June 12, 2019

Making Money with Amazon: 5 Facts You Need to Know

Amazon has produced thousands of millionaires over the last five years or so in particular, but the lure of earning big has also made the retail platform an extremely competitive one as well. In case you want to start a new business on Amazon in 2024, the following tips might be quite helpful in making your venture a success.

Making Money with Amazon: 5 Facts You Need to Know: eAskme
Making Money with Amazon: 5 Facts You Need to Know: eAskme

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Seed Funding

The reason why seed funding is named as such is that the funds invested act similar to how plant seeds do.

It’s the seed money, out of which you will grow a new entrepreneurial business on Amazon.

The money will be used to buy products in wholesale, pay office rent and build an inventory for your Amazon store.

Depending on how large your seed money needs to be, it can come from your friends, relatives, and parents, or you may need to go to the bank.

As Amazon stores do not require the upfront investment costs of a traditional brick-and-mortar business, the seed money required is usually not that threatening an amount!

Compare Your Wholesale Quotes

Since your brand is probably not a name that any wholesaler is aware of yet, you cannot expect them to give you special rates right away.

Nevertheless, you should still compare the quotes from more than just one wholesaler to see who has the best one, under the circumstances.

Service and reliability are also a factor to be considered here, so don’t just go with the cheapest one, but consider the reputation of the wholesaler in the market as well.

It works best if you go to a wholesaler through an established connection, but that isn’t a requirement by any means.

Invest Time in Understanding Amazon PPC

It is almost certain that whatever it is that you are selling is also being sold by a whole range of other businesses on Amazon, and some of them will be better established already than your new business is at the moment.

To build brand value and reach your target audience, an article published on Search Scientists is a must read for Amazon sellers.

It teaches you how to manage your Amazon PPC campaigns with brilliant results over a period of just six months.

The information will help you get significantly more ROI than is normally expected from the average Amazon PPC campaigns.

The Profit Margin: What is Ideal?

It will take some time for you to break even, of course, but that has nothing to do with the profit percentage on every sale.

Ideally, a 30% profit margin is possible on Amazon and that is what you should be aiming at.

Without at least a 25% - 30-% profit margin, it would prove to be quite difficult to pay all the dues, earn a living and reinvest into the business.

What Should You Sell?

Finally, we come to the most difficult question to answer because if every business knew what to sell, no one could possibly fail, which is by definition a paradox that cannot happen in the real world.

Although it would be impossible to suggest exactly what you should be selling, always consider the following factors before launching your first or your next Amazon store.
  • Check the top-selling items on Amazon first and they will give you detailed data and suggestions regarding it
  • See which products you can relate to the most in terms of experience, interest, knowledge, and understanding
  • Check the estimated profit margins on the top-selling products before choosing
  • Finding a product range which is slightly lower down the top selling chart will reduce competition
Always start small and with limited stock to see how well you are received.

Be prepared to change anything from the wholesaler you are buying from, to the very products you are selling on Amazon.

Adaptability is always important in any business anywhere, so it’s true in case of opening an Amazon store as well.

Other helpful Amazon guides for you;