Amazon is the world’s largest online retail business. Success of millions of seller on this platform often encourages people to start their own Amazon business. So, are you the one who want to be an Amazon seller soon?
If yes, then this article is for you. Learn how to take the next step and start selling on Amazon.
Table of Contents:
- Make a seller central account
- Ways to sell on Amazon
- How to sell on Amazon FBA
- How to sell on Amazon FBM
- Other ways to sell on Amazon
Create a Seller Central account on Amazon marketplace
Amazon operates its business in 12 different countries. It allows 170+ countries sellers to sell on its platform. Decide a marketplace (USA, UK, AU, India, or Europe) you want to start selling on Amazon. Create a business account on Amazon Seller Central.
Before you start to sell on Amazon, you will need to fulfill legal document verification. Documents and other information requirements vary with the marketplace and seller’s country as per government guidelines and protocols. Check document requirements by the marketplace.
2 ways to Sell on Amazon Seller Central
Amazon FBA
Amazon FBA means Fulfillment by Amazon. In this process, the seller sends the stock to the Amazon warehouse. When the customer orders a product, Amazon will fulfill the order to the customer.
Step 1
Create an FBA product listing on Amazon seller central. Forward the inventory to the Amazon warehouse.
Step 2
Customer orders your product. Amazon delivers it to the customer’s destination.
Pros:
Amazon handles the fulfillment process.
Amazon handles customer support.
You do not need to invest full-day to manage your FBA business. 2 hours a day enough.
Cons:
Amazon charges FBA fees for order fulfillment along with referral fees. Seller needs to pay 15% commission (percentage vary for some categories) to selling on Amazon fees on every order.
Amazon charges a monthly storage fee/cubic feet to keep inventory into the warehouse.
You will need to be a professional seller (39.99/month) to enjoying advertising, promotion, and unlimited warehouse usage.
How to sell on Amazon FBA?
Private Label Model
A private label business for FBA is the most profitable business in 2020. It helps you introduce and launch your product as a brand item. Amazon customers are smart, you cannot fool them selling Chinese brands at a high price.
A private label is a process where a manufacturer produces goods and wrap them under your brand packaging. You can find a manufacturer that allows private labeling on global sourcing sites Alibaba. Consider a Chinese manufacturer to have more profit margin per unit sale.
Wholesale products
Another best idea to start an Amazon FBA business is product reselling. You can buy a brand product from a supplier/wholesaler and resell it on Amazon. Process the inventory to the Amazon warehouse, and start your business.
To sell another’s brand product on Amazon, you will need to be an authorized seller. The wholesaler/supplier will help you get that. The second thing is less profit. In a private label model, you will deal directly with the manufacturer while wholesale purchases made through wholesaler/supplier. they add their profit margin to the product. But, it helps you start FBA business with little money as suppliers ask for low MOQ than manufacturers.
Amazon FBM
Amazon FBA means Fulfillment by Merchant. Here, the seller lists the product on Amazon for sale. When a customer orders it, the seller has to fulfill the order to the customer’s address.
Step 1:
Make an FBM listing on Amazon.
Step 2:
A customer will see the listing and order the product.
Step 3:
Extract the customer order details from seller central and ship the product to the customer’s destination.
Pros:
You can start an Amazon business with no money.
You will need to pay Referral fees only. No monthly storage fees.
Cons:
Shipping career charges high fulfillment fees than Amazon fulfillment fees.
You will need to invest 6-8 hours daily to check new orders and process them to fulfill it. You have to handle all necessary process required after receiving an order.
After a certain period, you will need a dedicated assistant to look after your business.
How to sell on Amazon FBM?
Retail Arbitrage:
Retail arbitrage is a process of stocking inventory at a discounted price and sell them at higher prices. You can buy products from a clearance sale, shopping malls, and wholesale stores.
Private Label/wholesale:
FBM can be done via Private label and wholesale stocking. Stock the products either at your home or take a warehouse space on rent. When you receive an order, download the packing slip from Amazons seller central and label it.
The next step is shipping. You can register to a shipping company website and get it processed to the customer’s destination.
Dropshipping:
Dropshipping is the simplest method that allows you to start an Amazon business with no money. Yes, you heard it right. You will need a seller central account eligible for selling. Find a product on Walmart, Sears, and dropshipping stores selling at a comparatively low price than Amazon.
List the item on Amazon, when you get sales, make an order to the vendor portal (e.g. Walmart, Sears, etc) and supply the customer’s address as a delivery destination along with the contact details.
It is advisabe to deal with a genuine and authenticated dropship supplier. Order the product at your destination and check the quality of the product before listing it to sale.
Other services offered by Amazon:
Multichannel order fulfillment
Apart from FBA and FBM services, Amazon provides multichannel fulfillment services to sellers. Use Amazon FBA as a fulfillment service and sale products on other platforms like Shopify, eBay, Etsy, or any where else. When you receive an order, process the customer and order details to Amazon.
They will fulfill the customer’s order. Amazon will charge standard FBA fee to process the order. You paying Amazon for using its warehouse storage and fulfillment.
Vendor Central
Like seller central, Amazon introduced Vendor central in 2017. It is an invite-only program for suppliers and manufacturers. Amazon buys bulk inventory from manufacturers/suppliers and sell them to customers. You cannot apply for vendor central. It is Amazon who decides the vendors to do business with.