Tips for Choosing the Right Product for Your Amazon FBA Business
Are you looking to start an Amazon FBA business but don't know where to start? Choosing the right product is crucial for your success, and there's a lot of information out there to help you make the right decision. In this article, we'll go over some tips to help you choose the right product for your Amazon FBA business.
Tip #1: Go Premium
Consider finding a product that you can sell for over $20 while still keeping your costs low. The best way to do this is to find a product that is very popular or in high demand. You can search through Alibaba.com for products that are trending high, and usually, there's an option to see what's really popular. Choosing a premium product is going to help in the long run because customers are going to be satisfied with a high-quality product. Over time, you're going to get better reviews, more customer traffic, and more sales.
Tip #2: Avoid Gated Products
There are some categories on Amazon where you can freely open a seller account and start selling your product without having any additional steps of approval from Amazon. However, there are products that are considered gated products, meaning that you need to request approval before you can actually start selling that product on Amazon. Because of this extra step and the potential of being denied to sell in that certain category, you're going to want to avoid these gated categories. Some examples of gated categories include jewelry, watches, and movies and music.
Tip #3: Look at Historical Sales of Your Product
Looking at the historical sales of a product that you're looking to improve or create your own brand of can be really helpful for you. You can incorporate the fact that you are improving it in a lot of ways, such as increasing the price that you would sell it for or seeing how it'll perform within the year. If you're creating a product completely from scratch, then this information might not be readily available to you. However, there are similar categories that you can refer to. The key thing to remember here is to not just go for those hot trending products out there because those may be just a quick trend that comes and goes and might not really sustain you in your sales over the years.
Tip #4: Know Your Numbers
Knowing your numbers overall is going to help you stay organized, understand your path to becoming profitable with your product, and better understand how cash flow is working. You're going to want to know what to expect and how your profit margins are working. You'll also want to keep inventory flowing, and there's a big reason why you don't want to run out of inventory on Amazon. You want to make sure that you're not necessarily losing money year after year and that you're on top of all of your numbers.
Tip #5: Leverage Amazon Seller Tools
By leveraging Amazon seller tools, you're not only getting a better understanding of how your product works and how it fits in that Amazon world with every other seller out there, but it also helps you understand where your competitors are and how you can do better. Both Jungle Scout and Helium 10 provide you with a set of tools that helps you launch your product. They also help with product research, so if you're in the beginning stages still looking for a product and wanting to know how well it can perform before you fully invest in it, then these sites have those tools for you to use.
Tip #6: Reconsider Large or Heavy Products
While finding a product to sell, you might want to avoid those large and heavy products mainly because of the increased storage fees that you'll have on Amazon. Usually, the rule of thumb is that if your product is under one pound or maybe under one and a half pounds, then you have a much lower storage cost in the long run. You'll also be able to save on freight costs. However, it doesn't mean that you need to completely avoid it. A lot of Amazon sellers are avoiding those bigger products, which means that if you have the means to do so, there's a lot of potential for sales there.
Tip #7: Differentiate Your Product from the Competitors
You're going to want to differentiate your product from the competitors before you source your products. This is going to help you see what two, three, or four months down the line will look like. If you definitely have a space that you're going for that there's a lot of competition for, you're going to want to start thinking in a very unique creative way to really stand out. Have a clear intention of what your whys are for your product as well. The more that you can convey as to why you're creating a product, customers will understand and empathize with that.
Tip #8: Consider How to Market Your Product
Again, you're going to want to start thinking about this before you even source a product. What is your game plan for marketing? Some products may be much easier to market than others. For example, if your product is something that can do really well on social media, then you have an advantage there. You can use influencers to help push your product, and you can do a lot of social media marketing in general with Facebook and Instagram and even TikTok PPC.
Tip #9: Consider Sourcing Locally
Consider options to source locally. This is definitely something that I would even consider more nowadays where we have a shipping shortage and a lot of delays at manufacturing warehouses. There's nothing wrong with international shipping, and a lot of Amazon sellers do this. However, if you can look into manufacturing locally, then it might be a good option. Not only would you be able to say it's made locally, but you're also going to be able to see if you can lower costs in some ways.
Conclusion
Choosing the right product for your Amazon FBA business is crucial for your success. By following these tips, you'll be able to make an informed decision and set yourself up for success. Remember to go premium, avoid gated products, look at historical sales, know your numbers, leverage Amazon seller tools, reconsider large or heavy products, differentiate your product from the competitors, consider how to market your product, and consider sourcing locally.
Highlights
- Go premium and choose a product that you can sell for over $20 while still keeping your costs low.
- Avoid gated products, which require approval before you can start selling them on Amazon.
- Look at the historical sales of a product that you're looking to improve or create your own brand of.
- Know your numbers and keep inventory flowing.
- Leverage Amazon seller tools to get a better understanding of how your product works and how it fits in that Amazon world with every other seller out there.
- Reconsider large or heavy products because of the increased storage fees that you'll have on Amazon.
- Differentiate your product from the competitors before you source your products.
- Consider how to market your product before you even source a product.
- Consider options to source locally.
FAQ
Q: What is Amazon FBA?
A: Amazon FBA stands for Fulfillment by Amazon. It's a service provided by Amazon that allows sellers to store their products in Amazon's fulfillment centers. Amazon then picks, packs, and ships the products to the customers.
Q: What are gated products?
A: Gated products are products that require approval before you can start selling them on Amazon. Some examples of gated categories include jewelry, watches, and movies and music.
Q: What are Amazon seller tools?
A: Amazon seller tools are tools that help you launch your product and provide you with a better understanding of how your product works and how it fits in that Amazon world with every other seller out there. Two popular Amazon seller tools are Jungle Scout and Helium 10.
Q: Should I source locally or internationally?
A: It depends on your product and your budget. Sourcing locally can help you save on shipping costs and avoid delays at ports, but it might be more expensive per unit. Sourcing internationally can be cheaper per unit, but shipping costs can be very expensive.
