As the world’s largest eCommerce platform, Amazon offers a tremendous opportunity to build or start a business. However, navigating this vast and multifaceted marketplace can be difficult, especially without prior knowledge or experience. To succeed in this field, you need to know how to start an Amazon FBA wholesale business and get a sight of some important Amazon FBA strategies.
Buying bulk branded products from another manufacturer, supplier, or distributor to resell to customers is known as Wholesale. Some examples are popular consumer electronics, kitchenware, and even toys.
Amazon Wholesale in 2023 is a good option to start your online business — but there’s a lot to know before you dive in.
Advantages of Amazon Wholesale
Why should you begin selling on Amazon wholesale? Here are some informative benefits of this sales model to consider for your business:
- High Sales Probability: Your chances of making sales are excellent because of the high demand for name-brand products.
- Less Competition: Obtaining approval to sell established brands involves more work. Only some people are willing to go through the process, so if you are approved, you will face fewer sellers.
- Automation: If you choose to use FBA, your entire business can be automated to a large extent. Your wholesaler will prepare your inventory and send it to Amazon, who will store it and ship it to customers each time you make a sale. This results in a more hands-off type of business.
- More Profitable: Because you are purchasing in bulk, your per-item price is much lower. That means you’ll make more money on each sale, resulting in higher profits overall.
- Huge reach: Over 300 million active customer accounts and nearly 2 million selling partners worldwide are held by Amazon. Its B2B arm, Amazon Business, has over a million customer accounts and over 150,000 sellers. That’s a large pool of potential customers for any Amazon seller.
- Marketing tools: To assist wholesalers in reaching customers, Amazon offers a variety of marketing tools, including sponsored products. The Amazon Seller app, for example, allows business to be conducted from a mobile device and is especially useful for those building a business while juggling other responsibilities.
- Data insights: Amazon provides detailed information on customer behavior and preferences, which can assist wholesalers in making sound business decisions.
- Option for fulfillment: Amazon provides various fulfillment services, including Fulfilled by Amazon (FBA), which can assist wholesalers in getting their products to customers more quickly.
Amazon sells $1.3 billion per day and ships 60,000 products per hour. As a result, it can be challenging to get noticed – but extremely beneficial if you do.
How to Sell Wholesale Products on Amazon?
The best way to sell with the Amazon Wholesale model is to find the right product and source it from a reliable supplier/manufacturer. So we will share some pointers and Amazon FBA strategies to help you start and run a wholesale business successfully.
The benefit of the Amazon Wholesale business model is that you can profit from the success of well-known brands. So, look for established brands with popular products. You want to avoid ending up with a low-demand branded product that you have to market from scratch.
Amazon’s best sellers page is a good place to start. You can be sure there is high customer demand because Amazon’s best sellers generate enormous sales. However, there is also high competition, so winning the Buy Box multiple times is required to earn money from bestselling products.
Please Note: You should avoid products already sold by Amazon because Amazon is known for offering extremely low prices that you cannot compete with. You should also avoid products sold by a private label seller because obtaining products from the manufacturer will be difficult. Furthermore, private-label sellers may prevent you from adding your offer to their current listing.
Calculate Profit Using Data
When you have identified some high-demand products, you must determine how much profit you are likely to make. It would help if you took the following actions:
- First, make sure your product price is within 2% of the Buy Box price.
- Discover the fees that Amazon will charge for the product. Some Amazon fees are dependent on your selling strategy and fulfillment method. Amazon has provided sellers with an FBA calculator. Enter the product’s ASIN, input the data, and review the results.
- You must calculate your estimated profit. The product’s selling price minus its cost price and Amazon fees equal your profit.
- Calculate your inventory turn rate after determining the number of sales you’re likely to make each month. This refers to the amount of inventory you should have on hand to meet your sales target. As a beginner seller, you should stock inventory for at least 2-3 months. This is to avoid paying Amazon’s long-term storage fees if you use Amazon FBA.
Find the Right Supplier for Your Product
Once you’ve decided what to sell, you’ll need to locate a wholesaler who can supply you with that product.
A Google search is an excellent place to start. First, enter the name of the brand you’re interested in, followed by “authorized supplier/distributor” to find supplier websites.
You can also use wholesale directory websites. Among the most well-liked are:
- Top Ten Wholesale
Many Amazon sellers use Alibaba to find suppliers. Unfortunately, although this website is a fantastic resource, you won’t find any name-brand goods here.
When you’re done searching for suppliers and manufacturers, make a list and contact them. There are 2 ways you can contact them, trough:
- Cold email: Almost on every website, you can find the brand’s email and contact them; when writing your email, make sure to be polite, and make it short and straightforward. When the supplier replies, make sure to hop on a call with them.
- Cold calls: If they have a phone number on their website, you should call them directly and negotiate with the supplier for the product you want to sell.
Get in touch with a few different suppliers to determine their minimum order quantities and what kind of prices they can provide. Most wholesalers are open to bargaining, so don’t be afraid to counteroffer and work to get the best deal possible.
Negotiate With Suppliers
To compete with established brands and stand out, you must demonstrate how to add value to their brand. But, of course, making money is a company’s primary goal. So the most important thing to show is how you can increase their sales.
Also, research the company, its annual revenue, products, etc. Then, identify areas where you believe they can improve and offer workable solutions to your identified problems. For example, suggest a more appealing design if their product packaging is unappealing. Or if the product images available online are of poor quality, you can highlight that as well.
Make brands that still need a presence aware of the advantages of using Amazon as an additional sales channel. Also, show how you intend to use Amazon’s power and potential to increase sales by creating new optimized product listings from scratch, etc.
If you’re looking for a side hustle and a stream of income that will only take up a little of your money and time, consider selling Wholesale. The wholesale market is profitable, but it has difficulties. However, implementing our shared Amazon FBA strategies will make you one step closer to success.