There are more than 100,000,000 (yes, million) Amazon Prime members. More than 50% of all Amazon sales come from third-party sellers.
Selling on Amazon is a legit way to make great money and isn’t going away any time soon. And if you’re completely lost on how to even get started selling on Amazon, bear with me for a sec.
My friend Jessica and her husband have perfected the art of selling on Amazon and have made well over $100,000 profit (their first year in the biz). Now, they make much more than that.
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1. For those of us that don’t know, what is an Amazon FBA business?
An Amazon FBA business is an online store, but in this case, Amazon handles a lot of the stuff that causes headaches for most e-commerce store owners.
“FBA” stands for “Fulfillment by Amazon.”
So we find the inventory, while Amazon stores the product for us, packs and ships it, and handles customer service.
Amazon then keeps a portion of the sales as a commission & service fee.
And when you sell through the FBA program, your items are Prime eligible, which means they’re available for Amazon’s free 2-day shipping.
That’s a big advantage for sellers like me because Prime products tend to sell for higher prices, and buyers often search only for items that have the Prime option.
This is a great business model for most anyone because of its flexibility and low start-up costs.
2. Where do you find inventory?
We find a lot of our inventory from regular retail “Big Box” stores, including items that are on sale or Clearance and some that we can buy at regular price but that sell for more on Amazon.
Other sellers do wholesale, which means they get their product direct from a manufacturer or through a middleman who can help them buy larger quantities at a lower price.
And some sellers introduce their own product to the marketplace. This is called Private Label.
3. How do you price your items?
We have an app on our phone that helps us calculate the profit on items we find to sell.
When we’re out at a store, we scan the product’s barcode, and then the app lets us know the selling price on Amazon, then deducts the fees that Amazon collects so we can figure out our net profit.
We can also research the product’s sales history on Amazon to get an idea of how often it sells, which is just as important as the profit.
It doesn’t do us any good to find something that only sells a few times a year.
Our scanning apps are a big help in decision making.
Everyone has their own approach, but we like to set a minimum of $5 profit per item and whenever possible and we also want to get 100 percent Return on Investment (or ROI).
So if we invest $10 in a product, we’d like to make a $10 profit. Of course, that doesn’t always happen, and we will sometimes buy a product with a lower ROI if the dollar amount is higher.
4. How much does it cost to start selling on Amazon? What expenses should one expect in the beginning?
I tell people that ideally, they should have $1,000 to invest.
That would buy you some basic tools, inventory, and some great training like our Amazon Boot Camp.
The training is optional, of course, but it helps save time by answering a lot of questions new sellers have, and it minimizes a lot of mistakes, which then saves money.
I have a full breakdown of Amazon FBA startup expenses, so there are no surprises.
When you think about it, that’s an incredibly low cost of entry for starting a new business.
If you opened a franchise or started a brick and mortar business, the costs are usually much, much higher.
5. If someone wants to get started selling on Amazon, how can they get started?
We have a very detailed FREE 7-Day Email Course For Amazon FBA that describes the steps involved and shows you how you can get started.
By the end of the course, you will know if you want to pursue this business or not.
For someone who says “heck yes” and knows that this is for them right away, we do have a full Amazon FBA training course called The Amazon Boot Camp.
This is a video course that walks you through the process in a step-by-step process. It’s very in depth and covers everything you need to get started on Amazon FBA.
We walk new sellers through the whole selling process; from setting up their Amazon account through making their first sales and beyond.
We also have an ongoing, private Facebook group where they can ask any questions, and the community will quickly respond.
6. What piece of advice would you give someone to succeed in selling on Amazon?
The biggest thing we tell people is to make sure they treat this as a business.
Because it’s so inexpensive to start, a lot of people treat it more as a hobby, or they don’t try as hard as they might with another business with a lot higher investment.
You can make a full-time income with this, but only if you give it the time and focus it needs, and be consistent.
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