If you want to develop your own e-commerce business globally and seize international market share, one of the best options is to become an Amazon seller. Unlike other entrepreneurial businesses, on Amazon, you can start your own e-commerce business in less than a few hours and less than $2,000 in start-up capital. Through Amazon, sellers can use their own operating methods and experience to make profits. As long as they create a popular product, they can achieve financial freedom in just a few days.
Of course, Amazon and Shopify have very different models of independent stations. Selling products on Amazon, sellers do not need to divert from outside the site to their own stores, because the Amazon platform itself has a large amount of natural traffic, its consumer population is large, and the number of active buyers is more than 400 million; and Amazon sells The product has a higher unit price per consumer, which is temporarily unattainable by other e-commerce platforms. The platform provides us with the basic conditions. What we have to do is to attract more purchasing power from the platform's traffic pool.
Amazon's business goal is to increase sales and increase profits. Many sellers choose Amazon FBA as their way to make money on Amazon. What good is this?
1. What is Fulfillment by Amazon (FBA)?
The continued popularity of the Amazon Fulfillment (FBA) business model is for a reason. Fundamentally, it is the same as a traditional e-commerce business. However, Amazon does not have to complete the orders for the sellers one by one, but stores the products for you, and can even pick up, package and ship to the customers, so the sellers do not have to handle all aspects of the business in person.
In this way, sellers will have more time and manpower to improve or select products, focus on strategic decisions and increase product sales. Amazon currently has 300 million active consumers, 90 million of which are Prime paid members (Amazon US site only), which also means that if you use Amazon FBA, you will get more orders from Prime members.
Second, the advantages of Amazon FBA
Amazon FBA business has many advantages.
1. FBA sellers almost always get "Buybox", which is an ideal situation for any product. 2. Simplified the transportation and return process. 3. Use multiple channels to achieve. 4. Get more sales. 5. Very suitable for the retail of large, heavy or low-priced commodity retailers that require a large amount of manual packaging and high retail costs.
In the traditional e-commerce business, the seller must send the product logistics to the customer in time. However, through FBA, Prime members can enjoy fast delivery, that is, Amazon will ship most orders to their homes within 2 to 5 days.
Another common challenge for e-commerce stores is that taking inventory and listing other products for sale increases the complexity of the business. With FBA, all the seller needs to do is ship the product to the Amazon warehouse. This can easily increase the range of product choices without significantly increasing the workload.
Three, Amazon FBA fees
The goal of many Amazon sellers is to sell their products at higher prices. If your product is 4 pounds, the seller expects to sell it for 12 pounds. In this way, you will earn 3 times the price difference, and then pay the price of the product itself and the shipping and storage fees paid to Amazon. Pay 4 pounds for the product, pay 4 pounds to Amazon, and earn 12 pounds back for every product sold. Therefore, for each product sold, the seller will get a 100% return and will not suffer any loss.
To start selling through FBA, you must first set up an Amazon account. There are two options: personal account or professional account.
Personal account: This is a free account, you can sell up to 40 items anywhere every month. However, you will need to pay all standard Amazon fees, such as postage and packaging fees. This type of account is more suitable for Amazon sellers who are just getting started with Amazon and don't have much initial capital, because it will reduce your startup risk. If you don't make any sales, then you will not lose any money.
Professional account: This account requires a monthly fee of $39.99 and shipping costs, but it can sell more than 40 items per month. If you are just starting out, I do not recommend seller friends to do this, because you may not have enough products to make money.
First of all, it is best to use a personal account, because the number of items in your first month will generally not exceed 40. Register on Amazon Seller Central and start using it. Then, add your credit/debit card to your account to control where the funds go.
4. How to make money on Amazon FBA?
1. Sell private label products on Amazon
One of the best ways to make money on Amazon is still to use Amazon's Fulfillment by Amazon (or FBA) network to sell private label products. This is a way to create your own brand, build new products on Amazon and get stable passive income. Although this method brings more learning outcomes, it ultimately reduces time consumption, increases revenue and may reduce competition.
Private labeling, also known as white labeling or brand creation, is the process of making pre-existing items (preferably product improvements), attaching your brand and logo to them, and selling them to consumers.
2. Sell wholesale products on Amazon
For many sellers, this is one of the most popular ways to make money on Amazon. Similar to private label, wholesale sales involve the purchase of large quantities of products to sell using Amazon FBA. However, the main difference is that you want to sell other companies' products. Therefore, sellers do not have to worry about manufacturing and branding products. It is entirely possible to use Alibaba, AliExpress and other wholesale platforms to purchase and manufacture products. This is an easy way to make money on Amazon FBA, all you have to do is pick potential winning products. The selection must be well selected.
3. Sell retail arbitrage products on Amazon
The process is that you buy a product in a retail store at a price lower than the lowest Amazon lowest price available, and then resell it on Amazon. This method usually requires a lot of work, but the investment is small. If you only have limited funds to start an e-commerce business, then this is a good choice.
4. Online arbitrage
Similar to retail arbitrage, you buy products with prices lower than the lowest available price on other e-commerce sites and then resell them on Amazon. This method requires time and effort, but you can do it at a relatively cheap price. You can buy on eBay, Alibaba or AliExpress, there is the best place to find these products.
Here I provide 4 ways and ideas to make money through Amazon FBA. But how to make money from them? The most important thing is my own thinking and in-depth understanding of the industry. The general steps are as follows:
a. Find the best-selling products on Amazon. b. Browse other websites or platforms to buy the same product at a cheaper price, and then buy a lower-priced product. C. Sell through Amazon Fulfillment by Amazon.
These steps are basically used for online/retail arbitrage, if you want to sell private label products, you must deal with your own trademark.
The most important step is to find potential winning products that can make money. First check which products are popular on Amazon. We can use the Amazon BSR product selection tool AmzChart to query all Amazon Best Seller Rank (BSR) products, set filter conditions according to our own preferences, and then find the best-selling products and check if there are still opportunities.
When searching for products on AmzChart, the following guidelines should be followed:
Find products whose price is only half the price listed on Amazon. When paying for transportation and storage costs, you can maximize your profit margins.
Try to find products that are well received, which shows that they are selling well on Amazon.
Buy smaller products-if the products are larger (heavier), it will cost more to ship them.
The above are several ways to make money through Amazon FBA, I hope it can help you develop Amazon business.