Is It Easy to Sell on Amazon? Here’s What to Know
Is it easy to sell on Amazon? The good news is that it is relatively simple to sell on the world’s largest sales platform. However, if you’re wondering how easy it is to have a successful and profitable store, that is where things get a little more nuanced.
Since it launched Amazon Marketplace in 2000, Amazon has connected independent sellers to a bottomless demand for products, services, and information. Amazon transacts more than $410 million per day. In U.S online markets, the eCommerce giant dominates the competition in several categories.
When it comes to selling, the competition on the Amazon platform is challenging. Many entrepreneurs and business owners have found a solution that allows them to own a successful Amazon store while having it managed by experts who know the ins and outs of running a store on this platform.
With the help of the Amazon automation dropshipping experts on the NextGen team, you may leverage the real power of this 21st-century institution that employs 100,000 robots, 7,000 dogs, and accounts for more than half of the world’s largest eCommerce market (the U.S.A).
Keep reading to learn more about the different ways Amazon stores are run and how you can work with an Amazon store management service to get a passive income while not doing tedious work.
Types of Sellers
According to Amazon review website Kommando Tech, there are currently more than 2.5 million sellers on Amazon Marketplace. So is it easy to sell on Amazon? To understand this question, you must first know what you want. To do this, let’s divide Amazon sellers into three fundamental types.
eCommerce novices wondering, “is it easy to sell on Amazon?” may be surprised to hear that not every product page belongs to the company that owns the item. Dropshippers promote and “host” a product on their sales page, while the supplier holds the inventory and a third party (like Amazon) handles fulfillment.
Dropshippers use their platforms to sell the products of other brands. This concept may mean an Amazon store, but it does not have to happen through Amazon to be considered dropshipping.
Dropshippers love Amazon. If you start a dropshipping business today, in 2021, you will have your work cut out for you. The competition is harsh, and you may find that you cannot make enough sales to justify the marketing expenses at first.
To avoid this, you must choose your products with care. Many dropshippers decide to hire a team to build out the initial store and create Amazon automation processes to keep the dropshipping store profitable through the challenging parts.
So what does it take to start a successful Amazon business? One of the most demanding components involves marketing and customer retention. The benefits of working with an Amazon store management service vastly outweigh your initial start-up costs and allow you to reach your passive income goals easier over time.
Getting a product in front of the right set of eyes is neither free nor automatic. Amazon provides plenty of tools and methods for a business to get this right. Still, any individual business’s success is often the effect of thousands of dollars invested and hundreds of hours spent learning and practicing marketing strategies.
Dropshipping and FBA are both a bit chaotic. This disorganized cost-structure can be streamlined through an Amazon automation service like what NextGen Investments provides.
By investing in the hire of experienced dropshippers to manage your store, you are providing yourself with a safety net, learning from a safe distance, and ultimately, earning a lot of time that you may have squandered otherwise.
Amazon’s logistics system is probably one of the best in the world. Rather than hoard this competency and use it exclusively for their labels, they open it to their sellers as an optional service. Paying to utilize Amazon’s extensive logistics machine, including features like Amazon Prime same-day shipping, is called Fulfillment By Amazon or Amazon FBA.
Sellers who use this service may or may not own their products. They may rebrand or resell products as-is, but the significant difference between this and dropshipping is that FBA sellers must purchase and keep inventory (and the costs that go with storing inventory) while dropshippers do not. Often, this also means Amazon FBA sellers own their products.
Consult with a specialist before rebranding generic or exclusive products that do not belong to anybody else.
How to make it a little easier to sell on Amazon
The massive volumes, the copious amounts of research, the bulk purchases – all the moving parts involved in setting up an Amazon store can make the process seem a bit overwhelming. The best thing you can do to get the ball rolling is to schedule a free consultation with our friendly e-sales professionals who have helped hundreds make more than $80 million from their online stores.
Which ‘Central’ should you use?
Amazon has two ‘hubs’ sellers use to launch their store. Amazon Seller Central and Amazon Vendor Central. Vendor Central is used more by manufacturers and distributors. It is invite-only, it is considered first-party sales, and these companies sell directly to Amazon.
Brands and merchants use Seller Central to sell directly to Amazon’s customers. It is open, it is considered third-party sales by Amazon, and these companies sell to users. Getting involved with Amazon Seller Central carries several benefits:
- It gives you the option to fulfill your orders through Amazon; this includes returns.
- It gives you the freedom to handle order fulfillment yourself if you do not want to go through Amazon.
- It allows you to control the messaging of your brand.
Which Categories should you sell?
Amazon third-party statistics show that home and kitchen appliances were the most popular category for sellers in 2019 and again in 2021.
Top 10 categories
- Home & Kitchen – 40%
- Sports & Outdoors – 21%
- Toys & Games – 19%
- Beauty & Personal Care – 19%
- Health, Household & Baby Care – 18%
- Kitchen & Dining – 16%
- Office Products – 15%
- Garden & Outdoor – 14%
- Tools & Home Improvement – 14%
- Pet Supplies – 13%
However, these are not necessarily the categories with the best margins. Average profit margins on Amazon range between 17% to 26%. The first thing dropshippers must decide is what they want to sell. To determine this, the top things we recommend to look at are subcategory, margin, and popularity.
To avoid the headache of researching and analyzing which products to sell, many business owners instead use an Amazon management service to conduct the research, choose the products, and handle the store’s operations (including returns and customer service).
Find out how you can own a profitable business, make passive income, and have your Amazon store entirely managed by our expert team by scheduling a consultation.