Selling products on Amazon has become a lucrative business opportunity for many entrepreneurs. With millions of customers worldwide, Amazon provides a vast marketplace for sellers to showcase and sell their products. But how to increase sales on Amazon marketplace? The success of an Amazon seller heavily relies on the ability to source high-quality products at competitive prices. In this guide, we will explore how to source products to sell on Amazon through these sections:
- Some popular Amazon product-sourcing metrics
- How to source products to sell on Amazon
- Amazon product sourcing tips
Without further ado, let’s get started!
Some Popular Amazon Product Sourcing Metrics
When it comes to how to source products, several metrics can help you make informed decisions. Here are some popular Amazon product sourcing metrics:
- Profit margins: Understanding the potential profit margins of a product is crucial for determining its viability. To know the profit margin, you need to consider the cost of sourcing the product, manufacturing or purchasing costs, shipping fees, Amazon seller fees, and other expenses.
- Demand levels: When sourcing for Amazon stores, assessing the demand for a product is essential to ensure that there is a market for it. You can use tools like Amazon’s Best Sellers list or third-party software to gauge a product’s popularity and sales rank. Alternatively, it would help if you looked for products with consistent demand and a steady sales history.
- Return on Investment (ROI): Calculating the ROI helps you determine the profitability of a product. It involves analyzing the potential profit against the initial investment required to source and sell the product. In other words, checking ROI is the way to know is selling on Amazon worth it or not. A higher ROI indicates a more lucrative opportunity.
- Competition: High competition can make it challenging to stand out and achieve significant sales. Thus, it is essential to consider factors such as the number of sellers, customer reviews, and the presence of established brands in the market. Moreover, you ought to look for products with moderate competition or explore niche markets to increase your chances of success.
How to Source Products to Sell on Amazon
Now, we come to how to source products to sell on Amazon FBA or simply Amazon. Basically, the product sourcing process for Amazon includes four main steps as follows:
- Decide what products to sell on Amazon
- Choose where to buy products to sell on Amazon
- Negotiate with suppliers
- Place orders and manage delivery
Decide what product to sell on Amazon
Before you start sourcing for Amazon, you need to decide what you want to sell on Amazon. This critical decision can significantly impact your success as an Amazon seller.
The popular Amazon product sourcing metrics that we mentioned above are the factors that you need to follow to find the most suitable products for your store. Among them, conducting thorough market research to identify high-demand and low-competition product niches is the most important. Tools like Amazon’s Best Sellers, Google Trends, and keyword research tools can help you understand market trends and customer preferences.
In addition, our article Best products to sell on Amazon is a valuable reference source for you.
Choose where to buy products to sell on Amazon
Once you’ve decided on the product you want to sell, the next step is to determine where to get products to sell on Amazon. There are several sources you can explore on the process of how to source products to sell on Amazon, which is:
Retail arbitrage
Retail arbitrage is the first option if you are considering where to buy items to resell on Amazon. Retail arbitrage involves purchasing products from traditional retail stores and reselling them on Amazon at a higher price. This method requires scouting for discounted or clearance items in brick-and-mortar stores and then listing them on Amazon. Also, you should research market prices and ensure that the potential profit margin justifies the effort involved in this method.
Overall, retail arbitrage can be an excellent way to get started with Amazon selling, as it doesn’t require a lot of upfront investment. However, it can be time-consuming and difficult to find profitable products.
Here are some pro tips to help you succeed with retail arbitrage:
- Use a price scanner app: This will save you a lot of time and help you find the best deals. Some popular price scanner apps include Amazon Seller App, Keepa, and Helium 10.
- Subscribe for big brands: This is the way to receive brand deals. With brand deals, you can buy products at bargain prices or with member incentives.
- Become selective about products: You must select products carefully because not all discounted products are worth reselling.
Dropshipping
The next option for where to source products to sell on Amazon question is Amazon Dropshipping. Dropshipping allows you to list products on Amazon without holding inventory. When a customer decides to buy, the supplier ships the product directly to the customer.
It becomes one of eCommerce strategies’ best practices as it eliminates the need for storing inventory. However, when sourcing for Amazon with dropshipping, you can face challenges in maintaining quality control and margins.
Here are some tips for you when you start the journey of how to source products to sell on Amazon with dropshipping:
- Choose a reliable dropshipping supplier: It is important to do your research and find a supplier that you can trust to ship products on time and in good condition. You can read reviews from other drop shippers or ask for recommendations from other Amazon sellers.
- Make sure your supplier can ship to Amazon’s fulfillment centers: If you use Amazon FBA, Amazon requires that all sellers ship their products to its fulfillment centers. So, you need to make sure that your supplier can ship to Amazon’s fulfillment centers and that they meet Amazon’s packaging requirements.
Wholesaling
Wholesaling is also a good choice for sellers stuck on the problem of finding items to sell on Amazon. It involves buying products in bulk from manufacturers or distributors at a discounted price and reselling them on Amazon.
Wholesaling can be a cost-effective way to source products and maintain a steady supply for your Amazon store. Furthermore, this method offers better control over your inventory and pricing, but it often requires a higher upfront investment. However, you can establish relationships with wholesalers and negotiate favorable pricing terms.
To complete your journey on how to source products to sell on Amazon with wholesaling, please note the following tips:
- Find a reliable supplier: There are many wholesale suppliers out there, but not all of them are created equal. You should do your research and choose a supplier that has a good reputation and that can provide you with the products and services you need.
- Negotiate a good price: Since you’re buying in bulk, you should be able to negotiate a good price from your supplier. Don’t be afraid to ask for discounts or free shipping.
- Manage your inventory carefully: It’s important to manage your inventory carefully to avoid stockouts and overstocking. You can use Amazon inventory management softwares like LitCommerce to track your inventory levels and sales. Please contact us to learn more about this great tool.
Private label
Private labeling is another answer to where to buy wholesale products to sell on Amazon. Private labeling involves sourcing generic products from manufacturers and branding them under your own label. This method allows you to differentiate your products from competitors and build a brand identity. Private labeling requires finding reliable manufacturers, designing packaging, and ensuring the quality of the products meets your standards. Also, you need to have a good plan for marketing and selling your products.
Here are some tips you can refer to when utilizing private labeling in the process of how to source products to sell on Amazon:
- Work with your manufacturer to develop your product: Once you have found a manufacturer, you have to work with them to develop your product. This includes designing the product, choosing the materials, and setting the specifications.
- Create a strong brand: Your brand will set you apart from other sellers on Amazon. We highly suggest you create a strong brand by developing a unique logo, tagline, and brand voice.
B2B marketplaces
B2B marketplaces are online platforms where you can buy products from wholesalers and manufacturers. Popular B2B marketplaces include Alibaba.com, ThomasNet, and Global Sources. This can be a good way to find a wide variety of products from suppliers all over the world.
Here are some essential tips you need to use when using B2B marketplaces in the process of how to source products to sell on Amazon:
- Intensive research: You need to do your research and vet suppliers carefully before placing an order. It helps you due diligence and verify the credibility of suppliers.
- Use a freight forwarder: If you’re buying from suppliers outside of your country, you’ll need to use a freight forwarder to ship the products to you. Freight forwarders can support you with customs clearance and other shipping logistics.
- Order samples: Before you place a large order, it would be better to order samples from the supplier. This will help you make sure that the items are of high quality and that they meet your standards.
Print-on-demand services
Print-on-demand (POD) services, such as Printful or Printify, are ideal for selling custom-designed merchandise like apparel, home decor, accessories, mugs, posters, cases,… When a customer places an order, the print-on-demand service will print and ship the product directly to the customer. This can be a good way to start an Amazon business with low overhead costs and high customization.
However, to be successful with POD services in your process of how to source products to sell on Amazon, you need to consider some of the following carefully:
- Choose the right POD service: Many different POD services are available, so it’s essential to choose one that is right for your business. Consider factors such as the types of products offered, the quality of the printing, and the pricing.
- Create high-quality designs. Your designs are the most important factor in your print-on-demand business, so ensure they are high-quality and appealing to your target audience. It is necessary to invest in a good design tool and hire a professional designer if necessary.
Auctions and thrift shops
The other exciting options for Amazon sourcing is auctions and thrift shops. It can be a treasure trove for finding unique and valuable items at affordable prices. You may come across hidden gems that can be sold at a significant markup on Amazon. Nevertheless, this method may require more effort in terms of product hunting and quality control.
Here are some tips to use auctions and thrift shops most effectively:
- Inspect items carefully: When shopping at thrift stores, you need to be sure to inspect items carefully for any damage or defects. You don’t want to sell a product on Amazon that is not in good condition.
- Communicate clearly: Effective communication is key during negotiations. Clearly articulate your needs, expectations, and desired outcomes. Active listening is also important to understand the supplier’s perspective and find common ground.
- Clean and restore items: If necessary, please clean and restore items before selling them on Amazon. This will make them more appealing to potential buyers.
eBay
eBay, another popular top marketplace for selling products, can be a great source for finding products to sell on Amazon. Many sellers on eBay offer wholesale lots or bulk products, which can be purchased at discounted prices and resold on Amazon. By leveraging both platforms, you can tap into a wider range of sourcing opportunities.
Of course, if you want to take advantage of eBay in your how-to-source products to sell on Amazon journey, you also need to keep in mind some of the following tips:
- Look for deals: eBay is a great place to find deals on products, but it’s important to be selective. You can start your search by checking out the “Deals” section at the top of the eBay homepage. This section is frequently updated with fresh offers. Also, in the Advanced Search option (next to the Search button), please specify the item you’re looking for and select “Sale items.” This will show you a range of items with discounts
- Be aware of fees: When sourcing products from eBay, be sure to factor in the cost of shipping and eBay fees.
- Use eBay filters: eBay offers a variety of filters that can help you to find the products that you are looking for. For example, you can filter by product category, price, and condition.
Negotiate with suppliers
In the process of how to source products to sell on Amazon, effective negotiation with suppliers is crucial for securing the best deals and maintaining healthy profit margins.
Here are some tips for successful negotiations:
- Research your suppliers: Before entering negotiations, you must thoroughly research your suppliers. Understanding their reputation, history, and pricing is also vital. You can look for reviews and feedback from other sellers who have worked with the same suppliers.
- Communicate clearly: You need to clearly communicate your expectations, including pricing, minimum order quantities, quality standards, and delivery times. Remember to ask questions and seek clarification to avoid misunderstandings.
- Negotiate terms: Don’t be afraid to negotiate terms. Suppliers are often open to negotiations on pricing, payment terms, and shipping costs. You should be prepared to walk away if the terms don’t align with your business goals.
- Include legal agreements: During the negotiation process, you should consider having legal agreements in place, especially for private-label products. These agreements should outline terms, exclusivity, and any proprietary aspects of the product.
Place orders and manage delivery
Once you’ve negotiated terms with your suppliers, it’s time to place orders and manage the logistics of getting your products to Amazon’s fulfillment centers. This is the final step on how to source products to sell on Amazon. However, it is also imperative.
Here are the small steps involved:
- Order placement: You need to place your orders with the suppliers. At this stage, it is crucial to make sure to specify the quantity, product variants, and any customization requirements. Then, remember to confirm payment terms and methods.
- Quality control: Before shipping, you have to conduct a final quality check of the products to ensure they meet your standards. This is crucial for maintaining customer satisfaction.
- Shipping and importing: You need to determine the most cost-effective and efficient shipping method for your products. This may involve air or sea freight, customs clearance, and domestic transportation.
- Amazon FBA: You can look at using Amazon FBA (Fulfillment by Amazon) if you prefer not to handle storage and shipping yourself. FBA lets you to send your products to Amazon’s fulfillment centers, where they handle storage, packing, and shipping to customers.
Amazon Product Sourcing Tips
When it comes to how to source products to sell on Amazon there are several tips that can help you make informed decisions and increase your chances of success. Here are some common Amazon product sourcing tips:
- Consider retail price: Many experienced Amazon sellers recommend finding products with a retail price between $25 and $50 USD. This price range allows for a good profit margin while still being affordable for customers.
- Get samples: Before committing to a large order, it’s a good idea to request samples from your suppliers. This allows you to assess the quality of the products and make sure they meet your standards.
- Play to your strengths: It would be better to stick to products that you have knowledge and expertise in. If you have a deep understanding of a particular niche, it can give you a competitive advantage when selling related products.
- Utilize Amazon programs: Amazon offers various programs that can support your business model and help you tap into different selling opportunities. Some examples include Brand Registry, Amazon Handmade, Amazon Custom, Merch by Amazon, Amazon Renewed, and more.
Sourcing physical products to sell on Amazon can be challenging, but exploring digital products offers a unique opportunity. Digital goods are often easier to source, have lower shipping costs, and can reach a global audience. check out our comprehensive guide to learn more about the strategies and considerations involved in selling digital products on Amazon.
How to Source Products to Sell on Amazon: FAQS
- Where can I buy stuff to resell on Amazon?
There are several options for buying products to resell on Amazon:
- Sourcing products from wholesale suppliers or distributors.
- Purchasing products from liquidation sales, clearance racks, or even thrift stores.
- Looking at online marketplaces like Alibaba, eBay, and Liquidation.com Attending trade shows.
- Networking with manufacturers.
- How do I find popular items to sell on Amazon?
To find popular items to sell on Amazon, you can start by:
- Conducting market research
- Looking for product categories with high demand and low competition.
- Utilizing tools like Amazon Best Sellers, Jungle Scout, or Helium 10 to identify trending products.
- Analyzing customer reviews
- Searching for emerging trends
- Considering seasonal items.
- Keeping an eye on social media platforms and online forums for product recommendations and discussions.
- How to sell on Amazon without buying the product?
To sell on Amazon without buying the product upfront, you can consider using the dropshipping model. With dropshipping, you list products for sale on Amazon, but the supplier handles inventory storage and shipping directly to the customer. When a customer places an order, you forward the order details to the supplier, who then fulfills the order. This way, you don’t need to purchase or store inventory in advance. However, it’s important to choose reliable suppliers and ensure smooth communication and coordination.
- Can I buy Amazon products and sell them?
Yes, you can buy Amazon products and sell them as a third-party seller on the platform. This is known as retail arbitrage. You can purchase products from various sources, such as retail stores, online marketplaces, or wholesalers, and then list them for sale on Amazon. When a customer buys the product, you ship it to them. However, it’s important to comply with Amazon’s policies and guidelines for selling products on their platform.
Product Sourcing for Amazon Now!
Overall, how to source products to sell on Amazon requires careful planning, research, and practical negotiation skills. By looking at multiple sourcing methods such as retail arbitrage, dropshipping, wholesaling, and private labels, you can find quality products at competitive prices.
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