Selling on Amazon has quickly become popular among business minded people. However, these people usually come to find the process of building a successful business inside Amazon a challenge. Aside from our expert help here at Five Star Commerce, here are 4 situations that you want to be in before you start selling on Amazon. The reason for this article is to dispel some of the myths that are sometimes projected online and to help provide some guidance, specifically for individuals who are considering starting an “Amazon business.”
- You’re an existing product brand that already sells your product line on other channels.
If businesses are already successfully selling their products on their own website or through other channels, it can be quite easy to replicate their business into Amazon. In most cases, your customers are probably already looking for your products on Amazon but not finding them. Getting at least a minimal amount of presence is going to be a good idea. With that being said, businesses that are present on other channels, but are struggling to sell, will not magically sell once on Amazon. Sometimes a business’s products sell very well through certain channels but aren’t necessarily a great fit for Amazon. Amazon cannot turn unwanted and unsold products into desirable and popular products.
- You’ve partnered with an existing brand.
Similar to the situation above, success on Amazon can happen when you partner with an existing brand. It is preferred, however, that the brand is well known. In this situation where you are the brands exclusive Amazon seller for their products, you can expect to find success. This isn’t something a typical individual can do. You’re going to need to have some kind of relationship with the brand, preferably an existing track record selling on Amazon, and a selling account with a lot of history and feedback.
- You’ve invented or created a new innovative product that a particular segment of people love or need above and beyond what is already available.
If you aren’t already an existing company, it’s not going to make sense to sell random products that already exist. You need to actually develop something new and innovative that a certain customer segment really loves. Preferably this could be something patentable so you have some kind of intellectual property that prevents others from copying you. Usually this also means you need to really know a certain customer segment really well and have a great solution that fixes a problem. This is not something unique to Amazon, anyone will tell you the same thing. You need to actually come up with something new, different, and better. This isn’t something an average person can or should do though.
- You’re famous or you can have famous people endorse your product.
If you’re a famous person, Youtuber, influencer, or something like that. There’s all kinds of ways you can leverage that to promote your products. That’s going to be a great competitive advantage that you can use to help a new product business be successful. If you can get famous people to endorse your product (athletes endorsing a sporting goods product, Youtubers promoting a product that appeals to their audience), that can also be enough to give you an edge. However, your product needs to be something these people are really excited about. It helps if you’re friends with the right people or your product is just so good that these people want to endorse it. This isn’t something you can do if you’re just buying a product, sticking your brand name on it, and trying to sell it.
Before you start selling on Amazon, it is important to ask yourself if you are in any of the 4 situations listed above. If the answer is yes, then yes, selling on Amazon is probably going to be something that will make sense for you. If not, then don’t do it. It’s ok, not everyone needs to own a business. There’s no reason to go out and risk your savings to start a business when there’s not really a pressing need for it.
Here’s some questions that people have sometimes asked us.
“Why do I see so many people on social media saying that ordinary people can quit their jobs and make money on the side?”
- Most of the people promoting this on social media are selling some type of informational course. They make money by helping people sell their courses, and do not care whether or not the course helps sellers become successful. Many of their customers go through the process to get started, spend their life savings on inventory, and then contact us when they realize that their product is not selling. However, by then it’s already too late because ultimately the business model never made sense in the first place.
- Some of the strategies used to be effective. However, things were a lot less competitive 10 years ago, 15 years ago, and even 5 years ago. However, we’re telling you that a very small majority of people who start, without being in one of the situations above, will make any money if they try to sell on Amazon. In fact, most will likely lose money. There’s many better ways to use, save, or invest your money.
- Think about it for a second. Do you want to buy a product from an individual who is trying to make “passive income” or do you want to buy products from a real company?
“Can Five Star Commerce help me come up with ideas of what to sell?”
No, we don’t do that, for several reasons.
- We work with hundreds of product brands. It wouldn’t be fair to you, or to our other clients to be giving out ideas of products to sell. We might have information based on our experience with one client and it wouldn’t be fair to share that with another. It also wouldn’t be fair if we offered this service but then purposefully left out ideas because our other clients were using them.
- You should never outsource the actual idea of our business to someone else. You need to actually come up with something new and original yourself. You need to leverage your special set of experiences and knowledge to create something that you can do better than anyone else. If you don’t have anything, don’t start a business, instead work for an existing business.
- The product or business idea has to match the person. One product actually might be a good fit for one person or business but a bad fit for another. In most cases, the people who ask us to come up with ideas for them lack the experience, interest, or time necessary to actually make that into a success.
This may not be exactly what one is wanting to hear. We wouldn’t even really write an article about it if we didn’t get these questions several times every week. Too many times we have seen people lose their savings because someone sold them on the idea that they could start a successful online business, even though they didn’t have any experience, any new innovative ideas, or really anything of particular value to offer customers. We hope this can help clear things up a bit. Don’t worry though, there’s no need for everyone to have a business. There’s a reason why most people work for an existing company and then grow their wealth by investing their money (typically in the stock market). That is usually the smartest move and there’s nothing wrong with that.