Amazon: How to start earning money
Internet is filled with success stories of entrepreneurs earning big money on Amazon platform, but it is rare to find a comprehensive guide on how to start and scale your business with Amazon. It is true that Amazon is growing in sales steadily year after year, and even if you have a daytime job, it is now the best time to start earning extra $ on Amazon. So where does one begin?
Despite common belief, a strategy for building and launching a successful online business is simple and straightforward. This strategy and your hard work will yield you about $10 000 a month within the first year of selling.
Find your products and your niche
Amazon has a huge audience, thus to be successful you have to identify specific products to sell to a specific niche. You will have to do a research and uncover products with low competition (little sellers) and high demand. After identifying ‘’your’’ products, it is recommended that goods are purchased in bulk overseas (product sourcing in China). It is best that you label these products with your authentic logo or label, so that the word spreads around and customers can easily identify your mark. Establishing Amazon FBA account is a big plus towards success at this point, since within the FBA program Amazon will sell, pack and ship your products to your customers, without you needing to rent a warehouse and hire employees, while you are focused on expanding your product range and scaling your business. Start listing up to 50 products that have significant demand and minimal competition.
What products to sell?
Even though the product market is saturated, be sure that there are hundreds of products released everyday and there is a big chance they are in demand. Get into the customer’s shoes and understand what makes a good product for the niche you picked, remember, that there are tons of opportunities out there. Your ideal product to sell needs to fit into:
- Product needs to be small and lightweight (fits in the shoebox, the lighter the better, as weight is going to be a big factor when shipping overseas by air)
- Product needs to be simple and not easily breakable, the simpler – the better (stay away from anything that has glass in it, lots of moving parts, very complex electronics)
- Stay away from licenced products, patented or patent pending products (no Disney or sports team logos)
- The ideal price range for your product is between $20 to $50 (ideal price range for impulse purchases, as well as after Amazon fulfillment fees you are still making a decent profit)
- The cost of the product should be around one third of a retail price you are aiming for. Thus, you have room for amazon fees, marketing, and still settle for a high profit margin
- There is a demand for product, market has enough volume (related products altogether sell at least 3000 units/month with a little discrepancy in numbers between sellers). This is your niche, capturing at least 10% of it will yield you enough profit. Use a free Camel Camel Camel tool to glance at the sales history of selected items.
Start brainstorming and get real ideas:
- Start spying on your close competition in a niche: see what’s selling well for them. You can use a research tool (AZ Opportunity Gizmo)
- Make sure that competition is low (all products in a niche do not have a huge discrepancy in the number of reviews) and sales rank is decent
- Pick a product or related product that is selling 10/day or more
- Browse Amazon best sellers and narrow down best selling products using categories and drill down into the subcategories further to find products that are less competitive
- Focus not on products that are sold by your close competition, but on those products that compliment them
- Choose one product to start with
Find a supplier
Be sure to get your supplier right (Aliexpress, Tradekey, Alibaba):
- Reliable (read comments)
- Get quotes from supplier
- Get samples from supplier
- By air (faster, easier, more expensive)
- By sea (takes longer, lost of paperwork, cheaper)
Market your product right:
Amazon is a giant platform with numerous sellers and you have to compete for your product visibility. Amazon customers buy based on search results rank. But do not despair, to increase your chances follow these steps:
- Include as many relevant keywords as possible in your Amazon listing
- Connect with your buyers and ask for a review, since 90% of all customers trust online reviews as much as personal recommendations. Definitely, more reviews will yield you more sales
- Advertise on Amazon
- Run promotions occasionally (even though it decreases your profit margin, it raises your sales rank, yields you more sales, thus more reviews)
Scale your business
- Start adding more products to your catalog after the first successful one
- Repeat product research cycle
- Expand your catalog adding more related products
- Conquer new niche
- Hire employees and delegate
- Focus on constantly uncovering new product opportunities and niches, adding new successful products
Remember Amazon sold around 480 million products in the US, averaging almost 500k new products per day for the past year. There are new opportunities arising everyday, there is always a wind of change in the air, you have to adapt, you have to change your ways, but following the tips above with a hard work and a right spirit you can accomplish wonders.