What is Amazon FBA? How does it work? How much does it cost, is selling on amazon worth it in 2021, how many sellers are there, plus much much more.
I will try to answer all the questions to the best of my abilities. As you can tell from the title, I’m a newbie myself and have spent hours, if not days, searching, reading, and watching and deciding what to go for.
Below are some of the questions asked and how I found the answers. Not saying I’m right, but it seems to make sense.
- What is Amazon FBA, and how does it work?
- How much does it cost?
- Is selling on amazon in 2021 still worth it.
- How many people are selling on amazon?
That pushed me into writing this blog, really to help guide you as well a more direct path.
Hopefully, you come across all of this in a year, six months, and I’m an amazon success story, and you can follow my guide.
I have been using two tools to help navigate Amazon FBA.
One of the tools is viral-launch more on that later.
I have also been listening to podcasts as well.
Check out Seller roundtable. It’s my favourite to listen whilst driving, exercising, or having a few minutes to kill.
Just make sure you keep your notes open, as you will have to write them down. As Amy puts it, there’s lots of gold in these podcasts.
Two very experienced amazon sellers help you set it all up and what to watch out for.
Its madness how many people are selling courses and programs and the prices they can charge when we live in an age of technology, and most can be found for free.
I promote viral-Launch, but I have just found another, which I may switch to more on Sunday’s blog post.
The team at viral-launch help you build your amazon account from scratch, and they have a free trial with full video training, which is incredible…
You know what happens with analysis paralysis, which I had just had for about the last weeks before I signed up for the free trial.
You end up putting yourself off. I have been looking into toothbrushes, pooh emoji keyrings to drive cleaners.
The lot and back again looking on Alibaba and amazon, I start putting myself off and thinking I cannot do it there is just so much to it.
As mentioned, what lead me to VIRAL-LAUNCH check out the free course on offer. It is worth a watch.
I have just finished the two-week free trial, and I have subscribed to the intermediate package as I find it helpful to find products.
What is Amazon FBA, and how does it work?
Let’s start from the top FBA means (Fulfilment by Amazon).
The fulfilment part is that amazon picks, packs, and posts your products stored at their warehouse.
But and it’s quite big, but you need to source, test, destroy, and invest in the stock.
Then organise shipping to an Amazon fulfilment centre, a warehouse of their choice.
Sound Genius, well yep, it is mainly for amazon 15% on every sale and lots of other fees.
1000’s of people are making a lot of money on amazon. Look at a listing. When you see fulfilled by amazon on the listing, see image below its someone just like you or me selling on Amazon.
I’m not ashamed to say I’m hopefully going to earn a lot and probably pay Amazon a lot but hay they have built the brand the reputation and all we can do is follow.
Why try and reinvent the wheel when we can keep it turning and work from home sourcing and selling popular products.
How much does it cost?
I will break it down below with an example but for starters, keep your account open its £25 A month.
Then there are various ways to work storage costs out. I think using the viral launch guide is great to see the images below for more details.
Below is an example. Viral-Launch is one of the tools they offer to give an example of cost to help you work out the profit margin.
I just put resistance bands into the search bar on Amazon.co.uk. See image below!
The best seller has 47,151 reviews. They have made some serious money on this product.
They sell over £100,000 worth a month just on this one product.
Now on with the cost figures, see the image below from viral-launces website.
They take an average of the price of products on page one, I think and work it from there so that the number one spot will be less than the figures above.
A total cost of £4.56 for an item that’s £14.39, so you can work the math backwards and see what purchasing cost you need to achieve a decent profit.
Calculation = £14.39 – £4.56 = £8.83 – £2.64 which is 30% = £6.18 left over to source.
To make a 30% profit on this product, you need to source it for £6.88 or less that’s the total cost delivered to the Amazon fulfilment centre.
Below is an example of the price from Alibaba.
The higher-end price is £4.64 for the bottom set, but you must think about shipping costs that can be anywhere from £1,000 – £2000 for a decent quantity.
So, it all adds up, and that’s why it’s worth signing up for a program. Check it out for yourself. A few different ones, jungle scout and viral-launch, are the two I looked at and decided on the latter.
We are just talking about the costs associate with amazon fulfilment, not the cost and delivery of your products. You need to take that into account as well. Yet again, viral-launch can help you with that and budgeting and working out if a product will be more likely to be a success.
Is amazon still worth it in 2021?
I cannot answer this one honestly as I am in the first couple of weeks of getting myself set up and looking at products, but from the general feelings and what people say, yes, it’s entirely possible.
Almost 4,000 people a day, 1.46 million a year, are joining Amazon to sell. That’s only 0.005% of the 7.67 billion population registering every year.
I know it’s a lot, but I would say there is still a lot of space for people to join and become a part of it.
I have read a few motivational books just. Lately, I would suggest you look at my previous blogs. Just click here. It will help give you some confidence in yourself and your products.
It helped me put my plan together and get myself sorted.
How many people are selling on Amazon?
Five Million people, yes, 5 million sellers. Wow, that blew my mind and got you thinking. Is it still possible to sell on Amazon?
One hundred fifty million people searched looked on amazon only on mobile devices. Guess what time scale one month in September 2020 was a record month for users.
It put it in perspective a little, and as a lot of sellers from America are doing now is jumping in on the UK market.
We don’t have Walmart and superstores that sell everything, do we? I know Asda and Tesco are trying, but they aren’t big enough, are they?
So, bearing all that in mind, I’m still on the search for my first product. There are only 12 million individual items on amazon selling right now.
How hard can it be? Hopefully, if you’ve enjoyed this blog and wish to follow my story, another post will be getting done in a couple of weeks with a couple of product ideas for you and some I have chosen, that is, if I decided to reveal them.