4 Secrets to Help You Successfully Sell on Amazon FBA

Selling merchandise through the fulfillment service by Amazon (FBA) is a fairly straight forward process. You simply find items you want to sell, bundle them up and ship them to one of Amazon’s many warehouses. Selling on Amazon FBA successfully, however — that’s a different story entirely.


Here are some things that can help you navigate the FBA “river.”


1. Take the time to read over Amazon’s rules and guidelines.

The first thing you will discover about Amazon is that there are a lot of rules. There are rules about photos, rules about shipping to the warehouses, and rules about selling. Before you begin, take the time to read over the FBA Guidelines and Frequently Asked Questions. If you’ve never sold with Amazon before, you should also take some time to figure out how their fee system works. This not only keeps you from receiving any nasty surprises when your invoice arrives, but can assist you in deciding what type of account you need. If you’re going to be selling a a high volume of items, a Pro Merchant account is generally best, while a regular account is better if you’re just going to dabble a bit before you jump in.

2. Set a Goal for Your Profit Margins

A simple way of thinking about your profit margin is to think about it as the money left over after everything else has been paid. You will want to get back the amount that you initially paid for an item, plus cover all the fees that are involved throughout the entire process, from listing to shipping — and have some left over (the profit). Although some people are happy just to come out a few dollars ahead after all is said and done, to truly be successful, you should have an actual number or percentage above cost that you shoot for with each item that you sell. The higher the percentage — the more money in your pocket. What this percentage is will be entirely up to you, but 40 to 60-percent is usually a good sweet spot to aim for. You can also decide to sell an item at a smaller margin (say 20-percent) if you think you’ll sell a large volume.


3. Read Your Seller Central Reports

Amazon offers sellers a lot of different tools and reports that can help you run your business. These tools and reports can be found in Seller Central on Amazon’s website, and can tell you how much profit you are making, how your inventory is doing, and whether you are having a lot of refunds or returns. One of the most overlooked things about these reports are that if they are used correctly, you can forecast how an item is selling and order more inventory if it looks like you are running low. This is especially important around the holidays since people will move on to the next seller if an item is out of stock.


4. Prepare for the Holidays

Many sellers actually start getting their Christmas inventory in as early as July and in some cases, even sooner. Keep in mind that it’s not unusual to see a sales increase of up to 5 times normal during Christmas. This is why keeping up with your inventory and forecasting ahead is so important. It can mean the difference between extra money in your pocket and kicking yourself because your inventory ran out. If you believe you have a potentially hot item, you will want to watch how other sellers are doing with similar items, and you may wish to set up a Google alert to let you know if any news stories are appearing that could cause in increase in sales. As an example, a few years ago the Furbies were so popular that they were selling out everywhere. News medias not only reported on the situation, but these news stories themselves created a heightened sense of urgency for people who were looking to buy them. Since everyone knew how popular they were — Furbies were not only selling out, but those who bought them were paying above and beyond to ensure that come Christmas day there would be a Furbie sitting under the Christmas tree.


This guest post was contributed by Kat Simpson. Kat is a trusted eCommerce author, speaker, educator, and entrepreneur. Kat Simpson has been a successful eCommerce merchant for over 10 years; is an eBay Education Specialist and Gold Level PowerSeller, as well as a successful Amazon merchant. Currently Kat is the hosts the popular weekly eCommerce Podcast That Kat Radio and an active Facebook Group ThatKat.




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