One of the best and profitable business idea being an Amazon FBA seller. This beginners guide offers step by step guide on how to sell on Amazon using FBA.
A Beginners guide on how to become an Amazon FBA Seller
One of the best home business ideas currently is becoming an Amazon FBA seller.
One question which is common amongst starters on Amazon; how do I sell on Amazon? Selling on Amazon especially for beginners can be a slightly lengthy process and it might take a while for one to be accustomed to the selling process. I have been there before and I kept on leaving it pending till I decided to make an effort to push it through.
To assist others who may be in the same position as I was, I have compiled a step by step guide that will assist you to learn how to sell items on Amazon FBA and make close to $2000 the first month.
So what is Amazon FBA Program?
With the FBA (Fulfillment by Amazon) program, the challenge of storing items or shipping them to customers is taken care of. All you do is buy the items to sell, send them to Amazon, and they take care of storing and shipping them.
For a start, Amazon offers a two-day free shipping through the Amazon Prime. If you have ever made a purchase through Amazon you know about this already. With Fulfillment by Amazon, an individual store his products in the Amazon fulfillment centers, they pick, pack the items, and offer customer service for those items.
All you need is to make the initial step, and getting started with selling on Amazon and being successful will be simple. The only secrets to Amazon FBA success commitment, patience, and diversity.
The Requirements of being listed as an Amazon FBA Seller
To become an Amazon seller, you only have to sign up. You require a credit/debit card and a bank account which is US-based (mostly for deposits) and a tax ID. (A lot of people from other countries sell on Amazon, so the account may differ in this case). The tax ID could be social security number, but from my experience, a distinct EIN or Corporate TIN is recommended to separate business from personal accounts.
What are the Benefits of Selling on Amazon FBA?
a) Your Items are fit for Amazon Prime free Two-day Shipping, and Free Shipping.
Prime members do appreciate free Two-Day Shipping, and every Amazon.com client can enjoy free shipping services on suitable orders. Upon listing your items with FBA, your items are qualified for free shipping as well. As your competitive edge keeps on growing, you will be in a position to increase your probability of winning the Buy Box. Also, upon registering for an Amazon account, you are in a position to sell on other Amazon markets in Mexico and Canada.
If you likewise enable FBA for items you list on Amazon.com.mx and Amazon.ca, you are in a position to reach even more clients all through North America and who like Amazon’s trustworthy fast and free Shipping.
b) Clients enjoy Amazon’s trustworthy customer service
FBA takes care of customer service for Amazon’s orders. Listings are displayed with the Prime logo, so clients are assured that Amazon handles packing, delivery, customer service, and returns.
c) Amazon FBA services allow your business to grow quickly.
Amazon’s fulfillment centers are fabricated with the client’s inventory in mind, and there is no limit on the number of units that a client ought to send. They take care of the details to save time which allows one to solely focus on business.
d) You are able to fulfill orders from other channels.
With Multi-Channel Fulfillment, one is in a position to fulfill orders from other sales stations using the inventory stored in the Amazon fulfillment centers. Through this channel, one is able to manage their items through an online user interface and can also issue a directive to Amazon to return the inventory in Amazon’s fulfillment centers any time they deem fit.
e) It is lucrative and simple.
Pay as you go—you are charged for storage space and the orders Amazon fulfills. The cost of shipping is included in your fees, with no extra charge for Amazon Prime FREE Two-Day Shipping and FREE Shipping on eligible orders. Fees for Selling on Amazon and optional services may apply.
How to Start Selling On Amazon FBA (Fulfillment by Amazon)
This beginner’s guide is a step by step guide on how to sell on Amazon FBA.
1. The first step is creating an Amazon Seller Account
Before creating an Amazon FBA account, you will need to consider the number of products to sell. In the event you will be selling more than 40 items, you will require a professional account where you will pay a monthly fee. For a start, I would recommend that you create an individual account selling a few items, less than 40. After the cutoff point is exceeded, you will be charged $1 for each item you sell using an individual account.
If your plan is to sell more than 40 items every month, then you can sign up for the professional account. The selling on Amazon FBA fees for a professional account is $40 per month.
After choosing the type of account, you will be required to log in or to sign in so as to create a new Amazon account. After that you will be required to provide the following information:
a) The method of Charge– This ought to be your credit card. Amazon does not automatically charge your credit card so you shouldn’t worry about that.
b) Seller Details– Some of the details necessary for successful registration are your name and address, your ‘Display Name’ (The name that appears next to your products and visible to the buyers). This should be a valid name because you want the buyers to trust you, and being sneaky may make you lose some clients.
c) Account authentication– For the final step, you will verify the correctness of the details you provided through a text message or a phone call.
Your account has now been created but your home screen will be empty so you will need to add a few items.
2. The Second Step is Listing Your Items on Amazon
The question now is how I list my items on Amazon. This is how. Assuming you have a list of the items you want to sell, navigate to the top of your screen and select ‘Inventory’. Then click on the “Add Product” icon. After clicking on the ‘add product’ icon you will be impelled to search for your item. I was selling DIY shaggy rugs so I searched for the name of the product. If you are selling a product that you have manufactured yourself, (which I doubt you do), you will need to ‘create a new product’.
After selecting your product, the next step would be to enter the crucial details of your product. You will be required to provide three main details:
a) The price of the product- You can set your price according to your liking. It is, however, crucial that I point that you should search for similar items, and see how they are priced. For example, I searched for the DIY shag rugs and priced mine slightly cheaper than the lowest priced. At the same time, I ensured my price would not make me sell at a loss.
b) The state of the product- If you are selling a used product, make sure you describe the actual state of the product. Do not indicate that you are selling a 4 by 6 new mat when you are actually selling a 4 by 5 used mat. The client will launch a complaint, you will be required to refund the money, and the negative reviews will negatively affect your chances of getting clients in future. In other words, be honest.
c) Choose the FBA option- This is where selling with Amazon FBA comes in. You should then select the option of “I want Amazon to ship and provide customer service for my items”. After checking the box, you will be sent a registration screen (That is if it is the first time you sell on Amazon FBA). Take your time, read the terms, and accept if your products comply.
3. The Next Step would be To Convert Your Products to Fulfillment by Amazon Products
This would answer the question- what sells on Amazon FBA? One requirement for being an Amazon FBA seller is by converting them to FBA products despite the fact that you have just checked the “I want Amazon to ship and provide customer service for my items” checkbox. So is the step by step on how to convert your products to Fulfillment by Amazon.
Click on the “inventory”, and then on “Manage Inventory”. From the drop down, select “Actions, then choose “Change to Fulfilled by Amazon” (the third option)
After converting your products to Fulfillment by Amazon, you will be presented with two preferences: FBA Label Service and Stickerless Commingled Inventory.
If the products you are selling are new, then you should choose stickerless commingled inventory. The meaning of this is that Amazon will commingle your products with the matching products of other sellers. How this works is that if a client makes an order from you, Amazon may decide to ship a matching product from a different seller, but from a warehouse close to the buyer. This is advantageous to Amazon because it allows them to ship products much faster and offer better customer service.
For the FBA Label Service, Amazon offers a Label Service whereby they put a label (a sticker) on your products on your behalf. If you do not want to print the stickers yourself, then you should choose the FBA Label Service, which will cost a very small fee of 20 cents for each item. If you want to reap the best out of the Amazon FBA Program though, you may want to print the stickers by yourself and label the products yourself.
After choosing the above options, you will be required to either (i) “Convert Only” or (ii) “Convert and Send Inventory”. If you selling only one product, choose the second option, “Convert and Send Inventory”. If you selling several items, select the “Convert Only” option to have the option of adding more items before the shipping process.
Your product will now be available in your “Amazon-Fulfilled Inventory” in the “Manage FBA Inventory” option.
4. The Next Step Would be To Create an Amazon FBA Shipping Plan
Whether you have selected the “Convert Only” or “Convert and Send Inventory” option, you will be impelled to create a shipping plan. For this option, you will require your address and the type of package.
The package is of two types:
(i) Individual Products- This would be convenient if you are selling different products. Like games, books, and some merchandise.
(ii) Case-packed products- This option is applicable if you have packaged your goods in a box, with only one type of product in it. For example, a box of 10 inspirational books.
After setting up your shipping plan, you will be impelled to add your products. Assuming you have added three items, you should be able to see three items. Select all of them.
If you want to add more items, go through the above process, but choose “add to the existing plan” instead of “creating a new one”.
5. The Next Step Would Be to Ship Your Items to Amazon for FBA
After listing the items you want to sell and choosing your shipping plan, you are now ready to ship your items to Amazon for FBA.
This is how you do it. Go to “Inventory”, then “Manage FBA Shipments”, then “Continue with shipping plan”. Then add the number of units for each item you are shipping. Here you will be required to choose whether your product will require prep or not (most products do not) and whether Amazon will label your product on your behalf.
After approving the shipment, you will be required to buy shipping from Amazon. (Confused?) Don’t be. Weigh the items, because the weight will translate to the amount it will cost to ship to their warehouse. After printing your labels and sticking them on the package, they will be ready to be mailed or dropped at your local UPS.
6. Finally, How do you Sell Your First Product on Amazon?
Now, this is the simplest part. After shipping your parcel off to Amazon and they collect it, your products will be accessible for buying.
Now, you sit, relax and wait for your products to be sold.
If you are retailing a more popular product, you will not have to wait for so long. For a start, I listed 5 items and they were sold off in less than a month.
(Video games do sell quite fast!
So, that is basically it, selling on Amazon FBA for a beginner is not a complicated process.
Here are Some Things You Need to Know before You Sell on Amazon with FBA.
1. You take care of shipping fees– As indicated above, you do pay for the shipping charges to the Amazon warehouses. This is a factor you should consider before packing whatever stuff you come across.
2. The Seller fees- Selling on Amazon is certainly not free. There are some seller fees involved. Amazon takes around a 15% cut on every sale you make through FBA.
3. Additional fees- Amazon charges a fee for merchandise pick-up, anytime Amazon staff handles your items to store or dispatch it) and stored as well as weight-based charges for product shipping. You may be asking ‘what happens to items that do not sell for a long time’? Well, the seller has to pay a Long Term Storage fee for products stored for more than one year.
4. Co-mingling questions- Since Amazon has several distribution hubs, it uses the distribution center positioned closest to the client when shipping items. Due to that, the item being sold might end up being someone else’s, if you decide to co-mingle your products. This mostly happens if you are selling an item that other sellers have listed as well.
The advantage that comes with co-mingling is that you get to sell your products much faster. The drawback is that the client might end up getting an item with a slight difference from what you listed.
5. Sales tax- Some states like Missouri requires you to have a sales tax report. Sometimes your items may be shipped to a country that charges sales tax.
With FBA however, you always know which Amazon warehouse is storing your products, and to which country they may be shipped to.
6. Competition- With selling with FBA, you’re not just challenging other third-party sellers both on price and variety, you’re similarly competing with the king- Amazon itself. This is probably the main slowdown against FBA as opposed to a selling service like Etsy or even eBay.
PS: Check Amazon prices for equivalent products before availing your own items to FBA.
Is Fulfillment by Amazon (FBA) Worth the Cost?
With the above factors, you could be wondering whether it is even worth selling on Amazon FBA. Amazon has the FBA Revenue Calculator that helps you determine the profitability of your products.