E-commerce business continues to grow since consumers shift from in-store shopping to online. Amazon has gained more momentum with the recent trend. The latest consumption pattern indicates that there is a growing potential for Amazon business. Here are the steps you need to walk through to initiate an Amazon business.

Step #1. Determine your business model

There’s no one way to start an Amazon business. Here are the main Amazon business models:

  • Wholesale: This is the practice of buying discounted goods in bulk and selling as individual units in a retail marketplace.
  • Private Label: Process of renaming a product that is already being manufactured on their own label.
  • Retail Arbitrage: Arbitrage is to finding low-cost goods in the retail marketplaces to resell them online.
  • Handmade: Handmade sellers create their own products.
  • Dropshipping: This is a business model where an Amazon seller transfers customers’ orders directly to the manufacturer or supplier.

Step #2. Determine your fulfillment method

Now time to choose your Amazon fulfillment method. You have two options to fulfill your customers’ orders on Amazon. Both have their own pros and cons. You need to closely look at both options to determine which one will work best for your Amazon business.

  • Fulfillment by Amazon (FBA): Most commonly used method. More than 90% of Amazon sellers sell using FBA (either only through FBA or with FBM). However, 57% percent of Amazon sellers only use FBA. In this method, the seller sends their products directly to Amazon’s warehouses. Amazon ships the product directly to the customer. You might think of using FBA in case (1) your products are small with lightweight, (2) you are ok with Amazon customer services, (3) your inventory turnover is quick, (4) you do not have logistics in place and (5) your expenses will be higher when you fulfill your own products.
  • Fulfillment by Merchant (FBM):9% of Amazon sellers sell only using FBM. However, 34% percent of Amazon sellers combine FBA and FBM. In this method, the seller lists products on Amazon and manages all storage, shipping, and customer support operations. You might think of using FBM in case (1) you have logistics in place, (2) you want more control over your customers, (3) your products are oversized or heavy, (4) you have perfect customer service practices, and (5) your inventory turnover is slow.

Step #3. Select your product with sufficient demand

As a first rule, you need to find products with high demand and relatively low competition. Here are characteristics of potential Amazon products:

  • Fewer reviews: You need to select products with relatively low reviews. Then you might easily penetrate the market with positive reviews.
  • Small lightweight: Lightweight products are easy to transport and import. Therefore, target small size products to reduce your cost and to speed up your delivery process.
  • Potential to Improve: Look for Amazon products having great improvement potential in line with customers` reviews.
  • Simple to produce: Complex products necessitate quality controls, whereas simple products are easy to handle and store.
  • Low seasonality:Low seasonality: Search for products that can be sold throughout the year.

Step #4. Optimize product listings on Amazon

Optimize your product listing, which will drive sales and take your business to the next level.

  • Product title is so crucial that you need to use major keywords reflecting what your product is and what your buyers are looking for. Furthermore, you need to find the right keywords for your product details.
  • Selecting the right product imagesSelecting the right product images is the next step. You need to use proper images that will get customers to click through Amazon’s search results to your actual listings.

Step #5. Be responsive to product changes and competitors` moves

You need to be prompt and responsive to the product listing changes. The ability to take immediate actions against scammers and hijackers is very crucial to protect your Amazon business. To be successful on Amazon, you must monitor your top competitors, learn from their success, and capitalize on their weaknesses. Having set your product listings, you need to closely monitor your competitor sellers in order to take prompt action.

That is nearly impossible to track a large number of products and competitors in a timely manner. Manual monitoring for your product listings is time-consuming, and it’s hard to keep tabs on them 24/7. So you need a third-party solution like AmzMonitor to track your products and competitors in Amazon.

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