How to Become a Seller on Amazon in 5 Easy Steps
With the emergence of third-party selling platforms, it’s no longer necessary for sellers to create their own website. In fact, many of these platforms are so effective that sellers have built their entire business around them. The most popular of these is Amazon.
In Q2 of 2020, third-party sellers made up over half of Amazon’s total sales. They are one of the most trusted brands today, so when a new entrepreneur operates under their umbrella they also enjoy an added level of trust amongst consumers.
Are you interested in learning how to become an Amazon seller? The process is actually easier than you might think. You don’t need to be authorized or certified to sell on their platform. Anyone can do it.
Table of contents
- What to Do Before You Start Selling
- How to Start Selling on Amazon
- Advantages of the Fulfilled by Amazon Program
This guide will walk you through all the requirements and steps you’ll have to take to find success.
What to Do Before You Start Selling
Like any business, if you want to make it as an Amazon seller you need a solid business plan. The planning stage may not be as exciting as the other steps, but it’s just as important so make sure to take the time to do it right.
#1 Decide on a Business Model
Before becoming an Amazon seller you’ll need to decide what type of business you’re going to operate. The two main questions you need to ask yourself are how are you going to acquire your products and how are you going to deliver those products to your customers.
For sourcing products, there are a few different options. You can do retail arbitrage where you buy items from local retail stores that are selling for lower than they are on Amazon and then resell them for a profit. This is good for beginners but it isn’t all that scalable.
If you’re really serious about building a business it’s best to purchase your products from wholesale businesses or manufacturers. If you buy from manufacturers you even have the option of creating your own private label products.
When it comes to fulfilling your orders, there are two ways to do this:
Fulfilled by Merchant: You store your own inventory and ship products to customers yourself.
Fulfilled by Amazon: You ship all your inventory to Amazon to be stored in their warehouses and they fulfill your orders for you.
Do your research and determine which model fits your needs best.
#2 Join an Amazon Community
This is a great way to get some useful tips and tricks. Joining a community not only provides great information, but it also keeps you up to date with what’s happening in the market. Perhaps best of all though, you’ll be able to ask other more experienced sellers questions if you run into any problems.
#3 Set Your Budget
Initially, you’ll have to spend some money on tools and inventory to get your business up and running. Think of it as an investment in your business. And as you grow, you’ll have to continue spending money on inventory and launching new products.
Determine how much money you can afford and set your budget for all the costs (inventory, tools, marketing, etc.) Make sure to stick to your budget to ensure you don’t run into trouble down the road.
#4 Be Realistic
It’s easy to get caught up in all of the unbelievable success stories of new Amazon sellers. Unfortunately, this isn’t realistic for every seller.
Don’t expect huge returns immediately. To become a successful seller requires hard work, at least during the initial stages until your product moves to the top. And even if you have a Best Seller’s tag, it requires work to maintain it.
Your business will face a number of ups and downs so prepare for every scenario. That way you won’t be discouraged if you hit a rough patch. That being said, if you keep working hard and doing things the right way you should be able to grow a profitable business in a matter of months.
How to Start Selling on Amazon
Now that the planning stage is over it’s time to finally start selling on Amazon. Below are the steps for getting started. Every step is important so don’t rush them. Take your time and do everything properly in order to give yourself the best chance at success.
#1 Find a Product
To begin with, you'll need to select your first product. This is the most interesting and challenging stage. Even if you’re selling handmade items you’ll want to do some product research to ensure you’re selling a winner.
Luckily, AMZScout offers a full range of tools to help you find products that are profitable and present good selling opportunities.
Here’s a quick rundown of how to find profitable products to sell:
Use the Product Database to Generate Product Ideas: Use the 44 search filters to search for products based on category, sales, reviews, weight, and more.
Review Your Results: Choose 3 - 5 products from your results that you’re interested in selling.
Analyze Your Products Using the AMZScout Pro Extension: Search for your product on Amazon, then open the Pro Extension. Review the sales, reviews, and history of the product to determine whether it’s profitable. You can also look at the niche and product scores to analyze profitability, demand, and competition.
Product research is an extremely important step, but if you use the right tools you’ll find it’s actually fairly easy to find profitable products.
#2 Create Selling on Amazon account
After you’ve decided on a product to sell, you’ll need to create a seller account. There are two options: a Professional Account or an Individual Account.
An Individual account is the best option for beginners that don’t plan on selling a lot of products per month. The account is free but you’ll be charged $0.99 for every sale. Keep in mind that Individual Accounts have some limitations when it comes to the product categories they can sell in.
More serious sellers should choose the Professional Account because of its variety of options, access to active Prime purchasers, and inventory allowance. This account costs $39.99 per month, but you don’t have to pay Amazon the $0.99 fee for every sale. So, if you sell more than 40 items per month it’s actually cheaper.
#3 Source Your Product
Once you have a product you want to sell you’ll need to find somewhere to source it. Most successful sellers source their products from China using Alibaba or other similar portals.
That being said, there are other options. If you sell in the US market it might be a good idea to look into US manufacturers, as “Made in USA” products are well respected. Buying locally can also help you save on shipping. India has many quality suppliers and manufacturers as well that are worth looking into.
Shop around and find a supplier that can offer you good quality products and a price that works with your budget.
#4 Create Your Listing
Once you have your product you’ll need to create your listing. The quality of your listing will have a huge impact on how high you rank in Amazon searches and how many people will buy your product, so be sure to follow the tips below to create the best listing possible:
Use High-Quality Images: Use hi-def images that clearly show the product’s features and follow Amazon’s guidelines. Click here for more information on images.
Include Keywords: Including the right keywords throughout your listing is an important part of showing up in Amazon search results. Use the Keyword Explorer and Reverse ASIN Lookup tools to find the best keywords for your product.
Focus on Benefits: Don’t just say what your product does. Explain why people should want it and how it will make their life easier and/or better.
#5 Market Your Listing with PPC Ads
If you create your listing properly, over time it will begin to show up in customer searches. However, if you want to start getting traffic right away it’s a good idea to run some PPC campaigns. With these ads, you’ll begin appearing in the sponsored sections of searches.
Amazon advertising budgets are flexible, and if you create your campaign right they should generate more money than you’re spending on them. The key is to target the right keywords. This is another area where the Keyword Explorer and Reverse ASIN Lookup tools come in handy. You can also use the Keyword Tracker to monitor the organic position and rankings of keywords to run more effective PPC campaigns.
Advantages of the Fulfilled by Amazon Program
As we previously discussed, when it comes to selling through Amazon you have two options: Fulfilled by Merchant and Fulfilled by Amazon (FBA).
The main difference between having items fulfilled by Amazon and fulfilling them yourself is that you have to do all the work. This can prevent you from having time to grow your business, leading to lower profits over time.
As an FBA seller, Amazon picks, packs, and ships your items for you, eliminating the concerns mentioned above. This means you don’t have to worry about shipping products to customers or storing your inventory.
Amazon will do everything for you - just ship your product to an Amazon fulfillment center and Amazon will:
Store your inventory
Pick and pack your products
Ship them to your customer
Provide customer service
The FBA program is extremely convenient and allows you to sell from any country. You can run your business from anywhere without having to even touch the goods or deal with warehouses and shipping.
How to Become an Amazon FBA Seller
1. Using the FBA program to sell your products is surprisingly easy. You can send products to Amazon fulfillment centers by creating a virtual shipment in your Seller Central account.
2. When preparing your shipment you’ll choose between preparing and labeling all the products yourself or using the label and prep service by Amazon.
In the first case, you’ll prepare your shipment yourself. You’ll also need equipment to print barcodes and other stickers for the products. If that sounds like too much work you have the option of using a prep center, or you can make an arrangement with your supplier to do it for you.
3. Next, you’ll need to choose a method for shipping your items to an Amazon warehouse. Amazon offers a few options exclusively for FBA sellers. Manufacturers may also offer some options for shipping your items directly to Amazon’s warehouses.
4. A shipment plan for the products that you want to send to Amazon fulfillment centers should be well maintained and documented. This will enable you to keep track of the products that are being shipped.
5. Products received by an Amazon fulfillment center are scanned and made available for sale within three business days.
So, that’s how to become a seller on Amazon. The company has a very strong reputation for putting their customers first. By selling on their marketplace you’ll be able to take advantage of that reputation and grow your business much faster.
With some hard work, the right product research tools, an initial investment, and little luck, you’ll have the recipe for a consistent five or six-figure income.
As you take your first baby steps towards becoming an online entrepreneur, remember that things are constantly changing. Keep learning and absorbing new knowledge. This will allow you to adapt and ensure you build a business that will be super profitable for years to come.