Amazon FBA (Fulfilled by Amazon) is a fulfillment service that lets you store your products in Amazon warehouses, and they will pack and ship them when they sell. This partnership is a great opportunity for anyone looking to get their product on the e-commerce market without having to invest too much time and money on storage, inventory management, picking, packing and shipping products. Therefore, if you’re thinking about selling your product through Amazon as an FBA supplier, this guide can help you get started with your business. In this post, you will learn all you need to know about starting an FBA business with the least amount of risk possible.
What is Amazon Fulfillment by Amazon (FBA)?
Fulfillment by Amazon, or FBA, is a service offered by Amazon that lets you store your products in Amazon’s warehouses and have them pack, ship, and provide the customer service regarding your product. This service is available to anyone selling their items through Amazon’s online marketplace. This means that if you’re a manufacturer or a wholesaler and you sell your products through Amazon, you can use FBA to handle the shipping and fulfillment of your products. Traditionally, Amazon charges a fee for FBA, but if you’re a first-time seller or if you’re starting your business with a small number of products, they allow you to become an “Amazon Seller” (which is different from becoming a “Fulfilled by Amazon” seller) and use their basic service for free. Once you do that, you can start sending your inventory to their warehouses, and their personnel will handle the rest.
Why Start an Amazon FBA Business?
If you are a manufacturer, wholesaler or a retailer, you can choose to sell your product through Amazon’s FBA program. By doing so, you greatly increase the chances of your product being discovered by millions of Amazon shoppers. As for the customers, this means that they get access to products from a much wider range of sellers and don’t have to worry about additional shipping costs. The advantages of selling through Amazon are numerous, including the fact that Amazon’s marketplace is one of the most popular shopping destinations in the world. More than half of Amazon’s product searches are from mobile devices, and the majority of them are new or first-time buyers. This means that selling your products through Amazon is a great way to build a new customer base and increase your sales.
The Catch with Amazon FBA
The old adage “if something seems too good to be true, it probably is” definitely applies when it comes to Amazon FBA. If you want to start your business, you will have to invest in inventory and pay for extra storage, packing and shipping costs. However, once you turn your inventory into sales, the cost of those upfront expenses will be offset by the profit from each sale. If you consider the fact that Amazon is one of the biggest retail websites in the world, you will see that this is a great opportunity to build your brand with minimum effort and expense.
How to Start an FBA Business: Step-by-Step Guide
If you want to start your Amazon FBA business, there are a few things you need to do. This includes finding a product, sourcing it, creating a listing, and then sending your inventory to Amazon’s warehouses to be processed. After that, Amazon will pick, pack and ship your products on their behalf. You will have to provide customer service and be responsible for the profitability of your business. Here is a step-by-step process to start your Amazon FBA business: Find a Profitable Product to Sell - The first thing you need to do is find a product to sell through Amazon FBA. Ideally, this product should have high demand, generate good profit for each sale and be easy to source. You can use a product research tool like Fashion-Inc to identify the best product opportunities for your business. You can also use Amazon’s product research tool to quickly identify the most profitable products to sell on Amazon. Start with broad categories, and then drill down to find the best products for your business. You can also use Google Trends to identify hot topics and decide what products are likely to be in demand in the future. You can use the “Search Trends” option to find related topics and product names that are currently trending. Find a Manufacturer to Start Your Business - If you want to sell your product profitably, you will have to start with a minimum order quantity. Once you have found the right product opportunity, you need to find a manufacturer that can make your product at a low cost. Start by creating a shortlist of potential manufacturers that can produce your product. While looking for manufacturers, make sure that they can produce your product profitably. You can use Alibaba or other online marketplaces to find manufacturers. Your manufacturer should be able to produce your product with a high-quality finish and deliver your order on time and at a low cost. It is important to work with a manufacturer with a good track record. Create a Profitable Product Listing - Once you have a product in your hand, it is time to create a product listing. Make sure that you create a product description that is appealing to customers. In this description, you should include the product’s benefits, its features, its uses, its size and any other details that will help customers make an informed decision. You can use a tool like AMZ Insight to research and analyze the keywords that can make your product more attractive to customers. Find a Reputable Shipping Partner - After you have created a product listing, it’s time to source a shipping partner that can pick up your products from your manufacturer’s warehouse and deliver them to Amazon’s warehouses. Ideally, you should find a shipping partner that offers discounted rates for large volume orders. You can use a freight shipping marketplace like Shippo to find a reliable shipping partner. Once you start getting more orders, you can also consider hiring a logistics company to ship your orders for you. Ship Your Products to Amazon’s Warehouses - Once you have sourced your product, created a listing and found a shipping partner, it’s time to ship your products to Amazon’s warehouses. You will have to create a seller account on Amazon and provide your banking information to start receiving payments for your sales. You will also have to create a shipment plan and upload a shipping instruction to Amazon. Once you have done that, Amazon will start receiving your products and will send you an email when they have received your products.
Important Things to Know Before Starting an FBA Business
As we have mentioned, Amazon FBA is a fantastic opportunity for anyone who wants to start their business without having to invest too much in inventory and logistics. However, there are several things that you need to know before starting your business. Amazon FBA is a fulfillment service that lets you store your products in Amazon warehouses, and they will pack and ship them when they sell. It is important to know that Amazon’s FBA service is only open to third-party sellers. This means that you are not allowed to sell your products in one of Amazon’s retail brands such as Amazon Seller or Amazon Wholesale. You will have to pay for the upfront costs of the inventory and the shipping. There are also some monthly fees associated with being an Amazon FBA seller. You will have to decide what to do with your products when they run out of stock. You can either send your products back to your manufacturer or have them send it to a different Amazon warehouse.
Amazon FBA is a fantastic way to get your products in front of millions of potential customers. It also allows you to outsource the risk of inventory management and shipping. That being said, starting an FBA business will require upfront investment in inventory and shipping. It will also require you to invest some time managing your business and ensuring that it is as efficient as possible. If you want to start your business, you will have to start with a shortlist of potential products, find a manufacturer that can produce your product at a low cost, create a product listing, find a reputable shipping partner, and ship your products to Amazon’s warehouses.