Don’t leech or I will come for you and your family. Enjoy and let me know what you think about the guide.
1. Determine your products and range
Spending time on product selection at the outset will help you make informed business decisions further down the track. Take the time to look at existing products from other Amazon sellers to make sure you have a good chance of being able to sell your products at a price that allows you to make a profit.
2. Calculate Amazon revenue
This would require you to first estimate your monthly sales volume for Amazon products, based on the product’s Sales Rank and current price. You can also add your Shipping Cost and Cost Price to get your total revenue and potential profit figures. This will enable you to get a guide of whether a product opportunity is worth pursuing before identifying and placing an order with any supplier.
3. Find a supplier
Unless you manufacture products yourself, you’ll need to find a business to make or supply your products. There are a number of supplier directories you can look for, but be sure to research any you find on an aggregator site thoroughly. Alternatively, you could reach out to other sellers you admire on Amazon and ask for recommendations.
4. Open an Amazon Seller account & sign up for Amazon FBA
You’ve identified your product range. You’ve found a good supplier. Now it’s time to sign up to Amazon!
Once you’ve become an Amazon Seller you’ll also need to sign up for FBA, which has a huge number of benefits:
- 2-day Amazon Prime shipping
- Managed customer service and returns
- Send products from your supplier directly to Amazon
- Shipping costs from Amazon to your customer are included in your FBA fees
- Multi-channel fulfillment if you have an eBay or Shopify store
- It’s worth noting that some businesses prefer to have more control over their distribution and fulfillment processes as an Amazon Vendor. If you’re not sure which is best for you, see our guide to being an Amazon Seller vs. an Amazon Vendor.
5. Create and optimize your Amazon listings
Product listings are one of the most critical aspects of your Amazon store, but unfortunately, they don’t often get the love they deserve. For each listing, play close attention to the following:
Product Title –Keep it clear
Features and descriptions – Should be concise, and contain relevant keywords
Categories – List in all relevant categories and sub-categories
Images – Should be high-quality and professional
Reviews – Encourage customers to leave feedback about your products
Ratings – Make sure you’re maintaining a good rating on each of your products, and, if not, look at what you can do to improve the product or remove it altogether
SKUs - All products sold on Amazon are required to have SKUs which you can either generate, or have Amazon generate for you. Check QuickBooks Commerce’s guide on all you need to know about Amazon SKUs.
6. Create an FBA shipping plan
The buck stops with you when it comes to ensuring the quality of your products, so make sure they’re in good condition by inspecting them thoroughly before they move into Amazon’s hands and follow Amazon’s FBA guidelines.
Regarding shipping costs, in many cases the products you sell are more impactful to profit margins than keeping shipping costs as low as possible – which is why it’s so important to choose the right products at step one. With that said, shipping costs should be reasonable based on factors like delivery time and item weight. It goes without saying that a heavy item being express-shipped will be pricier than a standard letter.
7. Generate your first sale!
Here’s the fun part: making a sale! Now that you’re up and running keep an eye on which products are selling well and which just aren’t cutting it so you can refine your offering over time and ensure you’re selling products which your Amazon customers actually want.
What is Fulfillment by Amazon (FBA)?
Amazon FBA is a fulfillment service that AMZ offers to its third-party sellers. AMZ undertakes major business processes like storage, order fulfillment, and customer service on behalf of sellers through this service. Amazon has fulfillment centers worldwide, so sellers can store their goods in these warehouses until they are sold. Once an order is placed, the product is picked, packed, and shipped from the warehouse to the customer without any input from the seller.
When learning how to sell through Amazon FBA, new sellers often assume that FBA is a business model. But it isn’t. The first step to selling on Amz and using FBA is to choose a business model. Amazon offers different business models, but you must be intentional about choosing one that suits your needs. Here’s a brief breakdown of AMZ’s business models and how they work.
Amazon Business Models
Private Label: The private label model requires sellers to source products directly from manufacturers. But in this case, the products are manufactured based on your specifications; they also carry your brand name, not the manufacturers. This model is best for sellers who want to build a brand on Amazon.
Wholesale: Here, you purchase products in bulk from manufacturers then sell on AMZ at retail prices. Unlike the private label model where you sell products under your brand name, you sell existing, already-branded items under this model.
Retail Arbitrage: This business model is best for people who have only a little capital and want to resell products for a profit. You’ll have to source products from online/physical retail stores, then resell them at a markup price.
Dropshipping: Under this model, you act as a middleman between a supplier and customers, so you will not have to purchase items or make any capital investment. You purchase products on behalf of customers and get the supplier to ship the order directly to the customer.
Handmade: This business model allows you to create beautiful, handcrafted, customized designs for sale on Amazon. It is best suited for creatives who want to make money from selling their designs on AMZ.
What to Sell on Amazon FBA
If you choose the wrong products, you risk losing money. And in the long run, you lose money, but you also lose time and effort. So, there is so much to consider when choosing products to sell. Product research is one of the most important aspects of AMZ businesses. But only a few “how to sell on Amazon FBA for beginners” posts talk about this.
Also, the AMZ marketplace is highly competitive, and if your goal is to make a profit, you may have wondered how people sell on the marketplace and earn from it. The first step is choosing a profitable product, but choosing a profitable one is not as easy as it sounds. Here are a few things to check:
Estimate the Product’s Profitability
The goal of starting a business in the first place is to make a profit. So, before you choose to sell in a product category, carry out proper research to confirm its profitability. First, find the most profitable category, then pick a product there.
You can use the “rule of 3’s” to estimate a product’s profitability. To do this, divide the price of your product into 3. One part goes to landing costs, and the other two go to AMZ fees and your profit. So, if you sell your product for $18, following this rule means that you make a $6 profit on every sale.
Landing costs cover the production and shipping costs while AMZ fees are the fees that AMZ charges its sellers. Don’t forget to include advertising and packaging expenses.
Naturally, your share of each sale depends on two things:
- How much you can charge for the product
- The fees you incur along the way.
- Whatever you do, keep your profit margin between $20-$70.
- Market Demand
- A product’s profitability usually depends on how much demand it has. So, in your product research process, be sure to find out about product demand.
Are people interested in the product? Can your product solve a problem for them? How many sales did it make in the past? If you answered yes to all these questions, you have this box ticked.
Next, identify how many products are exactly like yours. Then, determine if there are any opportunities for new sellers. Don’t forget to run a check on the brands in that product category to see how much competition you’ll have to face. Competition is determined by the number of products and the quality of their reviews, so pay attention to reviews. You can also use competitor customer reviews to improve the quality of your product; this will, in turn, increase your chances of making sales.
Apart from these factors, you should also consider:
Product size and weight. It’s best to choose small, lightweight products to reduce shipping costs.
Availability of the product and ease of sourcing. You don’t want to run out of stock for months and lose your customers.
Don’t choose seasonal products. If you do, you’ll only make sales when there’s a need for the products, so it’s best to choose products always in demand.
Still wondering how to sell on the marketplace and be profitable? First, research to discover a profitable niche or product category. Next, fix a favorable product price to cover your business expenses and secure your profit margin.
How To Uncover The Most Profitable Products on Amazon
Product research is an essential part of every AMZ business. However, only a few beginners know this. Most “How do I sell on Amazon” questions are often met with vague replies related to seller central account creation and the likes. So if you have asked this question, here’s a more practical guide to help you.
If you want to sell on the marketplace, you must be interested in finding the right products first. Selling and earning from an Amazon business is not a day’s job, and the processes involved cannot be accomplished at once. For the most part, these processes are confusing and can be exhausting, especially for beginners who use the trial and error approach. As a result, many ‘How do I sell on Amazon’ questions come from a place of frustration and exhaustion.
However, this is not a ride that everyone should go through. No one should spend the entire day cherry-picking from an endless list of product options. By automating your product research process using AMZ software, you can save time and effort.
There are tons of software available to help you automate your product research process. These tools will help you narrow down your options and validate your product ideas. Apart from product research, several other processes must be executed if your goal is to build a profitable business. After finding profitable products, you must generate relevant keywords and create well-optimized listings.
Thankfully, all these business processes can be automated using AMZ software. And all-inclusive software like ZonBase offers the best tools for product research, keyword research, and listing optimization.