Amazon Product Research is the key to start your FBA online business. It will decide the future of your eCommerce venture. A good product helps you build $$$$$ on Amazon while a bad product downs your bank balance by $$$$$.
FBA is an easy selling program. Send your inventory to Amazon warehouse and start your business. They take care of inventory management and delivery to customers.
But, Fulfillment by Amazon does not looks as easy as it looks to be. A seller has to pay monthly storage fee to Amazon for warehouse usage. Also, you will pay FBA fees to Amazon for order fulfillment.
You are responsible for product sales, Amazon provides no help to customers for sales. So, it is necessary to analyze the product before launching. You need to check the product scope in Amazon market.
Factors to look for finding a FBA product
Good Demand
A product you are going to sell on Amazon should have a good demand such that it should be a problem-solving thing for your target customers. Though Amazon does not provide sales metrics of products to public. But, you can use certain Amazon product sales estimator tools to predict the sales volume of a product based on its BSR (best seller rank).
Low competition
Always look for a product or niche that has low competition. A product with average seller rating under 100-150 is good product for Private label FBA.
Weight and dimension
Amazon provides fulfillment and inventory storage services to FBA sellers. The fulfillment fees depends on the product packaging weight. The light the product weight, the less will be FBA fees for order fulfillment.
The Amazon warehouse as a service cost depends on area occupied by the inventory. Amazon charge storage fees every month based on cubic feet area covered. A light weight and small standard package will cost minimum storage fee per month.
Product price: The product you select needs to be sourced. You pay to supplier, shipping company to process inventory. Also, the FBA fees and monthly fees associated to your expenses. So, you should go for a good price product selling on Amazon.
Prefer a product having selling price between $25-80. This way you could save good money per order.
ROI
It is a wise thing to measure ROI before launching a business. This way you can predict a product success and profit potential. A product having ROI between 150% or higher is a good private label product to start.
Brand sellers
You will find various established brands on Amazon in different categories. They are maintaining a good review rating score on Amazon. For e.g., O-Cedar. This brand has dominated the Amazon marketplace in MOP niche. Its market share on Amazon is 70% compared to competitors.
So, it is a bad idea to launch a product in the same niche dominated by brand sellers. Instead look for an opportunity that is growing and sales share is distributed among numerous sellers.
Sales and price history
Nothing lasts forever. The same concept applies to Amazon marketplace. So, do not rely on current statistics of Amazon listing. A seller selling today at 39 USD does not mean its a constant price. Check for the price history.
Similarly, you see BSR on the product listing. The rankings changes every day. So, monitor the BSR rank history. It will help you analyze the sales consistency of a product listing. other Amazon product sales history data tools will help you check that data.
Step By Step FBA product research process
Brainstorm your mind
The initial step for Amazon product research starts with thinking. Yes, give some strain to your brain and think of your interests or interesting products. Prepare a list of those things and here the FBA product research starts.
Check your interested categories on Amazon best sellers, Movers and Shakers, New launched, and most wished for features. Explore sub niches and get reach to new products.
Open the product listing. Look for ratings and read the reviews on the listing page. Download the AMZ scout chrome extension. It will show you monthly storage fees, FBA fees for the product.
Use product research tools
The alternative way to manual product research is automatic way. You can use product research tools like Helium 10 and Jungle scout to find a new niche or product.
Helium 10 free plan comes with 20 free searches while you can enjoy 14-days free Jungle scout trial adding your card details. You can cancel it any time.
You will find various filters to search a good potential product or niche. Both tools provide you a deep insight along with product suggestions. Get product idea and start focus on analyzing the suggested product.
Competition Research
You find a good product having less review and ratings. But, it is not sufficient to consider it the best product. You should do competition research of the product.
Either write a product name on Amazon or do reverse ASIN search with ASINseed.com. Find product keywords and search it on Amazon.
This way, you can analyze the competition of product. Check for sellers appearing on the Amazon search page, their reviews and ratings. It is quite a lengthy job to check manual listings one by one. Instead use Amz Pro chrome extension and do competition research on the search page itself. It allows 15 free searches without credit credit details.
The extension will feed you number of sellers (FBA, FBM, and AMZ). It will show you average ratings and sales figures. Also, you can check product sales history trend in a single click with the trend analyzer feature.
It suggests profit, demand, and competition score to you. So, you will get a detailed insight you look for with the free trial plan. The extension is equipped with Alibaba image search functionality. It will land you directly to the Alibaba product result pages for instant sourcing and comparing profit margin.
A product with average seller ratings under 150 and good average monthly sales should be an ideal choice to start FBA. But, look for other things profit, fees etc before making a decision.
Check product history and track it
Amazon is a competitive marketplace. Sellers do fluctuate their product listing prices to dominate competition. It is possible that the sales figure tools are showing would be due to price drop. We need to ensure that it is not a seasonal demand product.
So, it is recommended to check product history. CamelCamelCamel, Helium 10, and Keepa are the best tools to check product price and BSR history graph chart. Check up to a year history graph chart. It will help you identify a year round demand product.
Also, they help you track the prices. You an set a limit for a certain period and if the goes down. They will send you price drop notifications.
This way you can monitor the price and sales rank variations on the listing. A product with limited or no variations in price and BSR indicates a good market and demand.
Alternative way to check demand of a product
The demand of a product can be predicted by Amazon seller’s inventory. Do spy listing inventory with AMZ stock chrome extension. It will show you inventory level of a product. Amazon has a product order limit for 999. It will show 999 for the listings having 999 or higher inventory value.
Check top 5 sellers inventory regularly and note down them. Do it for next 5-7 days. You can check the daily sales potential of a product without much effort.
Prepare an Excel sheet
Maintain an excel sheet to list down all profitable products. Add necessary attributes including product name, Amazon link, listing score, FBA fees, monthly fees, product price, profit and BSR etc. You will have a record to manage and maintain the data correctly.
Product sourcing
The next after product research is product sourcing for private label FBA product. It has the same importance as product research. It will help you to identify whether the product you wish to start FBA with is offering a profit to you or not. Also, communication with the supplier helps you identify whether the product falls under your budget or not.