaneuver your competition and accelerate your business growth.
Fasten your seatbelts because you’re about to embark on an exciting journey into the world of Amazon selling. By the end of this guide, you’ll be armed with the knowledge and tools to kickstart your Amazon business venture confidently and efficiently.
Ready to transform your vision into a profitable reality? Let’s get started.
How to Start Selling on Amazon: The Basics
Starting to sell on Amazon requires choosing a product, setting up a Seller account, identifying a reliable supplier, creating an attractive product listing, and strategizing for growth.
What Do You Mean By Amazon FBA
Amazon FBA stands for “Fulfillment by Amazon.” Product fulfillment centers at Amazon are the place where sellers can store their goods. Amazon takes care of product storage, packaging, and shipping for sellers.
It’s a popular choice among sellers because it allows them to leverage Amazon’s vast logistics network and provides customer service and returns handling.
In terms of shipping their products, sellers have two primary options on Amazon:
- Fulfillment by Amazon (FBA): As explained above, you send your products to Amazon’s fulfillment centers, and they take care of storage, packing, shipping, customer service, and returns.
- Fulfillment by Merchant (FBM): The process involves you storing, packing, and shipping your products. You’re also responsible for handling customer service and returns.
As for what you need to start selling on Amazon, here are the basics:
- Product to Sell: You need a product that you can sell. This could be something you’ve created, buying wholesale and reselling, etc.
- Amazon Seller Account: To sell on Amazon, you must set up a seller account. There are two types of seller accounts: Individual (for people selling fewer than 40 items per month) and Professional (for people selling more than 40 items per month).
Are you interested in learning how to create an Amazon Seller account in 2023? Our step-by-step visual guide, titled “How to create an Amazon Seller account,” can help you get started.
- UPC/EAN Code: Depending on the product category, Amazon may require a UPC or EAN code to list a product.
- Product Listing: Once you have a seller account and a product to sell, you’ll create a product listing. This will include details about your product, photos, pricing, etc.
- Bank Account: You’ll need a bank account for Amazon to deposit your earnings from your sales.
- Tax Information: Depending on your location and the laws of your country, you may need to provide tax information.
- Compliance with Amazon’s Policies: Amazon has several policies and rules that sellers must follow. This includes rules about what can and can’t be sold, how items must be listed, etc.
Business Models That Are Supported by Amazon
- Private Label: You sell products manufactured by others under your brand. Enables unique branding but requires careful supplier selection.
- Wholesale: You buy products in bulk and resell them. Requires large upfront investment and storage space.
- Dropshipping: You sell products shipped directly from the manufacturer to the customer. Low startup costs but relies heavily on supplier reliability.
- Amazon Handmade: For artisans selling handcrafted products directly to consumers.
- Amazon Merch: You create designs for T-shirts and other merchandise; Amazon handles production and fulfillment.
- Amazon KDP: For authors and publishers to self-publish their books.
- Amazon Affiliate: You earn commissions by promoting Amazon products on your platform.
Things to Know About Selling Private Label Products on Amazon
The most commonly used business model on Amazon is a mix of Fulfillment by Amazon (FBA) and Private Label selling. Sellers create their own brands, manufacture products (often overseas), and then use FBA for storage and shipping.
This model combines the benefits of having a unique product line with the logistical convenience of Amazon’s fulfillment system.
What Do You Need To Do?
- Product Sourcing: Find or create a product to sell on Amazon.
- Product Preparation: Prepare the products according to Amazon’s guidelines, including packaging, labeling, and ensuring they meet quality standards.
- Shipment to Amazon: Ship the products to Amazon’s designated fulfillment centers.
- Listing Creation: Create product listings with accurate descriptions, images, and pricing.
- Inventory Management: Monitor and manage inventory levels to ensure availability.
- Marketing and Promotions: Drive traffic to product listings through marketing campaigns, advertisements, and optimization.
- Customer Service: Handle customer inquiries, feedback, and returns related to the products.
Amazon’s Responsibilities in Amazon FBA
- Storage: Amazon provides secure storage for your products in their fulfillment centers.
- Packing and Shipping: Amazon handles packing and shipping the products to customers.
- Order Processing: Amazon processes orders placed by customers on your listings.
- Shipping Logistics: Amazon leverages its extensive logistics network to handle the shipping process efficiently.
- Customer Service: Amazon provides customer service support, including order inquiries, returns, and refunds.
- Returns Handling: Amazon handles returns on behalf of the seller, including customer refunds.
What to Sell on Amazon: How to Find a Profitable Product on Amazon
Unlocking Success on Amazon: The Ultimate Guide to Product Selection, Consumer Demand, and Profitable Pricing. Discover what products to sell on Amazon, how to gauge consumer interest, and master the art of pricing for maximum profitability.
Let’s dive into the strategies that will fuel your Amazon success story.
How to Find Profitability of Product on Amazon
The “Rule of 3’s” in product research for eCommerce, including platforms like Amazon, refers to a guiding principle some sellers use to find profitable products. While the specifics can vary, a common interpretation of the Rule of 3’s might include these considerations:
- Price: The selling price should be three times more than the cost of sourcing the product. This ensures a decent profit margin after accounting for the cost of goods sold, Amazon fees, shipping costs, taxes, and advertising costs.
- Reviews: Aim to find products that have less than three hundred reviews. This can be an indication that the competition is not extremely high. If there are thousands of reviews, it might be challenging for a new product to compete.
- Sales Rank: Aim for products with a Best Sellers Rank (BSR) in the top 3% of its category. This means that the product is selling well and has a high demand. However, the exact BSR you should aim for can vary depending on the category.
How to Find High Demand Products on Amazon
Demand is a critical factor in determining the success of a product on Amazon or any other eCommerce platform. Here’s why it’s so important:
- Sales Volume: High-demand products often generate more sales, leading to higher revenue and potentially higher profit if the profit margin is good.
- Market Recognition: A high-demand product is likely popular, well-recognized, and well-received by the target audience, which can make your marketing and sales efforts easier.
- Faster Inventory Turnover: With high-demand products, your inventory moves faster, freeing up capital and reducing storage costs.
However, high-demand products often come with more competition, as many sellers may attempt to capitalize on the popularity of these items. This competition can drive down prices, make it harder to rank your product, and potentially thin your profit margins.
- Less Competition: If a product is in low demand, there’s often less competition. This might make it easier to become a leading product seller and maintain better profit margins.
- Potential for Niche Markets: Some low-demand products cater to niche markets. If you can effectively tap into these niches, you can establish a loyal customer base.
- Possibility for Innovation: With low-demand products, innovation opportunities may exist. You could increase its demand by improving the product or marketing it differently.
However, low-demand products tend to have lower sales volumes, which could result in lower overall revenue. You may also have to work harder on marketing to increase awareness and desire for the product.
How to Source Products to Sell on Amazon
To source products for Amazon, identify profitable items, find reliable suppliers via platforms like Alibaba or trade shows, negotiate pricing, order samples, and finalize your product.
Research For Amazon Supplier
Finding reliable and cost-effective suppliers is an essential part of selling on Amazon. The supplier you choose can significantly impact the quality of your product, your profit margins, and your customers’ satisfaction. Here are some tips on how to research for Amazon suppliers:
- Alibaba: This is one of the most popular platforms for finding suppliers, particularly for physical products. You can use Alibaba’s search and filter features to find suppliers based on product, region, minimum order quantity, price, and more.
- Global Sources: This is another large online marketplace for finding manufacturers and suppliers, particularly in Asia.
- Trade Shows and Fairs: Trade shows can be a great place to meet suppliers face-to-face, ask questions, and see product samples. There are trade shows for nearly every industry, from electronics to clothing to home goods and more.
- Online Directories: There are numerous online directories that list manufacturers and suppliers, such as ThomasNet, Maker’s Row, and Kompass.
- Local Manufacturers: If you’re looking to source locally, you can look for manufacturers in your area. This can be particularly beneficial if you’re selling a product that emphasizes local or ethical production.
Once you’ve identified potential suppliers, it’s important to vet them carefully. Here are some things to consider:
- Product Quality: Ask for samples to assess the quality of the product. If possible, visit the manufacturer’s facility to see their process.
- Pricing: Make sure the cost of sourcing the product leaves enough margin for profit after considering Amazon’s fees, shipping, and other expenses.
- Minimum Order Quantity (MOQ): Some suppliers require a minimum order quantity that might be too high for you, especially if you’re just starting out.
- Reliability: Check the supplier’s reputation. Look for reviews or testimonials, check how long they’ve been in business, and ask for references if possible.
- Communication: Good communication is crucial when working with a supplier. They should be responsive, clear, and helpful.
- Production Capacity and Speed: Ensure that the supplier has the capacity to produce the quantity you need in a timely manner.
Contact Supplier For a Quote
Contacting a supplier for a quote is an essential step when sourcing products to sell on Amazon or any other eCommerce platform. This process has several important benefits:
- Cost Estimation: By contacting suppliers for quotes, you can better understand the costs associated with producing your product. This includes the unit cost, minimum order quantities, any additional charges such as customization costs, and shipping costs. This information is crucial in helping you calculate your profit margins.
- Budget Planning: Once you have a clear understanding of the costs, you can create a more accurate budget for your business. This helps you manage your finances effectively and mitigate financial risks.
- Supplier Evaluation: Requesting a quote can also be a part of the process of evaluating different suppliers. You can compare their prices, terms and conditions, and response times. This can give you insights into their reliability and professionalism.
- Negotiation: Once you receive a quote, it gives you a starting point for negotiation. You might be able to get lower prices, especially if you are placing large orders or forming a long-term relationship with the supplier.
Evaluate and Modify Product Sample
Evaluating and modifying product samples is an essential part of the product development process. Here’s a step-by-step guide on how to do it:
- Request Product Samples: Before finalizing your product for selling, it’s important to ask your suppliers for product samples. This allows you to physically evaluate the quality, features, and packaging of the product.
- Evaluate the Product: When you receive the product sample, inspect it carefully. Check the quality of the materials, durability, functionality, and appearance. Compare it to the product specifications and make sure it matches what you requested.
- Get Feedback: Show the product sample to potential customers, business partners, or mentors and get their feedback. They might spot issues that you overlooked or suggest improvements based on their personal experience or expertise.
- Test the Product: Use the product as your customers would. This can help you identify any issues or potential improvements. For example, if you’re selling a kitchen gadget, try using it to cook a meal. This can give you a better understanding of its practical use.
- Make Modifications: If there are aspects of the product you’re not satisfied with, note them down and discuss them with your supplier. This might involve improving the product quality, changing the design, modifying the packaging, etc.
- Communicate with Your Supplier: Once you’ve identified the changes you want to make, communicate these to your supplier. Be clear and specific about what you want to change. It can be helpful to provide pictures or diagrams to illustrate your points.
- Get a Revised Sample: After the supplier has made the modifications, ask for another product sample. This allows you to check that the changes have been made correctly and that you’re satisfied with the final product.
- Finalize the Product: Once you’re happy with the sample, you can finalize the product and begin production. Ensure you have a clear written agreement with the supplier about the product specifications.
Order and Ship Your Amazon Products
Once you’ve finalized your product and supplier, the next steps involve placing an order and arranging for the shipment of your product. Here’s how to go about it:
Ordering Your Product
- Place Your Order: Once you’ve confirmed the product details with your supplier and you’re satisfied with the samples, you can place an order. This typically involves providing the supplier with a purchase order detailing the product specifications, quantity, price, and delivery date.
- Payment Terms: Different suppliers may have different payment terms, which include a deposit up front and the balance when the product is ready to ship. Be sure to negotiate and agree on payment terms that work for both parties before placing the order.
- Quality Control: Consider hiring a quality control inspector to check the products before they leave the factory. This can help ensure the products meet your specifications and the quality standards you’ve set.
- Choose a Shipping Method: Depending on your budget, timeline, and the size and weight of your products, you may choose to ship by air, sea, or land. Air shipping is usually faster but more expensive, while sea shipping is more cost-effective for larger, heavier orders but takes longer.
- Freight Forwarder: A freight forwarder can help you handle many of the complexities of international shipping, such as customs documentation and import/export regulations. They can help ensure your products arrive at their destination smoothly.
- Customs Duties and Taxes: Be aware of any customs duties and taxes that may apply when importing goods into your country. These costs should be factored into your budget.
- Shipping to Amazon Warehouse: If you’re using Amazon FBA (Fulfillment by Amazon), you’ll need to ship your products to an Amazon warehouse. Be sure to follow Amazon’s FBA product preparation and shipping requirements.
- Tracking: Ensure you have a tracking system in place to monitor the progress of your shipment. This can help you handle any delays or problems that may occur.
Are you interested in learning how to get a refund from Amazon? Our step-by-step guide, titled “How to Get a Refund from Amazon,” can help you get started.
How to List Products on Amazon
Listing products on Amazon involves several key steps and considerations. Here are some of the most important things to keep in mind throughout this process:
- Create an Amazon Seller Account: You need an Amazon seller account to start selling. If you don’t already have one, visit Amazon Seller Central to sign up. Based on your sales volume, you can choose between an individual or professional account.
- Identify Your Product’s UPC/EAN/ISBN: Before listing a product, you need to have its UPC, EAN, or ISBN. These codes are necessary to uniquely identify the product you are selling. If you are creating a new product listing that doesn’t exist on Amazon, you’ll need to buy these codes.
- Identify Your Product Category: Know which category and subcategory your product belongs to. Some categories are restricted and require approval from Amazon.
- Product Listing Information: Here are the main elements you’ll need to provide:
- Product Title: The product title should be clear, concise, and contain important keywords. It’s the first thing customers see, so make it count.
- Product Description and Bullet Points: Detail your product features, benefits, and specifications. Try to answer potential customer questions within your description.
- Product Images: High-quality images are crucial for online sales. Amazon has specific image guidelines that must be followed.
- Keywords: Use relevant keywords in your listing to improve its visibility in search results. Avoid keyword stuffing, though, as this can harm your listing’s ranking.
- SKU: Stock Keeping Unit (SKU) is a code you create to track your inventory. You can use any combination of letters and numbers that you like.
- Price Your Product: Consider your costs, competition, and perceived product value when setting your price. Remember, Amazon charges referral fees and possibly storage fees (if you use FBA) which you’ll need to factor in.
- Choose Your Fulfillment Method: Decide whether you will fulfill orders yourself (Fulfillment by Merchant or FBM) or use Amazon’s fulfillment service (Fulfillment by Amazon or FBA).
- Inventory Management: Ensure that your inventory levels are always up to date with a robust inventory management system. This is important to avoid overselling or underselling.
- Monitor and Optimize Your Listing: Once your product is live, monitor its performance and optimize as needed. Use Amazon’s reporting tools to track sales and understand customer behavior.
Advanced Seller Strategies to Grow Your Business
- Start with a Quality Product Listing: A well-structured product listing can set the foundation for success. As detailed in the previous response, ensure you have a unique and keyword-rich product title, detailed bullet points, engaging product descriptions, and high-quality images.
- Competitive Pricing: One of the first things a customer notices is the price. Research your competitors’ prices to ensure you’re not pricing your products too high or too low. If your product is new and you’re trying to attract customers, you might consider a lower price initially to encourage sales.
- Optimize Your Product Listings for Search: Use Amazon’s A9 search algorithm. Do keyword research to identify the keywords your target customers are using, and incorporate these into your product titles, descriptions, and backend keywords.
- Manage Your Inventory: Keep track of your inventory levels. Running out of stock can harm your seller performance metrics and drop your product listing in search results.
- Fulfillment Strategy: Consider using Fulfillment by Amazon (FBA), where Amazon handles storage, packaging, and shipping on your behalf. Customers value Amazon Prime, which allows faster delivery times and makes your products eligible for Prime.
- Get Reviews: Encourage buyers to leave product reviews. More positive thoughts can help improve your product’s visibility and give potential buyers more confidence in your product. Just ensure you’re following Amazon’s guidelines when asking for reviews.
- Consider Amazon Advertising: Amazon’s sponsored products feature can boost the visibility of your listings. This can be especially helpful when starting and trying to get your first sale.
- Enhance Brand Content: If you’re brand registered on Amazon, use Enhanced Brand Content (EBC) or A+ content to provide a more in-depth look at your product and brand story. This can help to increase customer trust and conversion rates.
- Customer Service: Provide excellent customer service. Quick and helpful responses to customer queries and issues can lead to positive reviews and repeat customers.
- Monitor Your Performance: Monitor your sales, conversion rates, and customer feedback. This can give you insights into what’s working and what needs improvement.
Starting a business on Amazon requires careful planning and execution. The process involves several critical steps, from understanding what Amazon FBA entails to determining the product to sell and setting up your Amazon Seller account.
Leveraging Amazon FBA allows you to tap into Amazon’s vast logistics network, leaving you to focus more on product sourcing, listing creation, and inventory management.
Additionally, with various business models supported by Amazon, you can choose the one that best suits your resources and goals.
Product sourcing calls for a deep dive into product profitability, demand, and supplier research, followed by obtaining and evaluating product samples, placing your order, and finally arranging to ship your products to Amazon’s warehouse.
Creating a quality product listing is another critical aspect that includes a clear product title, detailed descriptions, high-quality images, competitive pricing, and relevant keywords to improve your product’s visibility in search results.
After launching your product, the focus shifts to getting your first sale and growing your business. This might involve employing Amazon’s sponsored product ads, social media promotion, offering discounts or promotions, and providing excellent customer service. Moreover, regularly monitoring your sales, conversion rates, and customer feedback can provide insights into areas for improvement.
Selling on Amazon can be an exciting and profitable venture. The process can be complex, but it can lead to considerable business growth with the right strategies and a solid understanding of how Amazon works.
Remember, it’s about delivering quality products, optimizing your listings, and focusing on excellent customer service to stand out in the marketplace.