Market Overview

How To Make Money On Amazon: A Step-By-Step Guide

Share:
How To Make Money On Amazon: A Step-By-Step Guide

This story originally appeared on Benzinga.com/money

Gone are the days of traveling back and forth to five retail outlets to get everything that you need on your day off. Today’s consumers want convenience, speed and everything they need at their fingertips — and no one delivers quite like Amazon on those fronts.

If you’ve been pondering the question of how to make money online, selling on Amazon (NASDAQ: AMZN) can offer you a massive flow of buyers for your products from every corner of the modern world.

Selling on Amazon can be a great side hustle, but to make the most out of your new store, you’ll need to do a little planning first. Use our guide to learn what you can sell on Amazon, how to set up your store and how to make the most out of your product sales and marketing.

What You Need to Know Before You Start Selling

For the most part, Amazon is an open marketplace where you can set your own prices, sell almost anything and manage your own shipping and logistics. However, even if you have your product in hand and ready to ship, there are a few things that you need to know to keep yourself on the right side of Amazon’s rules and conditions.

Your Product Might be Banned or Restricted

From clothing to kitchenware and from movies to electronics, Amazon is well-known for offering one of the most diverse online product lines. However, there are a few things that Amazon does not allow its users to sell.

These include items that are illegal to possess and own (including drugs only available by prescription), most types of ammunition and firearms, pornography or graphic adult materials and most types of alcohol and artifacts removed from Native American lands.

Even if your item isn’t banned, Amazon also has a list of restricted item categories. If your item is in a restricted category, it must meet certain standards in order to be sold. For example, you’re allowed to sell surveillance equipment that only consists of video-only streaming but you may not sell bugging or wiretapping devices.

Though Amazon prohibits the sale of human body parts, it’s fine to sell wigs made from human hair.

Check out Amazon’s current list of restricted categories. If you believe your product falls into one of these categories, make sure you thoroughly read the rules and make sure that your items fit the rules before you list.null

You Might Need Special Approval

Even if your item is permitted, you may still have to go through an approval process from Amazon before you list your item for sale. Items that require approval are usually commonly counterfeit items (like watches, electronics, fine artwork and DVDs), professional services and things that are ingested (like food and wine).

You can check out a complete list of categories that require approval before selling. If your product does require approval, here’s how you can get it:

Only sellers who have a Professional Selling Plan subscription approved by Amazon can sell restricted products.

Your Item Meets Amazon’s Requirements

Many of Amazon’s restricted items have requirements that control packaging, appraisals, authentication and labeling. For example, if you want to sell cosmetics on Amazon, there is a long list of requirements that the product’s packaging must have in order to meet government standards. Find your product category and double-check that your items meet the site’s selling requirements.

Then, you’ll need to Contact Amazon and Request Approval. You can sign into your Professional Seller’s account and use Amazon’s “Contact Us” form to request approval.

Other Considerations

  • Refurbishers must go through their own vetting process. If you refurbish old or damaged cellphones, cameras or another type of electronic device, you’ll need to meet Amazon’s certified refurbished standards. To learn more about becoming a certified refurbisher, you can view a total list of Amazon’s requirements here.
  • Shipping costs can quickly cut into your profits. Many sellers on Amazon import their products from Chinese wholesalers like Alibaba (NYSE: BABA) and sell them at a markup to consumers. If this is your plan, make sure you calculate not only what you’ll pay to get your product to your customer but also the cost to ship the item to you.
  • Chinese holidays can mess with your import schedule. Another point that you must consider if you’re importing your goods from China is that Chinese holidays can be long and can seriously cut into your shipping schedule if you don’t already have product on hand. In particular, it’s customary for businesses to shut down for upwards of two weeks during Chinese New Year each February.
  • Selling isn’t the only way to make money on Amazon. Are you less interested in selling and shipping products than you are making money? Are you more interested in creating a passive income stream through Amazon? Becoming an Amazon Associate can help you earn a commission for every follower, user, or reader that clicks on your link or buys a product you recommend. Learn more about becoming an affiliate.
  • Some sellers choose to have their items fulfilled by Amazon instead of shipping their products out themselves. When you choose to register your product as FBA, all you need to worry about is shipping bulk orders of your product to the nearest Amazon warehouse.

Get Started Selling on Amazon

If you’re ready to get started on Amazon, follow these steps.

Step 1: Decide What You Want to Sell

Find a product that you want to sell and that you think would be popular with Amazon shoppers. If you’re importing your product, check around Amazon’s current listings to see if anyone is already selling what you want to import.

Make sure that your item meets all of Amazon’s restriction standards and that you’re allowed to sell your product. Make sure that your product has the necessary labeling and that this labeling is available in English.

Step 2: Choose Your Seller Account Subscription

Amazon offers two selling plans: individual plans and Professional Selling Plans. Professional Plans are available for a $39.99 a month subscription fee and allows users to sell an unlimited number of items per month.

Individual plans don’t have a monthly subscription fee, but you’re limited in the amount that you can sell every month and you must pay a $0.99 fee every time you sell an item. Both plans require holders to pay variable referral and closing fees depending on the price of what they’re selling.

Professional Selling Plans are required to sell certain restricted items. Consider your needs and capacity as a seller and sign up for your preferred plan.

Step 3: Fill Our Your Approval Form

When you open an approval request, you’ll be asked to fill out a form that gives Amazon a little more information about the product you want to sell.

Fill out the form, submit it and wait to hear back from Amazon. Amazon claims to service all requests within three business days, though they may need to contact you to ask for more information. Once you’ve gotten your approval through email, get ready to start selling.

Step 4: Create Your Listing

If your product isn’t already for sale on Amazon, you’ll need to create a new listing through your seller profile. Some things you can do to improve your chance of selling include:

  • Taking quality photos of your item.Blurry, low-resolution or low-quality photos do little to attract buyers — and in Amazon’s highly competitive marketplace, a great first impression is a major key to making a sale.
  • Take professional-looking photos of your items from multiple angles, use good, clear lighting when photographing your item and consider hiring a professional model if you’re selling clothing or accessories. You may even want to upload video clips of the product in use.
  • Create listing copy. The description of your item is called copy and it’s the second thing that most potential buyers will see after they click on your listing. Create a description that’s thorough and tells the buyer what they need to know about the product.
  • Consider sending promotional items out to influencers. Amazon explicitly prohibits you from exchanging money for a positive review. However, you are allowed to send out free or promotional items to influencers and request an honest and genuine review. Many shoppers limit themselves to buying products that have a four-star rating and above, so it can be worth the time and expense to collect a few reviews.

Step 5: Ship Your Product

When you sell an item, you’ll receive a notification from Amazon. Make sure to ship your item on time and encourage customers to leave reviews if they enjoy your product.

Master Your Side Hustle Today

The online marketplace has made selling and shipping products easier and more accessible than ever before. However, selling on Amazon, eBay and other sites offer their own set of risks. If you want to be approved to sell a restricted item, you must prove to Amazon that you already have enough stock to begin shipping large order quantities.

This can be a bit of a catch-22 for new sellers; you need funds to buy your inventory, but you need to have inventory already if you want to sell on Amazon. You can protect yourself and improve your chances of success by choosing products carefully and by beginning as an individual seller before you move into more heavily-scrutinized restricted categories.

Want to learn more? Check out Benzinga’s guides to the best Amazon FBA courses, the best eBay alternatives and the best e-commerce courses.

Posted-In: Personal Finance Best of Benzinga

 

Related Articles (AMZN + BABA)

View Comments and Join the Discussion!
Book A Demo
Learn How You Can Succeed In The Market With Benzinga Pro

Fastest Market News

Real-Time News Alerts

Customizable News Filters

Book A Demo

UPS Paying $2.25 Million To Avoid Pregnancy Discrimination Lawsuit

17 Ideas To Start A Successful Side Hustle In 2019