How to Start and Succeed with Amazon FBA: A Complete Guide for Beginners
Amazon FBA
The Ultimate Guide to Selling on Amazon FBA: Step-by-Step Instructions for Success
Amazon FBA is one of the best and smartest ways to enter the world of e-commerce. Whether you have experience in online trading and marketing or not, you will find that the topic is not difficult, and you can learn it, start with it, and profit from it easily.
After reading this guide, you will realize that selling on Amazon FBA is not difficult. We will explain and simplify all the steps and tools you need to know to enter this platform and achieve profits through it.
What is Amazon FBA?
FBA is an acronym for "Fulfillment By Amazon", which means fulfilled by Amazon.
In simple terms, you purchase and ship a specific product to Amazon warehouses. When a purchase is made, Amazon will take care of all shipping and delivery procedures.
In this process, you are simply a third-party seller who only purchases the product, lists it on the platform, and ships it to the warehouses. Your most important role and task is to research, list, and advertise on the platform.
In this way, you pay additional fees for using Amazon warehouses and shipping your products. However, it also relieves you of many steps that are considered tiring and difficult for many people, which you may face if you create your own e-commerce store or sell your product through Amazon FBM.
Amazon FBA vs. FBM: A side-by-side comparison
Selling on Amazon is not limited to the FBA method we explained before, but it also has another form, which is FBM or Fulfilled by Merchant.
The fundamental difference between the two types is that in the second type “FBM” you are responsible for storage, shipping, and all customer-related operations, unlike the first type in which Amazon takes care of all those procedures.
Regardless of the type you work in, you still need to learn how to do many important tasks such as product selection, sourcing, and listing on the platform correctly, which we will discuss shortly.
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| Amazon FBA |
How to Sell on Amazon FBA
1. Product Selection
Choosing the right product to sell is one of the most important steps in starting this type of business. You need to consider many factors and variables to choose the best product and make the most profit.
You may immediately think of a number of potential products you want to sell, or you may have already decided what type of product you want to sell. Whether you have made up your mind about the product or not, you need to consider the following:
- Profitability: You may think that you can make a good profit from selling any product on Amazon, regardless of its size or price. However, this is not true. The larger the product, the more you will pay for shipping and storage. On the other hand, if the product is on the low side in terms of price, it is possible that you will not make any profit at all from that process.
It is difficult to give you a specific price or size, as the calculations vary greatly from product to product. However, do your calculations well, and you will reach the perfect product for you.
In any case, try to keep the product above $20, especially if you are selling in one of the foreign markets. This is one of the secrets of selling on Amazon FBA.
- Demand: Once you have confirmed that selling the product you have chosen is profitable and will return you money after other side costs, now it is time to make sure it is in demand.
You don't want to buy a product, ship it to Amazon warehouses, and in the end, no one buys it.
Therefore, you need to see the search rate for this product, and that it is requested regularly, not just seasonally. This will ensure that you generate sales throughout the year through Amazon FBA.
You should not only look for the demand rate, but also the number of sellers. If the demand for the product is average and the sellers are few, you can still sell in this market.
To give you some approximate numbers, target products that achieve at least 10 purchases per day.
- Competition: Logically, you are supposed to start selling the product immediately after you have confirmed that it is highly profitable and has a decent demand.
However, this is an unwise decision. You need to make sure of one last thing first, which is that the product is competitive among all sellers, and is not monopolized by a particular seller or brand.
There are some products and areas that generate high profits. However, on the other hand, the competition in them is dead. People only buy from one or two famous sellers on the platform.
Therefore, make sure that most sellers are making regular profits, and that you can outperform some of their product defects that you find in the reviews.
Now, you may be wondering how to do all this research accurately. The answer is simple, there are many market research tools available online.
These tools give you accurate statistics about sales on Amazon, along with many other information that will help you throughout the sales process.
The most prominent of these tools and the most famous are Helium 10 and Jungle Scout. Both tools are paid and have different features. Search between them and choose the one that suits you.
Since we have started mentioning tools, you will also need the free Amazon Seller App, which will make you able to manage your store on Amazon FBA and everything related to it easily on your phone.
2. Finding a supplier
After selecting the right product and passing it through the filters we mentioned earlier, you will find that the next steps are much easier, so don't worry.
In this stage, you will need to find a suitable supplier to manufacture the product for you with the details you want and then ship it to Amazon warehouses.
You may find this step a bit daunting, as you will be communicating with people from other countries far away from you and you don't know if things will go smoothly or not.
But don't worry, this topic has now become much easier than before, and there are rules and guarantees for this communication process.
You will need to search and compare between suppliers, for example, through a site like Alibaba, which is one of the largest business platforms in the world, and provides a huge number of suppliers that you can communicate with.
To reach the ideal supplier for your product, make sure the following points are available in it:
- Experience: Alibaba provides you with a lot of data about suppliers, and one of the most prominent elements you need to look at in the beginning is the duration of this supplier's work, he must have been a manufacturer of your product for at least two or three years.
- Ease of communication: If your supplier is slow to respond or you are extracting the necessary details from him with difficulty, this will waste a lot of your time and effort, so choose the suppliers with the smoothest response and communication.
- Reasonable price and quality: The two essential elements for achieving profit from this process are price and quality, so reach the balance that suits you between price and quality.
- Be verified: You can make sure if the supplier is verified or not through the filters provided by the Alibaba platform, and make sure that he has activated the Trade Assurance feature so that you are reassured in dealing with him.
After applying the previous conditions to the suppliers, you will most likely have created a list of some potential suppliers to make the product for you, and now you need to communicate with them and tell them about the product in detail.
After receiving their offers, you will need to reduce your list to the best two or three offers, and request samples of the product you want.
You may find this step a bit expensive, but it is worth every penny you spend on it, as it will ensure that the product is in the shape and quality you want.
Of course, if the product is not made in the shape you want, you can ask them to make the modifications you want, which are for an additional fee.
The inspection is not limited to the product only, but also to the packaging and the brand, so if the packaging is not up to your expectations either in dimensions or design, you should inform the supplier of that.
After completing all of this, it will be clear to you who is the best supplier you will deal with, but wait, don't ask him for the shipment you want right now.
Instead, go first and register your account on Amazon FBA, and add the product to make sure that this product is allowed to be sold in the target country, and to also know the quantity that you can store in Amazon from this product.
Then you will ask him exactly for the shipment you want and you will follow up with him on a regular basis on all updates related to the manufacturing process, which usually takes between two weeks and 6 weeks.
3. Registration on Amazon FBA
It is the easiest and simplest step on this list, as all you will do is fill in some data without having to put in a lot of effort.
The first thing you will have to do is choose the market you will work in, whether it is the Egyptian market, the American market, or other markets, but make sure first that this market is available to work on from Amazon FBA in your country.
To start registering your data, you will need to go to the Amazon Seller Central website, and it is preferable to register with a separate email account for Amazon FBA from your personal account.
After completing the traditional steps of entering your name, email, password, confirming it, and entering the code they send you in the mail later, it will take you to another page to enter the important data.
You will need to enter a lot of detailed information related to identity, address, country of residence, date of birth, credit card, and others.
Filling out this information is not difficult, but try your best to be as accurate as possible, because any error or conflict in that data may cause Amazon to reject your account.
4. Listing Products on Amazon
Listing products correctly is a critical step in selling on Amazon FBA. It is the main factor in whether a buyer will find your product when they search for it.
If you don't know what product listing is exactly, it is simply adding product information so that buyers can find it when searching.
Once you have listed your products correctly, you will have improved your ranking in Amazon search results and attracted much larger numbers of buyers without taking any additional marketing steps.
Of course, there is a certain way to list products and some clear and proven steps that will make you appear in the first results:
A) Use the right keywords: Most buyers often use the same words to describe the product they want to buy. Your role in this step is to know what those words are that they use frequently so that you can use them later in the title and product description.
The sites we mentioned earlier in step one allow you to search for these words, and you can also see the most frequently used words by stores with the most popular products and use them as well.
B) Use high-quality images: Images are a very central element in the process of buying any product, as users usually look at the image before reading the description, so your images should be high-resolution and well-lit.
Amazon's terms also apply, which state:
- They are identical to the product you are displaying and are not taken from the internet randomly.
- They have a plain white background with no watermarks or logos.
- The product should account for 85% of the main image, unless it is a book or similar, in which case it should account for 100% of the image.
- Your image should be at least 1000 × 1000 pixels, and it is preferable to be more so that it is clearer when zoomed in.
- The number of images should not exceed 9, and of course, it is best to place as many as you can within this framework.
C) Get an UPC barcode: Amazon FBA requires that the product packaging contain several elements, including a barcode specific to you and your product.
All you will need is a barcode for each separate product you sell. For example, if you sell a notebook in three different colors, you will need a barcode for each color.
The best place to buy barcodes is the GS1 website, which is a paid site that offers you multiple plans depending on the number of codes you need.
Beware of dealing with resale websites or "Reseller" that offer them for a cheaper price, as they can cause you problems with Amazon.
D) Write the title correctly: We mentioned the importance of mentioning keywords in the title, but don't make it a random title without features to be easy to read for the buyer.
This is done by using punctuation and including only keywords with high search rates, and it is also recommended to use as many letters as possible.
E) Highlight the benefits of the product, not the features: In any marketing process, the level of customer awareness of the product is taken into account, and the campaign is designed based on this.
As for Amazon, in most cases, its visitors are not high-awareness customers like manufacturers or wholesalers, so you should not put features in the description.
Instead, you should put the benefit that will return to the buyer in case of purchasing it and the potential problem that they searched for this product to purchase it.
Make those benefits in the form of points, not paragraphs, so that it is easy for them to notice and read them among the other details.
5. Shipping Products to Amazon Fulfillment Centers
After completing the manufacturing process and listing your products, you will need to ship them from China to Amazon FBA fulfillment centers, no matter which country you have chosen to sell in.
Three essential steps in this process:
1. Selecting a Shipping Company
Most factories on Alibaba already offer the option of shipping products to Amazon fulfillment centers, which is why many sellers are inclined to give them this task so they don't have to do more research.
However, while this method is easy and will save you a lot of time and effort in the beginning, it is also very expensive. In some cases, the shipping cost can be the same as the manufacturing cost.
Therefore, it is preferable to choose a shipping company, which you can also choose from Alibaba by entering the country of origin and the country you will be shipping to in the search bar.
Of course, you should consider the ratings, communicate with more than one company, make comparisons, and other steps that we mentioned earlier in the step of finding a supplier.
In general, you will need the details of the product quantity, measurements, weight, and so on. Ask the supplier for this information before contacting them so you are prepared.
2. Product Inspection
To make sure that the products you ordered from the supplier meet the quality and measurement standards you requested, you will need to inspect them before shipping them to Amazon fulfillment centers.
Of course, you will not be able to do this task yourself, so you will need a inspection company to go to the factory and give you a detailed report on the quality of the products.
If you think that this step is expensive and may not be worth the money you spend on it, you are wrong. It is not only to make sure that you do not lose the profit of some damaged pieces.
Its importance lies in the fact that it makes it very difficult for a customer to complain about the product and give you a bad rating, which can kill your entire business.
Customers build their trust in online shopping on the ratings of those who came before them, so any mistake in the beginning can be fatal.
You can contract an inspection company separately or you can search for one through Alibaba, but in both cases, choose a company with a good reputation so that they do not deceive you in the reports to the benefit of the factory.
3. Getting Your Warehouse Address
After knowing the product measurements and details, you will need to log in to Amazon Seller Central on the Manage inventory page.
Enter all of this information and get the barcode that will be placed on the product packaging (this barcode is different from the other one we mentioned earlier).
Then you will send this barcode to the factory, to put it on the outer packaging of the product.
Then you will get a special address for the warehouse dedicated to your product, which you will send to the shipping company so they know their exact destination. Amazon will then ask you for a tracking number, which you will take from the shipping company and register in Amazon.
6. Advertising on Amazon
When you launch your product, it will not achieve the sales you expect at first. In fact, it will not be visible to most buyers in the first place, as it will be located on the last pages.
Therefore, you will need to run advertising campaigns on Amazon to make the product more visible to users when they use a certain keyword or visit a similar product.
This is done through Amazon Pay-Per-Click, which is an Amazon-owned advertising platform that allows you to create an ad for your products on Amazon and link the appearance of this ad to certain keywords.
When a buyer searches for one of the keywords you have defined in the ad (which of course are related to the product you are selling), your ad will appear. Your ad may also appear in the suggested products section.
Amazon ads are a very effective way to promote your product and make it visible to people who are interested in buying it. The ads may be a bit expensive at first, but they are necessary for the product to appear naturally later on.
In addition to Amazon PPC, there are some other methods you can use, including:
- Offering discounts: People always compare product prices when shopping, so make sure to offer some discounts from time to time to encourage them to buy.
- Requesting reviews: People always trust products with high purchase rates and positive reviews. Therefore, after you sell a product, send customers an email through Amazon asking them to review the product they purchased from you.
- Distinguishing your product: Sellers of the same product often use the same formula for shooting and displaying products. Therefore, any distinctive method or additional element in the product image will attract the attention of the buyer.
- Considering pricing: In fact, many Amazon sellers do not recommend lowering the price to attract customers. Although this method will attract some, the majority consider ratings and features more. Therefore, as long as the product price is reasonable, focus on other aspects.
Note: We are talking about ways to market your product within the Amazon platform, but of course there are many other methods and strategies you can follow to market your products outside of Amazon, such as:
- Marketing your products on social media.
- Marketing your products through a private blog.
- Marketing your products through influencers.
- Marketing your products through Google advertising campaigns.
And many other ways through which you can achieve excellent sales, which we may dedicate a special article to in the future.
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| Amazon FBA |
Common Mistakes to Avoid When Selling on Amazon FBA
High expectations:
Amazon FBA is not a magical place that will make you money as soon as you put your products in it. It's just like any other way to make money, and it can be profitable or not.
So keep your expectations realistic. In the best case, your profit margin will not exceed 15% to 25%. This is important to accept.
And that will only happen after a period of sales and advertising campaigns, which may last for three shipments. It is possible that you will be the one paying for them at that stage without any suitable financial return.
Starting with an inappropriate capital:
However, even so, you will need to make sure you can afford the cost of manufacturing, shipping, inspection, tools, and advertising.
This is of course in addition to the cost of ensuring at least one additional shipment of the product is always ready. You don't want, after the product starts selling and making profits, that your inventory runs out and you start from scratch when the new shipment arrives.
There is no fixed capital for all types of products, but the average amount to start on Amazon FBA will not be less than $5,000.
Selling only high-demand products:
But they don't know that in order to compete with these sellers and appear on the first page, they need to sell the same number of pieces, which is considered almost impossible for a beginner.
So try to choose a product with medium demand that you can provide additional value in and keep up with its sellers. And then, after you gain experience and more capital, start selling those products.
Rushing before listing:
The fatal mistake here is that the product may not be allowed in the country you will sell in, or it may be in violation of one of Amazon FBA's policies related to trademarks and intellectual property.
Or even that the space that Amazon will allow you to store it is much less than the number you requested. Therefore, make sure to list and wait for Amazon's response before taking any serious step.
Skipping some steps:
Things like requesting a sample from suppliers, hiring a company to inspect the product, creating a custom design and new barcode for products, and taking professional photos are considered by some to be unnecessary formalities, but they could damage your business on Amazon.
Not distinguishing the product:
All products, their display methods, and features are often very similar. Therefore, you need to put something that catches the buyer's attention, such as attractive photography, competitive pricing, or adding something for free, such as shipping.
Playing with the price:
Therefore, you should always set a reasonable price according to the average of the competitors who sell the same product on Amazon.
Conclusion
Selling on Amazon FBA may seem more difficult than some other forms of online selling, such as dropshipping. But in reality, it is more guaranteed, and it can generate excellent profits. And above all, it is considered a long-term business.
In this article, we aimed to cover all aspects and details of the process of selling on Amazon FBA, and all the steps you will need to know to start generating profits on that platform.
We hope you enjoyed and benefited from this article. If you have any questions, please ask them in the comments below, and we will answer them as soon as we can.
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