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Finding products to sell on Amazon is easy once you understand your sourcing options as an ecommerce seller. Wholesale products and made-to-order manufactured goods are what most startups and small businesses think of at first. However, these are just two of six very different methods when it comes to how to find products to sell on Amazon.
Equally important to your success finding products to sell on Amazon is knowing how to spot profitable sales opportunities on the platform. That starts with product research and, luckily, Amazon provides plenty of tools and resources to help you with that.
We’ll show you how to uncover what products to sell using Amazon’s own data below—but first, let’s get familiar with your six top product sourcing options. That way, you can start your own ecommerce business with full knowledge of all the different ways you can find products to sell on Amazon.
Some Amazon sellers use just one sourcing method, like retail arbitrage or private labeling, but many grow by combining several profitable sourcing methods. So as you read through each method, don’t feel that you have to choose just one.
Explore them all to see which best fits your online selling goals, whether that’s just selling on Amazon or building a multichannel empire.
In retail arbitrage, you purchase deeply discounted retail products and resell them on Amazon. It sounds simple, but doing it right—meaning profitably—takes some work. Retail arbitrage sellers are absolute pros when it comes to hunting up discounted and clearance deals in local stores and matching them with hot sellers on Amazon.
The secret is knowing what’s selling well on Amazon on any given day, and for how much. You also need to clearly understand your cost of selling that item on Amazon. Amazon seller fees run about 15% of your selling price, and shipping orders can take a big bite out of your profits if you’re not careful.
Luckily, there are tools to help you spot profitable bargains. Amazon pricing apps are the retail arbitrage seller’s secret weapon. These are smartphone apps that let you scan item UPC codes and match them to current listings for that product on Amazon.
These apps deliver a wealth of information to help you price your products including the average selling price and buyer demand, your shipping or Fulfillment by Amazon (FBA) costs, and your potential profit.
Using this information, you can decide if you should buy a product and how much inventory to stock based on the current demand and your profit potential.
You can also see detailed storage and shipping costs if using FBA for fulfillment. The FBA fulfillment option has its own costs—but managed right, it can be far cheaper and less time-consuming than handling fulfillment yourself.
Pros and cons of retail arbitrage
On the pro side, retail arbitrage is a very economical way for new sellers to dip their toe into selling on Amazon. Your only real investment is the cost of buying discounted goods. If you use an Amazon pricing app like the one above, you’ll have a solid idea of profit potential so you can make smart buys.
On the con side, it’s hard to build a consistent business since you’re always chasing discounted products in various stores. Plus, you need a good grasp of consumer demand cycles so you don’t overbuy goods on the decline—like kids’ backpacks when the back-to-school rush is over.
Also, your items vary and so does their size and weight. That affects your shipping costs and FBA fees. If you don’t understand these cost variables, you can lose out on profits.
Print-on-demand (POD) products are essentially dropship items that are custom made when a customer places an order. POD suppliers handle everything for you, from sourcing and storing all available products to printing and shipping items as they’re ordered.
This is a newer way to find good products to sell on Amazon and it offers an exciting opportunity to build your own brand on Amazon, even on a shoestring budget. All POD sellers do is create great looking designs, fun sayings, or unique artwork and market them using Amazon-approved POS vendors.
You need two things for POD Amazon product sourcing. The first is artwork of some sort that can be printed on tee shirts, mugs, pillowcases, and other items available via POD vendors. The second is an account with an Amazon-approved POD seller.
Not every POD vendor is Amazon-approved. Those that are must meet Amazon's stringent production and shipping requirements. If this sounds like a great way for you to find products to sell on Amazon, try Gearbubble or Printful.
If you’re creative, you can come up with artwork of your own using online graphics tools like Inkscape, Adobe Creative Suite, or your favorite graphics program. If not, you can hire a freelancer on Fiverr or Upwork to create some fun, stylish, or brand-oriented artwork to market.
Most POD vendors provide online design tools that you can use to create products with slogans or clipart-based designs, too. You don’t have to be artsy to create POD items that sell.
Pros and cons of print-on-demand on Amazon
On the pro side, you have little to no startup cost other than your Amazon Seller account, which will run $39.95 per month. Most POD vendors offer free accounts, you just pay for goods as items are ordered and shipped to your customers.
Amazon-approved POD vendors provide pricing tools so you know your costs, but it’s not the most profitable way to sell on Amazon. That’s the biggest con to this sourcing option. To stay competitive and capture sales, you generally need to cut your selling price to the bone, at least until you’ve established a brand with demand.
Are you a craftsperson or artisan selling products that you make by hand? Do you want to explore this as a possible product sourcing option? If you answered “yes” to either question, then Amazon Handmade is the product category for you.
You have to apply to sell on Amazon’s Handmade section, and the requirements are stringent—more so than Etsy in many cases. In fact, many Amazon Handmade sellers are Etsy sellers looking to expand their reach by tapping into Amazon’s vast audience.
If approved to sell in Handmade, you can list and sell up to 40 items per month without paying for an Amazon Pro Seller account. However, if you grow beyond 40 sales, you’ll have to pay the monthly $39.95 Amazon Pro Seller account fee.
Either way, you still have to pay the per-sale Amazon seller fees which average about 15% of your item’s selling price. Plus you need to figure in your fulfillment and shipping costs.
Crafting handmade goods and sourcing the necessary raw materials all depend on the products you produce, so the tools of the trade for this sourcing option can differ greatly.
However, Amazon Handmade sellers can use FBA for stock storage, order packing, and shipping. That’s a handy tool for moving those time-consuming tasks off your plate so you can focus on producing more high-quality handmade goods.
Pros and cons of Amazon Handmade
On the pro side, Amazon is pushing its handmade category and its audience is growing. Plus, it’s not easy to gain approval, so the competition within many sub-categories is lower than when selling on Etsy.
On the con side, Amazon’s seller fees are higher than Etsy and it’s known to change its rules—and fees—pretty frequently.
Simply reselling goods made by other companies falls under the wholesale sourcing method. This is a very common way to find cheap products to sell on Amazon, especially for startups looking to explore the profit potential of different product categories.
It’s easy to source products from wholesale suppliers online via wholesale marketplaces like Alibaba, Thomasnet, and others. You can also visit trade shows and buyers’ markets within your industry to find all types of wholesale vendors.
In fact, a simple online search is an easy way to kick-start your wholesale sourcing efforts and run an efficient ecommerce business. Start by searching for the name of an item you’d like to sell and add “wholesale.”
When you work with wholesale suppliers, you purchase goods in bulk, often in units called “case packs,” store your inventory, and ship products as they’re ordered. You can handle product storage, order packing, and shipping yourself or use FBA for these fulfillment tasks.
However you fill orders, you also need an inventory and purchasing management system to track your inventory levels and ensure you keep enough products in stock to fill orders. Many inventory management tools integrate with Amazon seller account and FBA accounts.
InventoryLab.com, Sellics.com, JungleScout.com, AMZScout.net, and Shopkeeper.com are economical and highly-rated options. Most also deliver sales estimators and product scouting tools to help you research and fine-tune your wholesale purchasing decisions.
Pros and cons of selling wholesale products on Amazon:
Variety and low order minimums are two major pros of using wholesale vendors to find new products to sell on Amazon. Virtually any product imaginable is available through wholesale suppliers. By ordering low minimum quantities, you can test different products to see what’s popular and profitable on Amazon without committing to huge factory orders.
However, the con side is lower profits compared to larger factory orders. Typical resale markup is just short of 100%—or double—your wholesale cost. This might not leave you with much profit after figuring your Amazon seller fees and your shipping costs or FBA fees.
If you have a wholesale product that sells well, you can gain higher profits with direct sourcing, which we cover next.
Direct sourcing can be the most profitable way to find products to sell on Amazon. With direct sourcing, you purchase goods directly from the manufacturer. You can purchase direct-source stock products, meaning products that the factory already makes, at lower per-unit costs than wholesale prices. You can also have custom goods made to order for unique, branded items that stand out from the competition.
You can find direct-source factories using the same tactics covered in the wholesaling section above. In fact, many wholesale suppliers operate their own factories.
Oftentimes, you can work with the same vendor if you like a wholesaler’s product line and service. You simply order larger quantities to get lower per-unit cost or work with them to develop your own made-to-order products.
This being said, like wholesale product sourcing, direct sourcing requires a careful eye on your product costs, inventory levels, and reorder quantities. Plus, you’ll have stock storage, and order packing and shipping to think about, which you can do yourself or outsource to FBA.
If you do elect to use FBA for fulfillment, you might also need a storage or fulfillment facility to handle the bulk of your inventory. FBA storage costs can be quite high, so most direct-source sellers feed small shipments of stock into Amazon’s warehouse network as-needed.
Inventory management software that integrates with your Amazon Seller and FBA accounts, plus any back-end storage facilities, is critical for most direct-source sellers. This lets you track stock in different locations and see when it needs to be replenished to ensure orders ship on time.
Pros and cons of selling direct-source products on Amazon
Higher profits and the potential to craft truly unique products are the major pros of using direct-source suppliers to find products to sell on Amazon. This is how most Amazon sellers find long-term success in this competitive marketplace.
The primary cons include higher upfront cost due to larger orders and the potential for major losses if products don’t sell. Product research is important for any Amazon seller, but for direct-source buyers, it’s a crucial factor for success.
An offshoot of direct-sourcing is private labeling, and it’s a great way to find products to sell on Amazon under your own brand. Private label suppliers manufacture goods, then label, tag, or package them under your brand.
You can find private label products in virtually any product category, from personal care items and cosmetics to kitchen tools, pet supplies, gourmet foods, and much more.
The process of finding private label products to sell on Amazon is similar to finding wholesale and direct-source suppliers. Many manufacturers offer a private label option on their stock goods. Or, you can find private label vendors within a specific product category using a quick online search, like this:
When it comes down to it, private label sourcing is similar to buying from wholesale or direct-source suppliers. You have to buy in minimum quantities, and stock and ship products to your customers. Of course, this can be done via your own fulfillment setup, using FBA as your Amazon fulfillment tool, or a combination of both.
Likewise, you need a way to track your inventory and product costs and forecast your reorders. The same inventory tracking tools that work for wholesale and direct-source purchasing can help you organize your private label product sales on Amazon.
Give InventoryLab.com, Sellics.com, and Shopkeeper.com a try if you’re heading down the private label path.
Pros and cons of private label sourcing
A major pro to selling private label products on Amazon is that you establish your own brand via Amazon, usually with reasonable upfront costs and low minimums. The only other sourcing options that offer equivalent branding power are handmade products and direct-source goods. Both of these generally require more of an investment in funds and time.
On the con side, you still have to order private label products in set quantities, so there are upfront costs. Plus, labeling and other customization factors come with added costs, so it might not be as profitable as other product sourcing methods.
That said, private label products tend to top the list of recommended sourcing options for startups and small sellers looking to build a brand.
Of course, before you can properly understand how to find products to sell on Amazon, it's helpful to first choose a specific type of product (or product category) that you'd like to sell.
So, if you're trying to decide what to sell on Amazon, you'll want to keep the following things in mind:
Cost: How much does the product typically cost? You'll want to look for something that isn't too expensive to purchase, but not so cheap that it will be difficult to make a profit.
Shipping: Are these products easy to ship? Shipping costs will play a large role in your business, so the easier an item is to ship, the better.
Competition: Just like with cost, you'll want to find the right balance when it comes to competition. You won't want to get involved with a product or category that has too much competition, however, you also don't want to start selling a product that no one is interested in.
Customers: Who is the ideal customer for the product you're looking to sell? Can you enter into a niche market with highly engaged customers? Can you fill a missing need in a specific market? Thinking about these possibilities will help you find the right products to sell.
All of this being said, there are a number of research methods you can employ to decide what type of products you want to sell on Amazon—including using tools from Amazon themselves. Here are three strategies you can use:
One of the easiest ways you can sort through products to decide what might be good to sell on Amazon is by using keyword research. You can simply perform a Google search, or use a keyword tool like SEMRush to see what the search volume is for different terms, products, and categories.
As an example, say you think you want to sell customized winter hats. You can perform a search for "customized winter hats," as well as other variations of the term, to see how many people are looking for this item, as well as what the competition looks like.
Through this process, you might also gain some insight on how to find the product you're looking to sell on Amazon as well—as wholesale or direct suppliers may appear in your search.
Next, if you want to explore your opportunities and competition within a certain category, you can simply head to Amazon itself, search for that category and add “best sellers” to your search term. Here’s what we found searching for “best sellers novelty scarves:”
The “Best Sellers” page lists the top 100 sellers in that category. From there, you can click into different items and scroll down to gauge their sales popularity.
The product description detail that Amazon provides on each item tells the story of its overall popularity. For example, this item is pretty popular according to:
Its Amazon Best Seller Rank (BSR) of 5,836 in the huge Clothing, Shoes, and Jewelry category. As a rule, anything with a BSR under 10,000 in a major category has respectable sales velocity.
Its 145 reviews from customers show that this item has a track record of sales.
Reviews add up over time, but each review shows the date, so you can use reviews to gauge how many of a given item sold in a set period of time. According to Amazon Seller Central, only about 10% to 20% of customers actually leave feedback. So 145 reviews can equal anywhere from 700 to 1,500 actual sales.
It’s not a perfect market analysis, but it helps you determine if an item has enough demand to make it worthwhile. It also helps you see what your competition is doing and uncover ways to improve upon their products.
Similarly, you can repeat this process with another set of top-seller pages that Amazon calls “Movers and Shakers.” Here is where Amazon tracks products that are quickly moving up the popularity charts, like the top trending items in Clothing, Shoes, and Jewelry, below.
Following the process above, you can drill into sub-categories and items to see what’s trending with shoppers right now. This is valuable information if you’re trying to catch a style or product opportunity on the upswing.
These are just a few of the many ways you can use Amazon’s own data—and your potential competitors’ own products—to guide you in finding and choosing the right products to sell on Amazon.
There are many methods you can use when it comes to how to find products to sell on Amazon—and only a few require an upfront financial commitment.
Shoestring startups can try retail arbitrage and print-on-demand to find products to sell on Amazon with few upfront costs. Artisans making unique handmade goods find a special home in Amazon’s Handmade section.
Wholesale, direct, and private label sourcing lets you test the waters with resell products, develop a branded line on a budget, or offer truly unique goods.
Starting the process with research is critical to your success. Amazon’s Best Seller and Movers and Shakers pages give you valuable insight into what’s selling now. Best of all, research helps you take advantage of the pros of each sourcing method, and avoid the cons, as you search for profitable, in-demand products to sell on Amazon.
This article originally appeared on JustBusiness, a subsidiary of NerdWallet.
About the author: Krista Fabregas is a freelance writer, specializing in e-commerce and retail. Read more
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