Starting a ‘Fulfillment by Amazon’ Side Hustle Business

Warning: preg_match(): Compilation failed: invalid range in character class at offset 4 in /home/customer/www/ on line 1364

Warning: preg_match_all(): Compilation failed: invalid range in character class at offset 4 in /home/customer/www/ on line 684

Warning: Invalid argument supplied for foreach() in /home/customer/www/ on line 691

Warning: preg_match_all(): Compilation failed: invalid range in character class at offset 4 in /home/customer/www/ on line 684

Warning: Invalid argument supplied for foreach() in /home/customer/www/ on line 691
For many years, Amazon has been an absolute revenue bonanza for independent entrepreneurs in many ways. From small-time merchants to affiliate marketers, millions can say that they derive at least part of their income from the e-commerce giant. The latest way to benefit from Amazon is by using the Fulfillment by Amazon program to run a high-volume online store. For e-commerce beginners and veterans alike, it can be the ticket to surprising profits. If you’re interested in starting a profitable Fulfillment by Amazon business, read on.

What Is Fulfillment by Amazon?

In short, Fulfillment by Amazon is a way for independent entrepreneurs to sell their goods quickly online with the least amount of overhead possible. You ship your merchandise to Amazon where it’s stored while it’s waiting to be sold. Once someone buys a product, it’s shipped from one of many Amazon Fulfillment Centers.  As such, third-party sellers don’t have to worry about shipping, customer service or returns. By signing up for FBA, you can potentially tap into a customer base of millions.

Downsides & Caveats

Before you get started, you should be aware of the possible drawbacks and challenges of building a business based on Fulfillment by Amazon. The biggest potential stumbling block is the co-mingling of products, which can make quality assurance a bit difficult. In addition, the FBA program charges storage fees that can eat into profits if items stay on the shelves for too long. Furthermore, prices on Amazon tend to fluctuate significantly over time since it’s such fluid market. Lastly, complying with local sales tax laws can be somewhat complicated.

Sketch Out a Business Plan

Before you start shipping out boxes of merchandise to Amazon, you need to sit down and come up with a well-researched business blueprint. Pick a niche that you know a lot about and focus on that. Know that you won’t make much money if you sell items that are $10 or less thanks to storage costs. You’ll need to figure out where you’ll buy your goods and what kinds of profit margins and sales volumes will be needed to make your business worthwhile.

Sign Up for FBA & List Your Stock

Getting started with the Fulfillment by Amazon program is actually pretty easy. Log into Amazon, sign up to be an Amazon Seller and add FBA to your account. To sell goods, simply upload listings from within Amazon Seller Central by entering the UPC or ISBN information for each product. The process is pretty self explanatory as you work your way through it. Amazon will tell you which shipping center to send your packages to and even give you labels to print out.

Sourcing and Selling Merchandise

When you get right down to it, the FBA program is basically one big arbitrage machine. You buy products from wherever you can find them as cheaply as possible and leverage Amazon’s expansive shipping infrastructure, logistics and reputation to find buyers at a higher price. You can find great deals locally at going-out-of-business sales and trade shows. For more expensive items, Craigslist and Ebay can be great places to find deals. Look for items that are unusually cheap in your local area for whatever reason.

Tools & Tricks of the Trade

For the majority of FBA participants, the keys to standing out are providing faster delivery times and slight edges on price. Nowadays, you’ll need to rely on technology to do a lot of the number crunching for you. One tool that no FBA warrior should be without is Profit Bandit, a mobile app that can scan any product and tell you whether or not it’s a profitable arbitrage opportunity. Furthermore, Quickoffice and Documents to Go can help you to make sense of large amounts of data.

Ensuring Long-Term Profitability

Despite the sometimes fierce competition, the Fulfillment by Amazon program is an amazing opportunity for entrepreneurs. As the ultimate digital expression of the free market in action, it’s not for the faint of heart. To succeed, you need to stay on your toes and roll with the punches. If you’re not an analytics expert or spreadsheet wizard, you should become one. Ultimately, a bit of common sense and good old-fashioned business savvy are the only prerequisites for building a killer FBA business.

About the author