How To Start An Amazon FBA Business With Little Money (Beginner’s Guide)

Want to start an Amazon FBA business?

Well if yes, you’re in the right place.

Everyone at some point of time or other wants to start his own business and one of the easiest ways to start your online business is with amazon FBA.

Amazon FBA (Fulfillment by Amazon) is a very popular business model and provides business opportunities for those who want to start and make their career in eCommerce.

There are a lot of frequently asked questions that people have in your mind while starting your online entrepreneurial journey with Amazon FBA. Some of these questions and the answers you need to know are: 

What is Amazon FBA?

Amazon FBA (Fulfillment by Amazon) is an amazon business model where Amazon allows you to store your products in amazon’s warehouse and all the work will be done by Amazon.

You don’t need to worry about storage, packaging, delivery, customer care services and return support. All these services will be provided by Amazon.

What are the benefits of using Amazon FBA?

Amazon is one of the leading online marketplaces which has millions of customers. Every day millions of customers from all over the world are purchasing from Amazon.

So, the first and biggest benefit of using the Amazon FBA program is that you get a very very big customer base.

Second, you can grow your business using amazon’s world-class technology and services. It means that amazon will help you in making your online business a great success.

How much does it cost to sell on amazon?

Now that Amazon is providing so many services to you and your customers, it will not be wrong if Amazon asks for some money for all this. They will simply charge some fees for the services provided by them.

You can read their fee structure on amazon’s website.

So, you know what is amazon fba program, benefits of using amazon fba and the cost to sell on amazon. Now is the time to go further and know that what it takes to start amazon fba business and make money online from home.

If you’re interested and want to know how to start Amazon FBA business?

Keep reading.

How to start Amazon FBA business and make money?

This step-by-step guide will answer your questions like how do I start Amazon FBA business? And, how to make money with amazon FBA?  That’s why you need to read each and every step thoroughly to succeed in the Amazon FBA business.

1. Create An Amazon Seller Account

The very first thing you need to do is create an Amazon seller account in order to start your FBA business.

First, go the amazon’s website and then find make money with us column at the bottom of the page.

Then click Sell on Amazon ==> Start Selling.

As you proceed you will be required to set up either an Individual account or a professional account.

An individual account is free but you have to pay extra fees for each item sold, however, In a professional account, you need to pay a fixed monthly subscription fee of $39.99 (Free for the first month).

So, with which account type should you go is entirely your decision. But if you want to grow your business and run it for the long term, I recommend you to go with a professional account.

2. Product Research

This is the toughest and most important step in setting your FBA business as your whole business depends on the product, its demand, and competition in the market.

In order to find the best product to sell on amazon, search the best seller ranking products on Amazon. This will give you an idea about what people are buying most from amazon. Use Google search to find out what products people are looking for to buy.

Find a product which a lot of people are searching for but there is no great product offering. Find a product that has a very high demand but low competition. You need to find a gap in the market and fill the gap.

3. Product Sourcing

Once you have decided which product you want to sell on amazon, the next task is to find out the manufacturers of the product to source it.

Buy products in wholesale at cheap prices and sell it on amazon for a higher price to make a profit.

One of the best places to source your products at a cheap price is China. Alibaba is a Chinese online platform where you can deal with many manufacturers and distributors. Find manufacturers on Alibaba and make a deal with them.

If you compare the similar product price on Alibaba and Amazon you will be surprised to know that the product which is selling on Alibaba for $4 to $5 is being sold for $15 to $20 on Amazon. There exist great chances of retail arbitrage in the Amazon FBA business model.

4. Pricing

Product pricing is a very important step because you have to make a profit and also compete in the market.

Note down at what price you are getting your product from your manufacturer on Alibaba. Now go the amazon website and check at what price similar products are being sold on amazon. This will give you an idea about how much profit you can make selling this product.

Before pricing your product you need to find out that what will be the total cost incurred for selling the product.

Amazon has developed an FBA profitability calculator to guide you about the costs in selling on Amazon FBA and at what price you should sell your product to cover all your costs and make a profit.

5. Find Manufacturers On Alibaba 

Once you have checked the profit margin in your product, find the product manufacturers on Alibaba and contact them.

It is better to contact as many manufacturers as possible to grab the best deal. Ask them for per piece price of the product and price if bought in bulk.

As you will buy in bulk so negotiate for the price of the product. Your profit margins will depend on how good you are in price negotiation.

Things to consider while finding a manufacturer is how well they can communicate with you, how fast are they responding to your queries and can you make long term relationship with them.

One very important thing to remember here is that do not buy from third-party distributors or re-sellers. If you want to make the best deal then contact only with original manufacturers.

Worried, how to find the original manufacturer? Well, don’t worry. While searching the product on Alibaba you need to add OEM at the end. For example, watches OEM. ‘OEM’ stands for an original equipment manufacturer. The benefit of OEM is that you can attach your own brand name with the product.

Do not forget to select the trade assurance which is a free order protection service offered by Alibaba.com. Also, ensure that the supplier comes in the gold supplier category and his physical presence has been checked by Alibaba i.e. Onsite check option is there.

6. Product Shipment

The next step in the process is to ship the product from China to Amazon warehouse in your country.

It seems to be a very big task but actually it is not because now it can simply be done by freight forwarders and customs brokers. One very popular name in the field is Flexport.

Flexport will receive the stock from the manufacturers and ship it to the destination country. Here all the paperwork will be done by them and then they will send the stock to amazon warehouse through courier service.

7. List Your Products on Amazon

Open your Amazon account and go to inventory. Then click on add a product.

Add your product name, brand name, price, etc.

Use clear and quality images of the product and add an informative description. Quality images and appealing description of the product helps in attracting more customers. Always highlight the best feature and benefits of your product.

Use the keywords to rank your product on amazon and become more visible to customers. Use those keywords which people might be using while searching for the product.

8. Product Marketing

Marketing your product and brand is as important as product research.

Do you know why marketing your product is important?

This is because there are a number of sellers on Amazon who might be already selling the same product. Chances of your newly listed product to be on the top page are almost zero. This means you will get no orders for your product because no one knows your product. I am sure you will not like this to happen.

So, market your product as aggressively as possible and let people know about your product and brand.

You can use social media platforms like Facebook, Instagram, Pinterest, Twitter and YouTube for marketing your product. The best approach in marketing your product is Amazon PPC campaigns.

Wondering, what is the Amazon PPC campaign? This is Amazon’s Pay Per Click campaign which helps you sell your product more rapidly and increase your ranking.

9. Product Reviews

Once your products start selling, contact your buyers and ask them to review your product. More you get good reviews more you will rank better in Amazon search.

It is clear now that you need to promote your FBA business and get good reviews for your product. But is it that simple to get good and honest reviews?

If you are thinking that you will put your family members and friends at work to review your products then this will not help you much. Amazon is keeping an eye on the sellers and their activities. Amazon knows it very well who is reviewing your product and whether these reviews genuine or not.

If not, then how will I get good reviews on my product?

Amazon allows sellers to email their customers and asks them to review the products they have bought. However, you are not allowed to offer any consideration for reviewing the products.

10. Start Making Money

By this time you have already started making money. The question that you need to ask is how much money can you make selling on Amazon?

Well, there is no fixed amount you’re gonna make selling on amazon. However, the opportunities to make money on Amazon FBA are huge. There are people who are making $1000 per month and there are people making $5000 per hour. It all depends on how well you have implemented all the steps mentioned above.

Conclusion

If you buy 100 pieces of $5 product it will cost you $500. Adding the shipping cost and amazon fee, your total investment cost would be approximately $800 to $1000. So you can start your Amazon FBA business with $1000 only which is not a big amount. Once you start making a profit in your business, you can expand it by adding more and more products.

However, If you want to make money online without investment, read this.

So, this was all about how to start Amazon FBA business and make money.

If you still feel that you need to know more about Amazon FBA, I recommend you to join some Amazon FBA course before starting your online business.

Now that you know everything about amazon FBA, what’s your call? Are you ready to start Amazon FBA business?

Also Read: Top 15 Best Money Making Apps (Earn Money Online)