It began as a virtual bookshop less than 25 years ago. Now it dominates online sales of pretty much everything. The numbers don’t lie: Amazon took in 44 cents out of every ecommerce dollar as of late 2017. And as for 2018 and beyond, estimates point only in the direction of further growth.
At first glance, this might appear dispiriting to any seller who isn’t Amazon. But significantly, those skyrocketing sales figures include third parties who sell on the marketplace. As anyone who’s shopped on Amazon in the last few years knows, these sellers function as a significant part of the enterprise, offering amazing opportunities to compare prices and ensure the best possible deal.
Faced with the unstoppable momentum of the website and its marketplace, you may have considered entering the fray. If so, you should also consider the following tips.
First and foremost, know what you want to sell. If you’re already in business, then you probably already have a solid vision. Expanding to Amazon is merely a matter of branching out. Otherwise, you’ll need to ask yourself what kind of brand you want to establish. Conduct research on the products that make sense for it—and the products that don’t. Know your target market. Gain an understanding of your competition by looking at what they sell and how they’re received, and think of how you might improve upon it.
After that, it’s a fairly easy process of choosing a plan ($39.99 per month or $0.99 per item), registering and listing.
But note that sales are taxable (you should receive a 1099 from Amazon). If you’re selling at volume, you will probably need a business tax ID. If you register a new company, you may also need an EIN (Employer Identification Number)—a crucial step that many Amazon sellers forget. For reasons like these, it’s a good idea to consult with a tax professional on any rules or regulations specific to your state.
Once you decide which products to offer, you’ll need a source for them. Unless your business is big enough to house its own inventory, you’ll probably be making use of a dropshipping model. Put as simply as possible: you sell the product online, and a separate supplier ships it directly to the customer on your behalf. The supplier ideally utilizes good inventory-management software, providing you with crucial up-to-date product feeds.
Needless to say, dropshipping provides distinct advantages in terms of lowering overhead and enabling personal freedom and mobility. In fact, all you really need to become a marketplace seller is a computer and an Internet connection!
Setting Yourself Apart
Besides product selection, successful Amazon sellers must juggle a few other factors, including:
- Information. Accuracy is key, and not just for the sake of honesty. The more specific your product information, the more likely it is to be matched with prospective customers’ searches. SEO is everything, so be sure to use Amazon’s keyword tool.
- Price. In short, it must be competitive. A lower price improves visibility. Amazon offers a Match Low Price feature to help.
- Reputation. This derives from your seller rating, making it critical that you present your business in the best possible light. Savvy Amazon sellers respond expeditiously to customer inquiries, resolve disputes in a polite manner and offer a reasonable return policy. The last of these objectives may be more easily met by using “Fulfillment by Amazon.” FBA results in higher fees, but it also provides the halo effect of closer association with Amazon’s enviable efficiency and customer satisfaction.
If all goes well, you may find yourself featured in the “Buy Box.” This means that customers will see your listing ahead of the others. However, Amazon itself is fairly vague about the Buy Box algorithm. All we know is that pricing, availability, fulfillment and customer service are considerations.
Finally, don’t become too discouraged by the level of competition. Even if other merchants are selling the same items as you, you can still get the edge by being creative. Put together unique combinations of products using Amazon’s bundling policy.
Final Thoughts for Amazon Sellers
Petra makes a great choice of distributor for those who wish to sell on the marketplace. We provide dropshipping expertise, an extensive inventory with regularly updated feeds, knowledgeable customer service and more. Contact a Petra representative to start your selling journey today!