As the leading eCommerce store on the planet, Amazon attracts many retailers just as much as consumers. But before selling anything on Amazon, there are things you must know to make the most of it while avoiding hitches. For instance, it could well benefit you to learn about Amazon seller category approval before you you get selling.
Now, sit tight; let's get you up to speed.
1. Choose what kind of sales works best for you
Not every Amazon seller sells the same way. Typically, most new online sellers would want to start slow, selling products without keeping a large inventory.
You could decide to go for online arbitrage, which is the process of buying products from retail stores and then reselling at a higher price. In that case, you'd have to buy at discount prices, possibly in bulk, from other online stores and then list the product on Amazon.
You could also try drop shipping, in which you list products on Amazon without first having them in stock. When someone makes an order on Amazon, you can then purchase the exact product from a retailer and deliver it to the customer.
2. Factor in shipping costs
Whatever price you fix for any product on Amazon, ensure you factor in the shipping cost and your profit. For example, if you're doing drop shipping, you shouldn't list a product for $20 when that's the actual price you'll buy at a retail store. There's no point going through the pain of buying a product and selling only to make zero profit.
However, you can opt for Amazon's FBA (fulfillment by Amazon). Here, once an order is placed on your product, Amazon fulfills the order on your behalf. It costs $3 per item for items weighing less than a pound. The price increases with the weight. You also need to factor in this cost and your profit when listing the product on Amazon.
3. Your products must have barcodes
Amazon mandates that sellers attach a barcode label to every product before selling it on their platform. These barcodes are what Amazon uses to identify each product and customers use to track their items. It's not required by law, but you need barcode labels to sell on Amazon. Since you require expensive machines to create and print these labels, it's wise to outsource the job to a third-party company.
If you make your products yourself, you should consider registering with GS1 and getting UPCs. Also, avoid an amazon infringement complaint by ensuring there is no basis for someone to accuse you of brand infringement.
4. Do your homework
It wouldn't be very wise to just hop on Amazon and sell whatever you lay your hands on. There are Amazon-restricted brands. You want to stay off of these. Some require paperwork for approval, so you need to decide if the profit is worth the stress.
Additionally, you want to consider selling relatively popular products. An item that ranks between #1 and #100 would get considerable sales weekly. This is important to an item's profitability because one that ranks over 100,000 might not even sell in a month, and that's no good.
5. Taxes apply
Every profit you make on your Amazon sales is taxed. Amazon collects it and passes it to the government. Since each state has its tax code, you want to inform Amazon on what state to associate your income tax with.
6. Finally... Follow the rules
There are many rules and guidelines on Amazon. It's a trusted marketplace because of these regulations, and you don't want to do anything to hurt that as it may affect your business.
Do your homework, sell the right products, promote your business professionally on social media, and considerable profits will surely come your way.