Selling on Amazon Marketplace is a great way for beginners to start an online business in 2024. The platform provides access to millions of customers and handles logistics like payments, shipping and returns. This allows you to focus on product sourcing and listing optimization to drive sales. With proper planning and preparation, you can launch a profitable Amazon selling business even as a complete novice.
This comprehensive guide will teach you the fundamentals of getting started on Amazon Marketplace step-by-step. It covers setting up your Seller Central account, choosing profitable products, preparing listings and inventory, fulfilling orders, driving sales through advertising and promotions. By following these key steps, you’ll gain the knowledge to find success on Amazon and grow your entrepreneurial ventures. With the right roadmap, anyone can leverage the power of the platform to earn impressive income.
The article is structured in a easy-to-understand format, using simple terms that are suitable for beginners. Real-life examples are incorporated to help illustrate key concepts. Whether you want to do Amazon selling full-time or as a side-hustle, this guide has actionable advice that will set you up for success.
Setting Up Your Seller Account
The first step to selling products on Amazon Marketplace is to set up your Seller Central account. This is the portal you will use to manage your Amazon business.
To create your account:
- Go to services.amazon.com and click on “Sell on Amazon.”
- Choose to sell as an Individual or Professional. Individual accounts are for casual sellers while Professional accounts provide more features for those running a full-fledged business.
- Enter your email, password, and basic business information. Accept Amazon’s policies and agreements.
- You will need to provide a valid credit card, bank account, and tax information. This is used to pay Amazon fees and receive your earnings.
As a seller, you will pay three main fees:
- Referral fees – a percentage charged on the sale price of each item. Generally 15% for most product categories.
- Variable closing fees – applies to media categories. Charged per item sold.
- FBA fees – for sellers using Fulfillment By Amazon warehouses. Includes pick & pack, storage, and shipping costs.
Additionally:
- You must collect and remit sales tax in any state where your business has a tax nexus. An accountant can advise you on tax compliance.
- Obtain an EIN from the IRS if registering your selling activity as a business.
Once your account is approved, you can access tools to list products, manage orders and inventory, collect payments, and analyze data.
Key things to set up:
- Payment method to receive earnings automatically
- 2-step verification for account security
- Seller profile to build credibility
With your Seller Central account created, you have the platform needed to start selling products on Amazon Marketplace. The next step is selecting profitable products to sell.
Choosing Profitable Products to Sell
When starting out on Amazon, one of the most important steps is selecting profitable products to sell. The key is finding items that have strong demand and low competition. This ensures there is a large target audience for your listings while also giving you room to rank well and drive sales.
Begin by using product research tools like Jungle Scout, Helium 10, or Unicorn Smasher. These tools analyze Amazon’s catalog to surface detailed sales and demand data. Specific factors to examine:
- Monthly sales volume – Look for at least 500+ units sold per month. This indicates steady demand.
- Best Seller Rank – Lower (better) rankings show higher sales potential. Aim for under 100,000.
- Review count – 10+ reviews is decent, 100+ very good. This proves existing interest.
- Price – Seek >$15-20 sale price for good margins, especially when using FBA.
- Competition – The fewer sellers with strong rankings, the better for you.
You can source products to sell in a few key ways:
- Private label – Contracting manufacturers to produce unique products that you brand and sell. High effort but higher payoff.
- Retail arbitrage – Buying clearance/liquidation items at big box stores to resell at a markup online. Easy to start but labor intensive.
- Wholesale – Establishing relationships with brand owners to distribute their products. Reliable supply source.
When first starting out, categories like books, toys & games, and home & kitchen goods offer attractive options without huge upfront risks. The goal is finding the “goldilocks zone” – enough demand to drive sales but not so competitive that you get buried.
As you grow more experienced, you can branch out into new niches and explore private label. The key is starting small, tracking metrics, and expanding thoughtfully over time. With the right products, your Amazon business can flourish.
Preparing Your Inventory & Listings
After finding profitable products to sell on Amazon, the next step is preparing your inventory and creating compelling listings that convert browsers into buyers.
Creating High-Quality Listings
Your product listings are key to success on Amazon. You need to craft titles, bullet points, and descriptions that convince shoppers to add the item to their cart.
Titles should be clear, concise, and optimized with relevant keywords. Avoid excessive punctuation and capitalization.
Bullet points highlight your product’s key features, specifications, and benefits. Use plain language and specifics.
In your description, focus on what makes your product better than competitors. Be detailed but scannable with paragraph breaks and bullet lists.
Include high-resolution images showing your product from multiple angles. Lifestyle photos show how customers can use it.
Pricing for Profit
When pricing your products, first check what similar items are selling for. Your price should be competitive but also allow you to hit your profit goals after Amazon fees and other costs. Remember you can always adjust it later.
Choosing the Right Sales Channel
You can sell products on Amazon using Fulfillment by Amazon (FBA) where they handle storage and shipping, Fulfillment by Merchant (FBM) where you store and ship items yourself, or both.
FBA makes sense for beginners since Amazon deals with logistics. But FBM allows you to sell hazmat or oversized products and gives more control.
Prepping Inventory & Shipping
Before shipping your products to Amazon (for FBA) or your own warehouse (for FBM), you need to label them properly and create inbound shipping plans in Seller Central.
Get unique FNSKUs from Amazon for product variations like size or color. Apply FNSKUs stickers along with your own readable UPC barcodes.
Box items up securely based on Amazon’s prep requirements. Then schedule shipments and print labels using Amazon Partnered Carriers. Tracking lets you monitor status.
Following these best practices ensures a smooth receiving process, proper storage, and order fulfillment down the line.
Fulfilling & Shipping Orders
Once you receive an order on Amazon, you need to fulfill it by getting the product to the customer. The easiest way for beginners is to use Fulfillment By Amazon (FBA). This allows Amazon to handle storage, packing, and shipping for you.
To start, you’ll send your inventory to Amazon’s fulfillment centers across the country. Make sure to properly prepare and label your products before shipping them to the warehouse. Amazon has specific requirements for labeling like needing scannable barcodes.
When an order comes in, Amazon will:
- Pick the item from their shelves
- Pack it into a box with their signature smile logo on it
- Ship it quickly to the customer using their discounted USPS rates
This is much easier than doing everything yourself! With FBA, you can focus on growing the business while Amazon handles logistics.
Once set up, you’ll need to closely monitor your inventory levels in Seller Central. Keep enough products in stock to meet customer demand. You can use FBA inventory management tools to automatically reorder when quantities get low.
If you sell out completely, turn on the “out of stock” option in your listing. This keeps the listing visible so customers can sign up to get emailed when it’s back in stock.
For very small sellers, Amazon also offers a “Sell One” fulfillment program. This lets you ship individual units yourself as orders come in while keeping the product listed. So you don’t need to stock inventory ahead of time.
Communicating with customers is important for providing good service. Make sure to respond promptly to any messages that come in through Seller Central.
Handling returns and refunds is a normal part of selling online. FBA has return procedures in place to smoothly process exchanges, replacements, and refunds for items customers send back.
As your sales grow, working with a 3PL (third-party logistics) company can also be a good option. They can store excess inventory and help with shipping if FBA alone can’t support your expanding business.
Proper inventory and order management ensures customers get what they ordered quickly and efficiently. This leads to more positive reviews and repeat purchases from happy buyers. So putting effort into fulfillment helps maximize long term sales on Amazon.
Driving Sales with Advertising & Promotions
There are several advertising options available on Amazon to boost your product’s visibility and drive more sales. Using targeted ads is one of the most effective ways to get your listings in front of high-intent customers already searching for your products.
The main advertising platforms on Amazon are:
- Sponsored Products: Product listing ads displayed in search results. You bid for keywords and pay per click.
- Sponsored Brands: Highly visible banner ads at the top of search pages. Includes your logo, image, and brand name.
- Headline Search Ads: Short text ads shown at the top of search results. Typically used to promote brands.
To set up advertising campaigns, simply navigate to the Advertising tab under the Advertising section in Seller Central. From here you can create campaigns for Sponsored Products, Sponsored Brands, and Headline Search ads.
When creating campaigns, carefully choose relevant keywords to target that describe your products. Bidding on keywords customers are already searching for gives your listings the best chance to appear in results. You can refine keywords over time based on performance data.
Listing optimization also plays a key role in improving organic rankings. Complete listings with good photos, titles, descriptions and back-end search keywords will rank better in normal search results. This complements your paid advertising efforts.
Beyond advertising, promotions are another way to spur more sales. For example, you can offer site-wide sales, limited time coupons and deals exclusive to Amazon customers, or free giveaways like buy-one-get-one offers. Promotions attract buyer attention while allowing you to move excess inventory.
Here are some tips to make the most of Amazon advertising and promotions:
- Learn ranking factors. Continuously improve listings for better organic placement.
- Analyze metrics. Use data to identify top converting keywords and effective ads.
- Automate campaigns. Use tools to optimize bids and manage large campaigns.
- Test new ideas. Experiment with different banner styles, headlines, etc.
- Promote new launches. Give previews and special deals to onboard first buyers.
- Run Lightning Deals and Coupon Giveaways for short bursts of promotions.
Driving external traffic to your listings through marketing is also an option. However, Amazon’s on-site advertising and promotions should be the priority for beginners looking to minimize costs.
By combining optimized listings with targeted Amazon PPC ads and strategic promotions, sellers can cost-effectively reach high-intent customers to drive more conversions and sales. Monitoring performance and continually optimizing based on data is key to success.
Growing Your Amazon Business
Once your Amazon selling business is up and running smoothly, it’s time to start thinking about growth. Here are some tips for expanding your Amazon presence:
- Diversify into more product categories: Don’t put all your eggs in one basket. Expand your catalog by adding complementary products in other categories that your existing customers may be interested in. Just make sure there is enough demand.
- Build a recognizable brand: Create brand consistency across your storefront, product listings, packaging, advertising, and even off of Amazon. This helps get repeat customers who trust your brand. Register your brand name and logo.
- Focus on getting reviews: Product reviews boost conversion rates. Follow up with customers asking them to leave positive feedback. Offer incentives if needed. This improves your rankings and seller rating.
- Maintain high account health metrics: Keep an eye on defect rates, on-time shipment rates, and other account health dashboards in Seller Central. Fix issues early to avoid suspensions.
- Consider expanding to other Amazon sites: Once you have a solid foothold in your home marketplace, go global! Expand your FBA inventory to Amazon Europe, Japan, Mexico etc. Adjust listings.
- Leverage automation tools: As your catalog grows, automation becomes key for simplified inventory and order management. Tools like Zendrop can save you time.
- Develop an exit strategy: Think ahead to your long-term goals. Will you sell your brand? Pass it to your children? Or just run it as a consistent cash-flowing business? Plan accordingly.
Tips to scale your business on Amazon:
- Automate repetitive management tasks
- Hire virtual assistants for customer service
- Reduce costs by negotiating with suppliers
- Reinvest profits into purchasing higher inventory
- Advertise new product launches focused on high-intent keywords
- Maintain stellar metrics to unlock privileges
The key is staying proactive. Keep optimizing your listings and advertising. Stay on top of reviews and feedback. Expand your catalog with complementary best-sellers. And pay attention to account health. By diligently reinvesting profits back into your Amazon business, the sky is the limit for ambitious entrepreneurs.
Conclusion
Starting an Amazon selling business can be rewarding but challenging for beginners. This guide covers the key steps – opening a Seller Central account, finding profitable products, creating optimized listings, leveraging FBA and ads, and growing your brand. Use it as an actionable blueprint to launch your business. Revisit challenging areas and keep learning. With a commitment to offering quality products and services, you can build a successful Amazon presence. Contact Online Sales Advisors to help manage your account growth so you can focus on long-term business goals.