Selling on Amazon
When I decided to try Selling on Amazon, I found it a bit tricky to work out where to start.
There was so much information; Facebook groups and posts, Youtube videos and Gurus trying to sell you a course on the best way to do things; I got information overload.
So I decided to make a Facebook Group, and this Guide to help others who may be having trouble working out where to begin, and whether Selling on Amazon is for them.
I will focus on selling from the UK as this is where I sell from. Some info may be slightly different if you are from outside the UK.
So let's start at the beginning….
Buy Cheap From Shops (Online or Retail)
Sell High on Amazon = Make a Profit
Merchant Fulfilled (MF) means you pack and send your products to the customer directly when they make an order on Amazon. You also have to deal with any customer service and returns.
There are some times when this may be a good idea.
When Amazon is temporarily out of stock, this means that you can list your items straight away. It doesn’t make sense to send the item into Amazon as it is likely to be back in stock by the time it arrives. Getting your stock listed quickly means you may get many sales before Amazon comes back into stock. You can then change the stock to FBA, or send some FBA and keep some MF.
If you are selling something for a particular season or date (eg.Christmas/Halloween) and it’s getting too close to get your items into Amazon for them to sell in time or before Amazons deadline. Or Amazon have restricted the amount of goods you can send in.
Items with an expiration date have to be sent into Amazon with at least 105 days of shelf life remaining. So if you miss the deadline for them to arrive at FBA, you can still MF them with ample time to sell them before the cutoff date.
Hazmat items can not be sold via FBA, but you are able to Merchant Fulfil. These can be items that just have an ingredient that Amazon considers hazardous, for instance a Bathroom cleaner (sometimes their Hazmat rules can seem strange, but they are there as they have been sued in the past for products leaking etc).
Merchant Fulfilled can be useful if a product is quite low priced and doesn’t weigh much so is cheap and easy to post, as it may not be worthwhile sending via FBA due to it eating into your profits too much.
Online Arbitrage (OA) is buying products online for a low price, repacking them and then sending them to Amazon to sell. Clearance sales or 3 for 2’s are a great way to get online bargains.
As well as the well known shops and supermarkets, try and find smaller and more obscure online shops that may get less traffic and deals that not everyone finds.
Retail Arbitrage (RA) is the same as OA, but you physically go to a shop and buy a product to sell.
This can be more time consuming, but you can find some great bargains as they are quite often unique to that particular shop.
Maybe they have too much stock or an end of line, or because of a change of packaging. Whatever the reason RA is a great way to find a bargain.
Can Anyone sell on Amazon?
Yes! Selling on Amazon is a programme that enables sellers to sell their products and inventory to millions of Amazon customers throughout the world. Anyone can open a Seller Account and then sell their items via Amazon’s website.
This is different to a buyer's account where you would normally purchase items from, but you can have both.
Firstly you need to open a Sellers Account with Amazon
You can open an individual Account called an Amazon Basic plan. This has no monthly fee, but you pay a fee per item. Good If you are not sure that selling on Amazon is for you yet, or you won’t be selling more than 30 items in one month. It is easy to upgrade to a Professional account if you change your mind, and it’s instant.
The Professional plan gives you the opportunity to sell an unlimited number of products and pay a £25 (excl. VAT) monthly subscription fee. Individuals pay no monthly fees, but instead pay £0.75 per item sold. Both Professionals and Individuals pay additional selling fees when an item sells. There are other advantages to having a Professional Account such as being eligible for the Buy Box, which is where a customer just clicks to buy, rather than looking through the listing to find different prices, and this is where most sales happen. (Personal accounts with FBA get the Buy box too)
What Will I Need?
To Register You Will Need…….
ID (Passport/Driving Licence)
A Credit or Debit card
Bank Account information
An Email address
(VAT number, if you are a company and are VAT registered.)
Essentials You Will Need To Start
A Computer/Laptop. There is a mobile app too but you won’t want to use this all the time as there is lots to see on the Seller account.
Money to buy the items you want to sell, the good thing about this business is that you really can start with a small amount of Capital and build up. Obviously the more you put in the more you will get out. But it is possible to do this part time and scale slowly.
Prep Items to wrap and secure your products before you send them to Amazon for Fulfilled by Amazon (FBA), or directly to the customer if you are doing Merchant Fulfilled (MF), such as bubble wrap and poly bags that have to have a suffocation warning on them. Sticker remover (to get old stickers off stock or boxes to reuse), parcel tape and scissors.
A Printer to print your labels for each item and address labels for your boxes. Amazon recommends a lazer printer so your labels don't smudge during transit or when in the warehouse.
A set of Scales to weigh your boxes that you are sending FBA. You can pay for the postage on your Amazon Seller Account, print the labels, and have UPS pick up from your house. (UPS give a discount for FBA customers, a big box under 15kg is about £4 to send)
What Can I Sell?
You can sell lots of different things, from Candles to Cookers, Puppy toys to Pistachios, Trainers to Toy Trains and the list goes on and on and on…
You may already have an idea about what you want to sell, but in the beginning it is probably easier to sell smaller items, and also items that you know a little bit about.
I started with toiletries and kitchen gadgets as those were what I found for a good price and I knew how they worked, and that I’d found a good price for them.
It would be harder to sell an item that you don’t have any idea of the usual price, and if it is relevant or not. For example a printer that you can not buy ink for anymore, that no one would want to buy, or end up returning to Amazon once they found out.
As you grow in experience you will be able to expand your inventory of items and choose more obscure and rare products, as these will give you a good return as less people will be selling them.
A good idea is to buy a small number of a lot of different items.
Spread your sales wide, but to start with maybe no more than 10 of each item. As prices change it is quite easy for another seller or Amazon themselves to reduce the price, this can quickly reduce the profit that you were hoping for.
Don’t worry though, if you do your due diligence when buying products and go shallow and wide, then this is less likely to happen
There are a few software products that can help you decide whether a product is a good deal or not.
One of my favourites is Buy Bot Pro This is a Chrome Extension and also a mobile app which is amazing for doing Retail Arbitrage. It gives you so much information, including how popular the item is and how many have sold. It tells you if you are allowed to sell that product, or if you are gated, and most importantly if the product will likely make you a profit or not. There are tons of other features.
Tips to get UnGated
When you first start selling on Amazon there are some categories that you can’t sell in and you have to get Ungated in. This means that you have to jump through a few Amazon hoops before they let you sell in that category. Amazon usually wants you to buy at least 10 items from that category, from a Wholesaler and show them the products in your own photos and also the invoice.
I made a few mistakes when I first started, so here are my top tips for getting ungated.
Open a Professional account - Amazon seem to un-gate those who are paying a lot quicker than the free accounts - I assume they think they are more serious sellers.
Buy 10 of the cheapest item in the category (Toys/Grocery/Topical etc) you need to be ungated in (this is different to Brand gated). You need to put the item into Amazon to check you are actually gated BEFORE you buy it!
You don’t need to send the items into Amazon once you’re un-gated and trying to find something that will make a profit can be stressful and can take too long, so just buy something you can use at home or give away as presents.
Make sure you take clear photos of each side of your product when you have received it from your wholesaler.
Your invoice Must match your details exactly to your Amazon Seller Account.
What is Online & Retail Arbitrage?
Tip - Make sure you keep ALL your receipts as Amazon may ask to see them in the future, always ask for an invoice if possible, and take photos of your receipts and keep them filed on google pages or whichever software you prefer, as paper ones tend to fade after a while.
What is Fulfilled by Amazon?
Fulfilled by Amazon is your product being sent to the customer from an Amazon Warehouse.
Amazon delivers the product and deals with any questions/returns/or complaints from the customer.
FBA sellers get the Prime Badge which is preferred by the majority of customers, and gives you an advantage when a customer clicks “The Buy Box”. The Amazon algorithm seems to prefer them currently too, this may be because Amazon knows exactly which warehouse they are sending it from.
Amazon obviously charge for FBA but for the service they provide, which also includes a storage fee and sending it to the customer, I think the cost is quite reasonable. Especially as it means that you can just get UPS to come to your house and pick up your multiple items to be shipped for a discounted FBA rate.
What is Merchant Fulfilled?