Amazon marketplace is a great place to start your e-commerce business because it is massive and is growing at a fast pace. Most people have shifted their shopping online.
The majority of US customers shop on Amazon, most of whom are prime members. Especially, during the global pandemic, Amazon in particular started booming. In the United States, an average of 57% of customers shop every week, and 18% do it twice per month.
Fulfillment by Amazon is referred to as FBA. What it really implies is that Amazon manages all of the products owned by the seller. These products will be stored at the FBA warehouse. When a customer makes a purchase, the products will be chosen, packed, and shipped by FBA. They also handle returns of those orders as well as offer customer service.
Amazon FBA business can ease your work and scale your business. These are the steps to create an Amazon FBA:
Choose a product that is a best seller. The certain product you choose should have high demand and less competition. To get the right product, you should conduct market research. You can use SellerApp’s product research feature in order to know your right product. Once you have found your product or your product category, you can figure out your FBA fees.
Use manufacturing marketplaces like Alibaba, GlobalSources, etc to source your product. Use a product sourcing tool to understand your manufacturer and other details about the product.
You will need an Amazon seller account. For that, you will have to give your personal details to create an account.
It is where you display your products on the Amazon marketplace. You must give detail about your product like the product title, description, brand, manufacturer, price, right keywords, etc.
After you’ve created a product listing, you should pack your product to send it to Amazon’s warehouse. When it comes to packing and inventory preparation, Amazon is quite careful. On their website, they’ve outlined the requirements for how you must prepare your items before sending them to Amazon’s warehouses
It is time to ship your product, and you need to create a shipping plan in your Amazon seller central dashboard. Also, you should print the Amazon-required shipment ID labels and deliver the products to their fulfillment centers.
You can come up with a definite product launch strategy to generate sales. You will need to optimize your listings with images, A+ content (if applicable), keywords, etc. You should also launch PPC campaigns and promote your products for an effective marketing plan.
After you get your inventory to the Amazon fulfillment center, what happens next can be understood from the following steps:
Once Amazon has received your products, they will sort them and store them in their warehouse. They might shift your products to another warehouse based on geographical needs.
Once the customer places their order on Amazon, it automatically gets processed within their system and is immediately sent for fulfillment.
All orders are eventually sent to Amazon’s warehouse. Here the products are picked, packed, and shipped and will be headed out to the customer’s door.
To increase your sales and scale your Amazon FBA business, check out these four steps that can help you grow.
Manage your FBA inventory levels to maintain customer satisfaction while reducing expenses. Check your Inventory Performance Index (IPI) score on a regular basis by reviewing your Inventory Performance Dashboard. A low score may incur inventory storage overage fees and make it more difficult for you to send more inventory through the Amazon FBA platform.
On Amazon, there are 13 international markets. There are two methods to sell to customers worldwide: join up for any or all of the 10 marketplaces or utilize Amazon Global Selling to distribute products to those customers.
For example, with Amazon UK account you can sell your products on Amazon Germany. When a customer orders your product from Germany, it will be shipped to them from the UK warehouse. Amazon also provides translation so that your product listing will be correctly spelled in the targeted language.
Give Amazon Sponsored ads priority regardless of your income source or spending plan.
Sponsored ads may enhance your sales, reach more consumers, and boost your visibility. You can decide how much money to put into advertising, as their targeted ads provide a fit for all levels. Additionally, since you only pay when your advertisements are clicked, it’s a low-risk, high-reward strategy for expanding your reach.
If you need to build your business with a good reputation then you should take care of your negative reviews. Negative reviews can make a black mark on your business by lowering your product visibility.
From a customer’s perspective, reviews are the most important information in order to make a purchase. Negative reviews can be a chance for you to learn what you need to do and you will be able to improve in order to outperform your competitors.
Fulfillment fees are the amount a seller has to pay to Amazon for picking, packing, and shipping the product through the FBA program. It is charged based on the size, weight, and shipping zone of the product.
There are FBA storage fees, which Amazon charges for the storage of the products to maintain your inventory. There are two types of storage fees: Monthly storage fees and long-term storage fees.
Amazon will charge you a monthly storage fee if your product is still in an Amazon warehouse at the end of the month.
Each month on the 15th, Amazon cleans out its inventory. Amazon keeps track of any products that have been sitting in its fulfillment centers for 365 days or more during the process.
For the products that are stored for 365 days in the fulfillment center, Amazon charges long-term storage fees.
The FBA calculator takes care of calculating the right fixed closing fee according to price category, shipment charges according to size, weight, or volume, pick and pack fee, fulfillment fee, and also storage charges as may be applicable.
Go to SellerApp’s FBA calculator to calculate your profit margin and ROI of the product.
Depending on these metrics, your FBA and FBM margins are calculated.
SellerApp’s FBA calculator can help you decide whether FBA is the best fulfillment strategy for your product.
FBA calculator can help you know your expenses beforehand so that you can choose products with lower fees and maximize your profits. You can also see exactly how much you’ll make on every sale. Use this data to determine expected revenue and know whether it’s worth it to sell an item.
Amazon FBA can help you to start selling and grow your online shopping business in no time. Your choice of fulfillment method depends on the product’s size, demand, and profitability. Just follow the guide above to be successful in Amazon FBA business.
Arishekar N is the Senior Director of Marketing and Growth at SellerApp, an e-commerce data analytics solution. He is responsible for overseeing the development and implementation of marketing strategies, as well as increasing process efficiency by executing cutting-edge Search Engine Optimization strategies at SellerApp.