FBA is a process whereby sellers send their goods to Amazon and Amazon lists them at the site, takes payment, deals with enquirers and buyers, and fulfils orders. Soon afterwards, Amazon sends a portion of the proceeds back to sellers.
The process is easy to understand and well documented in simple step-by-step format at the site, but using FBA can earn sellers significantly less than doing all their own selling and delivering goods direct to buyers.
Amazon’s FBA fees are quite high, not only for space to store sellers’ goods in the company’s warehouses, but also for picking goods from storage, as well as packing and delivering goods to buyers.
For a low profit product, it’s possible Amazon could earn more of the price paid by buyers than sellers receive from the company. There are even stories of sellers being out of pocket for sales made using Fulfilment by Amazon.
Thankfully, a number of tips will help you make money with Amazon sourcing on every sale. Such as:
– Choose products similar but not the same as goods already attracting high profit, regular sales at Amazon. When you find them, make your offer different to those other sellers, by offering a bonus package with every sale or adding your own eye-catching packaging to private label products to make them stand out from competing products. Give your products their own unique title and that way they cannot be compared or price checked on Amazon.
– Choose products matching high frequency search terms for other items at Amazon. Write down keywords common to Amazon’s bestselling products similar to those you propose selling. See how many top selling items contain one or more of those keywords and use the more frequent examples in your Amazon titles and listings. Use most frequent keywords in the name of your product but without breaching trademark laws or using brand names.
– Choose small, lightweight items, because Amazon charges by space required to stock your products and by the weight of each package removed from storage and packaged for delivery.
Last but not least, you will find FBA more expensive than doing everything yourself, but you will save time spent on unproductive tasks and be able to focus on more profitable chores, like sourcing new products and expanding your bestselling products to other marketing venues.