When it comes to reselling items online, reselling on Amazon is one of the first business models that comes to mind. Amazon is the biggest online shopping marketplace on the planet and has a massive audience that can be reached with relative ease, so it makes sense to try and build an online business on the platform.
Like any online business however, there's a few things to keep in mind when reselling on Amazon.
First, you need to understand the different ways that you can start reselling on Amazon, then you need to hatch out a plan to actually get your venture off the ground.
Reselling on Amazon isn't without it's costs and associated risks, but it truly is one of the greatest online business opportunities available to people from all walks of life.
If you are new to Amazon reselling, it may take some time to figure out what works best for you. But, with a little experimentation and research, you can create a successful Amazon business that brings in extra income or even replaces your 9-5 job.
If you're ready to learn about this amazing business model, let's dive in and explore everything about reselling on Amazon.
Different Ways to Resell Products on Amazon
In principle it's all very similar however, there are some different ways to resell products on amazon.
First, let's define a word that you'll see thrown around a lot in the Amazon business space.
To arbitrage something is to buy and sell something in different markets where you can take advantage of different prices, and make a profit.
Now lets talk about how you arbitrage on Amazon, in addition to a couple of other great ways to resell on Amazon.
My personal favorite ways to resell on Amazon is called online arbitrage. With this method of selling on Amazon, you simply buy products from one online retailer and then sell them on Amazon.
You can do online arbitrage with Amazon using Amazon FBA, which is where you ship all your products to an Amazon FBA warehouse and they pack and ship them to customers on your behalf, or you can simply stockpile products are your home or warehouse and send them out when you make a sale. This is called fulfilled by merchant or FBM.
Much the same as online arbitrage, retail arbitrage involves buying products from physical brick and mortar stores and then reselling them on Amazon. Both online and retail arbitrage have their pros and cons, but both are great models of selling on Amazon.
I personally got tired of always having to go to retail stores to replenish stock to sell on the Amazon marketplace, so if you're lazy like me then online arbitrage is a great option.
Buying in Bulk From a Wholesaler
Many Amazon sellers do this once they have a bit more capital to invest into their business. Quite often, people start with online arbitrage or retail arbitrage and when they find a proven product that has a healthy profit margin, they buy that product in bulk directly from wholesalers or distributors.
Manufacturing Your Own "Private Label" Products
This is another step up from wholesaling and it is often referred to as "private label". This method is similar to wholesale in the way that you need to buy products in bulk, but you are also getting a unique product made under your own private brand which you can sell from your own Amazon storefront.
This could be anything from sunglasses to flashlights to apparel and while private label is a great business model, it also comes with great risk due to the initial investment required and not knowing if you have chosen the right product to launch.
Finding Used Items to Resell on Amazon
If you're a fan of Gary Vee then you'll be well aware that he loves a good garage sale. This reselling model is better suited to eBay or Facebook Marketplace, you can certainly sell used goods on Amazon.
I don't recommend it as you can have trouble verifying authenticity of items you purchase at Goodwill or a garage sale in the even that a customer complains. The only caveat is used books. Besides text books not a ton of books are counterfeited in the US, it seems.
Amazon actually started out as a book marketplace, and many sellers now specialize in flipping books on Amazon. It's a huge market.
But you can sell anything you want, as long as it complies with Amazon's guidelines and fits within your own risk tolerance levels. You may even just start selling used products that you have at your house.
Again, I would suggest those items get sold on eBay or Facebook Marketplace.
How to Start Reselling on Amazon
It's relatively easy to get started reselling on amazon, even though it may seem a little daunting at first. Let's run through the steps to reselling on Amazon.
Step 1: Register an Account as an Amazon Seller
There's no difference between being an Amazon reseller or a seller, they both essentially mean the same thing.
You will need to head over to sell.amazon.com to start your Amazon account.
You can choose between and individual account, which is free to start but will have an extra fee attached to each sale, or a professional seller account. The professional account costs you $39.99 a month but it makes sense if you are starting to sell some volume.
If you plan to sell more than 40 units a month the professional plan is probably the place to start.
Step 2: Find Some Products to Sell
This is undoubtedly the most important part, the product research phase. The key to being a successful amazon reseller is to source and purchase products for a low price and sell them for a higher price on the Amazon marketplace.
You also want those products to be low competition products too, sounds easy right?
The truth is it's pretty hard to find a true unicorn that has a huge profit margin and no competition, but the more experience you get the easier it will become as an Amazon reseller.
We cover the whole product sourcing thing in my OA challenge if you want to take a look at that.
If online arbitrage tickles your fancy, you might like to check out how you can find online arbitrage leads which will help you find products to sell on Amazon.
Step 3: List Your Products on Amazon and Start Selling!
Obviously there is more to it than these simple 3 steps, but there is also no use overcomplicating the process!
One of the other big considerations is whether you will store products at your home or whether you want to make use of Amazon FBA, which is where you send your products to Amazon FBA and they handle all of the order shipping and customer service.
If you are just starting small and you don't mind packing and shipping products yourself, then you can just start working out of your home.
What's the Benefit of Using Amazon FBA?
Once your Amazon business gets to a certain size, it makes sense to join the Amazon FBA program. This is where Amazon holds your inventory and manages the fulfillment when orders are placed.
I could talk about FBA all day long, but here's just a handful of reasons why Amazon FBA is so popular.
Take Advantage of Amazon Prime Shipping
If you're selling new products on Amazon and they are in the FBA warehouse, you qualify for Prime shipping which customers love.
Amazon Handles the Customer Support
Yep that's right. You don't need to answer any pesky customer questions. Once you offload your products to the FBA fulfillment center, Amazon takes care of the rest.
You will still have a message here or there that needs to be replied to but often you can point them to Amazon customer service.
Save Time and Grow Your Business
This is a big one for many Amazon sellers. Having Amazon handle the fulfillment of your products is a massive time saver, allowing you to spend more time on your Amazon reselling business and saving you from having to hire labor to help you prep, pack, and ship dozens or even hundreds of items per day to ship to a customer.
You can also take things one step further by sending your products to an Amazon FBA prep center service, who'll package up and send your products into the FBA warehouse for you.
Win the Buy Box
You may not be familiar with the Amazon buy box, but if you have it on one of your listings then you have hit the jackpot. The buy box makes it easier for customers to purchase your products on the Amazon marketplace. Every seller wants to win the buy box.
It seems that FBA sellers get a little higher share of the magical buy box if they use the FBA Program. That algorithm does get tweaked every now and again and seems to level the playing field between FBA and FBM.
This may happen during peak times like the holiday shopping season and can be a boon to FBM Amazon sellers.
Frequently Asked Questions About Reselling on Amazon
Can you really make money selling on Amazon?
Heck yes you can. This is a question that is asked all the time. I get that there is scepticism around the whole selling online thing, but Amazon has helped so many people become business owners it's just crazy. During busy holiday periods, third-party Amazon sellers offload up to 11,500 products per minute!
But Like any business model, there is risk of failure though so make sure you do your due diligence to ensure any new business you undertake is right for you and please never invest more than you can afford to lose in a business venture like this or any kind.
What if I get bad customer reviews on Amazon?
This is a reality for anyone selling on Amazon. The best way to avoid this is to sell quality products and use Amazon FBA to ensure fast shipping and good customer service.
You may be able to have some negative reviews removed depending on the reason for the review. Product reviews, complaints about pricing, and a few other things will be struck through by Amazon pretty quickly.
Is it legal to resell products on Amazon?
Yes, it definitely is. There is no law that forbids people from reselling items on Amazon, but some brands might try and stop you from reselling their products. That's why I've written about Amazon IP claims in the past to help sellers avoid products that may cause issues.
Reselling on Amazon really is no different than what Walmart or Target do in their retail stores. You are purchasing inventory from a source and selling it where there is demand for it. Your sources look a little different than large retailers but it is the same business model without all the real estate.
What products should I resell on Amazon?
There really is no one answer for this, but a personal favorite of mine is the beauty category. The items are small, light, and sometimes they can be pretty expensive. People often become fans of particular brands and buy them repeatedly. These types of products are known as replens or replenishables.
Replens are products that need to be replenished often, so customers need to keep coming back and buying more. Undergarments, tools, toiletry items. Really anything can become a replenishable for your business because of how many people buy on Amazon. You get the idea.
The Final Word on Reselling on Amazon
I will forever be grateful to Amazon for the opportunity to sell on their marketplace. Whether you're into arbitrage, flipping used goods, or private label, there is so much opportunity to build an amazing business reselling on Amazon.
The most important tips I give all of my students and friends who want to start reselling on Amazon is this:
Take your time to educate yourself, learn from those that have already succeeded reselling on Amazon and don't give up too soon!
Don't be afraid of the seemingly high competition, all good business models have competition. That's how you know it's profitable.
Thanks again for reading, be sure to take a look at my other Amazon blog topics to help you become an amazon reseller.