How to sell on amazon
Whether you’re looking to make some extra cash or dreaming of leaving your 9-5 job to start a full-fledged online business, selling on Amazon remains one of the best ways to make money.
If you’re hesitant, thinking it’s too late or that all the niches are saturated, reconsider your stance. Even sellers who began in the last 2-3 years have achieved significant success on Amazon, and you can too.
All it takes is a bit of courage and patience to push through the initial challenges. However, for those just starting out, figuring out what to sell and how to navigate the complexities of marketing can be overwhelming.
To assist you on this journey, we’ve put together a step-by-step guide to help you kickstart your journey into selling on Amazon.
Quick Guide
Here’s why selling on Amazon can be highly profitable in 2023, even if you’re just starting.
With a 37.8% market share and 310 million customers worldwide, Amazon is undoubtedly one of the biggest players in the e-commerce industry. And despite the pandemic, inflation, and recent recession threat, Amazon is continuing to grow.
With this contentious growth, Amazon offers new and existing sellers to get more profit and grow their eCommerce business.
Buyers usually avoid going to unknown stores to buy products. However, selling your products through Amazon will make the buyers feel at ease when purchasing. It also improves your brand reputation.
If you opt for an Amazon professional seller plan, you’ve to pay a flat fee of $39.99 per month.
However, a beginner seller with less than 40 products can opt for the individual selling plan, which is a pay-as-you-go plan.
Sellers can list products for free on Amazon and only get charged $0.99 per sale when their product sells.
Amazon sellers can make up to $1000 and $2500 per month.
Additionally, 76% of Amazon sellers have said they made profits in 2022. Among them, 63% of sellers became profitable within one year of launching their business on Amazon.
If you find the right product-market fit, there’s no bar on how much you can earn from Amazon.
Here’s a simple step-by-step guide for you to start selling on Amazon:
Before selling on Amazon, you need to choose a business model to work with. There are five business models to choose from.
Private labeling is a common way to sell products on Amazon.
Here, you buy products from a manufacturer, label and sell them under your own brand. Amazon Basics products are the prime example of Private labeling.
In 2021, private-label consumer goods business sales reached $197 billion in the US.
This staggering growth allows new sellers to start their businesses with minimal effort.
Another popular business model among sellers is dropshipping.
Dropshipping lets you list your products on Amazon and sell them without actually owning the product.
Here, you’ll work with a third-party supplier who will take care of manufacturing, maintaining inventory, packaging, and shipping to customers on time.
However, dropshipping has its drawbacks. Given it’s very easy to start, the marketplace is highly competitive and provides low margins.
Apart from that, building a brand for your dropshipping business is difficult since you don’t own the product right.
Also, since you’re outsourcing the logistics part of it, you don’t have any control over the supply chain of your business.
Still, if you’re a beginner seller, It’s a great way to get your hands on selling on Amazon in 2023.
Recommended read: What is the registration process for Walmart plus.
Wholesale is a simple business model where the seller purchases branded products in bulk from manufacturers or suppliers and resell them to retail customers.
Although the wholesale business is highly-profitable, the initial cost of buying products in bulk can be high.
The most challenging part of starting a wholesale business it to find the right product to sell. You’ll have to browse through hundreds, if not thousands of different products to find the right product opportunity that you can sell with a good profit margin.
Recommended read: Amazon Review Software Tools to Increase Sales.
Reselling is one of the simplest business models on Amazon. It means buying the product from other marketplaces at a discount and selling it to Amazon at a higher price.
Let’s say you’ve found a water bottle at $10 at Walmart. And similar water bottles are sold for at least $15 on Amazon.
Now, this is an opportunity for you to resell. You can buy 100 such bottles from Walmart and list them on Amazon at $14.50.
This will still give you a good profit margin while keeping your price lower than the retail price.
There’s no supplier or manufacturer. You just have to find a low-cost product from a retail store or marketplace and flip it on Amazon.
The low barrier of entry makes retail arbitrage the perfect way to sell on Amazon.
Related Post: Websites for Amazon sellers to Find Private Label Product Ideas
If you have a knack for artistry and building things, you can look into selling at Amazon Handmade.
It brings together crafters from over 80 countries and gives them a platform to showcase and sell their handcrafted goods to retail customers.
Amazon has strict rules for handmade stores. Everything sold here has to be handmade, such as
Despite the pandemic and looming recession, consumers are not shying away from spending online.
Unlike previous years, in 2023, buyers are not ready to splurge on things mindlessly. They are more selective in choosing a product that’ll add value to their lives.
Not only that, consumers across all generations – from baby boomers to Gen Z have become more aware of the connection between our environment and consumption.
Only 58% of consumers were willing to spend more on sustainable products just two years ago. Today nearly 90% of GenX consumers are ready to spend extra for sustainable products.m
When researching a profitable product to sell, you need to keep all this information in mind.
Here are some steps to start your product research in 2023:
Before you start researching products, you need to identify your niche.
Perform thorough market research and find a niche with high demand and low competition that also falls within your interest. This is important because it will help you stick to your business during the low times and help you create long-term sustainable growth.
It’s important because it keeps you going when you hit the
For example, if you select the “Jewelry” niche and don’t have any interest or knowledge about it, it can be very difficult for you to identify gaps in the market and improve on the product.
Once you’ve found your niche, choose a few best-selling products and analyze them based on profitability, demand, cost, and competition.
Here’s how you can analyze the products:
With every product sold on Amazon, there are some costs associated with it for the sellers.
These include:
So, whenever you consider a product you want to sell, ask yourself if you can make a 15 – 30% profit after deducting all the costs.
Use the SellerApp FBA Fee Calculator to estimate Amazon FBA fees will be for a product and estimate your product revenues.
Another key component of a good product is demand. Do you find enough search volume for the product? Do customers want the product all around the year or during a particular season?
You can use the SellerApp free keyword research tool to see the search volume of the keywords.
Additionally, Google Trends to find out the seasonal demand for your product.
As you can see from the example, an umbrella has seasonal demand, unlike Keyboard, which is searched throughout the year.
Identifying the demand is important because you’ve to plan your inventory ahead of time before the peak season, or else you’ll lose out on sales.
In general, you want products to sell that lay in the $15 – $50 price range. Shoppers don’t think too much about finding the best product in this price range as long as your product meets their needs. It also allows you to have a healthy profit margin.
Anything below $15 will leave you with a low-profit margin. These products are also easier to source and get oversaturated quickly.
On the other hand, if you price your product above $50, buyers will think twice before buying a product from an unpopular brand.
The next thing you have to evaluate is the competition in the space.
How many similar products exist in the category? Are there any big brands selling the product?
Shoppers will always choose a big brand over a new seller. Instead of competing in a niche with famous brands, it’s better to find a product with relatively fewer competitors.
Recommended read: How to get started with Walmart Connect.
Try to find products with a low star rating on Amazon. (maximum four stars). Go through the reviews and “Customer Questions & Answers” section.
Identify what buyers like and dislike about the product. Consider all the factors like size, material, color, feature, and packaging, and see if you can improve on any aspect of it.
Ideally, avoid products with 4+ star reviews on Amazon since you won’t find many opportunities to improve on these products.
Must-Have
Good to have
Finding the right product to sell is half of the story. The next step is finding a reliable supplier or manufacturer for your product.
This can be intimidating, especially if you’re just starting to sell on Amazon.
The easiest way to find suppliers is to search on online marketplaces like Alibaba or AliExpress.
There are thousands of manufacturers and suppliers around the world who are listed on Alibaba. And you can use the SellerApp Product Sourcing tool to quickly find them for your product from Alibaba.
Enter your primary product keyword on the tool, and filter the suppliers by your country, supplier country, minimum order quantity, product type, and price range.
Before selecting a supplier, it’s important to ensure that you’re making the right investment with them. Here are some things to consider when choosing a supplier:
In 2023, buyers will only consider products that are high quality and provide value to them.
Before ordering in bulk from a supplier, ask for a sample product. If you have improvement ideas, you can also request modifications to the sample product.
Check the sample product based on specifications, quality, and usability. If it meets all your criteria, negotiate with the supplier on the price.
You want to find a seller who gives you a reasonable price. It’s an essential factor that leads you to a good profit margin. You can also browse through Alibaba and understand the average price of the products. It’ll give you a good idea of the price range you should target.
You need a supplier who is easy to communicate with and responds to you promptly. You can assess the supplier’s communication during the initial conversation with them.
There are primarily three options of fulfillment to choose from:
Through FBA, Amazon handles the entire fulfillment process, from storage to packaging to shipping, returns, and customer service. If you use Amazon FBA, your products automatically become eligible for Prime shipping and faster delivery, and your listing will show the “Prime” badge.
Amazon FBA also helps you increase your chances of winning the Buy Box since Amazon prefers FBA over other fulfillment methods.
In FBM, the seller has to manage all aspects of the orders, such as storage, shipping, order fulfillment, returns, and customer service, on their own.
Ideally, we recommend sellers use FBA, but there are some scenarios where FBM can be a good option too. For instance:
Handle slow-moving or special care products on your own rather than handing them over to Amazon through FBA. Slow-moving products also have higher FBA fees.
In dropshipping, the seller has to ship the product via FBM.
The SFP method gives sellers all the benefits of Prime while still maintaining control over fulfillment and keeping Amazon fees low.
Amazon sellers must go through a trial period and fulfill FBM orders abiding by Amazon’s strict shipping requirements to get SFP eligibility.
However, SFP enrollment is currently closed on Amazon. But you can join the waitlist and apply when it reopens to new sellers.
Once you find and source the product, it’s time to list it on Amazon.
Here’s a step-by-step process to set up a successful product listing:
The right keyword will help your product to reach relevant customers.
There are two ways you can efficiently conduct keyword research.
For example, if you’re selling water bottles, you can search the same keyword on the tool. Select 10-20 highly relevant keywords with decent search volume and conversion rate from the results.
These keywords will help your listing appear on Amazon search results for relevant search terms and get you more visibility.
Before creating your listing in Amazon Seller Central, you need to have a standardized universal product code (UPC) for your product. It helps you identify the authenticity of your product.
You can get the UPC from GS1.
If you sell handmade products, you can also apply for GTIN exemption. It allows your product to sell on Amazon without any UPC.
Now that you’ve established all the prerequisites, it’s time to create your listing on Amazon Seller Central.
Open your account on Amazon Seller Central.
Go to Catalog → Add Product.
Select “I’m adding a product not sold on Amazon.”
Choose the most appropriate product category and subcategory
On the next page, fill up all the product details, including the product ID, Title, Brand name, and other vital information.
Once done with all the information, click “save changes,” and it’ll add your listing to the inventory.
When adding the listing, you need to optimize the title, images, description, and bullet points with relevant keywords.
While the product title is all about keywords, the bullet points should talk about the product’s main features and unique selling points.
Add more information about your product in the description, which you couldn’t add in the bullet points. Amazon also ranks the product based on keywords in the product description. So, optimize the product description section with longtail high-converting high/medium search volume keywords.
If you’re a brand-registered seller, you can use Amazon A+ content instead of the product description. Amazon A+ content will allow you to add more enticing images and texts that can highlight the USP of your product.
“Picture speaks louder than words.”
Most buyers make the buying decision just by seeing the product image. So, make sure the product images are relevant and high-quality.
You can take the pictures yourself, but hiring a professional product photographer who will help you present your products in front of the customer better than your competitors is better.
Read about the Amazon product photography guideline before creating the product images.
After listing the product on Amazon, getting traffic and sales from day one is important. It improves the Best Seller Rank (BSR) and improves the organic position of the listing.
So, make a strong marketing strategy before you list your product on Amazon.
Amazon PPC (pay-per-click) campaigns are your best bet to get your newly-launched product in front of buyers from day one.
Use broad-match keyword targeting to get more visibility on your product.
In the initial phase of the launch, you shouldn’t be too concerned about spending more on advertising. Calculate your break-even ACOS and monitor your campaigns accordingly.
If you’re selling a product for $30, and the net profit on the product is $17 after all deductions, then the break-even ACoS will be $17/$30 * 100 = 56.67%
Additional read: Strategic benefits of outsourcing Amazon PPC services
Building a brand should be on your checklist from the start if you want to see long-term success for your Amazon business.
It helps you build a loyal following and get more traffic to your listing. A strong brand also helps you position your products for a high selling price down the line.
Influencer marketing is one of the key elements of a successful product launch in 2023.
Especially micro-influencers provide a great level of relatability and engagement with the audience that brands can’t.
You can select 2-3 micro-influencers in your niche with 1000-2000 followers and send them a free sample of your product after launch in exchange for some posts of them with the product.
You can share those posts on your social media and cross-promote as well. This doesn’t require a lot of effort for both parties, but you can get good engagement on your products with this activity.
As part of your launch strategy, you can give offers and discounts to the buyers. There are three types of offers you can choose from:
You can also run giveaway campaigns on Amazon. The winner will get a free product, and other contestants who didn’t win will get a percentage off on your product.
Recommended read: Factors that Can Cause Amazon to Ban Your Selling Account.
Getting the initial sales is the most challenging part. But once you crack that puzzle, you must remember some other things.
54.4% of Amazon customers say they read at least 4 product reviews before making a purchasing decision. Reviews also help your product to rank high on Amazon’s search results page.
Therefore, in the initial days, you should focus on getting more reviews for your product.
However, make sure you follow Amazon guidelines to get reviews. If you try to manipulate the reviews in any way, your account might get banned.
Amazon has an early reviewer program and a Vine program that can help you get more reviews.
Running out of stock can affect your product ranking and sales. So, restock your products ahead of time to keep a healthy inventory level.
Proper inventory management will help you fulfill customers’ orders quickly and avoid the risk of stock depletion.
There are three major KPIs you should monitor for your product:
You can go to your Amazon Seller Central account → ‘Performance’ tab → ‘Account Health’ to get all these metrics.
Tracking these metrics can help you identify and fix the gaps and make your business as best as it can be.
Launching your Amazon business in 2023 offers immense growth opportunities, but success requires a strong and strategic approach. Here are some tips to remember:
Recommended read: Types Of Data Available In Amazon Marketing Stream
For further support, check out SellerApp – a world-class Amazon marketplace software that will amplify your selling efforts and streamline your path to success.
Take the first step towards triumph in the dynamic world of Amazon selling with SellerApp’s exceptional resources and solutions.
Additional read:
What Are Amazon Compliance Documents?
How does Amazon Marketing Cloud work?
How to optimize ads with AMC and Amazon Ad Server?
Amazon Seller Software
Boost Amazon Sales with SellerApp Insights!
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