Chances are, you are here because you are considering selling products online. More, you want to know if Amazon is the right platform for you. But first, you wish to get a better of how Amazon seller utilizing Fulfillment By Amazon (FBA) works.
Typically, this is how to sell on Amazon FBA for beginners:
Basically, you source a cheaper product typically from a low-cost production country such as China or in a cheap market for $1, you get them shipped to an Amazon fulfillment center. Then you sell them on Amazon for $20. After, Amazon fulfills then for you. Amazon takes their fee, because of fulfillment, handling, and distribution. Finally, you get paid to the profit.
A. Find a product that can sell on Amazon
This is the most difficult stage of the process. It all starts with the product.
- Scan Amazon
Check out the Amazon Bestseller list. It is a fantastic place to start. Indeed, you can narrow down to any category you have interest in. In addition, try to eliminate seasonal products so you can maintain consistency throughout the year.
This is the most critical step of the entire process. That is why you should go in-depth and spent enough time, researching without cutting corners. If you pick the right product, you can do anything else wrong but still, make a lot of money. However, if you pick the wrong product you are going to have a hard time.
- Stay away from items that are extremely popular or niche.
That is because you will be facing competition. Equally, if they are niche it could be hard finding buyers.
That is why you should focus on products with “Product Reviews” on Amazon of less than 900 and “Best Seller Rank” Between 500 to 6500 within your interest category.
- Go Private Label
You can take a great selling product, improve it with your own taste and twist, and put it back on the market.
- Quality and size
Focus on good quality products for durability. In addition, to mitigating any complaint from your client. Then the size will help you ship fast and limit shipping cost.
You want your products to be small, non-breakable, and easy to use. Ideally, weight should be less than 4 pounds
There is no exact science. Each product is different. However, you want to make sure you get a good profit margin on the product and the considerable net profit. A good rule of thumb is a profit margin of at least 30%.
B. Find a way to make your product.
A lot of people will go on Alibaba because it is a massive directory of manufacturers. Truly, many products are made in China or Asia. If you choose you to have your product done in China then here are some criteria to keep in mind:
- You want a manufacturer that has years of history. Don’t be deceit by the badge on Alibaba. It doesn’t really work. Instead, check the manufacturer’s website, do phone calls, check the manufacturer references, look for past transactions (Alibaba list those transactions), find a seller that has used the manufacturer. If you can do a tour at the manufacturer factory. Then narrow your list to the top 3 manufacturers within the category you are interested in.
Another option is to find a reliable contact agent. Usually, you will find with a little bit of research some agents in your hometown. He or she will do basically everything for you and present you with the manufacturing options. Typically, they know the manufacturer and have worked with the manufacturer for years and in case of any issue, you know where to go.
Nonetheless keep in mind, when your manufacturer abroad, you might encounter some setbacks. For instance, difficulties fulfilling your order, intellectual property, product defect, and delivery delay.
But more and more people are going South nowadays ( Mexico, Brazil). That is because it is closed and easy access.
Locally source and manufacture product
On the other hand, you can choose to make your product in the country., you will have more control over your products. The margin might not be very high but you will have the assurance of quality, resolve any disputes, and mitigate shipping challenges. The only issue is you have to work a little harder to find an on-demand manufacturer. The advancement of technology especially with 3D printing has improved manufacturing capabilities.
- You want a manufacturer that has years of history. So, check the manufacturer’s website, do phone calls, check the manufacturer references, look for past transactions, find a seller that has used the manufacturer, visit the manufacturer factory. Then narrow your list to the top 3 manufacturers within the category you are interested in.
Below a directory of manufacturer in the USA.
B. Utilize Dropshipping Model
Once you have to find the right product to sell on Amazon and finalize everything with your manufacturer. Your work is pretty much done. All you have to do now is to have your product package well and shipping directly from the manufacturer to the Amazon fulfillment center.
Or you can choose to receive your products, store them, do product control and packaging before shipping everything to an Amazon fulfillment center. That is because the less inventory you have the better you will be. Nevertheless, you will need to optimize the process with a good inventory management system.
C. Inventory Management
You want to make sure you don’t ever run out of stock and you don’t overstock. Obviously because of financial considerations related to inventory management. Consequently, monitor your inventory and find the perfect balance. Inventory forecast so you can choose the perfect number to order, the perfect quantity to have in stock, and when to order. This will take sometimes but ultimately you will find it. This aspect is critical because it will help you optimize your relationship with your manufacturer and your customers.
D. Put your product in front of the buyer
Create a listing on Amazon. In other to be effective with this step, you will need to capitalize on Search Engine Optimization, keywords. Amazon is a product search engine. To get sales on Amazon, you have to rank the highest on the result for the keywords you want your product shown for. Still, your pictures need to be on point, your product description seamless and easy to digest. Focus on the following: Product Title, Product images, Price, and Reviews.
Your image needs to be perfect, don’t hesitate to invest in a professional photographer for a better outcome. Think about it with so many vendors on the platform any little thing can make a big difference.
To get reviews, you can get into the Amazon Early Reviewer Program. You pay $60 to Amazon and Amazon incentives random customers to leave an honest review of your product. You are online eligible if your product has zero reviews and Amazon will get you from $0 to $60.
Don’t launch until or do PPC you have at least 5 reviews.
For a successful launch, you do full price giveaways or rebate give away.
But also, you can do marketing on PPC on Amazon Marketing Platform. The big part of marketing on Amazon is to do marketing on Amazon Marketing Platform.
PPC is Amazon Marketing Platform.
Learn how to do promotion and marketing on Amazon.
How to sell on Amazon FBA: additional resources
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