Top 10 High Margin Products and How to Find Them on Amazon
Amazon's marketplace is known for being highly competitive, requiring each seller to find their own strategy in order to thrive. The ability to generate significant income on Amazon depends largely on the potential profitability of the products you sell. Therefore, it's essential to identify high-profit goods by evaluating their profit margin metrics.
In this post, we will explore the attributes of high-margin products and discuss strategies for finding them to sell on Amazon.
Table of contents
What is a Good Profit Margin?
A profit margin for selling on Amazon represents the difference between the revenue generated from product sales and the costs (including sourcing, shipping, advertising, Amazon fees, and other expenses). To calculate this number, apply the following formula:
Net Profit Margin = (Total Revenue - Total expenses)/Total Revenue
A good margin for Amazon sellers typically falls within the range of 10-20%. Anything less than 7% requires a very high volume of sales or high product prices to guarantee a revenue of at least $1,000/month. The best margins are greater than 20%, indicating greater profitability and financial health for selling online.
Finding high-margin products is crucial, as it enables sellers to grow their businesses. Higher margins provide the financial flexibility needed to expand product offerings, invest in advertising, and ultimately increase profits. Now, let's delve into how to find profitable products on Amazon.
How to Find Amazon Products with Good Margins
Understanding whether a product will yield good profits requires calculating all related expenses, analyzing sales, and more. If you're unsure where to start and don't want to calculate profits for dozens of products manually, consider using Amazon product research tools, such as AMZScout. The AMZScout toolkit provides sales data and a calculator so you can easily get ideas for high profit goods and assess the margins for top Amazon products quickly.
Let’s examine how to use these tools to help you find high-margin products to sell on Amazon.
Explore Profitable Ideas with the AMZScout Product Database
The AMZScout Product Database is a tool designed to assist you with generating a list of potential things to sell on Amazon. It contains detailed sales metrics for hundreds of millions of Amazon products. Here is how you can use the Database to find products with high margins:
Step 1. Open the AMZScout Product Database. If it's your first time, you’ll be prompted to provide your email address to start a free trial.
Step 2. Enter your product criteria. You can search for specific terms, and there are several filters to help you refine your product list based on criteria such as sales and average rating.
Step 3. Apply the Net filter. Use this filter to apply a nominal margin to your products. It works using the following formula: Net = Product Price - Amazon Fees. You can use this to have the results only show products that keep a certain amount after Amazon fees are taken out.
If you have a preferred price range (for example $80-100), set your Net to 65% or higher than the price ($55-90) to ensure there will be enough balance remaining.
Step 4. Click Find Products to generate a list of matching products. Review the results to find interesting items worth selling.
Make a note of any products that look like good options. After that, you’ll need to do a bit more research to make sure a product is worth selling.
Validate High Margin Products Using the AMZScout PRO AI Extension
The AMZScout PRO AI Extension is an awesome way to make sure your product ideas are likely to generate high profits. This will provide you with more details for specific products, as well as profitability metrics for the niche as a whole.
Below are the steps for finding high-margin items with the PRO AI Extension:
Step 1. Install the AMZScout PRO AI Extension.
Step 2. Start your AMZScout free trial.
Step 3. Go to the Amazon marketplace you are interested in selling on.
Step 4. Find your products. Use the search field to check out any niche you want to see. Enter any product ASIN or product name that you found through the AMZScout Product Database, or that your supplier has suggested.
Step 5. Open the Extension. Click the AMZScout icon in your browser extension bar or the circular button in the lower left-hand corner of the page.
Step 6. Review the data. At the top of the app, you’ll find a compilation of stats for the niche. Among these are the average monthly sales, revenue, and net margin.
Step 7. Look for high-margin items. In the results table, you can find the product margin for each individual item, which is calculated taking into account only FBA fees. To find the items with the highest margin, click the Net Margin column at the top of the table to sort the results from highest to lowest margins.
Step 8. Calculate your estimated monthly profit. Click and open the Profit Calculator. Enter your costs for the item (price to buy the product, shipping expenses, etc.) to see your profit margins. The extension will automatically calculate your Amazon fees and show you how much you can expect to make on every product.
When searching for high-margin products, don’t forget to look at other important metrics such as Estimated Monthly Sales and Revenue. This will ensure that you are able to sell the products in high enough volumes to capitalize on their high margins.
The AMZScout toolkit streamlines the process of identifying high-margin products to sell on Amazon. It also enables you to save time on research and optimize your immediate earning potential through precise data.
Product Categories with the Highest Margins
After devising a strategy to select the most profitable goods on Amazon, let's delve into the categories with high profit margins. In e-commerce, some of the most popular groups known for generating lucrative returns include:
Home & Kitchen
Research indicates that in 2023, this category accounted for 60% of total Amazon sales. The majority of items in this category are lightweight, which helps to save on shipping fees and increase profit margins. Due to the abundance of suppliers, it's possible to find competitive pricing. Additionally, the wide range of household products ensures stable demand throughout the year, as they cater to various needs and preferences of consumers.
Toys & Games
Parents are often willing to purchase a wide variety of products for their children. Toys and games, in particular, tend to have a relatively low purchase cost compared to their selling price, allowing for significant markup. Additionally, sales in this category typically experience growth during holidays. However, it's important to note that this market is also highly competitive.
Sport Equipment
The trend towards leading a healthy lifestyle has been growing steadily over the years. You can focus on products in specific subcategories, such as underwater swimming. Accessories for these activities are typically inexpensive to source and lightweight, making them attractive options for online sellers.
Clothes & Apparel
Clothing is a product that attracts consumers consistently due to its necessity. Many items are lightweight, which keeps shipping costs relatively low. Moreover, emerging niche markets, such as women's sustainable clothing or customized apparel, offer significant growth opportunities with less competition. However, if you intend to sell products from other brands on Amazon, it's important to check whether approval is needed.
Jewelry
This category offers the opportunity to source unique products, often featuring artisan craftsmanship. The inclusion of a recognized brand or the use of precious materials enhances the value of these items, allowing sellers to justify premium prices. Keep in mind, it's crucial to select reliable suppliers to avoid counterfeit products.
Beauty & Hair Products
Body care products are essential for various consumers, ranging from babies to adults. There is also the factor of brand loyalty that can lead to recurring purchases. Additionally, it’s possible to differentiate from competitors by offering organic products, which are currently in high demand. Many suppliers offer significant discounts when purchasing body care products wholesale, allowing for substantial markup and potential profitability.
Pet Supplies
According to research, as of 2024, there are approximately 844 million cats and dogs kept as pets worldwide (excluding other types of animals). Pet owners are devoted to their animals and often willing to invest in premium pet products that feature high-quality ingredients or innovative features, which can result in high profit margins due to strong demand and high pricing.
For individual products within these categories, analyze their profit margins on Amazon to gauge their market effectiveness. Let's continue to the next section.
10 High-Profit Margin Products and Niches on Amazon
Now that we’ve explored the most profitable categories for general e-commerce, let's narrow our focus to Amazon.
Please note that the following information is provided for reference purposes only and does not constitute product recommendations. The data, such as price, sales volume, and FBA fees, has been sourced from the AMZScout PRO AI Extension and is accurate at the time of writing.
Here is a list of some examples of high-margin Amazon products:
1. Wireless Earbuds
Potential Net Profit Margin: 20-30%
Wireless earbuds are an electronic product with steadily growing demand. Whether you want to sell a name-brand item or create your own private-label product, you’ll find plenty of manufacturers for wireless earbuds.
These products enjoy high margins due to a balance of high sales prices and low product costs. And since these items are small, they also have the added benefit of low FBA fees.
Be aware that consumer electronics products have some of the highest return rates on Amazon. You’ll need to consider these costs when calculating your product’s profitability.
2. Silver Chains
Potential Net Profit Margin: 30-50%
Silver chains are one of the most popular products in the jewelry category. You can find a wide range of these items for both men and women, and across various price points. Plus, you can source these products using a variety of methods, including print-on-demand. Like many jewelry items, silver chains have strong margins, as you can apply a big premium to your sales price.
3. Hair Extensions
Potential Net Profit Margin: 25-40%
Because the beauty niche has such a consistently high demand on Amazon, you never have to worry about having enough customers when selling this product. These items have high margins because they come at a very low cost with minimal fulfillment fees.
4. Flying Ball
Potential Net Profit Margin: 40-60%
The Flying Ball is a toy that generates strong sales volume. It works by floating in the air and then returning to your hand like a boomerang. This is another smaller item that you can get at a low cost, allowing you to sell it at a high margin.
5. Car Covers
Potential Net Profit Margin: 25-35%
Car covers are great for keeping your car clean during inclement weather. These items can stretch to cover the length of a car, and are also lightweight and easily folded, helping to keep storage and shipping costs low.
Take a look at the PRO AI Extension to get the freshest data.
6. Sleeping Bags
Potential Net Profit Margin: 20-30%
When you sell sleeping bags, you’ll have a variety of suppliers from whom to source them, including those for both wholesale and dropshipping. These products can be sold online for a sales price that’s higher than their cost, resulting in a good margin.
7. Garden Hoses
Potential Net Profit Margin: 20-30%
Garden hoses are a popular outdoor product. Hoses are bulkier than some of the items on this list, but you can still get them for a relatively low cost. Plus, there are plenty of suppliers for this product. You can even source them from a physical store as part of a retail arbitrage strategy.
8. Kids’ Play Tents
Potential Net Profit Margin: 25-45%
Play tents are another popular item for children. On Amazon, you can find both indoor and outdoor versions of these products. Tents command a good selling price, so you can sell them at a high margin if you’re able to keep your product and shipping costs down.
9. Vegetable Choppers
Potential Net Profit Margin: 35-50%
Vegetable Choppers are useful kitchen items that let you cut up a variety of different products. The kitchen niche has some of the strongest demand on Amazon, so you’ll never lack customers when selling this product. You can set a high or low price depending on how you want to position your product. Also, the sourcing costs are low, so you can enjoy a solid margin no matter which you choose.
10. Dog Beds
Potential Net Profit Margin: 35-50%
Due to their size, these products will have notably higher fulfillment fees compared to others on this list. However, because of their simple design, the product cost is generally low. Plus, you can list these items for a high sales price.
These examples of the most profitable items to sell online are those in high demand among buyers, and are also lightweight and relatively inexpensive to source from suppliers. All of these factors allow for setting an appropriate price to yield high revenue. Let's now consider the best strategies to increase profits even more.
How to Increase Your Profit Margin
Even though most sellers aim for high margins, they don't always achieve the desired values in practice. The typical average profit margin for Amazon FBA sellers falls within the range of 10% to 15%.
However, your profit will depend on various factors like your pricing strategies or diversifying the inventory offer. You can increase your income by implementing the following strategies below.
Tips
Here are a few tips on how to increase your Amazon sales profits:
Choose profitable products: These ensure a higher return on investment without the need to constantly search and attract new customers. By focusing on products with strong profit margins, sellers can generate more income. You can check which items are considered to be profitable by analyzing them using AMZScout tools.
Reduce your expenses: Find a supplier with lower costs, preferably without compromising product quality. Also, optimize your inventory management to minimize storage fees and fulfillment costs associated with storing and shipping products through Amazon FBA. If FBA fees are too high, consider becoming an FBM seller and shipping products through third-party delivery services.
Improve your organic rankings: You can improve your organic rankings by optimizing your product listing using SEO strategies to enhance your visibility in search engine results. This can attract more visitors and drive potential sales to your store without the need to spend additional funds on advertising. Consider using professional tools like AI Listing Builder by AMZScout to create more compelling listings with the assistance of AI.
These are general recommendations to keep in mind. It's important to remember that strategies for increasing your profits vary for each seller.
Conclusion
For a seller, the main goal of running a business on Amazon is to guarantee profitability. By focusing on selling high-margin products, you can maximize your chances of achieving rapid business growth and thriving on Amazon.
To validate profitable products and calculate potential income right on the Amazon page, utilize the AMZScout tools.
