In my previous post, I gave you an overview of selling on Amazon and how Amazon FBA works.Now in this post, I’ll show you the steps of finding a profitable product to sell on Amazon.
Decide on what’s your interest and passion
I think it’s essential to find a niche and market you’re interested in. Having an interest and enthusiasm for something helps you sell the product much more comfortable. You want to think about the bigger picture and build a brand around your product. However, it’s not just about the money; it’s about serving people. So, ask yourself how you can add value to your customers.
Ask yourself what your passion is? For instance, do you like health or sports & outdoors or toys & games? If you go to the Amazon Best Seller List, you can find different category ideas to choose one that you like the most. You can see the different categories on the left side of the page.
Find a product in that niche
Firstly, you need to find a niche.
There are three ways you can use to find a product. Let’s say you figured out you’re passionate about cooking, so you chose the kitchen & dining market.
Now let’s see what the different ways you can do to select your product are.
Using the Amazon website
- Go to the Amazon.com website and log out from your account.
- Click in the search bar and enter the minus symbol and then at least eight characters (for example -hjhfdjjkj)
- Then click “All” on the left and select the category you chose previously. In our example, it’s kitchen & dining.
- You got a list of potential products. Create a list of products you like.
Using the Best Seller List
- Go to the Amazon Best Seller List
- Click the category you chose previously on the left side (like kitchen & dining).
- Here are some product ideas that you may like. Create a list.
- Go to google.com.
- Type in [your category] products. For example “kitchen & dining products.”
- Then, you’ll find lots of websites where you can see product ideas. So, collect ideas and create a list.
Narrow down your list of products
Secondly, you need to narrow down your list.
Once you have at least 10-20 products on your list (more is better), you can start narrowing down your list.
It’s important to check out the competition of the products as well. You can do this by typing the product keyword in the search bar and check the top products.
It’s a very time-consuming process, but Jungle Scout will make your life easier when you’re looking for a product to sell on Amazon. This software will help you do all the research you need to find a profitable product.
Criteria to find a profitable product
Here are the requirements that you’ll need to use if you’re going to find a profitable product. You need to use these criteria when you check the top products for a keyword.
- BSR (Best Seller Rank). The lower BSR means more sales and more competition. So try to find products that have a BSR range between 300-20,000.
- Price range. The price range should be between $17-$70. If you choose an expensive product, your profit margin will be higher, but the manufacturing costs will also be higher. A cheaper product means that your first inventory order will be more reasonable, but your profit margin will also be lower.
- Size & weight. You don’t want to select an oversize product as your first product. The Amazon oversize limit is 18” x 14” x 8.” The weight should be lower than 5 lbs. If you choose a small and lightweight product, your shipping cost will be lower.
- Reviews. You want a product that has a competition with fewer reviews. In the beginning, it’s challenging to compete with other sellers who have a lot of reviews. People will buy the one with more reviews. Try to find a product where the competition has 1000 reviews or less.
- Product line. Think about your next products. Is it possible to build a brand around this product and sell other products under this brand name later?
If you use Jungle Scout, it helps to look at the Amazon Best Seller Rank, reviews and sales data. As a result, it’s a more comfortable and faster process as you don’t need to open up every product and check the information.
What’s next & what is Amazon FBA?
Finally, you need to choose a model.
I think the most profitable model is private labeling. It means that you don’t need to invent a brand new product and manufacture it. Therefore, you only need to find a supplier who produces that product and put your label and packing on it.
I recommend Alibaba.com. Go to the search bar and type in your keyword. Then in the “filter results by” section select supplier types. You want your supplier to be verified supplier, and you also want your supplier to provide trade assurance, which is a protection for you.
Warning: if you want to sell a product that goes into your body or on your body, you should find an American seller. To clarify, it’s not recommended to use Alibaba for this type of product.
After that, you’re ready to find a supplier for your product. If you’d like to read a tutorial from me about choosing a supplier, leave a comment below, and I’ll create one.
If you have the product you want to sell, I recommend buying a few products on Amazon from your competitors to see what they are doing to stand out. It also helps when you are evaluating your samples because you know what to look on a product. It helps to understand what leads to success.
Amazon FBA means Fulfillment by Amazon. It means that Amazon handles everything for you from storing your product to shipping to the customers and even they do customer service. So, I highly recommend Amazon FBA.
Calculate your expenses
Before you order your inventory, calculate your shipping cost as well and compare it with your budget. You need the exact weight to calculate your shipping cost. A small and light product can be ship by air which is much faster than shipping by the ocean.
You also need to calculate the Amazon seller fees. Amazon will take a certain percentage for storage and shipping your product to the customers. In short, small items are cheaper. Please note that this is only true for Amazon FBA.
I’ll write about saving money and starting this business with little money in the next post, so be sure to come back later.