Have you been hearing stories of people making crazy money selling online? Do you wonder how to sell on Amazon?
There are so many ways to sell and be profitable. Whether it’s through typical yard sales, the Facebook marketplace (or, as some say, the Facebook Store), Craigslist, eBay, or a seller account from Amazon, there’s a plethora of ways to get your products out of your hands, replaced with money via your own online e-commerce business.
Notice that most of those options are through online marketplaces for selling. The power of the online seller’s market over the past decade has created a sense of power in the consumer, where there are no limits to what they can sell and make money online off of.
Perhaps the most prominent brand from those options is Amazon. Jeff Bezos, its CEO, is one of the wealthiest people on the planet, and his Amazonian empire shows no signs of slowing down. While Amazon has many products sold straight from the warehouse, a larger collection is from individual sellers and vendors.
If you want to be one of those sellers, keep reading. You’ve come to the right place.
Table of Contents
- 1 How to Start Selling on Amazon
- 2 Vendor vs. Seller: What’s the Difference?
- 3 Amazon Programs
- 4 What Should I Sell on Amazon?
- 5 Pros of Selling on Amazon
- 6 Cons of Selling on Amazon
- 7 The Bottom Line
How to Start Selling on Amazon
Learning how to sell on Amazon is not a complicated process, and setting up your account on the e-commerce website is easy. You most likely have an Amazon account already, but a seller’s account is a different type of registration.
To sign up for an account, go to services.amazon.com. From there, click the button that says, “sign up.” Underneath that sign-up button is a fee of $39.99 per year.
So we can squash the difference between having a professional or personal seller’s plan off the bat, this plan costs $39.99 monthly subscription fee if you select the professional plan.
The personal plan only charges $0.99 per sale plus extra fees. Basically, if you choose to sell fewer than 40 items per month, it makes more sense to use the individual plan. Otherwise, you’re just wasting money. The plan sells some people who don’t need it; don’t be one of them.
After deciding which of the two seller account options is for you, click your chosen option on the next page. Fill out the required information, including some tax details Amazon requires from you. Amazon doesn’t require you to have your own business, so selling simply as an individual Amazon seller is completely fine.
Once that’s all filled out, you have your seller’s account and your first online store. The product listing is pretty simple.
You should be able to search up an item that you want to sell online from there unless there is no original item with your search parameters. In that case, you need to make your listing, and if you are only selling randomly, it might be smarter to sell on eBay. Niche sales work on there better. But it’s up to you!
Vendor vs. Seller: What’s the Difference?
As a seller on Amazon, the shipping, listing, updating, and everything else is up to you. You have to build your store and create your commerce individually. Amazon does not act as a middle-man except as the website you list your products on.
However, say you are a legitimate business and want to sell products on a more wholesale basis. Amazon has made it easier for merchants to do just that.
Just give them your products.
Amazon truly acts as the middle-man if you are a vendor in that you send your products to Amazon to then list and sell your item. You make your money off the sale in similar ways, and your sales numbers will undoubtedly increase for a couple of reasons.
The item you are selling online will show up as “sold by Amazon.com,” which is more appealing to consumers than if it was just coming from any old business. Also, because of that confidence, more people will buy your products.
There is one caveat, however. You need to be invited from Amazon corporate to join in on its Vendor program. You almost certainly won’t be a vendor right off the bat, so learning the seller’s craft is essential.
Amazon has tons of seller programs that stack up among any retail competition around that makes it a great place if you have products to sell. Product listing programs help with earning money!
Fulfilled by Amazon
Do you know how that blue Prime logo just sticks out among everything when browsing through an Amazon listing? You want to have a product sold with Amazon Prime.
Welcome to Fulfillment by Amazon.
In the age of instant gratification, if you aren’t selling through Prime, customers will be less likely to flock to your store. It’s no secret that the best products are ones that can get to consumers’ doorsteps quicker, and with free shipping. You can send products to Amazon with a personal account and a professional seller account to get delivered to customers via Prime delivery.
If you sell on Amazon a lot with a history of success and know what to sell consistently, then you won’t even have to send products to Amazon’s headquarters to get in the Prime party.
In a trial period with Seller Fulfilled Prime, as long as you ship 99% of products out on the same day with high satisfaction, you’ll be in the program. Amazon says that sellers see a 50% rise in sales after using this program.
Subscribe and Save
Certain Fulfilled by Amazon products can be purchased on a rotating basis. By selling products online through the Amazon online marketplace, consumers can sign up to have your products shipped from your online business at a discounted rate as long as they purchase the item every set period, such as a month. The merchant gets a consistent cash flow, too.
Amazon Business Reports
The heart and soul of any good Amazon business are statistics. It shows you how good your business is performing, what you could improve in, who is buying your products and where from, what products to sell online, how your price margins are performing, and more.
Amazon has a comprehensive report page on everything you could need to run a business and control your storefront. It does all your product research for you, and it’s right there on your seller central dashboard.
What Should I Sell on Amazon?
There are two main ways to get products to sell. Either you purchase them or create them. Purchasing them could include used products, wholesale products, or for normal retail price. Creating them could be handcrafted yourself or from a manufacturer.
Retail Arbitrage vs. Private Label
Retail arbitrage means you’re purchasing the products to resell them on Amazon for a markup. Using the arbitrage method has a much lower barrier to entry. You could go to any big box store in the country and purchase the product and sell it on Amazon for a profit, assuming the margin exists. Sourcing to find products to sell using this method requires a lot of research to ensure you can actually make money doing it, though.
The added benefit to this method is that products will already have reviews, and the demand for them has already been established. So you won’t have to spend time creating a demand for the products. The drawback is that Amazon could also source the same product, which typically undercuts your pricing, making it challenging to sell since you’ll have a hard time competing with them.
Private label means that you are the creator, and are either creating it or having someone else create it for you with your branding on it. A private label product can be much more profitable if you can create a demand for your product, market and advertise for it, and actually sell it. A lot more work goes into private label products, and there is a lot more red tape to get approval. Coming up with product ideas and finding ways to drive traffic can be difficult, depending on the types of products you decide on.
Selling private label also means you’ll have to create product listing from scratch. This includes taking your images, learning to optimize product listings, creating descriptions with keywords, and doing your brand recognition. However, being a private label seller means you’ll have much larger profit margins, though, if successful.
Both of these methods can be sold third party or fulfilled by Amazon (FBA). Regardless of which method you’re using, you could try to drop shipping these directly to your end customer. This saves you on overhead costs since you won’t even have to touch the product, and you’ll have someone else to ship them for you. It could also save you on shipping costs since many will pass some of their discounts onto you.
Pros of Selling on Amazon
It’s the go-to place for shoppers
Amazon is by far the largest e-commerce company in the US. Its 2018 market share for E-commerce was 49%. eBay was in second place, albeit with 6.6%. It’s ridiculous how far in front Amazon is in front of the competition.
Shoppers will learn about your brand.
When selling anything, having a brand on Amazon will only strengthen people’s recognizability to your store and own website. In fact, it can work better than if you just wanted to advertise.
For example, say you are looking for a charger for your phone and come across the same company multiple times. You’ll recognize that company going forward. That company could be yours.
Online shopping is a huge industry.
Sixteen percent of all sales in the United States in 2019 was from online e-commerce websites, like with Amazon products. In 2018, Amazon was responsible for 5% of all retail sales in the country. The numbers for the e-commerce store don’t lie. Products on Amazon sell.
Cons of Selling on Amazon
Marketplace fees are never fun to deal with, and when you are going through a middle-man, the middle-man gets paid. An e-commerce platform like Amazon gets theirs.
Seller fees can take a decent chunk of your would-be paycheck away from the seller on seller central. This isn’t just an Amazon seller thing, either, as eBay and PayPal give a one-two whammy with their fee system.
Lack of Control
Not having full control of how a purchase works or if returns can or cannot be made under specific conditions can be stressful for some sellers. Marketplaces don’t always have the seller first in mind, which one could argue is fair. Nonetheless, the seller can still end up on the bad end of things.
With marketplaces and e-commerce platforms like Amazon, you need to keep your inventory up to date manually. Your different variations must be up to snuff, and that can be quite the time-consuming product for sellers.
The Bottom Line
While there is no perfect way to sell your products online, Amazon serves as an extremely worthy option for your Amazon business.
Not only will recognition from sellers bring more money to your table, but the plethora of business reports that come to the seller’s way is more than enough to keep people wanting to return to Amazon’s Seller Central time and time again.
Getting your first sale will be amazing. Anything more than your first sale, it’s addicting. Now, it’s your time to decide.
Will you have an Amazon seller account? An Amazon vendor? A small or large business? The choice is yours.