How to start an Amazon FBA business Part 1

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Wouldn’t it be great to earn loads of money online? To be able to work from home or anywhere in the world? We already have an article up on our blog about the 20 best online jobs but today I want to introduce you to a business where you’ll be able to earn a nice amount of money online: Amazon FBA. I have personal experience with assisting an Amazon FBA business and would love to share my knowledge and what I’ve learned with you today.

What is Amazon FBA?

As one of the biggest online retailers in the USA, UK, and most of Europe, most of you have probably heard of Amazon, have made a purchase through Amazon, or even have a prime subscription. What you probably don’t know is that when you purchase something from Amazon, you are most likely buying from a third party that is selling to you using Amazon’s FBA program.

FBA stands for “Fulfillment By Amazon”, which basically means that Amazon looks after all of the seller’s stock. When customers order through Amazon, the order by-passes the actual seller and goes straight to the FBA warehouse. Amazon then prepares the products and delivers it straight to the customer.

Amazon FBA also handles almost all aspects of customer service. Their top quality customer service is something that other online sellers would not be able to compete with. From my experience with working with both a normal seller account (managed by the actual seller) and an FBA seller account (managed by Amazon), the performance of the FBA seller account is always higher. By this, I mean Amazon consistently has a lower rate of reported defects and a higher customer feedback rating. However, to the customer there is almost no difference between ordering something from the seller or ordering through Amazon FBA: they can choose the same delivery options and have the same return policy.

how to start an amazon fba business

Here you can see that these earbuds are sold by Nonoco US, but the order is fulfilled by Amazon. Nonoco US is an Amazon FBA business.

Amazon FBA vs eBay: Which is Better?

It’s true that you can run a great online store from your bedroom with eBay, but if you want to up your game and earn more, Amazon FBA is the way to go. Here’s why. As a seller, you won’t need to find suitable space to store your inventory or look after your stock. And the amount of work is the same whether you sell 10 or 1000 products. As mentioned previously,  through Amazon FBA, your customers will get amazing customer service, and that’s one less thing you have to deal with as well.

You can run an Amazon FBA business from Europe or from the United States, even while traveling or living remotely in Asia. I don’t know about you guys but this seems like the perfect remote opportunity to me.

But… I don’t have a product. What do I sell if I don’t have anything to offer?

I spoke a lot about Amazon, but a big player in creating an Amazon FBA business is Alibaba. Alibaba is a huge Chinese e-commerce where factories and distributors from all around the world display their products. It has become incredibly easy to become a seller on Amazon due to Alibaba. Amazon Sellers start by buying products from Alibaba without changing anything about the design and only changing the logo and increasing the price.

how to start an amazon fba business

Simply put, you could buy this tea-infuser from Alibaba for $1.00 and turn around and sell it for $4 – $10 on Amazon.

Don’t be afraid to negotiate prices on Alibaba. $1.00 per piece may not seem like a lot if you’re selling the same item for $10.00 on Amazon, but don’t forget that you’ll be incurring fees from Amazon for their services, taxes, shipping costs, and so on. If you want to turn a good profit, make sure you’re calculating your total costs properly and negotiating prices on Alibaba. You can often get up to 40-50% off their listed prices. With a tea infuser, as shown above, it may not make a huge difference, but it could for more expensive products such as couches or mattresses.

I do highly recommend that you add a unique touch to your products. Find a supplier that can alter the design of the products or personalize them for you to create a signature look that matches your branding or future branding. You will have guaranteed better results.

I hope you enjoyed these tips I shared with you today on how to start an Amazon FBA business and begin earning money. Next week, I will go into detail about the costs involved, risks, opportunities, and how to get started using Amazon’s FBA platform.

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