Jan 092014

tips for selling on Amazon logo Amazon  is now the largest ecommerce site on the internet so it’s naturally a great place to sell your items. But that popularity means it also has the most competition from other sellers. If you want your items to stand out from the crowd then you need to go the extra mile and do some things that not everyone else is doing. We recommend  you try some of these tips for selling on Amazon.

Tip #1 Sell Products That Other Amazon Sellers Are Not Offering.

Unlike eBay or Etsy, Amazon presents its listings in a single page format with the least expensive seller shown first. They also automatically get the “Buy Box” which is an easy sale whenever someone clicks on the “add to cart” button. This means that you have to be the cheapest in order to get the best exposure. Compounding the problem is the fact that someone can undercut you at any time and bump you from that top spot.

But if you’re selling a unique product that no one else has, you don’t need to worry about the competition! That means staying away from mass marketed goods like DVDS, books, and games. Try to find unique products and a source for one of a kind items. Look to local businesses and even consider making a product yourself that you can sell.

Tip#2 Be Ready to Compete on Price.

If you are selling popular, mass-produced items you need to be ready to compete. That means you that you can’t just be looking for a good wholesale price on the items you sell, you need to get the best wholesale price on those products. If you don’t you’ll be stuck sitting on unsold inventory. You must be the cheapest dealer on Amazon if you want to move your stock.  You’ll need a healthy profit margin that will let you come down on your retail price several times as others enter the market.

Price isn’t the only factor though. Time is also important. Sometimes the only way to compete is to just wait it out and let the competition sell off under-priced stock so the market can get back to normal pricing. Doing this can be a tough call. If 10 sellers undercut you then waiting may not be the right strategy. But if one or two clearly amateur sellers want make a quick sale, let them. Then sell at a profit when they’ve sold out.

Tip #3 Understand Your Fees.

I’ll be the first to admit that the fees on Amazon were created by the guy who also invented the Rubick’s Cube. But you will need to know how much you’re going to be charged before you consider listing an item. Fees can vary widely depending on what category they fall under, but as a rough number I use 25%. The actual amount of Amazon’s fees is often less than that but It’s a good place to start if I have to make a quick decision. If you have a bit more time I recommend you use our Amazon Fee Calculator.

To fully understand Amazon’s fee structure you will need learn the terminology it uses. Here’s the basic breakdown.

  • Shipping Credit – Money that Amazon charges the customer then gives to you to cover your shipping cost.
  • Amazon Referral Fee – A commission fee that ranges from 6% to 25% based on the category of your item
  • Variable Closing Fee – A fee that is charged based on the weight of your item and the shipping method.
  • Per Item Fee – Each time you list you’re charged $.99 unless you have a pro stores subscription ($39.99 a month)

Here’s how it all comes together:

Price of your item
+ Shipping charges paid by the buyer
– Referral fee
– Variable closing fee
– $0.99 per item fee (waived for sellers who pay a subscription fee)
= Total deposited to seller account (remember that you still have to pay for shipping from this amount)

If you’re really feeling ambitious, get a cup of coffee and call your buddy in the accounting department and have a look at the full Amazon Seller Fee Page.

Tip #4 Research Product Reviews.

Before you invest in an item to sell you need to look at how consumers are reviewing it on Amazon. Even if you can get a great deal and a huge profit margin on an item it won’t be worth it if buyers are trashing it in the reviews. It might seem like you’re getting a steal on a pallet of some new Xbox game but you’ll be eating them if it it’s not up to par with what the maker advertised it as. A software bug or defect in an item will quickly be called out by reviewers and potential buyers will go elsewhere to spend their money.

Tip #5 Don’t Undercut Other Sellers.

In Tip #3 I told you to be the cheapest in order to sell the most. But there’s a catch here. You can easily start a bidding war with another seller that becomes a race to the bottom if you’re not careful. It might be wiser to match the best price on Amazon instead of beating it. True, you’ll have to share that top spot, but you’ll still technically have the cheapest price and you’ll be making a better profit margin than if you undercut someone.

This tactic can be especially wise if you don’t have a huge quantity of something to sell and can exercise some patience.

 Tip #6 Consider Using Fulfillment by Amazon.

If you haven’t considered this tip yet you really should. Imagine you could hire someone to process orders for you really cheaply. Well you can. With Amazon fulfillment all you have to do is ship them a crate of the item you’re selling and they will take care of payment processing, invoicing, packaging, and shipping your item for a very reasonable fee. This can be especially useful if you want to take a vacation or to deal with sales around the holiday. You can sign up for it here.

Tip #7 Use the Amazon Forums.

Amazon has a user forum where you can read honest opinions and advice from other sellers. They even have a whole section dedicated to help for new sellers. Although it’s true that most answers about Amazon can be found in their help pages, the information there is biased in Amazon’s favor. On the forums other sellers will tell you how it really is. And if you can’t find what you’re looking for you can post a question of you own. With the huge number of people who participate in the forums, you should have an answer within a couple of hours. It’s also a good place to find more tips for selling on Amazon.

Tip #8 Vacations and Emergencies.

If you ever need to go on vacation or an emergency come up that will keep you from filling you orders you can temporarily hide your listings without canceling them with the listing status feature. It can be found on the Seller Account Information page in your seller account.

To set your listings to inactive, follow these steps:

  1. Go to the Listing Status page.
  2. Select Inactive.
  3. Click Submit.

Within 1 hour, your listings will be unavailable for sale on Amazon’s website.

When you are ready to sell again, follow these steps:

  1. Go to the Listing Status page.
  2. Select Active.
  3. Click Submit.

Within 1 hour, your listings will be available for sale on Amazon’s website.

Tip #9 Handle Returns Promptly.

Nobody likes to deal with returns. But they’re just something you’ll have to deal with because of Amazon’s very liberal return policy. And you’ll need to do it quickly because you’ll be judged on your actions by both amazon and your customers. Amazon keeps an internal tally of how promptly you deal with returns and customers will judge you through your feedback. So be careful here. Handle everything promptly, document the process, and be extra courteous with the customer who is returning the item. Even if they’re full of crap (which they often are). Remember to keep a long-term outlook on your business and keep your thoughts on future sales.

Tip #10 Use Terapeak to Find the Best Items to Sell.

Terapeak for Amazon is on online software analysis tool that you can use to find out what items are selling, which aren’t, and how much they have sold for in the past as well as the currently going price. If you need something that can instantly tell you if an item is worth investing in, this is the best tool for the job. Pricing is $29.95 a month or $19.95 a month if you pay for an annual subscription. They also offer a free trial period so there’s really no reason you shouldn’t check it out.

Tip #11 Use Product Variation.

Often you might be selling an item that comes in different sizes or colors like shirts or shoes. You don’t have to make a listing for each individual type of item. You can use Amazon’s Product Variation tool to offer all of your items within one listing. The process has a bit of a learning curve, but it’s easy once you’ve gone through it once and get the hang of it. However, You do need to have a Pro Merchant Account to use this feature

Tip #12 Shop for Your Own Items.

This one might seem a bit odd. But seriously pretend you’re a customer and scrutinize your listings. Can you find your items if you search for them on Amazon? Are you listings appealing and detailed? Are the images good enough? Can you understand the shipping terms and return policy easily? Most of all, compare your listings to the competition. If theirs is friendlier or more appealing you need to make some changes to make your listings more competitive.

More Tips for Selling on Amazon.

If you’d like some more tips for selling on Amazon I recommend checking out the following blogs.

Kabbage.com’s Guide to Selling on Amazon. Practicalecommerece.com’s Tips for Increasing Amazon Sales. And Amazonsellersupportblog.com’s Amazon Seller Tips.

  One Response to “12 Tips for Selling on Amazon”

  1. As a long time online jewelry retailer I am about ready to give up on Amazon because of all the hoops I have to jump through that they now selectively apply to just jewelry.

    I know it’s a little off the subject but after years of using all the tips mentioned and years of constantly trying to meet the changing demands Amazon keeps insisting from small jewelry retailers I have just had enough. It makes me feel Amazon is going the way of eBay and intentionally forcing out the small retailer for the benefit of the large companies.

    As far as I am concerned, I survived after I left eBay and I will survive leaving Amazon too if necessary.

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