Hustle Rating: 4/5
Difficulty [Easy/Intermediate/Hard]: Intermediate/Hard
Earning Potential [per month]: £500+
What is Amazon FBA?
FBA stands for Fulfilment by Amazon.
What does that mean exactly and how can it benefit me?
Say for example you are looking for a little side earner by finding a product that is selling cheap and selling it at a higher price elsewhere. Buying the item is easy enough. Selling the item is easy enough. When do you post it if you're running a full-time job? During your lunch? When you get home? (Post office may be shut by then!)
The issue you come across is actually getting the item packaged and sent off in good time. When people order these days they want it YESTERDAY! They won't wait for you to gather enough orders and take your weekly trip to the Post Office.
Amazon FBA allows you to send your inventory over to Amazon's warehouses and store it there until sold. You list your item on Amazon in front of the multi-million member audience and when it sells Amazon will fulfil your order and ship it to the customer for you. They will handle any customer service and any returns. You simply get an email to say it has sold and, providing you have done your maths right, get to take your profit by doing nothing!
Why have you marked this as hard? It sounds easy!
I mark Amazon FBA as hard because the hardest part is finding the product to sell! We aren't the only people to try this and definitely won't be the last. Product research is tough! You need to find a product with low competition that you can source for a fair price and sell on Amazon for a higher price that will still turn a profit after Amazon take their fulfilment fees. That is the tough part!
Many suppliers will only accept a minimum order quantity (MOQ) in order for you to get a wholesale price so startup capital is also a requirement here. I would say to get a good margin on your purchase you need to be shifting at least £1k's worth of product plus paid advertising to get your first few reviews on board which I will go into later.
Amazon FBA earning potential
Earning potential with Amazon FBA is MASSIVE! As Amazon are handling your products and shipping them out this model is highly scalable.
Take one product for example:
Purchase for: £11.50
Sell for: £22
Overheads: Amazon Fees £3
Total: £7.50 Profit
Say it sells one a day which is very much achievable given the footfall and exposure you will get listing with Amazon, you make £52.50 a week or £210 a month.
Find 4 more products that perform similar and you have broken £1k/month. Why not move on to 10 products and have £2k/month? Why not have 40 products and have over £8k/month?!
You see where I am going here. I am under no illusion this is easy, but there are case studies out there of people being highly successful by finding the right niche and scattering products around it!
Click here to continue reading and find out where to find your products!