How to Sell Third Party Products on Amazon

Selling third party products on Amazon can be a lucrative venture if done correctly. Amazon, being one of the largest online marketplaces in the world, offers a vast audience for sellers. Here’s a comprehensive guide to help you get started.

1. Understand Amazon's Marketplace
Amazon allows individuals and businesses to sell products directly to consumers. This is facilitated through Amazon’s platform, which includes Amazon Seller Central, the hub where sellers manage their sales operations. The primary modes of selling are:

• Fulfillment by Amazon (FBA): Amazon handles storage, packaging, and shipping of your products. This option is popular due to Amazon’s reliable logistics and customer service.
• Fulfillment by Merchant (FBM): You manage storage, packaging, and shipping yourself. This gives you more control but requires more effort.

2. Setting Up Your Seller Account
To start selling, you need to set up a seller account on Amazon. Here are the steps:

• Create an Amazon Seller Account: Go to Amazon Seller Central and sign up. You’ll need to provide business information, bank account details, and a credit card.
• Choose a Selling Plan: Amazon offers two types of plans:
  • Individual Plan: No monthly fee, but you pay a $0.99 fee per item sold.
  • Professional Plan: Costs $39.99 per month, but you don’t pay per-item fees. This plan is ideal if you’re selling in larger volumes.

3. Product Research and Listing
Research is crucial before listing products. Consider the following:

• Identify Your Niche: Research which products are trending and what’s in demand. Tools like Jungle Scout and Helium 10 can help analyze market trends and competition.
• Source Your Products: Find reliable suppliers or manufacturers. You can use platforms like Alibaba or contact wholesalers.
• Create Compelling Listings: Your product listings should be clear and attractive. Include:
  • High-Quality Images: Multiple images from different angles.
  • Detailed Descriptions: Information about the product’s features, benefits, and specifications.
  • Keywords: Use relevant keywords to improve visibility in Amazon search results.

4. Pricing and Profitability
Setting the right price is crucial for success. Consider these factors:

• Cost of Goods Sold (COGS): Calculate the cost to acquire or produce your product.
• Amazon Fees: Amazon charges various fees, including referral fees (percentage of the sale price) and, if using FBA, fulfillment fees.
• Competitor Pricing: Check the prices of similar products to ensure your pricing is competitive.

5. Managing Inventory and Orders
Effective inventory management is key to maintaining a successful selling operation:

• Monitor Stock Levels: Regularly check your inventory to avoid stockouts or overstocking.
• Fulfillment Options: Decide whether you want to use FBA or FBM. If using FBA, ensure your products are shipped to Amazon’s warehouses. For FBM, ensure timely and accurate fulfillment of orders.

6. Marketing and Promotions
To boost sales, you need to promote your products:

• Amazon Advertising: Use Amazon’s advertising options like Sponsored Products or Sponsored Brands to increase visibility.
• Social Media: Promote your products through social media channels to drive traffic to your Amazon listings.
• Deals and Discounts: Offer promotions or discounts to attract buyers and improve your sales volume.

7. Customer Service and Feedback
Maintaining good customer service is essential for building a positive reputation:

• Respond Promptly: Address customer inquiries and issues quickly.
• Handle Returns and Refunds: Follow Amazon’s policies for returns and refunds to ensure customer satisfaction.
• Encourage Reviews: Positive reviews can significantly impact your sales. Encourage satisfied customers to leave feedback.

8. Analyzing Performance
Regularly analyze your sales performance to make data-driven decisions:

• Sales Reports: Use Amazon Seller Central’s reporting tools to track sales, profits, and inventory.
• Customer Feedback: Review customer feedback to identify areas for improvement.

9. Legal and Compliance Issues
Ensure you comply with Amazon’s policies and legal requirements:

• Product Compliance: Make sure your products meet relevant safety and regulatory standards.
• Tax Obligations: Be aware of your tax obligations and ensure you comply with local tax regulations.

Conclusion
Selling third party products on Amazon offers great opportunities for profit, but it requires careful planning and management. By understanding Amazon’s marketplace, setting up your seller account, managing your inventory, and marketing effectively, you can build a successful selling business. Always stay informed about Amazon’s policies and market trends to adapt and thrive in the competitive landscape.