Are you thinking about selling on Amazon? Starting a new business can be nerve-wracking at first. To put your mind at ease, we have collected some frequently asked questions by new Amazon sellers. Our data-backed research reveals that there is no better time than now to start selling on Amazon. With the right strategy, selling on Amazon can fast become a profitable venture for anybody!
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How easy is it to sell products on Amazon?
The major advantage of Amazon is that the site receives millions of visitors every day looking for items to buy. Selling on Amazon is like owning a store in one of the busiest malls in the world. You are bound to get some foot traffic simply by being there. Consider this:
- Amazon had 5.7 billion site visits in just the first six months of 2021. While this number includes repeat visitors, it still means that you get access to the equivalent of 80% of the world population every six months.
- Amazon is the leading online e-commerce retailer in the United States. In just one month (September), Amazon had 122 million US visitors, more than double that of its closest competitor Walmart, which only managed to reach 59 million.
- Amazon has more than 150 million Prime subscribers. These are people who pay a monthly fee to Amazon for a premium shopping experience on the website. They are actually spending money just to shop more on Amazon. Twenty percent of these Amazon Prime subscribers shop on Amazon a few times per week, with seven percent saying they do so almost every day. This means, on average, 10.5 million people are definitely purchasing items from Amazon every single day.
Although you need to understand how the platform works and establish processes, Amazon is a thriving e-commerce ecosystem, where anyone can grab a share if they want to.
How much can a new Amazon seller make per month?
The amount a new Amazon seller earns ranges widely from $12000 to $42000 in the first year. 60% of sellers reported profitability within one year. However, it is essential to remember that initially, the profits you earn are going to be re-invested back into your business to make it grow further.
New Amazon sellers with 1-2 years' selling experience are making about $200000 in sales per year. Considering an average profit margin of 18% (lower end – most sellers report profit margins above 25%), new sellers are averaging $3,500 income per month or $42,000 in annual profits.
Why is it so hard to sell things on Amazon now?
Amazon is a competitive marketplace, and sometimes the numbers can be overwhelming. For example, statistics show that Amazon.com sells more than 75 million products as of March 2021. At the same time, it has 1.5 million active sellers, and over 1500 new sellers join every day.
Given the scale of operations, there are bound to be failures you may have heard of or people you know who gave up. The fact is that just having a listing on Amazon is not going to get sales. You have to treat your e-commerce venture like a business.
Who finds it hard to sell on Amazon?
Those who find it hard to sell on Amazon are the ones who:
- Don't do market research
- Don't make strategic financial decisions
- Don't learn marketing or budget for it.
In short, they are the ones who go in without a plan, thinking that selling on Amazon is a shortcut to easy money.
Who finds it easy to sell on Amazon?
Of course, the sellers who take their Amazon business seriously are the ones who:
- Do their study and research
- Find the right niche and product
- Invest the early revenue back into their business
- Use the right technology and tools
- Keep scaling their business.
That's how they get to be the top 6%, making many millions of dollars a year on Amazon.
Is being an Amazon seller using FBA as good as it sounds? How hard is it to sell on Amazon FBA?
Yes, being an Amazon FBA seller is highly lucrative. Over 73% of sellers in the USA prefer to sell through FBA rather than shipping products themselves. Being an Amazon FBA seller basically means setting up your Amazon store so that Amazon handles your product shipping for you. You have to organize your products to be sent to Amazon's warehouse. Amazon will stock them and ship them to you.
If you meet all of Amazon's terms and conditions as an FBA seller, they will make your products more attractive to their 150 million strong Prime member database. This means that your product listings will have the Fulfilled by Prime option. Prime members get free shipping if they buy your products which, of course, means that the chances of them buying your products increases significantly.
It is straightforward to set up an Amazon FBA seller account. Consider joining our free course on how to start selling on Amazon to learn the details.
Will Amazon FBA still be profitable in 2022?
Being an Amazon FBA seller in 2021 is more profitable than it has ever been. At $332 billion, Amazon's sales were up 28% in the third quarter of 2021. Net profit through nine months of this year was up 35%. Amazon FBA seller shares were 56% which means third-party sellers on Amazon collectively made $110 billion in just the three-month period of June to September 2021.
Amazon continues to project strong growth in e-commerce over 2022 and beyond. Being a large-scale, stable, and established e-commerce platform, Amazon is not a short-term trend or a dot com bubble about to burst. Selling on Amazon is a tried and tested business idea.
Can you make a living selling on Amazon?
Many new sellers wonder if they can quit their day jobs and live off Amazon alone. The answer to this is simply—it depends. The lowest risk option is to start an Amazon hustle on the side and keep your day job until your profits can replace your regular income. You just need to plan backward:
- Calculate the amount of money you currently make per month before taxes.
- Calculate the profit you can make by selling one product on Amazon.
- Multiply and find the number of products you need to sell to hit your monthly income target.
- Make a research and marketing plan to get you to your target!
Have other people got there? Yes! There was a survey of nearly 5000 sellers that indicated that half of the survey participants were self-employed and selling on Amazon as their primary business activity. 22% of these Amazon sellers said that their Amazon FBA store was their only source of income.
Can products on Amazon FBA be sold without marketing?
Potentially, yes. Depending on the product and niche, you could sell items without any marketing. This is because millions of people visit Amazon every day and search for all types of keywords and items. However, since millions of other sellers are actively marketing their products, skimping on marketing is not the best strategy if you want to grow and scale your business.
The top sellers on Amazon all invest in Amazon PPC, Amazon's advertising platform that lets you run ads and shows your listings on top of search results when customers look for specific keywords. 10% of the United States net digital ad revenue goes to Amazon alone. If you want to be a serious seller, you will have to learn how to optimize your Amazon PPC ad campaigns. Sellers report 20% profit margins after ad spend, and you can really push up your margins if you run your PPC campaigns strategically!
What is the best category to sell on Amazon FBA?
Amazon has a bestsellers page that you can monitor for the trending items that are very popular. 2021 trends showed that the best-selling categories were:
- Toys & Games
- Camera & Photo
- Video Games
- Clothing, Shoes & Jewelry
- Home & Kitchen.
We also gathered our data to understand the most popular products and categories in 2021.
Use free Product Research tool for Amazon, powered with artificial intelligence, to uncover low demand, high competition products with smart filtering.
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Many new entrepreneurs often ask – "Is it really worth it to sell on Amazon?" or "Do Amazon sellers really make money?" The answer, of course, is a resounding yes. If your fears hold you back, begin your Amazon journey by learning How to Start Selling on Amazon: A Complete Beginner's Guide