If you want to start an online business, Amazon FBA might be one of the most popular options. With Fulfillment By Amazon, you can reach millions of customers searching for your products. That’s why it’s important to know the process of finding profitable products that can skyrocket your sales and increase your profits. So here pops the question, how to find profitable products to sell on Amazon? Well, first things first, conduct research:
- Look at Google Trends and other marketplaces
- Look at Amazon’s best-seller rankings
- Utilize product research tools to assist you in assessing demand and competition levels
Discovering items to sell doesn’t have to be complicated. In this article, we’ll try to simplify the selection of winning products for your Amazon FBA business and increase your sales.
What Kind of Products Are Best for Selling
Whether you are a professional FBA seller or a beginner, the main principles for finding profitable products to sell on Amazon are the same. However, some of your chosen products might not make a sale. That’s why you need to follow a strict formula to increase your chances of making more sales.
Profitable Products to Look Out For
These are some aspects that experienced sellers recommend looking for in best-selling Amazon FBA goods:
- High Demand: Search for products with at least 300 monthly sales. This equates to 10 sales every day, which is a solid starting point.
- Low Competition: Ideally, you want to identify good items that are not widely available. This will help your listing appear at the top of Amazon’s rankings.
- Fewer Reviews: Amazon’s search algorithm heavily relies on customer input. It will be challenging to be noticed if the top items in a category all have thousands of reviews. Search for categories with top sellers who have less than 400 reviews.
- Products weighing less than 5 pounds: Heavy Products are more expensive to ship and store. This is especially critical if you are importing from China. So search for lightweight things to save money on delivery. Profit margins are higher when expenditures are low.
- Sizes under 18″ x 14″ x 8″: Larger goods cost more to transport, and because they take up more shelf space, you’ll be charged extra for storage. Hence, if you want to save money, go for smaller products.
- Sales Price: $10-$70: You want to offer products that aren’t so cheap that you can’t make any money from them but aren’t so expensive that buyers are scared off. The sweet spot is generally between $10 and $70.
- 25% of Sales Price: Search for products you can sell for around four times the cost of sourcing them from a wholesale supplier.
- Everyday Use Items: Things that people require regularly tend to sell well.
How to Find Profitable Products for Amazon Wholesale
Now you know what products are a good fit for your Amazon business. Here are 6 tips and ideas on how to find a winning product:
- Conduct Market Research
- Analyze Competition
- Evaluate Profit Margins
- Consider Seasonality
- Check for Restrictions
- Look for Private Label Opportunities
Let’s further discuss the tips mentioned above and dive into some more details. They will help you to automate your product research and give you a deeper understanding of what you need to look after.
Conduct Market Research
The first step to identifying profitable products to sell for Amazon wholesalers is to conduct market research. This is the process of researching the market and determining which product has a high demand and a low number of competitors.
There are a few ways you can research the market. One is looking for Amazon’s Best Sellers and Movers and Shakers pages. These pages will give you an idea of what is currently selling and what’s high in demand.
You can also use Google Trends to see if your products are trending and identify if they have a long-term or short-term demand, meaning if they sell all year round or just for the season.
When analyzing your competitors, you need to look for products with low competitors – usually 3 to 5 sellers and a high sales volume. Wholeseller’s Product Sourcing tool can help you with product research. This will give you more information about the product’s price, sales history, and reviews.
When you’re done with competitor analysis, you can proceed with the following steps:
- Make a better offer with a lower price or a unique bundle
- Offer a higher quality product
- And give better customer service
This will make you stand out from the competition and have a better chance of making more sales.
Evaluate Profit Margins
The most important part of selling a product online is ensuring a good profit margin. Therefore you need to calculate the product cost, Amazon FBA fees, storage, shipping costs, and other expenses. This will determine the price of the product.
Just be careful – you don’t want to over-price your product, which will lead to fewer sales. But at the same time, do not underprice your product. You need to develop a number that you and the customer will be happy with.
Why do you need to consider seasonality when selling products on Amazon? It’s challenging to sell swim shorts in the winter, and the same goes for selling winter clothes in the summer. A lot of products have their season in which they perform best. Analyze their history and see what season they’re selling.
Speaking of Seasonality, another tip would be to look for big holidays, for example, Christmas presents, Valentine’s Day gifts, thanksgiving gifts, Mother’s Day presents, etc. Look at your holiday calendar and plan out at least a month earlier.
Check for Restrictions
Be cheerful with product restrictions. Amazon may restrict some of the products you choose to sell or may require approval to sell. How to know if a product is restricted?
You have a few ways to see if your Amazon product is restricted. One is to go and look for it in Amazon’s restricted product list. You will see what products require special approval and products prohibited from being sold on Amazon.
Important Note: Check out the product’s trademark and copyright status. If you sell this kind of product, it may cause your Amazon Seller’s account to be suspended.
Look for Private Label Opportunities
For context, a Private Label creates your unique brand, starting your products. This way, you are more likely to stand out from the crowd and, therefore, be able to increase your profit margins.
One of the strategies you can use is to find a third-party seller and sell their product under your brand name. Of course, this will require a bigger upfront investment and time, but the profits will also be higher.
Work closely with your supplier to ensure the products fit your criteria, and build brand awareness by investing in marketing (social media and advertising).