Amazon FBA business has three selling models wholesale model, online arbitrage model, and Private label model. Out of these three models, Private label FBA model is the best and effective techniques to make good profit online.
What is Amazon FBA Private label?
Private label on Amazon means selling a product under your own private label brand name. It involves Amazon product research, selecting a product to sell on Amazon, finding a manufacturer, and ask them to produce goods and wrap them under a specific brand name.
For e.g., a shoe company name “xyz shoes” manufactures shoes. They sell raw materials to companies and brands. The brands can label these goods under their boxes and sell in the retail market.
The Amazon Private label FBA model works the same. Find a manufacturer for your goods, discuss pricing and quantities with them. They will produce goods and wrap them under your branding.
Amazon FBA Private Label business model strategy
Step1 :
Select a product to sell on Amazon
Step 2:
Fine a right private label manufacturer for your product and make a deal.
Step 3:
Get product dimension and product box details from the manufacturer.
Step 4:
Get product package design and forward it to the manufacturer.
Step 5 :
The manufacturer will print the package design and label it to all product boxes.
Step 6:
List your product on seller central under FBA. Get the shipping slips ready and forward it to the manufacturer.
Step 7:
The manufacturer will prepare the cartoons and label the Amazon shipping slips over it. He wills end the shipment to the Amazon warehouse.
Step 8:
Once the inventory reaches to the Amazon Warehouse, your listing will go live on Amazon.
Step 9:
Customer can see and make order on your listing.
Step 10:
When you receive the order, Amazon will deliver it to the customer.
Benefits of Amazon Private Label
Interact as a Brand to customers on Amazon
Amazon customers are smart. They can easily smell local Chinese goods. They would not pay you the expected price for such products.
But, private label a product helps you interact as a brand with your audience. The branding investment on the product delivers a sense of quality, and assurance regarding the product. It encourages them to purchase your product.
Good profit Margin
For private label product, you will deal directly with the manufacturer who producing it. A direct deal with the producer will help you buy products at the cheapest price. This model ensures the highest profit margin on every unit sale.
Sell through multiple platforms
Once the manufacturer sends the inventory to the Amazon warehouse, you can sell it via both Amazon FBA and outside Amazon as well. Either sell on your website or list it to eBay, Etsy,Walmart etc platforms. Amazon Multi-channel order fulfillment helps you deliver the orders.
Make a multi-channel fulfillment request in Amazon seller central and provide necessary order details, Amazon will deliver it to your customer. They will charge FBA fees only to process the order.
Cons of Private Label
High MOQ
Here, you doing business with the manufacturer. So, definitely you will need to purchase good inventory to get it private label. It needs a good investment based on manufacturers MOQ. Also, the manufacturer will cost you extra fee to prepare and print custom packaging on product boxes.
What are Amazon Private Label requirements?
Anyone can do Amazon private label business. You do not need to have a brand registered on Amazon. But, it is recommended to check your selected private label brand name in the selling country registered brand database. In this way, you can protect yourself from brand infringement and legal process in the future.
Note: Now a days, for listing a product on Amazon under a private label brand, you will need to apply for a GTIN exemption or need to have EAN/UPC/GTIN purchased from GS1 under the specific brand name.
Other requirements:
An Active seller central account
You should have an approved seller account to sell on Amazon. Register to seller central, fill the form, and get your account activated.
Professional Seller Account
To send bulk private label inventory, you need to buy 39.99$/month professional seller account. This seller plan allows unlimited storage to Amazon warehouse to sellers.
Why Private label brand registry?
Amazon is a marketplace where you will find millions of sellers. So, no doubt there is a huge competition. Your product niche may have thousands of sellers. Like us, they keep a close eye on our business. So, there are chances that they can apply for your private label name trade mark and get it.
SO, acquiring the brand name trade mark will protect your business and do not let you compromise against competition.
How to do brand registry on Amazon?
Requirements:
You should have a registered logo or name trademark (exactly as on packaging) to get brand registry on Amazon.
Process:
Step 1:
Open https://brandservices.amazon.com/.
Step 2:
Submit all necessary inform that Amazon asks you to register your brand.
Step 3:
They will moderate your brand registry request within 3-5 working days and verify it.
Step 4:
On approval, you will be able to access brand features on Amazon.
FAQs
Do I need to private label to sell on Amazon?
No, you can sell on Amazon without private label. Online arbitrage and Wholesale models are alternatives available to private label selling.