Selling online has been a surging business model for some time. It’s flexible, convenient, and allows just about anyone to start making money online. This business model is even more popular today due to the coronavirus pandemic, with more individuals buying items from the comfort of their homes.
If you’ve thought about starting an Amazon business but don’t know how to get started, this post is for you. Starting this type of business is easier than you might think.
The Amazon marketplace is one of the most popular shopping platforms in the world, which means plenty of potential customers to buy your products. As well as traditional business-to-customer sales, Amazon business is also popular, catering to business customers who shop on Amazon.
One way to sell on Amazon is with a Fulfillment by Amazon (FBA) setup, used by many online sellers, both new merchants and seasoned veterans. This is popular with private label business models, arbitrage, wholesale and more.
If you don’t want to use Amazon, you can check out these other ecommerce fulfillment companies.
Here’s what you should know on how to start an Amazon business:
What is Amazon FBA?
Amazon FBA is when you send your products to Amazon and they handle the packaging and shipping process. When a customer orders one of your items, Amazon takes it from there and handles the fulfillment and delivery services through their FBA selling option.
This is how FBA works:
- Seller sends their products to Amazon
- Amazon stores the products in warehouses
- When a customer order comes in, Amazon will package the item and ship it directly to the customer
- Amazon will track the order and handle returns and refunds
- Amazon charges a storage fee and a fulfillment fee
Benefits of Using FBA
Using Amazon’s FBA is an excellent choice for new Amazon sellers and new online sellers in general. Here are some benefits to choosing an FBA selling method:
FBA Makes it Easy to Learn How to Sell on Amazon
If you are a new merchant starting out in online selling, it’ll take you a little while to get used to the process. By choosing the Amazon FBA business setup, you’ll only handle inventory and setting up your Amazon listing. Amazon’s fulfillment empire will take it from there and handle all packaging, shipping, and customer service duties. With an Amazon FBA business, you can start the Amazon selling process slowly and ease into becoming a seller.
FBA Lessens Your Business Responsibilities
One of the main things Amazon sellers like about FBA is that it lessens their overall business duties and puts these responsibilities in the capable hands of others.
By using FBA, you’ll have more time to devote to other business aspects such as buying inventory, marketing, and social media. And by selecting an Amazon FBA business option when selling, you are entrusting these duties to a company that knows exactly how to get the job done and do it right.
Amazon Stores Your Products for You
Not every online seller has a ton of warehouse space to store their products. Depending on what you’re selling, this inventory can fill up warehouse space quickly, so it’s a good idea to let someone else handle this task for you.
When Amazon stores your products in an Amazon FBA business setup, you don’t have to take the time to send each product out as orders come in. Amazon has the products right there to get to them quickly and easily. And you can even sell your private label.
Customer Service Tasks Won’t Be Your Responsibility
When you choose an Amazon FBA business and sell your products, you don’t have to deal with customers for complaints or returns. Not every business owner wants to handle these duties, which are time-consuming and return little in the way of ROI. Many business owners just want to handle choosing their products and leave the minutiae of running a business up to someone else. This is why they choose FBA for their private label sales. As service tasks can be timely, difficult, and frustrating, it’s nice to know that you can hand this job off to someone else.
Steps to Starting an FBA Business
If you’re convinced of the benefits of selling on Amazon through FBA, now’s the time to get started. It’s easy to start selling online through Amazon and, if you already know what you want to sell, the process is even easier. Follow these steps to get started setting up your FBA business:
1. Create Your Amazon Seller Account
Before you do anything else, you have to create an Amazon seller account on Amazon Seller Central.
Setting up an Amazon account is easy. Simply go to the bottom of the Amazon homepage and click on “Sell on Amazon” then follow the directions.
During this step of the process, you can decide if you want an individual account or professional Amazon business account. If you want to operate an FBA business, the professional account is usually the best bet. An individual seller account doesn’t come with a monthly fee (you’re only charged on each item you sell), but there are big limits on what you can do, in terms of marketing and more.
Once you’re signed up to sell on Amazon, you can move on to step two.
2. Choose Your Niche
Once you’ve signed up for an Amazon professional seller’s account, the next step is to pick your niche. Think about what the Amazon customer would want. Think about the products you are going to sell and then select a general niche.
From there, you can narrow down the choices to specific niches (choose three or four) and then select those as your chosen niches. By selecting more narrow niches, you’ll be better able to market your products and cater to customers who want the online products you offer as a seller. But, always consider the bottom line profit margin.
3. Research Potential Products
Now that you’ve selected a few different niches, it’s time to research products. Figure out what inventory you’re going to buy and what items might be best left to other online sellers. Here are some ways to do product research:
General Product Searches
First, do some general product searches. Search for your chosen products on Amazon to see what other online merchants are offering. Also search other sites, such as eBay and specific niche retailers, to see what items are most popular. As you search, look at prices and find ones that are similar to what you plan to charge. Make sure your price point isn’t too high or too low. You want to make money and have a good profit margin, so don’t make it too low, but you also want to sell your products, so ensure the price tag isn’t too high.
Use a Keyword Tool
Keywords are essential when listing your products for sale and also when researching the best products to sell. The more often a product turns up in a keyword search, the more popular it is. Use a keyword tool like JungleScout or SEMRush to find out which products are the best sellers.
Best Seller Rankings (BSR) on Amazon
Another way to determine what products sell best is to use BSR on Amazon for your Amazon FBA business. BSR rankings show you which products are selling the most and how high the level of competition is amongst sellers for a particular product. This will help you choose the best products to start off with for your new business and make you the best possible seller.
4. Consider Product Sourcing Options
Once you know what you plan to sell on Amazon, figure out how you’ll get the products. Research product wholesalers and choose the one that offers the best deal and the quickest delivery.
If you’ve already tested out certain products, you can then directly purchase them from the supplier.
You’ll have various options regarding suppliers for your FBA business, including the following:
- Overseas suppliers
- Bulk items from local retailers
- Trade show vendors
- Local manufacturers
When you’re researching suppliers, make sure you factor in shipping costs. Even though you might be choosing the FBA business as a selling option, you still need to pay to have the items shipped to you from the supplier and then get them to Amazon to store for you.
5. Create Your Brand
When you have your products selected, you are almost ready to start selling. But, before you do, you have to create a brand name for yourself. Establishing your brand can be done by checking the following items off your list:
Choose a Name
Start by brainstorming name ideas with your product niches in mind. If you plan on expanding your offerings in the future, keep the brand name general. Use Google to help with this step by doing a search to make sure your chosen name is not already being used by another company. Also, make sure the domain is available and, if it is and you’re set on the name, reserve it ASAP.
Create Your Logo
Creating the best possible logo is just as important as selecting an eye-catching, memorable name. The logo is what individuals will think of whenever they hear your company name, so it has to be sensational. If you’re an artist you can create the logo on your own, but if you’re not, it’s best to leave the logo design up to a professional once you decide what it should be.
Create a Brand Motto and Theme
Another way for people to identify your company with ease is through a brand motto and theme. The brand motto and theme are two identifying features that help to ensure prior customers continue to buy your products and don’t leave your Amazon store to shop at the stores of your competitors. These items will help your brand to be unique and easily recognizable. This is especially crucial with private label items.
Make It Legal
The best way to safeguard your brand name and logo is to copyright them. You should also inquire about forming a limited liability company (LLC), which offers various protections and safeguards as you do business.
Getting a trademark is also a necessity to be able to join Amazon Brand Registry, which you will want to look into at some point.
6. Create Your Product Listings
Now it’s time to create your product listings for your private label products and other items you’ll be selling. Make sure with each product you include a professional photo of the product showing various angles when necessary. Use detailed product titles to draw people in and make them interested in learning more about your product.
With the description portion, be precise when describing your product and don’t be afraid to list all the details. Think of what you would want to know about the product if you were the buyer and not the seller. If you read back over your description and are unimpressed or left with questions, revise it until it’s accurate and complete.
Check out this post for more on optimizing your Amazon product listing.
7. Market Your Product
The final step to starting a business on Amazon, especially an FBA business, is to handle the marketing details. You want people to find out about your products and high-quality marketing is the way to do so. You’ll likely be working on a budget, but don’t worry, you can efficiently market your products with cost in mind. You can use Amazon Seller Central to help you with this.
Summing Up – Selling On Amazon is Easy (Especially with FBA)
Now that you know how to get started selling on Amazon, you’re probably ready to get started. Whether you want to choose the FBA business method or prefer to handle all the packaging and shipping duties on your own, these steps will help you along the way.