A Guide to Selling on Amazon FBA

20 Mar 1 Sun 17:23
Home Beginner’s Guide A Guide to Selling on Amazon FBA
Amazon FBA Review
How Does Amazon FBA Work?
What's Your Role as the Amazon FBA Seller?
Individual vs. Professional Amazon Seller Accounts
Amazon FBA Fees
Starting An Amazon FBA Business
What To Sell On Amazon FBA
Conclusion

Today, most people have learned and liked the art of selling their brands online. This is because people don't have to setup physical structures for running a business. However, running an online business can sometimes be challenging. Serving online customers whom you've never met can be a daunting task. Remember that for you to sell online, you have to list your item somewhere for it to be seen by customers. Even after listing, you have to promote it so that it can be seen by many customers. You have to receive and process orders from customers. Once a customer orders for an item, you have to organize for the delivery of the item to the customer. It's also your duty to follow up and ensure that the item has reached the right customer and in the right condition. Sometimes, customers may reject your item upon delivery. This means that you will have to process returns and any returns if applicable. This shows that selling online is not as easy as most people think, especially think.

Luckily, there is a solution for you, the Amazon FBA. It's a program offered by Amazon to those selling on Amazon. With the Amazon FBA, selling is made easy. It does many of the tasks on your behalf. Your major task is to choose the item to sell. After choosing and getting the item, you ship it to the Amazon FBA warehouses. You then wait for money to flow into your account. This is because Amazon FBA will do other tasks for you. That's how things will be easy for you as an amazon fba seller.

Amazon FBA Review

FBA means Fulfillment By Amazon. In Amazon FBA, Amazon will perform all the hard tasks for you. The Amazon FBA relieves amazon fba sellers of most tasks. It has changed the way businesses are run on Amazon. Some of the tasks that FBA does for its users include:

  • Preparing items while in their storehouses
  • Receiving orders for various items from customers
  • Preparing items ready for shipping to the customers. The major preparation task done by Amazon FBA is packaging items.
  • Shipping items to customers
  • Following up to make sure items reach right customers and in time
  • Handling customer complaints raised in relation to items.
  • Providing customer support
  • Handling payments for items from customers
  • Handling returns of products from customers.

When running a business, whether online or not, you have to deal with all the above tasks. However, the Amazon FBA has made things different. They take up the above responsibilities and perform the tasks on your behalf. This makes it possible for the seller to focus in looking for strategies that can invent to help in expanding the business. This means that it's easy for you to grow your amazon fba business by joining the Amazon FBA program.

How Does Amazon FBA Work?

For you to join and become an amazon fba seller, you have to go through a number of steps.

how to start amazon fba

However, these steps are simple and can be accomplished within a short period of time. The following are the steps explaining how fba selling works:

Step 1: You identify the item to sell. Remember Amazon is a large marketplace. There are millions of items on sale on Amazon. If you join Amazon, you will find thousands of other sellers selling similar item as yours. There are also variations or alternatives to your item. This means that Amazon is a competitive marketplace. The type of item you choose to sell on amazon fba will determine the future of your amazon fba business. Your business can either succeed or fail, which is majorly determined by the type of item you choose to sell. This means you have to be keen when choosing the type of item you sell on amazon fba. Luckily, there are many software tools that can help you identify the best item to sell on amazon fba. Most of these software tools are free while others are paid. They consider factors like competition and amount of sales when recommending the type of items to sell. Choose one of the tools to determine the item that you will be selling on Amazon.

  • Step 2: Once you have identified the item to sell on amazon fba, you need to get it then ship to Amazon. Amazon FBA has large warehouses where they store items for amazon fba sellers. These stores/warehouses are known as fba fulfillment centers. The fulfillment centers are managed by employees and robots. You ship your items to them, then they store them in these fulfillment centers.
  • Step 3: The items are then sorted and inventoried by Amazon through employees and robots. Amazon knows how to take care of items while in their warehouses. If any of the items gets damaged while in the fulfillment centers, they will take the responsibility of reimbursing you. You get a full reimbursement of the item's retail price.
  • Step 4: The customers will see your item listed on Amazon and make an order. Amazon FBA will receive the order and handle the transaction on your behalf. You are not required to do anything as far as the transaction is concerned. Amazon FBA has automated the process of handling transactions related to processing of customer orders. The orders are processed quickly, accurately and more efficiently.
  • Step 5: Amazon FBA identifies the location of your ordered item from the shelves, pick the item, pack it then ship to the customer. Note that they do this without involving you.
  • Step 6: Once the item has reached the customer, Amazon FBA does a follow up to ensure that everything is okay. In case a new need arises, amazon fba will take the responsibility of handling the need on your behalf.

That's how the process of selling on amazon fba work. It's simple and easy for anyone. If you want focus on something else while at the same time running your amazon business, join the amazon fba program. The process of starting an amazon fba business i simple. Running the business is also easy, making the amazon fba the right program for anyone intending to sell on amazon.

What's Your Role as the Amazon FBA Seller?

As you know, Amazon FBA does most of the tasks for its users. However, as the amazon fba seller, you still have some roles to play. You will be responsible for:

Amazon FBA Product Research

The role of doing amazon fba product research belongs to you as the amazon fba seller. You have to identify and pick the best item to sell. The good thing is that there are different ways through which you can get items for fba selling. There are also different tools available to help you carry out research and know the most profitable item for sell. A good example is IO Scout. It's your task to determine what to sell on amazon fba.

Inventory Stocking

Amazon manages your inventory for you once you ship your items to their fulfillment centers. They sort the items and prepare them for shipping to customers. However, it's your role to ensure that there is enough stock for your item in the inventory. Amazon will notify anytime your item is running low of stock. It will be your role to ship another stock of the item to their fulfillment centers.

Marketing

Amazon is a very competitive platform. Your item will be competing with thousands of other similar or related items. This means listing your item on Amazon for sell is not enough. Actually, it doesn't mean your item will automatically fetch sales. You must put in some effort to make your item visible to potential buyers. If they see the item, they will be interested to know what it is about. They will click the item to view its details. You need to come with techniques to help you create catching content that will completely grab the attention of the potential buyers. They will buy the item instead of going back for your competitors' items. Amazon will not market the item for you, but you have to do it for yourself. Some of the ways you can use to market your item include using colored images, using best keywords, using bullet points etc.

Individual vs. Professional Amazon Seller Accounts

Amazon provides two types of seller accounts. Each amazon fba seller is required to choose the one. They include:

  • Individual seller account
  • Professional seller account.

The individual seller accounts are free, but they attract higher sales fees. When using this type of account, you will be charged $0.99 for each item that you sell. This means that if you sell a high number of items, the plan will be expensive for you. Suppose 1000 items in a month. A charge of $0.99 per item sold translates to $990. That is too expensive. This makes this plan only suitable to those who know they cannot sell more than 40 items monthly. This means they will be paying less than $40 monthly.

what to sell on amazon fba

The professional seller account attracts a monthly charge of $39.99 monthly. However, the fba seller is not charged the $0.99 per item sold. This make the plan suitable for amazon fba sellers who target to sell more than 40 items monthly. This will help them save greatly on the $0.99 charge.

If you need to start small, choose the individual seller account. If you need to be selling more than 40 items, choose the professional seller account.

Amazon FBA Fees

The Amazon FBA program makes selling easy on the Amazon platform. The Amazon seller is relieved of most of the tasks involved when selling on the platform. However, these services are not offered for free. You've to pay for them. Selling on FBA attracts additional charges compared to selling through FBM (Fulfillment By Merchant). Let's discuss the various types of fees FBA sellers incur:

Referral Fees

Amazon requires you to pay for using this platform. This payment is charged as the referral fees. Amazon items are grouped into categories. Different categories of items attract different amounts of referral fees. However, the referral fees is not normally more than 15% of your item's price. When determining best items to sell on amazon fba, it's recommended you choose items in categories that attract a referral fees of 15% and below. This way, you will avoid any unnecessary charges.

Categories like clothing, jewelry, etc. attract high referral fees and are tough to make sales.

FBA Fulfillment Fees

This is the type of fees that you pay Amazon for pick, preparing, packing then shipping your items to customers. Remember they also handle returns and refunds on your behalf. You pay them fulfillment fees. The amount of fulfillment fees paid by FBA sellers is determined by size of items. Items with small sizes attract less fulfillment fees. Items with larger sizes attract higher referral fees. The shipping costs for your items are factored in the fulfillment fees and the amount is determined by the carrier. However, Amazon negotiates with various carriers, allowing you to save some money.

Items of below 1lb attract a fulfillment fees of $2.41 per unit, while items of above 90lb attract a maximum fulfillment fees of $137.32. For you to incur less FBA fulfillment fees, choose small and lightweight items. These attract low fulfillment fees as well as shipping costs.

FBA Monthly Fees

This will depend on whether you're using an Individual seller account or Professional seller account. The professional seller account users pay a monthly charge of $39.99. The individual seller account owners don't pay this. However, they pay a charge of $0.99 per item sold.

Amazon Storage Fees

As you know, amazon fba sellers ship their items to FBA for storage in the fba fulfillment centers. This is not done for free, but they've to cater for storage fees. The reason for charging this fees is to avoid a situation where sellers' items stay in the fulfillment centers for long. The amount paid as storage fees is determined by volume of your items and calendar month. The fees is always low between January and September. During this period of time, there is a low demand for items. However, the fees rises between October and December. During this time, there is a high demand for items.

what to sell on amazon fba

If you store your items in the FBA fulfillment centers for more than a year, you will incur long-term storage fees, running up to $6.90 for every cubic meter.

To reduce amount paid as storage fees, only keep a stock of 2 months at any particular time. The impact will be less storage time in fulfillment centers.

Starting An Amazon FBA Business

Now that you know how the Amazon FBA works, you must be interested in joining the program. The following steps will help you get started:

Step 1: Create Amazon Seller Account

First, you must an account in the Amazon Seller Central. This can be done from amazon.com. You will be required to provide various details during the registration process. Example include names, phone, bank details etc. Fill correct details to make payments faster. For trust purposes, you can a photo to your profile. Once you've filled all your details, click OK button and your account will be created.

Step 2: List your Items

Now that you seller account is ready, it's time for you to create a listing for your items. Amazon allows you to sell nearly everything you can think of. You've to list the item in its right category. This will increase chances of your item being discovered when buyers browse through the categories of items they are interested in.

When adding product images, use high-resolution ones for improved visibility. If you've many items, simply ship them to fulfillment centers and start your amazon fba business. Note that at this time, you're not required to pay the FBA fees. This will come later when you begin to make sales.

Step 3: Learn Private Label

For any amazon fba seller to reap maximum from the FBA program, they must understand private labels. You have to research about what to sell on FBA, source the items from their manufacturer and ship them to fulfillment centers. Once the items have been listed, selling them will become easy especially they are on high demand. You then relax and watch Amazon sell the items for you. Anytime Amazon sells your item, you will receive a notification in your seller account.

Step 4: Get Paid

Since your item has been sold, you've to be paid. However, the payment will come after deductions for the FBA fees have been done. Note that the fee won't be charged after each purchase, but after two weeks. This way, you will have enough time to pla your budget, making it an effective way of making deductions. The payment will be channeled to your bank account and any information related to taxes will be send to you.

What To Sell On Amazon FBA

Searching the best items to sell on amazon fba can be a challenge. After identifying the right item to sell, you must know how you will be sourcing it. It's after you've sourced the item that you will send it to the fulfillment centers for sell by Amazon FBA. Here are few ways used by amazon fba sellers to source items for sell on FBA:

Arbitrage

This method involves looking for low-priced items in retail shops and other e-commerce sites. The items are then resold on Amazon at a higher price. When using this method, target items that are on discount. You will purchase them at low prices then sell them at higher prices. The difference between the two will mark your profit.

Wholesale

This involves buying large quantities of items of goods from manufacturers. When you buy bulk items, you get discounts. When you resell the items on Amazon, you earn profit.

Used Books

Your shifting neighbor must have books they no longer want to read. You can also find used books in yard sales and book sales. These are sold at discounted prices. When you resale them on Amazon, you will earn profit.

Private Label

This involves researching and manufacturing own branded items for sell on Amazon. You will then exercise control over each aspect of the item. It's the common way of getting items for sell on Amazon FBA.

Conclusion

The Amazon FBA is a program offered by Amazon to sellers. It's a great program for those in need of running Amazon businesses while still doing something else. With Amazon FBA, the seller is relieved of most of the tasks that Amazon sellers have to perform. This helps the amazon fba seller to focus on something else like crafting strategies for expanding the amazon fba businesses. This means that amazon fba sellers have great chances of growing their businesses for the benefit of their brand.

Amazon fba operates on a simple principle. You ship the items to their centers, then they sell them for you. Note that even though FBA does most tasks for you, you still have some roles to play as the seller. You have to research and identify the best items to sell on amazon fba. There are various tools you can use for this. It's also your role to ensure that you market your item and make it visible to shoppers. This way, the item will be seen by many shoppers, increasing chances of it being purchased. Again, you are responsible for ensuring that there is enough stock of the item in the inventory. Amazon stores your items in its fulfillment centers. Once they realize that your item is running low of stock, they notify you. It's your role to ship fresh stock to their fulfillment centers.

Amazon FBA does the tasks of preparing your items once they reach to their fulfillment centers. In case some items gets damaged while in the fulfillment centers, they reimburse you the retail price of the item. FBA receives and processes customer orders on your behalf. They also ship items and handle complains, refunds and returns for you.

Explore the most powerful tools to kickstart & grow your Amazon FBA business.