How to Start a Quarter Million Dollar Business Part Time

| August 9, 2015

Did you know that you can start and build an online physical products business via Amazon? It’s called Fulfilled by Amazon, or FBA, and a lot of people are doing it.

By selling products through Amazon, you don’t need a warehouse. You don’t need staff. You can import nearly anything or sell products made in your own country. And you can sell nearly anywhere in the world.

You either send your products to Amazon yourself, or have your supplier send them for you. Amazon puts them in stock and when a customer buys, Amazon does the shipping for you.

By using FBA your items qualify for Prime service which is a huge selling point. Amazon customers can literally buy your product with one click and have it arrive on their doorstep in two days. Prime members heavily outspend non-prime members, so this is a huge benefit.

You look like Amazon to the customer. And if there are delivery issues, Amazon takes care of it for you.

One thing to keep in mind as you build your FBA business is this: What will make you more money than anything else is fulfilling a demand that already exists, not trying to create demand. In other words, sell what people want, not what you think they should want.

And you don’t need to sell hundreds of products to build a business on Amazon. You can start with just one product and expand from there. Just a handful of the right products can produce a full time income.

Let’s say you have just 10 products and you make an average profit of $5 per product. If you sell just 2 of each product each day, that’s $3,000 per month. And all you did was choose and source the products, get them shipped and create listings.

Like anything else, when starting your own FBA business, you can focus on your lack of experience or you can focus on the potential. The key is to start small, reinvest your profits and work your way up.

Look at it this way – why put your money in the bank at 3% when you can invest it into products to sell on Amazon and make a much greater return?

Remember, the key is to go where the fish are. You’re going to fulfill demand that already exists, not try to create it. When you do this you eliminate the risk and ensure you make profit.

So the basic strategy is this:

  • Choose a niche to focus on.
  • Find a product that’s in demand.
  • Get a sample to ensure it’s a good product.
  • Place a trial order and list it in Amazon.

Not too difficult, right?

Here are tips to get you off to a great start:

Choose a niche you enjoy that has a lot of products. Cooking utensils, kitchen ware, cosmetics, personal care products, essential oils… the list goes on and on. The reason to choose one niche with lots of products is two-fold:

First, you can actually develop a list for your niche and do your own promotions. Second, you might want to consider private labeling…

Get into private labeling. Private labeling is much like PLR: You take something that someone else created and put your own name on it. In the case of essential oils, it’s the same oil, but you’ve had the manufacturer place your brand label on it. This is a method that makes you stand apart from the competition. You can then create your own website for your brand, build a list, do promotions, etc. There is a lot more money to be made in private labeling if you’re willing to go the extra mile to do it.

Even if you private label, you might still want to carry the brand names. Suppose an Amazon customer types in, “Vanilla essential oil” and the top three results are all yours – do you stand a good chance of making a sale? You bet! One of those results will hopefully be your private label oil, while the other two could be established brands that you carry. You might make $10 on your own oil and only $1 on the brands, but it’s still worth it. If you sold 1,000 units of the brand name, you made $1,000. And all you did was order it and have it shipped to Amazon.

Forget top selling items. Everyone wants to sell the top selling items, and they all end up competing against each other for pennies of profit. Don’t do it.

Look for the holes. Do your research on Amazon before choosing a product. If there are 30 sellers of a product and they’re all on Prime, forget about it. But maybe there’s only a couple of sellers and they’re not on Prime. That is, they are doing the shipping themselves. This could be a good product to carry because Prime customers will choose your product over theirs because they can have yours in 2 days.

Look everywhere for ideas. I went on vacation recently and noticed some really cool totes and mugs in the gift shop. Right there in the store I searched Amazon and couldn’t find them. So I bought a tote and a mug and contacted both companies to see about getting their products.

Go with what you know. If you start in a niche that you already know a lot about, you will be well ahead of the game.

It’s better to start with 3 each of 50 products, than 150 of one product. No matter how much research you do, you can’t predict everything. So if you get a lot of different items up on Amazon, you can see what sells fast and what sells slow. Then get a lot more of the fast sellers on there. Rinse and repeat.

Spend as much time sourcing suppliers as you do choosing products. The right supplier can make all the difference. You want one that has quality products, offers a wide range of products in your chosen niche, and lets you test many different products. Find the right supplier and for the first six months or so on FBA, this could be the only supplier you need.

You can test before you sell. Some sellers do this, some don’t, but here’s how it works: Put up a listing for a product you don’t even have yet. If it sells, buy one from someone else and have it sent to the customer. This is a way to test with no money out of pocket and no waiting time to get the product ordered and shipped to Amazon.

Amazon arbitrage – see the testing method above. Believe it or not, it is possible to actually MAKE money doing this. Generally it involves going to the supplier website and placing the customer’s information in the ‘ship to’ portion of the order, with you as the billing address. You won’t get rich, but it’s cool you can sometimes make money testing products.

Find the obscure items on Amazon. Click the links that say, “This item is suggested to you” and just keep going deeper and deeper until you find products and product ideas that are a good fit.

Use Reddit for research. Go into Subreddits and ask what they have to buy for their hobby that is overpriced or doesn’t exactly do what they want. Ask what they would like to have and can’t find. Just ask lots of questions about what they want and you’ll get some great ideas.

Choose products that sell for $20 or more. The higher the price, the more room for profit.

Don’t sell electronics. The problem with electronics is there aren’t many manufactures that can build electronics both cheaply and with high quality. Things break, you get bad reviews and customer complaints, and now you’ve got problems. Plus electronics are highly competitive and dominated by a few really big brand names. Instead, choose products with as few moving parts as possible.

Make your listings enticing. Listings are like mini-sales letters and can make or break your sales, so invest some time getting them right.

Send a message through Amazon to your product buyers. Ask them if they’re delighted with their purchase. If they’re not, let them know they can contact you. If they are, ask them to write a review, because reviews equal sales.

Sell on Ebay and fulfill through Amazon. You can do Ebay auctions for your items, and then have the item shipped from Amazon to the Ebay winner. I know one FBA seller who doubles his business with this technique alone.

Even if you don’t private label merchandise now, consider doing it soon. Eventually Amazon is going to have deals with every manufacturer out there, eliminating a lot of the profit from the FBA program. Think about it – every third party seller on Amazon is doing research for Amazon. Amazon gets the stats on what sells the best, then contacts the manufacturers. So it’s not like the FBA train will be profitable forever. It’s an open window right now where you can make good money, but in 10 years? Who knows. That window may have closed. But if you have your own private label line, then Amazon cannot come between you and your private label customers.

Don’t waste time when you private label. When it comes to private labeling, quickly choose a name that sounds professional and catchy. Get a website up and go to Fiverr to get someone to do the logo. In one afternoon you can get all of this done. If you take 3 months to do it, you’ve just lost 3 months’ worth of sales.

Where do you source products? The number one place to look is Alibaba, which is sort of like a directory of manufactures and their products.

Amazon has developed a simple, easy to use platform for customers as well as FBA partners. People looking for products go to Amazon first and in much higher numbers than they do to a search engine. And Amazon’s reach just keeps getting bigger. You, too, can carve out a slice of the pie for yourself, and you can do it working from anywhere in the world.

Remember, start small and reinvest your profits. There are FBA sellers selling six figures worth of products per year and even per month. You could be the next one to join their ranks.

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Category: Biz Ideas

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