Sellers Guide: Amazon FBA Step By Step
Starting an ecommerce business can feel overwhelming, but becoming an Amazon FBA seller doesn't have to be. An Amazon FBA business has straightforward guidelines and an array of tools available to those who wish to sell on the amazon marketplace. With this simplified Amazon FBA step by step process, sellers can gain the information they need to make the most of their online selling potential.
Getting Started on Amazon FBA
There are five main parts to setting up an Amazon FBA business. As an Amazon FBA seller, you will need to:
- Product Research & Development / Production / Sourcing
- Register your Amazon business
- Create your product listings
- Prepare products for transport
- Ship products to an Amazon warehouse
Let’s break down each of these further to better understand the requirements of an Amazon FBA business.
Before a seller even begins the FBA process, they should do substantial product research to ensure they are identifying and selling a profitable product(s). It is always important to consider recent and future trends when coming up with a product idea. For example, historically, electronics have been favorited online purchases, but with the major ecommerce shifts we saw in 2020 due to the coronavirus, products like home-office or household goods have seen massive increases.
Consider what the profit margin will be for your chosen products, and then make sure you are able to secure a reliable supplier.
A supplier can make or break the success of an Amazon store. Securing a reliable supplier ensures that the seller is able to keep track of their products, costs, and growth. Once a supplier(s) have been identified, it's time to create an amazon account and start the Amazon FBA registration process.
Register Your FBA Business
To set up your Amazon selling account, you must decide if you want to register your Amazon business as an Individual or Professional account. If you’re interested in how to sell on Amazon FBA with a smaller inventory (fewer than 40 items a month), the individual setup may be the way to go. This plan option costs $0.99 per sale.
The other route is signing up as a professional seller, which costs a flat fee of $39.99 per month regardless of the number of items you sell. This is intended for those who sell well over the 40 item benchmark per month and may already have established a solid brand presence online. This type of account gives you access to selling reports, APIs, and other programs/tools that allow a seller to continuously grow and scale their FBA business.
In short, it depends on your goals. For many sellers who are looking to build a substantial business on Amazon, starting with a professional account can avoid many of the inevitable headaches that come with business growth. However, if you aren’t sure if scaling into a big seller is your end goal, and you feel more comfortable starting with an individual seller account, that’s perfectly fine as well.
Once you've set up an amazon seller central account, it's time to think about the amazon listing strategy.
Create Product Listings
Think about how shoppers would view your products in a store. The placement, imagery, and product description, as well as price, all make a difference in whether a person decides to buy from you versus one of your competitors. The same methodology goes into creating a product listing. These listings are the customer's first impression of your store and merchandise, and product presentation can easily affect whether they buy from your FBA business for sale or another.
That’s why creating clear and descriptive product listings is crucial to the success of your business. You must first choose a category for your products and label the condition they’re in (new, used, collectible). Each product listing must also contain:
- A product code that identifies each listed item. This may be a ISBN, GTIN, or other type of code for registration.
- A SKU, which is the number ID that tracks each item separately. This helps you know how much inventory you have left, what items are selling best, and works as a reference number for shipping and delivery.
- Product details. This includes listing the name, brand, description, images, and keywords. Each of these details helps potential buyers find your products and encourages them to purchase. Each section of the product listing page has specifications with regards to character count, image sizing, and format you must adhere to in order to meet the qualifications.
- Buyer information. In the product description, there’s also a place to enter in price, the number of items left in stock, and shipping options for the customer
Knowing how to sell on Amazon FBA involves a learning curve and the willingness to set a strong foundation from the start. Being organized with your product listings and making them uniform in appearance, tone, and style creates a positive connotation about your brand. In addition to word choice, capture and upload hi-res photos of your products, and create a spreadsheet that lists your products that can work as a template as you build your inventory.
Preparing Products for Transport
As an Amazon seller, you have the option of either packaging and shipping your products directly to your customers or becoming an FBA business and having amazon take care of your shipping and fulfillment. As an Amazon FBA business, your inventory will be stored, packaged and shipped through an Amazon fulfillment center. Amazon will take care of all your fulfillment needs, and will give you up to date statistics on your amazon product trends. If you’ve signed up for an Individual plan, there is a set shipping plan that applies to all products, which makes a difference when deciding how you want to price your items in order to turn a profit.
However, FBA benefits all business sizes because it gives you access to the extended storage space that make up Amazon’s fulfillment center, plus it puts Amazon in charge of packaging, shipping, and handling customer service inquiries once you’ve shipped your products. This gives you space to store your inventory, which proves helpful especially in seasons where you may have a surplus that takes up room in your home. It also leaves room for you to work on other areas of your business, such as product sourcing and advertising, while Amazon remains responsible for the logistics.
Shipping Products to Amazon
Once you’ve decided to set up your FBA account, there are guidelines to follow when shipping your products to the amazon warehouse. Details around the type of packaging that must be used, ensuring product labels are accurate, barcode labels are readable, and that the quantity is correct, are essential to a successful FBA shipment. Make sure to note the shipping method and carrier you want to use, whether you’ll label your inventory prior to arrival or want Amazon to take care of that, and submit a list of each individual product sent to Amazon.
When embarking on any kind of new endeavor, there’s a lot of work upfront that must be put in place to make the workflow more efficient and effective as you grow. Once you have the core processes in place, you can then optimize and improve your descriptions and other selling aspects in the future.
Review Reports to Optimize Your Business
Once sales begin, you will be able to access your business performance data in your Amazon seller account. Reviewing your progress reports will help you optimize, scale, and grow your business.
Tracking metrics like late shipment rates or order rates are important so a seller can remedy a problem right away, and avoid losing customer loyalty or potential new business.
On-time delivery and zero damage to products are the two of the biggest factors customers consider when repurchasing from a store or brand. If an amazon store continues to have poor performance, it's likely customers will not return.
Reading your analytics reports also helps you plan for inventory shipments. It proves beneficial to ensure you have what you need in stock, while at the same time anticipating extra storage fees for items that aren’t selling how you initially anticipated. Scheduling at least a monthly review of your store’s progress will help you quickly identify areas that require small changes or big improvements, as well as better understand your customers’ needs.
One of the key elements of ecommerce is earning buyer trust. Everything from your Amazon product descriptions to shipping plan/delivery dates must be accurate and meet the expectations of your customers. Performance reports guide you in building a favorable reputation online and keeps your business growing at a steady rate.
Grow Your Business Through Advertising
In addition to the optimization and maintenance phase of the business, you’ll also want to consider ways to increase revenue. Whether it’s through inventory growth or expansion into other markets, the Amazon FBA marketplace gives you the tools and methods necessary to help you grow. In addition to optimizing your product description by updating imagery, improving headlines, or other parts of your product page, you can start advertising to get your products in front of more potential buyers. Sponsored posts and sponsored brands are two of the many tools available to increase your brand visibility onsite.
Cross-channel promotion is also a key marketing strategy to build brand recognition. Your online shop is where people can read about the details of your products. Using social media sites, such as Instagram, meets people where they already are, in a way that fits their lifestyle. Although the majority of those who are looking for a specific product will head directly to Amazon to search, cross-promotion allows you to build your reputation and business.
It allows you to reach an audience that may not currently be in the buying phase but may eventually purchase an item from you based on a deal, seasonality, or shopping trends. It also provides more opportunity to show potential customers how your products will help them fix a problem, improve their day-to-day lives, or bring them a sense of delight. Part of the success of e-commerce is based on how well you’re able to connect to your customer base.
By following the tools, methods, and recommendations created by Amazon FBA step by step, you’ll position yourself for unlimited success. Once you’ve started your business and watched it grow, you may want to explore other avenues. You may decide to sell your business for a profit in order to invest in a new e-commerce store or pivot to another endeavor altogether. One of the true benefits of being an Amazon FBA seller is there is plenty of room for growth and opportunity depending on how much time, effort, and hard work you put into building your business, all by starting with that first step.