Amazon Resell Business Guide: Steps for Success in 2023

When people found out they could make money buying and reselling products on Amazon, the market was flooded with sellers.

Though the competition is high, the Amazon Resell business is far from a dead dream. 

We’ll cover what you need to know to get started reselling on Amazon’s marketplace!

Introduction to Reselling on Amazon

Reselling on Amazon is the process of buying and reselling products for a profit. If done right, it can be a lucrative e-business.

Becoming an Amazon Reseller

Amazon resellers are individuals who sell products on Amazon’s marketplace. They source products from suppliers or create their own brands. As an Amazon reseller, you can take advantage of the customer base, fulfillment services, and inventory and order management tools provided by Amazon.

However, it is important to adhere to Amazon’s policies and standards while also facing competition, from sellers. Additionally investing in marketing strategies and providing customer service are aspects of being a successful Amazon reseller.

How to become an Amazon reseller

To start your journey as an Amazon reseller, you need to: 

  1. Do market research and choose what to sell.
  2. Become an official seller on Amazon.
  3. Find suppliers for your products.
  4. List and market your products.

Legal considerations and requirements

Luckily, you don’t need to be a registered business or have a seller’s permit to resell products on Amazon. 

However, once you begin making a profit, you will need to register a DBA and obtain a Sale Tax ID and a Federal Tax ID.

There are also some restrictions on reselling brands. Before you can resell branded products, you must get permission from the company.

Advantages of Brand Reselling

Amazon Resell

Brands as direct-to-consumer resellers have pricing flexibility.

When you sell brands directly to customers, you have the ability to change prices, promotions, and other sales tactics.

Ability to cut retail prices while remaining profitable.

Sellers also have the advantage of eliminating the middleman, or retailer, from sales when they sell directly to consumers. This cuts retail prices while still ensuring a profit for the reseller.

Exclusive sourcing relationships offer advantages.

When you guarantee business to suppliers, you often open yourself up to better pricing opportunities and higher-quality goods to resell.

Challenges in Reselling on Amazon

Reselling on Amazon can be a profitable business, but it also comes with some challenges. Some of the common issues that resellers face are:

The competitive nature of the Amazon marketplace

Amazon US has over 1 million active sellers, so the competition is fierce in this online marketplace. 

To get in front of other sellers, you’ll have to do some serious product research and marketing.

Pressure on prices due to the Buy Box algorithm

Because multiple sellers offer the same product, customers are given the option to price check and find a lower price on the same listing. 

This pressures sellers into lowering their prices in order to get ahead of the competition and “win the buy box.”

The need for accurate cost considerations

Amazon charges various fees to resellers, such as referral fees, fulfillment fees, storage fees, and closing fees. These fees can eat into the profit margin of resellers, especially if they sell low-priced items or have slow inventory turnover.

It can be difficult to make a profit if you don’t factor in supplier costs, shipping costs, and other expenses that impact your bottom line.

Rules and regulations

Amazon has strict policies and guidelines for resellers, such as product quality standards, seller performance metrics, and intellectual property rights. Resellers need to comply with these rules and regulations, or they risk getting their accounts suspended or banned.

Customer reviews

Customer feedback plays a role for resellers since it directly impacts their visibility and reputation on Amazon. Resellers must prioritize delivering top notch products and services to their customers promptly addressing any concerns or complaints, with professionalism.

Key Steps to Reselling Success

You need to follow some key steps to achieve reselling success. Here are some of them:

Identifying Profitable Products: Understanding how to find products with potential profit

You can use tools like Google Trends, Amazon Best Sellers, or eBay Sold Listings to research what products are popular and profitable. The most profitable products can be found in the following categories:

  • Beauty and personal care.
  • Clothing.
  • Electronics.
  • Sports.
  • Books.

Find what’s trending in these categories and go from there.

Using Tools for Product Research: Introduction to tools like AMZScout for research

Tools like AMZScout use Amazon’s database to find profitable products within your niche. AMZScout is an additional expense and costs $16.49/month. 

Analyzing Product Demand and Competition: Exploring strategies for analyzing market demand and competition

Strategies such as visiting the “Best Sellers” page on Amazon can help you to analyze the market and see which products are in demand.

Calculating Profit Margins: Explanation of calculating profits considering Amazon fees, shipping, etc.

A good profit margin is between 15%-25%. You can calculate profits by subtracting your seller and product costs from your total revenue.

Promote your listing on various channels that reach your target audience

You have the option to utilize media platforms such as Facebook, Instagram or Pinterest in order to generate advertisements or posts that direct traffic towards your listing. It is also advisable to employ SEO strategies so as to enhance the visibility of your listing on search engines, like Google or Bing.

Provide excellent customer service that builds trust and loyalty

You should respond to inquiries and complaints promptly and professionally. You should also ship your orders quickly and securely. You can use tools like Shopify, WooCommerce, or BigCommerce to manage your orders and inventory.

Reselling Process on Amazon

Registering as an Amazon Seller: Steps to create an Amazon seller account

  1. Go to https://sell.amazon.com
  2. Click “Pricing.”
  3. Select an individual or professional seller account.
  4. Create a New Account with your email.
  5. Choose business location and type.
  6. Input your personal and billing information.

Finding Suppliers: Exploring options for finding wholesalers, manufacturers, and retail opportunities

TIP: Source your products from reliable suppliers that offer quality, authenticity, and good prices. You can use platforms like Alibaba, AliExpress, or Wholesale Central to find wholesale suppliers or drop shippers.

Listing Your Products: Step-by-step guide to listing products on Amazon

  1. Login to your seller account.
  2. Choose “Add a Product.”
  3. Add the product to a category and sub-categories.
  4. Use “Advanced View” to add your product details.

TIP: You can use tools like Canva, Photoshop, or Lumen5 to create attractive images and videos. You should also write a clear and persuasive description that answers the common questions and objections of your potential buyers.

Winning the Buy Box: Tips for winning the coveted Buy Box on Amazon

  • Use FBA (Fulfilled By Amazon) to pack and ship your products.
  • Set competitive prices that still bring in a profit.
  • Offer fast shipping and tracking information.
  • Have top-notch customer service (you need positive reviews!).
  • Always have stock to meet demand where other sellers can’t.

FAQs

Is it legal to resell on Amazon?

It’s legal to resell products on Amazon as long as you have the brand’s permission to be a third-party seller.

Can you make money with Amazon reselling?

You can make money with Amazon reselling by finding high-converting products and using proven marketing tactics.

How to resell items on Amazon for free?

You can start reselling on Amazon for free with the Individual Plan. You will only have to pay $0.99 per product once you start selling.

Conclusion

An Amazon resell business can be profitable with the right products and marketing strategies. By sourcing products from suppliers, crafting product listings and delivering exceptional customer service, you can establish a devoted customer community and generate steady income. 

Engaging in Amazon reselling is not a get-rich-quick-scheme; rather it represents an fulfilling avenue for earning money online. By doing market research and utilizing Amazon’s tools to boost your visibility, you can create a rewarding side hustle.

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