Today I have a special post for you all regarding another incredible way to work from home by starting your own Amazon FBA business.
Jessica from The Selling Family is living proof that this is a REAL work from home job, as she has made over six figures from her business. Her first year in the business, she had a net profit of $100,000. Amazing!
You can sign up for Jessica's FREE 7-Day Email Course For Amazon FBA and learn everything you need to know to get started.
Read more below on how you can start your very own Amazon FBA business!
1. For those of us that don't know, what is an Amazon FBA business?
An Amazon FBA business is basically an online store, but in this case, Amazon handles a lot of the stuff that causes headaches for most ecommerce 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.
When I was laid off from my full-time job in 2008, I decided to sell online full-time and was able to replace my income within a few months.
A year later, I set the goal to retire Cliff from his job and decided that Amazon FBA was the way to do it. Even though I was mostly working during the day while he was working and weekends, I was still able to bring Cliff home within about a year.
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. We also shop at liquidation stores and even online.
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. There are a lot of options for how to sell on Amazon.
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 $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.
If you have a smartphone, computer, and printer, you don’t need too many other tools to get started. There’s the smartphone app I mentioned, and then you need just a few more things to get started.
You’ll need to create an Amazon seller account, which includes a $39.99 monthly fee if you sign up for a professional account, which we recommend. There’s an option that doesn’t include the monthly fee, but that charges you for each item you list and is for sellers who don’t plan to sell very much.
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 really 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 like 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. This isn’t a passive income business model, so you have to know upfront that it does take work.
You’ll also need a lot of patience. There’s a learning curve involved and a LOT of scanning.
New sellers are often surprised at how many items they need to scan to find something profitable, and they feel like they’re wasting their time or not getting the type of return they’d like for the time they’ve spent looking.
The more you do it, the faster you get and the better you are at finding things to sell. But new sellers need to realize it isn’t going to happen immediately.
We tell people to expect at least three months before they see a profit … which is still incredibly fast when you think about how most brick and mortar businesses take years to break even!
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