How Not To Fail With Amazon FBA From The Start

How To Make Money With Amazon (Part 5) – Private Label Products

This is a part of “How To Make Money With Amazon” series.
It is for everyone who is serious about making money online.
We focus on the quickest and the least risky strategies with a minimum starting budget as possible. You will gain the knowledge that you can put into practice right now, for the money to start working for you instead you working for the money.
The series consists of 6 parts:
Part 1 – Introduction To Amazon FBA
Part 2 – Amazon FBA Retail Arbitrage
Part 3 – Amazon FBA Online Arbitrage
Part 4 – Amazon FBA Wholesale
Part 5 – Amazon FBA Private Label Products
Part 6 – Amazon FBA Seller Evolution
If you haven’t read previous parts, please go over them, so you will get the most out of this one.

Private Label Products With Amazon FBA

How Not To Fail With Amazon FBA From The Start

Amazon FBA Seller Evolution - Private Label Products
Private label products are the products that you manufacture and sell under your own brand. Most of those products are sourced from China.
Most of the videos that you find on YouTube refer to this as Amazon FBA (Fulfillment by Amazon).
Unfortunately, this is not true. Private label is just a way of sourcing products and there is nothing about Amazon in this process.

FBA is a program, introduced by Amazon that allows sellers to outsource the most painful tasks to them. With FBA Amazon will store and ship your products to customers, it will handle payments and returns, and most importantly it will provide customer service for your buyers too.

Here is how the sourcing of private label products process works with Amazon FBA:

  1. Product research to find potential winners
    1. Find a product
    2. Analyze competition
    3. Find a way to improve the product
    4. Make sure it is not patented
  2. Sourcing the product
    1. Find a supplier
    2. Design logo and packaging
    3. Packaging often has to be ordered from a different supplier
    4. Order samples
    5. Negotiate order quantity and price
    6. Place an order
  3. Delivery
    1. Work with freight forwarders to deliver the order through customs
    2. Work with preparation centers that will prepare products and will send them to Amazon
  4. Create a listing
    1. Get professional photos done
    2. Create optimized listing
  5. Launch/Sell
    1. Run discounts to get sales and reviews
    2. Run Amazon PPC Ads to the product

You will need to invest at least $3000-$5000 in it and it will take 1-2 months to get your product delivered. You can always combine it with other methods that will bring quicker results, which I will cover later in this report.

You can see how big the learning curve is here.

Here is a List of the Pros & Cons of Private Label Amazon FBA


Pros

  • The most profitable model. IF you can find right products
  • Predictable supply. Easy to replenish inventory
  • Scalable
  • Can be done from anywhere

Cons

  • High competition
  • Need bigger budget to start ($3000-$5000 just for one product)
  • Product can flop, so will need to start again
  • Risk of breaching patents and trademarks law
  • Big learning curve
    • Finding products
    • Dealing with manufacturers (e.g. China, India, local)
    • Dealing with freight forwarders and prep centres
    • Creating proper images (expensive)
    • Creating and optimizing listing
    • Running Amazon PPC ads

Summary

  • High ROI
  • Predictable products supply
  • Scalable
  • High investment
  • Big learning curve
  • Legal risks (patents and trademarks)

There are so many moving parts in the process of sourcing private label products and selling them with Amazon FBA, which comes with a huge risk involved in it.
I personally would not start with such a complex model.
I have seen many beginners stopping in the middle of it without achieving anything due to the complexity of it.

But if all of the steps are done right, then you can get great results with it.

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