Fulfillment by Amazon (FBA) companies is becoming more and more popular, with excellent online business opportunities for both buyers and sellers that are interested in getting involved in this space. Since FBA businesses are still quite new, there’s not yet a huge amount of advice available when it comes to how to effectively scale this type of company.
Amazon has managed to create one of the most advanced fulfillment networks in the world today. All you need is an Amazon Seller Account to create your FBA business, giving you several benefits, including the opportunity to store your product in an Amazon fulfillment center and have all the packaging, shipping, and customer service provided by Amazon on your behalf. If you are interested in this business type, here are some tips to keep in mind to develop your strategy and achieve business growth.
What to Sell
There’s more than one way to grow an FBA business, and one of the first decisions you will make is what you are going to sell on Amazon. What product should you sell? How should you price it to make a profit? How do you know if consumers will be interested in your product? These are all questions that you may have, and the best way to get the answer to them is to be guided by data, rather than simply picking a product that you like. Take your time to do product research and analysis and use tools that are designed to mine huge amounts of Amazon data to find suitable products that have high demand and low competition.
Once you have determined which product or products you are going to sell, it’s important to come up with a strategy for listing management. Regularly check on your listings on the live listing itself and within Seller Central. This gives you the chance to review descriptions and images to make sure that they appear as expected, along with answering any questions that you have from customers. Keep your eye out for any new product reviews that you get, as you can use these as feedback and guidance to improve your product in the future.
Building Your Brand
You will also need to come up with a strategy to build your brand. Experts suggest that rather than simply letting Amazon do all the work for you, it is worth considering positioning your brand separately to your Amazon FBA business by creating your own website and appearing on other platforms. Focusing on building your brand gives you a better opportunity to build a loyal customer base and drive more traffic to your Amazon product listings. You may also want to consider becoming brand-registered on Amazon to get access to enhanced marketing features that will help you stand out.
Finally, another strategy to consider when setting up your Amazon FBA business is how you are going to manage your inventory. You should try and find the right balance of having enough inventory to keep up with the demand, but without having too much supply in Amazon warehouses. Ideally, experts recommend keeping around three to six months’ worth of inventory in an Amazon warehouse at any given time, with more around the holidays if your product is likely to see an uptick in demand around these times. Consistently monitor your inventory needs and adjust as necessary to reduce the risk of paying more storage fees than you need.
Amazon FBA gives you the chance to set up your own successful business on Amazon with packaging, storage, and shipping is taken care of by Amazon. Keep these tips in mind to get your strategy off to a successful start.