This article is written by Udemy instructor Emilie Schrevens-Wester and is part of The Entrepreneur Masterclass.
Amazon is one of the largest marketplace in the world, it would be a shame to miss out on the opportunity to benefit from it. While the money potential with Amazon FBA and private labeling is through the roof, it will also involve a lot of research and some investment into softwares that will help you get the job done. Having a winning product and knowing it well is not enough though. Let’s run through everything you need to work on to be successful on Amazon. Please note that depending on your location, Amazon might offer less options to sell on their platform. It can also take you lots of time to learn the ropes so I’d advise you start doing Amazon selling when you are financially comfortable and can afford 2-3 months without a major amount of sales.
1. What you can do on Amazon
Private labeling: You source products from a manufacturer or make your own, print your own label on it and sell it as “your brand”.
Wholesale: You buy bulk items from the manufacturer and sell it on Amazon at retail price. You don’t have to build a reputation as you’ll be selling a known brand already.
Arbitrage: You buy normal items at local stores and sell them for a profit.
Selling handmade: Sell your own things. Great opportunity if you are an artsy person or have artistic skills to sell.
2. Create your account
Head to Amazon Seller Central and create your account or log in if you already have one. Based on your goals, pick whether you want to go for an individual account or a professional one. The pro account lets you sell more items per month but comes with a fee and monthly cost.
3. What software do you need?
JungleScout is the best tool out there to do your product research. It is a paid software. If you work quick enough, you can do all the research you need and cancel your plan before you’re charged a second time. ZonBase can also be used, and Amazon has its own tools as well.
4. Research
Picking the wrong product could mean losing your time and your money, so you have to be serious with your research. There are four things you need to research:
A winning product (high interest, low competition)
The market (global sales for your product and which areas of the world are interested)
Your customers (who is likely to buy from you? From where? What can you conclude from research data?)
Your competition (who do they sell? What’s their strategy?)
5. Your product
Again, a winning product is one that has high demand, and low competition. Ideally it should be a product that doesn’t involve fancy knowledge in case there is an issue (eg: electronics, high-end jewelry, medical equipment, etc).
Find a reliable supplier that can make the items quickly for an interesting price. Calculate your selling price by adding up the Amazon fees for your country + price of the product from the manufacturer + the profit you want.
Ex: you sell running shoes. One pair costs you $50, Amazon takes a $8 fee, and you want to profit $20 per item. You need to sell your pair of shoes for at least $78. Don’t forget to consider shipping.
Whatever you do, keep your profit margin between $20-$70. If you can’t make at least 20-30% profit, the product may not be the right one, or will require a lot of effort on your side to be profitable.
Once you think you found your product, check the market and answer those questions:
Is there already a number one bestselling store selling a very similar product?
Where are they located? What’s their shipping time to the area you want to cover? (They are in China = 3 weeks delivery to the US. You are in the US = You can ship faster)
What kind of reviews do they have? Is there a specific feedback that comes back? (eg: “fabric tears easily = you need to focus on the quality of the fabric to stand out)
How easy is it to ship your item?
Will your product sell all year long? You’ll only sell Christmas decoration when Christmas is coming
6. The manufacturer
This part of the process can be long and discouraging (unless you’re partnering up with someone you already know and trust). Contact a manufacturer that would agree to sell their product at an interesting price. Get some samples for yourself, discuss the options regarding warranty, product return, and customer service handling.
7. SEO
Do your keyword research and make sure that everything in your product listing is SEO friendly and well written. Be complete, write a little FAQ to avoid receiving the same questions all the time. Try different keywords based on regular research and adapt your listing, follow up and track which keywords do best.
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