Amazon FBA business is becoming more and more prevalent. They are a reasonable reaction to the booming tech giant that is Amazon invading homes around the globe and slashing retail businesses along the way.
The simple reason, is that Amazon is making more and more money by the day, and they have made it possible to ride their coattail.
Amazon FBA businesses have the opportunity to be wildly profitable, but many people don’t even understand what they are.
Amazon (Fulfillment By Amazon) businesses are a business model where you contact suppliers/act as a supplier and send Amazon your products which is listed, then whenever orders come in, they handle everything from customer service to shipping it to your buyers.
It’s a very lucrative opportunity for the right people. It’s a great opportunity for more passive income, but it can also be a huge headache if not done right.
So, what are the three reasons that make Amazon FBA businesses worthwhile?
1. Freedom
This comes at the beginning and comes back again after things start running smoothly/after all the kinks have been worked out. Amazon FBA businesses are tricky in the beginning. You have the freedom to pick any product/niche you want to and pursue it.
This means you can get ideas from finding profitable niches within your interests or by looking at communities such as Reddit and social media to find things that you would like to sell.
You have the freedom to make day to day decisions regarding pricing, how listings are done, pictures, and more. As you pick up staff and solve problems, gradually things run themselves in part, freeing up time for other activities and travels as long as you remain vigilant.
2. Scalability
The more products you find that can be profitable and the more traffic you drive, the better your listings do. If your product is quality and the community on Amazon that buys your product, the better your product will do.
The better your reviews, the more Amazon drives traffic to your product, and the more you make potentially. It’s a cycle of success or failure depending on your market research and product sourcing abilities. The sky is the limit for how well your venture can go.
3. The Challenge
Working with an FBA business is hard work in part, but like many businesses require thick skin. Challenges and problems will pop up. It’s Murphy’s Law when things can go wrong; they do go wrong and usually at the most opportune time.
Like Rocky said, it’s not about how hard you can hit (how much you can make and how well you do), but it’s about how hard you can get hit, and get back up (respond and rise to problems and get things back on track). This is the case especially in FBA businesses, preparation and the ability to problem solve is key. Some products will be faulty just due to volume, there will be returns, there will be organizational failures, but it’s from these failures that the right ones and the wrong ones for FBA businesses will be separated. With great reward, comes great risk, and running an Amazon FBA business is no different.
You can also have a look on an infographic about Amazon selling fees 2018-2019