01/01/2026
Amazon FBA
Amazon is widely considered to be the world’s largest eCommerce company, according to revenue. They have invested themselves into several aspects of eCommerce, with one of those aspects being Amazon FBA.
Fulfillment by Amazon (FBA) is a service that provides storage, packaging and shipping assistance to sellers. Unlike dropshipping, where you do not own any merchandise, Amazon FBA has you invest in merchandise that is then stored at one of their warehouses. The products are packed and shipped, all courtesy of Amazon.
This works to your benefit, as you have the credibility of Amazon being associated with your products, and customers will feel they are more likely to receive quality products through your business. On top of this, you will never have to handle any merchandise, which can take the burden off of handling and maneuvering large volumes of equipment. Using Amazon FBA also means that you will pay lower shipping fees, due to their relationships with certain shipping companies.
As I am sure you have already guessed, using Amazon’s services will cost you a bit of money. Amazon will take approximately 15% of your product price once it is sold, along with storage, shipping and handling fees that you will have to pay.
Now you may be thinking that dropshipping is already a better alternative, as you avoid having to pay several fees, however each comes with its own perks according to your business model.
With dropshipping, you are required to build up a client base in order to sell your product. However, Amazon allows you to bypass some of this, as you have access to their huge customer base, while increasing your profit margins due to a higher selling price, courtesy, again, of the Amazon brand.
Naturally, you will have doubts about involving any of the giant-size brands in your startup business, such as Amazon, there is much success to be made from this kind of business model. Amazon FBA’s profit margins and branching revenue streams make it possible to greatly increase the earning potential for your business.
Spencer Haws, owner of Niche Pursuits, used this to his advantage, selling his products on Amazon and raking in approximately $40,000 dollars in his first month. This just shows that there is tremendous potential for profits within the industry, just in merely finding the right niche. The possibilities that await are potentially endless!
Building Your Amazon FBA Business
So now that you’re interested in starting your own Amazon FBA business, where do you actually begin?
Open an account and consider your niche
Well, the first step is to open a ‘Seller Account’ with Amazon. You can either opt for a Professional or an Individual account. The Individual account does not require any monthly subscription, however you will have several limitations placed on your account. These could work for you, or against you, depending on the needs of your business.
Just as you would do in dropshipping, you will need to find a niche for your business. Remember to relate it to something that you’re interested in, such as a hobby or special interest. Don’t throw away extra ideas you may have, as you could potentially add them in the future, or use them as an alternative if your current niche is not turning out successfully. As always, expand your knowledge as much as possible, so that you can better determine the best possible outcomes for your business.
What products will you sell?
From there, you will need to determine what products you would like to sell. Consider using keyword tools to help you gather research into how often people search for certain products, and use this to determine what are the best products to sell.
Make sure to identify what fees are associated with each product. Weight, size and storage requirements will vary depending on your product, so look for products with lower fees to minimize your expenses.
Do your best to keep away from products that are used by popular brand names and are well-established in the markets. These are infinitely harder to compete with.
Product Sourcing
Once you’ve determined the core products that your niche will center around, you will need to find out where your products will be sourced from. You should be looking for supplies with high quality products available for you to sell.
If you intend to sell a product that is produced locally, you could head to your local manufacturer and I’m positive they will be welcoming to your efforts.Alternatively, you could still take the route of using an overseas supplier, which is also beneficial as it tends to bring potential for higher profit margins for your business.It would be to your own benefit to test the products that you are planning on selling, should you find yourself sourcing from an overseas supplier. Try to get your hands on some samples so that you can ensure you will be providing high quality items to your future clients.
Your next step will be to ship the goods to an Amazon Fulfillment Center. Amazon will provide you with specifications and instructions when going through this process. Be sure to keep shipping costs in mind, as these can derail your business if you fail to keep track of them.
Creating your brand
You now have products ready to be sold, however, you’re still going to need a brand. Your brand will tell your clients who you are. Make sure to research if your brand name has already been used or not, as well as whether there is an available domain. Your domain name is your website’s name, and this will be where clients are able to find you.
Even though you gain more brand will gain more credibility through Amazon, it is still important for you to place high value on its creation. This will define your business for as long as it exists, and so you need to make sure it starts off on the right foot. Remember the main facets of a brand are its name, tagline, logo and the brand story.This will also include your products and how you choose to display them.
Create your product pages, making sure your product details are accurate and detailed, while product photos are professional that emphasize and show off your products. Take a look around to see how other brands market their own products, using this to guide you in your own marketing.
Make sure the tone of your descriptions are friendly and enticing to potential buyers. ‘Sell’ the product, but don’t let them feel that you are selling it. Use the descriptions to make clients feel like this is something they must buy; that they can’t live without. Be expressive in your writing. Make sure any paragraphs you have are structured and organized so that they are attractive to the reader. Too much boxed all together will feel a little overwhelming.
The aim of the description is to sell the product, and to silence all doubts a client may have regarding their purchase.
Marketing
Your Amazon FBA business is all set up. Now we have to market it. As it is with dropshipping, advertising is the key component to get your business up and running and bring in sales.
Social media is still your best friend here. Look at enhancing your brand’s profile, allowing people to view, like, comment and share as you go along. This ensures that you begin to build a rapport with potential customers.
However, don’t rush yourself into exploring several channels for marketing at once, and try to invest time in all of them simultaneously. Instead, select a few channels or platforms to begin with, and once you feel you are gaining a return, you can move onto something else.
Here, there is a benefit to influencers, as you can use them to market your product for you. Offer them free products in return for reviewing and marketing your products, and you may see your sales gain a significant boost.
On top of this, consider adding platforms on your website and social media for clients to leave reviews of their purchases and service, as great reviews can give you a massive reputation boost for future customers. Drive your current and potential customers to sign up for email subscriptions. Use your website to find interesting, but not overwhelming ways of enticing your clients to sign up for a subscription. (Smale, 2019)
A Few Extra Tips
Make it a consistent goal to improve your Best Sellers Rank (BSR). The term being fairly self-explanatory, having a business with consistent BSR growth will show clients that your business has tremendous potential to succeed, and that you are reliable in the quality that you offer.
Stay ahead of the trends, and provide more offers to your clients whenever possible. Continue to include products that will compliment the ones that you already have yet provide more variety in selection.
You could also continue to increase your revenues by becoming an affiliate with Amazon. However, we’ll discuss affiliate marketing in detail a little later.
With Amazon’s extensive brand and tools available to you, there is a world of endless possibilities that await you, should you choose Amazon FBA to further your venture.
