Table of Contents:
1. Choosing the Right Amazon FBA Model
2. Importance of Doing a Test Order
3. Avoiding Stock Outs
4. High Reviews Don’t Guarantee High Sales
5. Selling on Private Label Listings
6. Building a Diverse Product Portfolio
7. Delegating Tasks to Scale Your Business
**The 7 Costly Amazon FBA Mistakes I Made (And How You Can Avoid Them)**
🔑 When getting started on Amazon, not everyone has thousands to lose. I can relate to this situation, as I used to make around £1,000 per month at my 9-to-5 job. That’s why I’m making this video to share the seven Amazon FBA mistakes that cost me thousands of pounds when I first began my Amazon FBA journey back in 2020. If I had someone create a video like this for me when I was starting out, it would have saved me a lot of time and money. So, if you’re just starting out, I recommend you watch this entire video and learn from my mistakes. All I ask in return is a like and share if you find value in what I have to say.
🔑 Mistake #1: Choosing the Wrong Amazon FBA Model
When you begin selling on Amazon, it’s important to choose a model that is right for you based on your budget. There are three main models: Amazon Arbitrage, Amazon Private Label, and Amazon Wholesale. Arbitrage has low capital requirements but lower potential profits, while Private Label has high initial investment but higher potential profits. The model I use is Amazon Wholesale, which has a medium initial investment but high potential profits, making it a great option for those with limited funds.
🔑 Mistake #2: Not Doing a Test Order
When you first find a product, it’s easy to get excited and order hundreds or even thousands of pounds worth of units. However, I’ve made this mistake, and it has cost me hundreds of pounds. Even after doing all the product analysis checks, there’s a chance that the product may fail to sell or have another issue. That’s why you should always order a test order of 10 to 50 units to test if the product will sell. This helps you assess how well the product is selling and determine how many units you should order from the manufacturer.
🔑 Mistake #3: Running Out of Stock
Running out of stock is one of the most common mistakes made by Amazon FBA sellers. This can cause you to miss out on potential hundreds, if not thousands, of pounds worth of sales. To avoid running out of stock, you should regularly check your inventory levels and order more stock whenever it starts to get low. You can use tools like Seller Toolkit (link in the description for 30% off the first month) to help you keep track of your inventory and analyze your profits. Another way to avoid running out of stock is to purchase your inventory in bulk and store some of it at your home or office, so you can quickly restock when needed.
🔑 Mistake #4: High Reviews Don’t Mean Higher Sales
In the beginning, I used to think that if a product has a lot of reviews, it automatically means the product sells a lot. However, this is not always the case. A listing could be years old, and all the reviews it has received could be several years old, but the product might not be selling as well anymore. To ensure a product is selling recently, you should filter the reviews by “most recent” to get an indication of how well the product is currently selling.
🔑 Mistake #5: Selling on Private Label Listings
One of my first mistakes when starting with Amazon FBA was selling on private label listings. Private label listings are products sold under a brand name, while Arbitrage and Wholesale are selling products already sold on Amazon. Amazon does not allow sellers to sell on private label listings if they are not the owner of the brand, and it can lead to suspension of your account. It’s important to follow Amazon’s policies and guidelines to avoid any issues.
🔑 Mistake #6: Not Focusing on a Product Portfolio
Most people jump on Amazon FBA with the mindset of finding products with thousands of sales per month. However, this is where they go wrong. Instead, you should focus on finding “mini gems” – products that make around 150 to 200 sales per month and where you can get around 60 to 80 sales per month in the buy box. These mini gems are easier to find and less competitive than products with higher sales volumes.
🔑 Mistake #7: Not Hiring Staff
As your Amazon FBA business grows, it can become difficult to scale if you’re a one-man army. Tasks like product preparation and packing can take up a lot of your time. To overcome this, you should start delegating tasks to free up your time to focus on finding more products and expanding your business. The key is to first identify the most time-consuming tasks and start delegating those.
Highlights:
– Choosing the right Amazon FBA model based on your budget
– Importance of doing a test order to assess product viability
– Strategies to avoid running out of stock
– Understanding that high reviews don’t guarantee high sales
– Avoiding selling on private label listings to prevent account suspension
– Building a diverse product portfolio of “mini gems”
– Delegating tasks to scale your Amazon FBA business
FAQs:
Q: What are the three main Amazon FBA models, and which one do you recommend?
A: The three main Amazon FBA models are Amazon Arbitrage, Amazon Private Label, and Amazon Wholesale. I recommend the Amazon Wholesale model, as it has a medium initial investment but high potential profits, making it a great option for those with limited funds.
Q: How can I avoid running out of stock on Amazon?
A: To avoid running out of stock, you should regularly check your inventory levels, use tools like Seller Toolkit to track your inventory, and purchase your inventory in bulk to have a backup supply on hand.
Q: Does a product with high reviews always sell well on Amazon?
A: No, a product with high reviews does not necessarily mean it is currently selling well. You should filter the reviews by “most recent” to get a better idea of how the product is performing recently.
Q: Can I sell on private label listings if I’m not the brand owner?
A: No, you should not sell on private label listings if you are not the brand owner, as this can lead to the suspension of your Amazon FBA account. It’s important to follow Amazon’s policies and guidelines.
Resources:
– Seller Toolkit: https://www.voc.ai/product/ai-chatbot
– Amazon FBA Workshop: [Link to workshop registration]