FBA- A SID Primer

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For those of you following my income reports, you know that in June my brother and I launched a business together. And we are killing it on Amazon. I’ve been pretty vocal about it as I had no idea how fast it would scale. 10 weeks in and we’ve listed over 400 items sold over $4700 in product. AND made well over $2500. Well I don’t know if ‘made’ is correct because we reinvested every penny thus far but I digress. The reason I’m writing this is because I keep getting FB and Snapchat messages. (Gosh would it kill you to drop me an email? My inbox is lonely). Anyway these messages boil down to one thing: “how do you or how can I make money on Amazon?” yes that’s two things sue me! Thus my topic for you today: FBA- a SID Primer.


So what is Amazon? (skip if you already know)


Do you live under a rock? Just kidding, here’s a quick history lesson for ya. Amazon is the largest internet based retailer in the United States and world. They were founded by Jeff Bezos in 1994, in Seattle, Washington. Originally started as an online bookstore Bezos initially ran his business from his garage. That online bookstore has evolved over the years to become one of the best places to find what you are looking for. They carry practically everything from books, to sex toys, to groceries. Electronics, you name it and you’ll probably find it on Amazon. I should know I work at one of their warehouses. I’ve seen all kinds of stuff come through the building, some I didn’t even know existed!


How does Amazon work?


There are 3 types of sellers on Amazon. There’s Amazon itself, they sell and fulfill (ship) products that they’ve purchased from  manufacturers. You might have rented a text book from them as well. Next you have individual merchants. Merchants sell on Amazon but they fulfill one of two ways by Merchant or by Amazon. Both are pretty self explanatory but this is a primer so….

When a merchant fulfills, they ship the product direct to the customer. Amazon gives merchants whatever the customer pays for shipping.  If shipping is more than anticipated the merchant covers the rest of the cost. When Amazon fulfills, the product itself is still sold by the merchant. The product is shipped direct to the customer from an Amazon Fulfillment Center (warehouse). Fulfilled by Amazon or FBA is my favorite way to sell on Amazon if you didn’t know by now. With all 3 scenarios Amazon collects fees as their cut for facilitating the transaction. And rightly so as they provide the framework to make it super easy to sell to anyone in the world practically.


How do I/you make money?


Exposure! Well technically by selling even if you’re not doing the sales part. Amazon gets traffic every day. I’m sure you agree it’s a great idea to list with them. I like to think of it as a more efficient eBay though more restricting. Anyway reselling is the name of the game at least in the beginning. Unless you have your own brand new product to sell ie Private labeling. Otherwise, you’ll spend your time reselling other people’s stuff. Like I said before you have two options as a merchant FBA or FBM, Fulfilled by Merchant. With FBM you make more money (most of the time) there are less fees involved on the Amazon side. You also don’t have to deal with Amazon’s preparation rules for things you send to their warehouses. With FBA 25-35% give or take a bit, is taken as your cost of doing business. It’s a wide range but it really depends on the product category itself so it seems.


If FBM is cheaper why go the FBA route?


Simplicity! Have you heard of Amazon Prime? If you’re a member or know a member you know that almost anything sold by Amazon is eligible for FREE 2 day shipping. The shipping offer extends to FBA products as well but not FBM. Frequently this is the deciding factor for purchases on Amazon. People literally pay a little bit more to have their products right away! As opposed to paying less and waiting 3-5 business days or MORE. Thus Prime eligible products sell faster. What if you get a sale at 10am and you’re stuck at work until 5pm? With FBM your shipment is delayed at least a day more if you can’t drop of until your next morning off. With FBA Amazon’s warehouses run 24/7 360+ days of the year so your shipment goes out right away. That’s key because you don’t get paid until the product is shipped. If your shipment is delayed that gives your customer time to cancel. Can you say buyer’s remorse? Best part is Amazon is pretty good at covering you insurance wise.  If a package is ever lost they well investigate at no additional cost and reimburse your losses. One warning they are ruthless when it comes to misrepresentation. That means don’t try to pass off something as a better condition than it really is. Negative feedback can and will get you shut down quick!


How do I get started?


I thought you’d never ask! Wait you say you’ve been asking that the whole time? Sorry I was so excited to tell you this part that I had to tee it up nice.


Getting started is fairly simple! However there’s a lot more to it than just signing up for a seller account. Certainly more than I could fit in a 1000 word blog post….


That’s why I put together a crash course to get you up and running fast! How fast? 5-days fast! I’m sure you’re thinking “great, how much?” Well with the value I’ve packed into this email course I’m SURE I could get $97 a pop for it. But I love ya so it’s totally FREE all you gotta do is enter your name and email in the form below and I send it to you one step at a time over 4 days.


In it you’ll learn the steps we took to go from $0 to $1500 in less than 60 days:

  1. How to get setup
  2. How to Feed the Beast
  3. The shipping process
  4. Tips and tricks plus how to go PRO!

All that and it’s totally FREE. That is as an exclusive subscriber to The Social Introvert Dad. If you’re already a subscriber perfect you’re all set up just click the link in your FBA primer email to get started. If you’re a new subscriber or missed the email entering your info below gets you on the list. My people handle the rest!

I hope you have a better understanding of FBA and start killing it in the near future. Let me know if this post was helpful or if you have any questions in the comments below. Happy selling!

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