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How to Sell on Amazon in 6 Steps, With Photos

How to Sell on Amazon in 6 Steps, With Photos

Amazon is the world’s largest online marketplace. The platform has over 300 million active users and can sell in 180 countries. In 2022, Amazon nearly hit $514 billion in revenue, most of which was through e-retail sales of products in different categories. With such metrics, it’s no wonder many people are interested in selling on Amazon. Take into account that 89% of Amazon sellers record profits, and even with the challenges associated with rising costs, 37% of sellers attested to increased profits throughout 2022. 

However, Amazon seller competition is fierce, and most struggle to stand out among the millions of listed products. Mistakes often lead to low sales and frustration, especially if sellers lack a clear strategy and fail to plan effectively. You don’t want to be part of the loss-making 11%, so we are here to help.

Whether you are a first-time seller or a not-so-experienced digital marketplace entrepreneur, this guide is for you. We’ll detail all you need to know about how to sell on Amazon, including the things you’ll need to get started, and the associated costs. We’ll also expound on business growth opportunities and how to become an excellent seller.

Two Methods for Selling Products on Amazon

You can sell on Amazon using two methods. However, these methods aren’t exclusive, and Amazon allows you to use them simultaneously. For instance, you can use the Amazon-provided service to ship lighter and fast-moving products while relying on your methods to ship bulkier and slow-moving products.

Amazon FBA (Fulfillment by Amazon)

Fulfillment by Amazon (FBA) is a service that allows sellers to store their products in Amazon warehouses. Whenever a customer places an order, Amazon will pick up the product, pack it, and dispatch it for shipping on behalf of the seller. Besides shipping, FBA has other perks, like 24/7 customer service, return management, and multichannel fulfillment. 

In exchange for these services, Amazon charges an extra fee for storage and fulfillment. This fee is in addition to the monthly charge you pay as a seller on Amazon. Fulfillment by Amazon is the perfect option for sellers who want to take full advantage of Amazon’s vast logistic networks and the trust that comes with the Amazon brand. 

Shipping Products By Yourself (Fulfillment by Merchant)

Fulfillment by Merchant (FBM) is a platform where an individual business sells its products directly to customers on the Amazon marketplace. Sellers using this method store and ship their products themselves. Moreover, they have control over their customer service, including communicating directly with their customers. 

FBM is ideal for sellers who deal with bulky products that don’t sell that fast. In addition, they don’t have to pay Amazon storage fees for products that probably won’t sell. The logic behind this is that the longer a product stays within the confines of Amazon warehouses, the more expensive it becomes. 

Step-by-Step Guide to Selling on Amazon 

We’ve already established that there are two ways you can sell on Amazon, but you can still use both methods simultaneously. Here are the steps you need to take to have a successful seller account, whether you’ll be using FBA or FBM. 

Step 1: Choose Your Product

Choose your product.
Sort Amazon products by “Best Sellers” to find the most successful products on Amazon.

The first step is to choose a product you want to list on your Amazon seller account. Choosing the right product is critical because it can break or make your success on the platform. Before anything else, you need to conduct extensive market research. You need to understand the demand metrics for the product, the competition, and the profit margins. 

You can use the Amazon Best Seller Rank (BSR) feature to identify high-demand products with low competition. Further, you can use several third-party tools like Jungle Scout and Viral Launch to conduct in-depth research about a particular product. 

Besides extensive product research, you must choose a product that aligns with your interests and expertise. Doing so helps you stand out from the crowded marketplace because you can provide valuable insights to your customers. 

You must also consider the shipping requirements like size, fragility, and weight and ensure that you can ship your product safely and affordably. 

Step 2: Create an Amazon Seller Account

Create a seller account.
If you sell more than 40 products per month, the Professional plan might save you money.

Before you can sell anything on Amazon, you must have a seller’s account. The platform has two plans for seller accounts. These include: 

  • Individual Plan 
  • Professional Plan 

The individual plan charges a flat fee of $0.99 per sale made on the platform, whereas the professional plan charges a monthly fee of $39.99, regardless of the number of sales made. The professional plan is ideal if you sell more than 40 items monthly. Moreover, this plan gives access to selling reports, APIs, and other advanced seller tools. If you are still undecided about what to sell, don’t need advanced tools, or intend to sell less than 40 items, then the individual plan is what you need. You can always switch between the plans when one becomes a better fit than the other. 

Before you can set up the account, ensure you have these details available. 

  • Credit card 
  • Government-issued ID, i.e., a driver’s license
  • Bank account number with routing number
  • Phone number 
  • Tax information

Once you have all these, proceed to Seller Central and sign-up for your Amazon seller account. You’ll be asked to fill out several forms, including one about your business information. Ensure you fill out these forms correctly because they can affect the status of your Amazon Seller account. 

Fill out your business information carefully.
Fill out your business information carefully.

Step 3: List Your Products 

Assuming you have researched the products you want to sell, the next step is to list them on your seller platform. Depending on your chosen category, some products are open to all Amazon sellers, others require a professional seller account, and third-party retailers can’t sell certain items. For more details, check out these product categories and the condition under which Amazon allows you to sell. 

You can add products in two ways. The first method is using an existing list identical to what you intend to sell. You won’t have to do much here because everything is already populated for you. The other method involves using a new listing if you are the only seller for that product. 

Fill Out a Product Listing

Carefully fill out your product's information. You can also click on the small "i" icon next to the fields for help.
Carefully fill out your product’s information. You can also click on the small “i” icon next to the fields for help.

All products usually feature a Global Trade Item Number (GTIN), such as an ISBN, an EAN, or a UPC. Like any other marketplace, Amazon uses these numbers or product IDs to identify what you are selling. If the product ID you want to sell isn’t on the Amazon database, you must buy a new UPC. Alternatively, you can request an exception from Amazon.

Besides the product ID, Amazon listings include the following details:

  • SKU (Stock Keeping Unit)
  • Product Description
  • Images 
  • Search terms or keywords
  • Price, available quantity, and product condition 

When writing product descriptions for Amazon Seller Central, you need to do so in a way that stands out and captures the attention of potential clients. Focus on the benefits and features of the products using clear and concise language. Ensure the description is easy to understand and accurately communicates what the product entails. Use bullet points with short descriptive sentences. It’s also crucial to perform keyword research associated with your product and include the words in your description. Optimizing the description for SEO improves the visibility of your product on Amazon and other search engines. 

When uploading images, ensure they have a white background and are 500 x 500 pixels or 1,000 x 1,000 pixels. Amazon allows sellers to upload up to nine images, but some categories allow up to 10. Often, companies will take the images for you, but most sellers use a light box to take the images instead. 

The “Keywords” tab helps improve the discoverability of the product. However, they won’t be displayed anywhere on the product page. You can add up to 500 characters under the “Search Terms” field, which allows you to add more keywords. Under the “More Details” tab, you’ll add the nitty gritty aspects of the product, like the weight, unit count, unit count type, and item dimension. 

Step 4: Look for Customers 

Attracting customers to buy your products is key to the success of your business. With the millions of products on the platform, most sellers find it challenging to stand out. One of the best ways to do so is by optimizing your listing for SEO, which we’ve already covered in the previous step above. 

Still, other methods that have shown results in the past exist. The most popular is setting competitive prices. Amazon features built-in seller tools, allowing sellers to price their products based on certain parameters. These parameters work in such a way that the seller always makes a profit. However, sellers must research the prices of similar products on the platform and ensure theirs is competitive. Some offer discounts and promotions to attract more customers. Besides pricing, you can also utilize Amazon’s advertising. You can use sponsored ads at the top of the search results or other relevant pages. 

Another way to attract customers is to offer excellent customer service. Respond promptly to customers’ concerns and inquiries and exceed expectations to ensure they are satisfied with their purchases. Positive customer experiences often lead to repeat businesses and word-of-mouth referrals. 

Step 5: Fulfill Your Orders 

Here you can see how many orders are in which stage of fulfillment and where these orders are from.
Here you can see how many orders are in which stage of fulfillment and where these orders are from.

The most critical part of the selling process is fulfilling your Amazon orders. Once the customers place an order, it’s your duty as a seller to ensure they receive their products. Always check your emails and the Seller Central dashboard for notifications about orders. Process the orders manually or use Amazon FBA to outsource your processing needs. 

You can choose to personally send the buyer's item to them or outsource the entire process to Amazon.
You can choose to personally send the buyer’s item to them or outsource the entire process to Amazon.

Once processed, you need to ship the product to the customer. The company offers Amazon Prime, standard, and expedited shipping options. Carefully select the right method and include tracking information so the customers can track the shipment. 

Monitor the delivery status, and in case of a return, ensure you have a clear policy in place. A clear return and refund policy ensures prompt and professional handling. You can also use Amazon’s return management feature to manage refunds and returns. 

Step 6: Get Reviews 

Request a review from buyers that have ordered your product to increase your interaction rating.
Request a review from buyers that have ordered your product to increase your interaction rating.

The last step is to get reviews from your customers. Amazon has very strict rules about how you can ask for customer reviews. For instance, offering incentives in exchange for reviews is a forbidden act that may result in a permanent ban or withholding of funds. 

Always follow up with your customers once they receive an order and encourage them to leave a review. The best way is to use Amazon’s messaging system or email to appreciate their purchase and request feedback. You can also give them instructions on how they can leave a review.

We recommend using the Early Reviewer Program if you are selling newer products. This program incentivizes customers to leave a review in exchange for a small gift. Always respond to these reviews, whether they suit your positive narrative or are negative. 

Monitoring Your Amazon Seller Performance Metrics

Monitoring performance metrics is crucial to the success of any Amazon seller. Below are some metrics to keep track of: 

  • Order Defect Rate (ODR): Using this metric, you can tell the percentage of orders with negative feedback, chargebacks, or A-to-Z guarantee claims. Amazon sellers must aim to maintain an ODR of less than 1%.
  • Pre-Fulfillment Cancel Rate: This metric indicates the percentage of Amazon orders the seller cancels before shipping. A PFCR of less than 2.5% is ideal. 
  • Late Shipment Rate (LSR): As the name suggests, this is the rate of late shipments. Amazon expects sellers to maintain an LSR of less than 4%.

Other metrics sellers must consider include the Valid Tracking Rate (VTR), which shows the percentage of orders with valid tracking information, customer response time, product ranking, Amazon click-through rate, return on ad spend, and buy box percentage. 

Closing Thoughts

Selling on Amazon can be lucrative for entrepreneurs, but requires careful planning, strategy, and persistence. Following the steps outlined in this article, you can create a successful Amazon business that stands out from the competition. 

Ensure you research your product before committing your time and finances, optimize the listings for SEO, set competitive pricing, and offer excellent customer support. Once you fulfill your orders, always request feedback and reviews, and track the performance metrics to stay ahead of the game. 

Frequently Asked Questions

Is it free to sell on Amazon?

No, it’s not free to sell on Amazon. The company has two plans: individual and professional. The individual plan charges $0.99 for every sale made on the platform, whereas the professional plan charges a flat fee of $39.99 monthly. 

 

Is it worth trying to sell on Amazon?

It’s worth selling on Amazon because, according to a recent study by Jungle Scout, about 89% of sellers are profitable. 37% of respondents said their profits increased throughout 2022.

Is selling on Amazon easy?

While using the Amazon seller system is pretty straightforward, you need a good SEO understanding to craft the best product descriptions. The FBA framework is also easy to grasp, and you’ll be selling in no time.

What is the hardest part of selling on Amazon?

The hardest part of selling on Amazon is having to deal with the competition. Some sellers set extremely low prices, which may be unprofitable to competitors.

How fast do you make money selling on Amazon?

It takes some work to start making money on Amazon. If you are aggressive enough, you’ll start generating revenue within four weeks.

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