I decided to take a 6 month journey through Asia last year after quitting my job and trying my hand at online marketing.
It was the biggest learning experience of my life in many ways, but especially through the learning of all the ways digital nomads everywhere were earning an income.
One of the most popular ways digital nomads were earning money to travel was by selling items purchased from China and selling them back to the US through Amazon.
In this quick curated article, I’d like to share with you this very popular and amazing opportunity to earn enough income through Amazon.
What is FBA?
Fulfillment by Amazon.
FBA first launched nearly 10 years ago to let businesses use Amazon’s infrastructure to store and ship their goods, but it is still seen as one of the biggest opportunities for sellers right now, according to several people whom Business Insider spoke to as well as a panel of presenters talking about the “unwritten rules” of Amazon sellers.
By using FBA to let Amazon handle shipping logistics, sellers can cut their inventory and shipping costs (though Amazon does charge fees for the service) and make their goods eligible for Amazon Prime, the company’s $99-per-year membership program, which offers free two-day shipping on more than 20 million items. The Prime aspect is a big part of what makes FBA so valuable for Amazon.
FBA is generally a hot topic in part because Amazon is investing in it heavily of late as it becomes a bigger part of its business. In its fourth-quarter earnings last year, Amazon said goods sold through FBA made up more than 40% of its third-party sales. The company also announced last summer that it would add six new fulfillment centers and more than 15 “sortation” centers in the coming year to help it improve shipping efficiency for both its own inventory and FBA goods.
A recent Consumer Intelligence Research Partners survey of 500 Amazon shoppers concluded that Prime members spent more than double what nonmembers did.
Amazon has spent the past year amping up its digital offerings for Amazon Prime and investing in FBA because it banks on the fact that when it hooks people into its Prime ecosystem, it will make more money from their increased shopping.
How Can I Sell Something On Amazon?
The whole idea is to first choose a market you can easily dominate. (And by easily, I mean a market that isn’t as competitive since its probably not going to be easy)
After that your job is to choose a product, then source it. Meaning you buy it from China.
The most popular website on the planet for finding products in China is ALIBABA.
There’s A LOT TO GO INTO!
But I’m going to make it as clear as possible just to get started. It’s up to you to really dive in more to learn of all the opportunities with FBA!
What Can I do to Start?
Create an Amazon seller account.
In order to get your FBA business up and running, you’re going to need to create an Amazon seller account. Go to Amazon’s website, scroll down to the footer and look for the heading marked “Make Money with Us.” Then, click on the link that reads “Sell on Amazon.”
At this point, you can either sign up as an “Individual” or a “Professional.” When you sign up as an “Individual,” you will not be charged a monthly subscription fee. If you’re looking to build a business over the long haul, then you’ll want to sign up as a “Professional.” The first month is free, and after that, it’s $39.99 per month plus selling fees.
Other than that, the signup process is relatively straightforward. Follow the onscreen instructions and complete setup.
How Can I choose a product?
There are a number of different ways to leverage the FBA model, but the most popular way is private labeling. The idea is to establish a brand or label, apply it to your product and sell it on Amazon.
First, you will need to do your Amazon product research.
Some of the tools I’ve heard other successful Amazon Sellers use are:
Unicorn Smasher (best software name EVER)
This is the most important step for a variety of reasons.
If you enter an unpopular product category and sell a product for more than your competition is selling it for, you could lose money on that product. If you take the time to find a popular product category, do competitive analysis, study product reviews and identify a product that you can improve upon or sell at a better price, you’ll have found the sweet spot.
Another popular way to sell products through Amazon is with retail arbitrage — buying a brand name product and flipping it on Amazon for profit. This is a much easier way of making money on Amazon, at least in the short term.
With private labeling, you need capital. Ordering private label products may cost you several thousand dollars, but if you’re looking to build an asset that can later be sold, then this is the direction you want to go in.
Another key piece of the puzzle is your supplier. You can’t make money if you don’t have products in stock, so you need to ensure that the time delay between the placement and delivery of the order is as short as it can possibly be.
Tips for growing and scaling your FBA business
- Pursue your passion. If you enjoy doing it, you will stick with it for longer. Find a product category that interests and excites you.
- Increase your product offerings. You will need to do proper research for every new product offering you create. Having more products can reduce the risk of your business becoming dependent on just one product.
- Improve your Best Sellers Rank. BSR is an important metric for both your customers and your sales. This is also a key factor when the time comes to sell your business. Buyers will want to see steady growth in your BSR rank over time.
- Build your brand website. As you continue to expand your private label product offerings, you’ll want to build a professional, dedicated site for your business. This gives you another way to market your products, and can also make your business attractive to potential buyers.
- Become an Amazon Associate. Increase your revenues by becoming an affiliate with Amazon. Refer customers to your products from your own site, and start earning commissions.
How Can I Rank My Product?
Here’s an in-depth article you should go through after choosing your product.
I encourage you to read the whole thing to know what’s up!
How much do FBA business owners earn? What is the earning potential of an FBA business?
Spencer Haws from Niche Pursuits reports he was able to make nearly $40,000 within 30 days of starting his FBA business. Chris Guthrie from UpFuel made almost $3,000 within 30 days. James Amazio, founder of Feedbackz, went from zero to $50,000 per month in just eight months.
These results aren’t necessarily typical, but they do show that it is possible to build a five-, six- or even seven-figure business by leveraging the FBA model.
Like I said, this subject is huge and definitely needs time to learn about. Although the earning potential is great, it does take time. This covers a lot on how to sell something on Amazon.
As a traveler myself, I think this is a great way to earn enough money to travel and live abroad for sure.
Expect to hear more on this topic in the coming weeks.
Leave a comment below and let us know if you’re interested in learning more!
- Thomas Smale: https://www.entrepreneur.com/article/282277