amazon fba vs amazon dropshipping
Published on: February 9 2023 by pipiads
Table of Contents About amazon fba vs amazon dropshipping
- Dropshipping VS. Amazon FBA | Which One Is Better? | Amazon FBA Tips
- Dropshipping vs Amazon FBA - Was ist besser? | 2022
- Amazon FBA vs Shopify Dropshipping in 2022 - Which One Is Better For You?
- Amazon FBA vs Dropshipping - Which One Is Better?
- How is Selling on Amazon 2022? Amazon FBA VS Amazon Dropshipping
- Why I quit Amazon FBA After 30 Days - Retail Arbitrage
Dropshipping VS. Amazon FBA | Which One Is Better? | Amazon FBA Tips
if you want to know why Amazon FBA is so much better than Drop Shipping, keep watching what is up. you guys. welcome back to a new video, and today we are going to tok about why Amazon FBA is so much better than Drop Shipping. what makes them different? what makes them the same? because I get so many comments on my videos of people saying, well, isn't this the same thing as Drop Shipping? and Drop Shipping is dead and this is a scam and don't go for it. so I am here to tell you that they are not the same thing. so let's tok about what makes them different. alright, so if you are new here, first let's discuss what Amazon FBA is. so Amazon FBA stands for fulfillment by Amazon, which basically means that you purchase products from Alibaba or from any manufacturer- it doesn't actually have to be Alibaba- and you are basically making the product better than it already is. you're tweaking it, you're making a difference, you are putting your branding on it. so the great thing is you're not Reinventing the wheel. you're buying an already made product and you're putting your branding on it. then you're sending it off straight to the Amazon warehouse for for you to sell on Amazoncom or amazonca or Amazon UK or whatever country you're in. so this is what Amazon FBA is, and whenever you see products that have the Prime logo on them, that means these products are being sold through the Amazon FBA program. now, Drop Shipping, on the other hand, means that you are finding a manufacturer again, whether it's in China or in the US or whatever country you're in, you can find a manufacturer in and you are finding a product that they have that you really like and you want to sell. you are not going to put your branding on this product, because what's going to happen is you will create a website, usually on Shopify. you're going to list this product on your website and then run Facebook ads to drive traffic to your website, and when people purchase this product, your supplier will then ship each order in plain packaging, because they're not going to print out your branding just yet when they're shipping order by order. so they're going to ship, fit in plain packaging and they ship. it usually takes around two weeks to get to the customer. all right now. this is the overview of Amazon FBA and Drop Shipping. now let's get into why I think Amazon FBA is way better. alright, so I have seen countless videos on Drop Shipping, to be honest of you know very, very young entrepreneurs making millions and millions of dollars off of this business module, but for me it just doesn't make sense. because- number one: I don't think customers have the patience anymore to wait two weeks to get their order- especially for me as a customer- and I always put myself in the customers shoes and try to see how the customer is going to think- and I don't think I would want to wait two weeks to get my product. and this is a huge hurdle when it comes to drop shipping, because the whole idea of Drop Shipping is that you are shipping from your manufacturer and usually those are in China, so they don't have the same day or next day delivery options. now my second problem with Drop Shipping is that, to be be honest, now it has terrible reputation. it's actually very hard to trust independent websites these days. they have to have a really good brand going, they have to have a lot of reviews. it's very hard for me to just go on a completely new Brand's website on Shopify and purchase off of them without having to think and have a million questions about this brand. so usually questions that I would have is: what is the refund policy? how long is the shipping gonna take? I mean, are they even going to ship my product or are they just gonna take my money and not ship me anything? so these are all questions that come up on every consumer's mind when they come to a new and independent website. now, another problem with Drop Shipping- because usually this business module doesn't require a lot of effort on your side- is that you're usually not using your own images or using your own content to promote it. and for me, if I am seeing repeated images on different independent websites of the same product, then I won't really know what the product looks like and what the quality is like, which is a huge problem. so let's say, for example, you find a product like these hair ties over here and you decide that you want to sell them on your own independent website. your process is going to look like this: first you're going to go on alibabacom and you're gonna find a manufacturer or a supplier that has this product. then you're gonna tell them: hey, I want to drop ship this product. are you able to ship it unit by unit? I don't want to purchase inventory, I want you to ship it unit by unit, and if they agree, then you're going to create your own website and you're going to take the images that are from the supplier and you're going to put it on your own website. now, keep in mind that these products, there's usually hundreds of Sellers and hundreds of websites that are selling the same product and that have the same exact images. and then you're going to take videos from your supplier and you're going to push these videos through Facebook ads. now, obviously, Facebook does not like Drop Shipping advertisements because it's usually not your own footage, so you might get flagged and you might might get that ad account taken down. so, to be honest, it's just a very messy process. and then for somebody to then purchase these hair ties from you, they're going to have to wait two weeks until they get the product and if they don't like the quality, then they will return it, which is a huge loss for you. so, on the other hand, when you list something like this on Amazon FBA, this is what the process looks like. so listing this on Amazon FBA means that you're gonna do the same thing, where you're gonna go on Alibaba and try to find a supplier, but now, instead of asking the supplier to ship each individual unit, you're gonna purchase bulk inventory, let's say 300 units. now I actually looked this product up and I believe you can get hair ties like this for around one cent a hair tie. so if this is 70- I believe, heritized, then it's going to cost you 70 cents for this entire bundle. so let's say you purchase a bundle of 70 hair ties each and you purchase 300 bundles for 70 cents, then you're going to then tell them: I want my branding on it. so, as you can see, these hair ties over here have a brand called goody. so you're going to maybe send them a picture of this and say: I want the same thing, but I want my branding on it. let's say my brand is on the trend. you're going to tell them to put own the trend right here. let's say your branding colors are gold and black. you then you're gonna ask them to do this whole packaging in gold and black. that way, your product is now branded towards your branding and your guidelines. now this product is ready to ship. what they're going to do is then put it in a box or put it in a poly bag or however you choose to ship it. and keep in mind you need to keep your shipping cost very minimal because you're shipping bulk of this inventory to the us, so you want to keep your cost very low. so let's say you put this in a nice black poly bag or a nice gold poly bag and then you're going to send it straight to the Amazon warehouse. once it gets to the Amazon warehouse, it will then be available on Amazon after you create your listing, of course, through Amazon Prime. so now you're going to have an actual sample of the product for you to take pictures and take real videos of, so people can see the actual, real product. when you run Facebook ads with these videos, people are then going to be redirected to Amazon and what happens is when they're redirected to the Amazon website and they see: wow, this product is a really affordable price, it's available on Amazon Prime, which means I'm going to get it the next day. I already have my payment information saved on amazoncom and I'm protected by their 30-day refund policy. it is literally a no-brainer and
Dropshipping vs Amazon FBA - Was ist besser? | 2022
amazon, fps oder dropshipping, zwei super bekannte geschäftsmodelle. die einen schwören darauf, dropshipping ist der heilige gral. du musst dropshipping anfangen, wenn du ein eigenes business starten willst, wenn du schnell viel geld verdienen willst. die anderen sagen: hör mir, auch mit dropshipping, das ist alles nur scam. kein mensch glaubt produkte aus asien. ihr müsst amazon espey machen, ja, und dann sagen: die drop shock, weil wir ja, aber du brauchst du viel kapital für andere zb, und das ist ein viel höheres risiko, und es gibt zu viel konkurrenz. und dann sagen die wieder: ja, aber du musst teure werbung bezahlen, und so weiter und so fort. das heißt, es ist ein ewiger clinch. in diesem video werde ich dir ganz genau erklären, was die vorteile der beiden geschäftsmodelle sind, für wen das richtige geschäftsmodell. dropshipping ist für jeden das richtige geschäftsmodell, aber zb ist- ich habe heute nicht nur meine persönlichen erfahrungen, meinungen mitgebracht, sondern auch zahlen, also ganz klare zahlen, an dem du einfach auch mal die chancen abwerten kann- es zwischen den beiden, denn da gibt es eine riesengroße überraschung, die ich selbst so nicht erwartet habe, und genau darüber werden in diesem video sprechen, bevor wir los gehen. bevor wir loslegen, kurz zu mir: mein name ist das spiel. ja, ich mache hier auf youtube seit über drei jahren videos zum thema onlinehandel. ich habe selbst vor über fünf jahren angefangen und dann nämlich selbstständig gemacht- neben dem hauptberuf- damals hat bei mercedes gearbeitet- habe gestartet, viele sachen falsch gemacht- ja so. nicht so diese heroes story, sofort durch die decke gegangen, sondern erst mal viele sachen auch falsch gemacht, aber ist geschafft, wirklich finanziell unabhängig und frei damit zu werden. und ja, teile meine erfahrung. ich habe einblick in über 1300 produkte, die ich selbst oder gemeinsam mit meinen teilnehmern und kunden auf den markt gebracht habe. das heißt, ich habe auch super viele daten, die sonst so eigentlich fast niemand sieht, und davon werde ich heute auch viel berichten, damit du einfach eine bessere entscheidungen treffen kannst und ich auf keinen fall eben für das falsche geschäftsmodell entscheidest. denn das ist mir ganz wichtig, am anfang zu sagen: ich kenne leute, die mit dropshipping sehr viel geld verdienen. ich kenne leute, die mir damals dfb sehr viel geld verdienen. beide geschäftsmodelle können funktionieren, und in der beiden geschäftsmodellen steckt eine vollkommen andere strategie und herangehensweise, und das ist eigentlich das, was du verstehen muss, um dann zu wählen, welches für dich sinnvoll- als wenn es kann sein, das dropshipping für dich die beste wahl ist und damit viel, viel, viel schneller und viel mehr folge haben wirst, als dass jemand aber zb hättest, und andersrum ganz genauso. also starten wir mit dem thema nummer eins, und das ist immer eine große frage, wo man sich selbstständig macht, und zwar: wie viel geld brauche ich, um das business zu starten, und auf der einen seite, und wie aufwändig ist das? also, was muss ich alles lernen? also, wie komplex ist jetzt endlich so ein business? ja, weil ich sag jetzt mal grundsätzlich: wenn jetzt jemand um die ecke kommt und sagt: hey, man kann gerade gut geld verdienen mit raketentiknologie, dann wird das für dich relativ irrelevant sein, weil es zu komplex ist. das heißt, das spielt auch eine große rolle. wo finde ich, drüber nachdenken? denn auch das ist ein großer unterschied. schauen wir uns erst einmal thema kosten an. so das klischee in diesem markt ist: wie drop shipping kann ich mit null euro theoretisch staaten, bei amazonde brauche ich ein paar tausend euro, ware einzukaufen. tatsächlich ist es teilweise richtig. fangen wir mit dropshipping an, der job sharing kaufst du ja keine eigenen waren ein, sondern du erstellst einfach einen online-shop, und wenn deutschland mit dem shop eines seiner produkte bestellen, dann wird es nicht bei dir bestellt, sondern diese bestellung wird direkt an den hersteller und lieferanten weitergeleitet. der sendet das produkt dann zum kunden, und du erhältst als provision sozusagen die differenz zwischen verkaufspreis und dem einkaufspreis inklusive versand und so weiter und so fort. so jetzt ist halt wichtig zu sehen: ok, in dieser rechnung bedeutet das ja das jetzt, außer, dass so ein shop bauen musste, vielleicht monatlich irgendwie 30, 40 euro die software kostet, und ich hoffe das, was eigentlich ja gar kein geld investieren muss. das stimmt auch, soweit das problem ist. aber es muss ja einen weg und eine möglichkeit geben, erst mal überhaupt diese verkäufe zu generieren, denn von alleine kommt niemand auf deinen online shop. wenn du jetzt irgendein neues produkt auf marco ist, ganz egal, was du machst, es wird nicht auf einmal zig, tausend leute in deutschland geben, die da über irgendeine facebook gruppe wind von bekommen haben und jetzt allen ein brot kaufen wollen. das heißt, du musst social media werbung schalten. das kann zb facebook sein, das kann auch in fenster marketing sein, kann youtube werbung sein, das kann theoretisch google, wenn man seinen. und zweitens fordert gibt mehrere möglichkeiten, und diese werbung kostet geld. und wenn du jetzt den ablauf siehst, ist muss erst werbung geschaltet werden, bevor ein kunde gewonnen werden kann. das heißt, du musst erst geld investieren, um kunden zu gewinnen. und hier liegt ein riesengroßes missverständnis vor. manche leute denken, ich kann mal 20 euro investieren in solche anzeigen, und dann mache ich ja schon die ersten umsätze, und das ist leider einfach. das kann mal sein, mit glück, ja, aber das ist bei 99 prozent von allen projekten nicht der fall, und ich ärgere mich immer ein bisschen. ruhe, weil es halt so verkauft wird wie das business, mit dem kein startkapital brauchst. du musst sie hat vorstellen oder muss verstehen, wie facebook, werbung oder instagram werden funktioniert, damit du weißt, wie viel geld wirklich brauchst. facebook zum beispiel hat ja ganz viele kundendaten, ja, die haben ihre ganzen nutzer, das sind, glaube ich, schon 40 millionen. und jetzt verkaufst du dein produkt, und letztendlich zeigt facebook hat werbung aus, und facebook kann ja nicht an alle 45 millionen leute deine werbung ausspielen, so viel budget hast du ja nicht, sondern die fang vielleicht an und wollen das erst mal nur 1000 leuten zeigen. und jetzt stell dir vor, an diesem ozean, in dem es sicherlich viele leute gibt, die das produkt interessant finden würden und das will, das kochen würden, ja, schaltet amazon ich, aber erstmal nur auf 1000 leute, weil sie da ein paar mal den das zeigen können, weil die wenigsten leute kaufen, denken produkt, wenn sie das erste mal sehen. wir müssen es mehrmals angezeigt bekommen, und du musst jetzt vorstellen die wahrscheinlichkeit, dass unter diesen 1000 direkt leute sind, jetzt, jetzt, gerade in diesem moment dein produkt kaufen wollen, ist super gering, also wirklich super, super, super geringen. wenn du jetzt denkt: okay, wie viele sind das? von tausend vielleicht fünf oder sechs. es wird in den meisten fällen niemand sein. es wird auch unter den ersten 10.000 den meisten fällen niemand sein, und das verstehen die leute nicht. du musst dir vorstellen, die leute auf facebook so lange unterwegs sind. selbst wenn dein produkt für die interessant ist, ist die wahrscheinlichkeit, dass sie es jetzt direkt bei den kaufen würden, super, super, super, super, super gering, weil die gerade irgendwie katzen videos schauen, gar nicht an das produkt denken, weil die das produkt vielleicht schon haben. offensichtlich teil der zielgruppe sind zum beispiel verkaufs ein hundebett, und target ist auf facebook hundebesitzer. ja, dann sagst ja, gut, dann sind wir schon mal alle irgendwie grundsätzlich interessiert. ja, aber 90, wer hat denn kein ende? die leute haben ja alle schon drin, so. und selbst wenn sie jetzt sagen, ich bin gerade auf der suche nach dem hundebett, selbst wenn sie dann auf dein ding draufklicken, wie hoch ist die wahrscheinlichkeit, dass sie dann deines kaufen und nicht noch woanders im internet andere hundebetten sich anschauen? und das ist super, super, super, super wichtig zu beachten. ich s.
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Amazon FBA vs Shopify Dropshipping in 2022 - Which One Is Better For You?
amazon and shopify are two of the most popular ways to start generating income online, and for most new sellers, choosing between selling products on amazon or shopify is one of the earliest decisions you'll need to make as an online entrepreneur. there are some important differences between both platforms that may make one option better for you, so in this video, i'll be going over the pros and the cons of selling on each amazon and shopify, and what platform i'd recommend for most sellers. for those of you new to the channel, my name is michael and it's my passion to help make starting your first online business as straightforward as possible. so first off, i'll start by doing a quick overview of each platform. then i'll get into the pros and cons of each amazon fba and shopify drop shipping. so first up is amazon fba. using amazon's fulfilled by amazon program, you'll be selling on amazon's website and you'll need to create a listing using amazon's listing format. so this basically means that you'll need to follow all of amazon's listing rules in order to list products for sale. when selling products on amazon, chances are most of your customers will come from the amazon site itself as opposed to from a different website, and when shopping on amazon, products show up based on search terms that customers search, as opposed to needing to place ads on google, instagram, facebook and other platforms to generate awareness. when selling through the fba program, you'll also ship your products to the amazon warehouse before you make any sales and amazon will manage your fulfillment, your shipping and things like returns. for you, this means less work over time, but it also means that you'll need to purchase your inventory up front, which could mean higher startup costs. so, next up, we have shopify drop shipping. when selling on shopify, you have your own website and you're in charge of shipping your own orders. so, generally speaking, you'll have more customization options on shopify and basically that means having more control over what your product page branding and marketing look like. however, since you'll be selling products from your own website on shopify, you can expect to put in more effort to attract customers to your own website versus finding them already ready to purchase on amazon. so while you can save on certain seller fees by operating your own website, you'll need to set up more processes that amazon streamlines for you as part of that seller central program. shopify is also a great way to have more control over all aspects of your business, but this does come at a cost, namely the time and effort it takes to create your own website and to fill your orders, among other things. so now that we have a quick overview of what it means to get started on each platform, let's double click on the pros and cons of each. so first, the pros of selling on amazon. first off, amazon has a larger audience that already trusts amazon's platform. so if you think about it, if you're a brand new customer and you stumble upon a new shopify page, chances are you're going to be a little skeptikal before making your first purchase. second, amazon customers are warmer leads and they're on amazon for a reason: to make a purchase. so, versus just browsing on google or facebook and coming across your shopify ad, amazon customers are, generally speaking, a little bit closer to making their final purchasing decision. third, amazon handles shipping and returns for you. now, this can be a really big benefit for a lot of new sellers, because fulfillment and returns and managing all those processes can be quite time consuming. next, amazon also has very reliable, fast shipping. so if you're aware of the amazon prime program, you'll know that a lot of items are available for one to two day shipping, and this is really helpful in helping push customers to make that purchasing decision, that kind of quicker gratification of fast shipping. next, the potential to scale is quite huge on amazon, especially if you find the right products with enough demand, because amazon has so many customers and because so many people are going to amazon for a lot of their purchases. if you find the right product and put it on amazon and scale it, the chances are you can actually reach a lot of customers quite quickly. and lastly, amazon prime members spend more on average than regular customers. so another thing that people don't think about too often is the buyer psychology behind buying and having a prime membership. so as a prime member you want to make sure that your amazon prime membership is worth it. it's over a hundred dollars per year and the more purchases you make on amazon, the more you get out of that prime membership in the first place. so prime members on amazon will generally spend more than their regular member counterparts. next up we have the pros of shopify drop shipping. the first pro of shopify drop shipping is that there's very low startup cost. so with amazon, what you'd have to do most of the time is purchase all of your inventory up front or a big chunk of it, send it all to the amazon warehouse before you can even start selling your products. but on shopify, especially shopify drop shipping, what you can do is actually receive certain orders and fulfill them once you've received them, and a lot of this will depend on the connections that you have with third parties or manufacturers in order to make that happen. but, generally speaking, the startup costs on shopify are a lot cheaper than on amazon. next, when you're on shopify, you basically own your customer base and all of that customer data and their preferences are yours to analyze. and if you compare that to amazon, where amazon is giving you certain metrics that you can use to help improve your listing, on shopify, because you have total control over your website and what your listing looks like and the ads that you're running, there's a little bit more control and a little bit more creativity that you can add to the process. lastly, a benefit of shopify drop shipping is that seller fees can be a lot lower. so if you think about being on amazon, because you're using their website, you're putting your listing on their website, you're using their warehouse and their fulfillment methods. they can afford to charge you a little bit more for their services because you're creating those processes yourself. on shopify, generally speaking, those fees will be a lot lower. now let's get into the cons of amazon. so the first count of amazon is that you don't really own your customer relationships, so it's harder to contact your customers, tell them about a new product, it's harder to understand specifically why someone did not choose to purchase your product and you're kind of using the tools that amazon gives you in order to help make your product as good as possible. second, amazon can change their fees at any time, meaning big changes can impact your profitability. so let's just say that the seller fees increase tomorrow and suddenly your profits decrease. those are things that can actually happen on amazon. so just being completely up to date with amazon's terms of service is going to help you a lot in terms of planning your business and understanding how much profit you're actually generating over time. so let's get into the cons of shopify. so shopify, generally speaking, you're going to be working with a pretty cold audience, so the leads aren't quite as warm, meaning that people aren't as ready or willing to purchase as they are on amazon. also, on shopify, especially when drop shipping, you could experience longer shipping times. so because with drop shipping. you're making these connections and partnerships with people overseas and manufacturers. you can ultimately fulfill your order because a lot of these partners are overseas or farther from your customer. sometimes that shipping period can be a little bit longer and some customers can be a little annoyed by that. also, on shopify, targeting customers is a little bit more difficult, meaning that you'll.
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Amazon FBA vs Dropshipping - Which One Is Better?
hi there, my name is ariana and i'm a full-time amazon seller. today, i'm gonna go over the pros and cons of both amazon and drop shipping. as an amazon seller, i'm a little partial to creating your own unique product to sell on amazon. however, there are massive pros and cons to both amazon and drop shipping, so i want to go over that for you guys so that you can make a decision that works best for you. in the ecommerce space, there are typically four business models that you can follow. one is retail arbitrage. this is where you buy items on sale and then flip it on amazon for a profit. the second model is wholesale, and this is where you go directly to a wholesaler, buy a product at wholesale price and then sell it on amazon for full price. the third model is private label. this is where you find and buy a product that already sells on amazon, but maybe you want to change it a little bit, make it better, and then put your own private label on an already existing product. and the fourth model is to create your own product, and this is what i did for my product: vino carts. this is where you create a unique product that does not yet exist, or a product that you can improve and make better to sell on amazon. each model has its advantages and it can also fulfill that passive income lifestyle. but i'm sure you've come across some e-commerce youtubers that tok about drop shipping. so let's dive into what drop shipping is and compare it to amazon fba. drop shipping is where you have a storefront, either on shopify or another website, and a customer will go to that website, buy your product, and that product will link to a manufacturer where they have that product in china, and it's usually from aliexpress. that supplier will ship out that order as soon as a customer makes that purchase on the website and there's a software that will link the two. so that process is really seamless for the customer and the supplier. now there are a couple of cons with this type of setup, the first being the shipping time. so a customer will likely have to wait about two weeks to even receive the product and, as you know, customers can grow impatient with that kind of time frame, and especially because we're so used to getting quick shipping, especially with amazon fba. the second con is that there's a lot of advertisement needed in order to push your storefront, so you might have to get influencers in order to push your product forward, or you'll have to run ads on both facebook and instagram. the cost for advertisement can get pretty high and overall you'll need to kind of convince the customers to go to a site that they might likely have never heard of. usually, customers tend to prefer sites that they do know of, that are well-known brands or with amazon, where, if they know, they get free shipping and easy returns. however, there are some pros to drop shipping, the first being that you don't need to buy product, since your product is going to be linked to a manufacturer in china. they're going to be able to fulfill the orders that come in, so you don't need to handle any of the actual physical product. the second pro is that you'll, of course, save in storage. since the inventory is in china, you don't have to have a physical product at hand. the supplier will take care of that inventory for you, so that you don't have to pay for extra storage in your home or if you want to rent out a storage unit or whatever it is. also, with amazon fba, you have to pay for storage fees when you send in inventory to their warehouses. so you'll be able to save with these costs. now let's dive into the pros and cons for amazon. amazon fba is where amazon enables third-party sellers to sell new and used products on a fixed price online marketplace alongside amazon's regular offerings. the first pro for amazon is that amazon fba handles the pick and pack. with fba, you'll buy your product, send it into the amazon warehouse and when you get an order, amazon handles all of the orders for you. so they'll handle all of the shipping for your product, any returns that the customers may have and they'll pack your orders as well. so it's all taken care of for you. you don't need to do anything on your own. the second pro is that you can have your own brand on amazon, and this is important because if you're able to brand your product, you'll have more ability to add descriptions and images to your listing, making it really appealing to customers. i branded my product vino cards on amazon and it allowed me to add more description and images and become amazon's choice in my product category. the third pro is that amazon has billions of visitors per month, so this is a lot of eyes on your product, a lot of product visibility, which helps you increase your sales. amazon is seeing upwards to 2.5 billion views per month, so, again, that's a lot of visibility for your product and hopefully helps increase your sales. amazon also accounts for 41 of the total e-commerce market in the us, so that's a huge leadership for them and one of the number one marketplaces for online shopping. now let's explore some of the cons for amazon fba, the first being that you have to have bulk inventory ready. one of the biggest things to note with amazon is that running out of inventory is a big no for your listing. amazon tends to really not favor the listings that are running out of inventory, that are constantly having to replenish um really quickly, and if a customer isn't able to get your product, then you know usually, that customer either leaves the site or goes to a different product, but amazon wants you to stay, so it's really a big deal to always have inventory in amazon warehouses. having a lot of inventory in the amazon warehouses, though, can be very costly, and that leads me into the next con, which is very high selling fees for selling on amazon fba. you have to pay a fee just to be selling on amazon- that's a monthly cost- and then, on top of that, you have to pay for storage, and that usually depends on the size of your product so that price can vary and there's also a few miscellaneous fees that you'll have to take note of. plus, they also take a percentage of your product sales. so i really break down all of these amazon fees for you. i'll link a video up above for you guys to check out so that you can really see how much amazon is taking from you each month. however, they do take care of everything, so they're also providing a service for you where it's really hands-off and, like i mentioned earlier, they take care of all of the shipping and the customer returns and packing all of your orders. so it's a really so it really depends on how you want to spend your time and money. they do take care of a lot, so it's up to you to make the decision on whether you want to spend that cost or not. overall, i believe amazon fba to be the best option in terms of stability, consistency and growth. if you're looking for a long-term business strategy, then i would suggest going with amazon fba. if you're looking for a low-cost option and just testing out the e-commerce market, then drop shipping is a good option for you. whether you're a beginner or not, both amazon and drop shipping have their advantages, but my expertise lies with amazon fba and i break down my yearly earnings and costs with my amazon fba product, vino cards, on this video here, and by clicking the video here, you'll also learn some of my biggest amazon fba mistakes. so click the video here and i will catch you in that one.
How is Selling on Amazon 2022? Amazon FBA VS Amazon Dropshipping
In this video, we are going to tok about selling on Amazon in 2022, comparing two popular fulfillment options: Amazon FBA and Amazon Dropshipping. If you are planning on using Amazon to make some passive income or expand your eCommerce businesses, then I hope this video could help you a little bit to see which fulfillment model is right for you. Hey guys, welcome and welcome back to our channel. before getting started, I’d like to say a big thank you for giving us the thumb ups and following us on youtube. now let’s just jump into today’s first topic. When it comes to selling on Amazon, one of the most significant benefits is how massive global market Amazon itself could be - up to now, there are 310 million global active users on Amazon. more than 197 million people use Amazon every month, And the US is the largest marketplace, with more than 4,000 items are sold in every minute. On top of that, as the largest online retailer in the world, Amazon got a very developed online selling process & infrastructure set up, making everything easier for sellers to start, and that’s the second benefit that many people opt to choose Amazon to start their businesses. However, along with the non-stopping expansion of Amazon, the competition is getting fiercer now, and that’s true - according to the data from business insider, there are over 3700 sellers join in the game everyday. last year and the number is going up in 2022. Aside from that, affected by pandemic and inflation, the cost of selling on Amazon continues to go up. 5% fuel and inflation surcharge has been added to all amz fba fees since April 28 2022, leaving more pressure on the profit margin. So is Amazon still profitable or not in 2022, especially for small business owners? In terms of the reasearch data, the answer is still yes. Let’s take a look at the numbers directly. There are nearly 2 million third party small and medium-sized businesses on Amazon by 2022 and 76% of smb sellers are profitable. Speaking of sales earning, 22% of them sale over $10,000 monthly on average, and about one-third of amazon sellers earn profit margins above 20%, and 65% (slip of tongue) of sellers got their profit margins higher than 10% in 2022. There’s one thing you need to know: that eCommerce industry continues moving forward, even during recession time, since people still need to purchase what they need and nowadays online shopping is shaping our daily life habit. there will only be more people shop online, Even though it doesn’t mean selling on Amazon is easy like what it used to be years ago. new opportunites and ways of playing the game actually keeps coming up. there are always people who adapt it and leverage everthing they got The first and foremost. it may sound pretty basic, but it's the principle: let customers see enough value that you can bring them And that's the incentive the customers need before they are thinking about purchasing something. To be more specific, there are many doable strategies, like creating add-on offers. along with your product, it maybe some gadgets or digital content or services, which really depends on what are you selling, to make buyers feel they got everything ready without paying twice. Or you can leverage bad products reviews to see what customers are complaining about and that's their pain-point and then optimize your product and better make your stand-out points obvious on detail page. The second thing is that you want to figure out what kind of sellers Amazon prefers and take advantage of their incentives to optimize your listing. Make sure to maximize the support from the platform is important way to help your businesses go further and safer. What's more, you want to choose a selling model that is suitable for your business to avoid unnecessary cost, To be competitive. there are so many processes you may want to improve: lower prodct price, better supplier the shipping warranty, etc. But it’s hard for especially smb owners to take care of everything. But at first we can choose the fulfillment option that’s right for your business. Here I picked up two popular options: Amazon FBA and Amazon Dropshipping. If you want to know about the conclusion, first ask youself what’s your goal of selling on Amazon? What kind of risk is acceptable for you? If you plan a safer selling to grow steadily, Amazon FBA may be your choice. or you are ready to take some risk to launch your business, to test everything as soon as possible without upfront cost, then dropshipping on Amazon is a way to go. Now let’s break these down to see the pros and cons of each of the option. Fulfillment by Amazon is a done for you fulfillment service offered by Amazon. The service includes the complete pick-pack-ship deal - from storing products in the warehouse to packing, labeling and shipping them off to the customer. Even the customer support operations are handled by Amazon. All you have to do is send your items to Amazon’s fulfillment centers. So one of the best part of Amazon FBA is that it’s highly hands-off. you are leaving your inventory and shipping to a trusted one. Amazon takes care of everything, even the customer services, so you are kind of free from these process so you can focus on the marketing. You also tend to see a lower shipping rates. that benefits from amazon’s great fulfillment scale. What’s more, you don’t need to be tik savvy or study about conversion optimization from 0 to 1 to sell on amazon. your listings also got the chance to get access to Amazon Prime users, who are more likely to purchase on the platform. Meanwhile, AMZ FBA sellers tend to have more growth opportunites. you can run paid advertising, create a brand identity through storefronts, Content etc. and get a boost in your traffic - it is believed that amz will boost your listing if you sell with FBA. Speaking of which, the first obvious drawback of Amazon FBA could be the high upfront fee you need to pay first, including order handling, pick & pack, Shipping, storage, and all of these may bring pressure on the profit margin. Except the fees from Amazon, sellers also need to purchase inventory and ship them to the Amazon waresehouse in orde to start selling. Moreover, Amazon puts customer exprereince first. it’s much easier for customer to return the products if they are not satisfied with it. for sellers, the return rates could be higher and you have no choice but eat the cost. On amazon, it is also hard for sellers to build deep relationships with customers, since Amazon holds their information, but not you. Dropshipping is another different type of fullfillment, which focus on demand. Sellers only need to notify the supplier when they got orders, and the supplier then ships the product directly to the Amazon customer on your behalf. If you are wondering if dropshipping is legit on Amazon, the answer is yes. Amazon allows dropshipping on their marketplace as long as you follow their rules, and we have already uploaded an episode about amazon dropshipping policy. you can check all the details here later. So, when it comes to the pros of Amazon dropshipping, it may be one of the easiest ways to start online selling. the barrier of entry is relatvielty lower, and the risk of upfront cost is lower too, since there’s no requirement on huge start up cost. All you need to do is find a reliable suppler, and they will fulfill the orders for you. You don’t need to purchase inventory, or, if you do, you can find suppliers who can even store the inventory for you with no additional cost. In a nutshell, dropshipping is an easy-to-start model for beginners with little experience And, yes, easy sometimes comes along with risk as well. for sellers who choose dropshipping, a reliable supplier is vital, Since you are likely to have less control over on the order processing. you even do not need to see or touch the product. the supplier does all these jobs. Sometimes you can not get the real time update when the stok is running out. b.
Why I quit Amazon FBA After 30 Days - Retail Arbitrage
Let me tell you how I was able to open a successful Amazon FBA store as a 15-year old that generated over $4,000 in revenue in the first 30 days while only using my bike, and let me show you how you can do the same thing. I'm not lying and will break down all of the numbers later, but let me tell you why I think you shouldn't do this. This all started a little more than a month ago. I was watching YouTube and came across a video where a person toked about how they drop-shipped from Walmart to amazon successfully. If you don’t know what dropshipping is, it’s where you find an item on a website like Walmart that, for example, costs $2.98,. then you find that same item on a website like amazon and sell that item that you can get on Walmart for $2.98 for $14.99.. Then, when someone buys that item on Amazon, you go to Walmart and buy that item directly to the buyer’s address. You effectively don’t have to keep an inventory of your products and all you do is find the products and keep the difference when someone buys. This immediately intrigued me, but after doing more research, I discovered that dropshipping is against amazon's terms of service, so that ruled out any chance of me trying it. I was still intrigued by the idea and found out that if I bought the item from Walmart and sent it to myself, then sent it to the customer, that was perfectly “LEGAL”, based off of amazon's terms of service. Knowing if I found one or two good products that I could make thousands of, I spent a few hours searching for products manually, with no luck. I then remembered that I can code in python. I spent the next 2 or so weeks every day writing software that would compare amazon and Walmart prices to find products. Long story short, the software worked, but I never ended up using it. Somewhere along the way of my coding, I came across a video from the channel “Reezy Resells”. His videos introduced the concept of Retail Arbitrage to me. This is when you go into physical retail stores and go to clearance isles and find products that are marked down enough for you to make a profit selling on amazon. I was actually on vacation in Florida when I found out about this concept, so I spent the next multiple days watching videos about retail arbitrage on youtube from other creators. I also spent this time figuring out what I needed to start like software such as Inventory Labs and Keepa. When I got home, the fun begun. I went into Target and started scanning, but with no luck. I found things that had profit, but none that I was allowed to sell. I called it a day and went home. The next day I tried Marshalls and struck gold, or so I thought. I found these Hydrapak water bottles that were selling at marshalls for $12.99 and amazon for $39.99. I bought every single one they had on the shelf. I continued to find a few more products throughout the following days. On amazon, you are restricted in selling a lot of categories when you start off as a new seller, and this was a big problem I was facing. I was constantly finding things to sell that had a good return on investment, but I wasn't allowed to sell them due to amazon restricting me. I watched youtube tutorials on how to remove these restrictions and came across the website “The Funnel Guru” that claimed to un resttrict any seller in any category and brand. I chose the “Topicals, Toys, Grocery” category and I paid the website “$997” in bitcoin. I also paid an extra 200$ for them to unrestrict me. in a day, Little did I know this would be the worst decision I could have made. A few days passed by and they sent a request to amazon for me to get ungated. thankfully, it was denied and the website refunded me my money. I will explain later why this was the best thing that could have happened. While watching these videos on how to get un restricted, I also saw that you can get un restricted by buying from a wholesaler and submitting an invoice to amazon. I applied to multiple wholesale websites and got accepted to one called “Frontier Coop”. I placed an order for some Burt's bees, chapstik and tea to get ungated in “Burt's Bees”, “Topicals” and “Grocery”. The total order cost was $119.00.. The order came in a week later and I submitted the invoices to amazon and crossed my fingers. To my surprise, I was ungated. I now was able to sell things in the grocery and makeup section. this opened up a huge world of opportunities for me. This is also about the time my first amazon shipment reached amazon and was processed by Amazon. I was starting to see sales and, most importantly, profits. I was now coming to my local marshalls every day that I had free time after school. I also upgraded my in-store product scouting methods by buying a barcode scanner and an iPad. I was scanning hundreds of items per hour and finding alot of products. at this point. This is also about the time I found my best selling item, which was this: a microfiber hair towel. I bought it for $6.99 and sold it for $22.00.. I found 23 of them and bought them all. Keep in mind I was doing all of this on an electric bike and the distance from the marshalls to my house was 2 miles. The towels were all sold within the same day. I listed them. that day alone, I was able to hit 500$ in sales. This was huge for me. I realized that if I was able to find a few products like this from stores like Target that I can restok, I could be selling hundreds of dollar a day. Unfortunately, I wasn't able to find anything else like this. After this happened, I decided I would focus on products that I could replenish, which means products that I can continually buy over and over for the same price. I decided to pay $69 a month to join a group chat that shares different finds like this with each other. This was also my second biggest mistake. Most of the things shared in this group are not helpful at all. Whenever someone would share an item they found, the other people in the group would start to sell it and, because of supply and demand, the price would end up tanking and you in turn would end up loosing money. It's possible that I didn't try enough, but I would say not to join any of these groups for the first couple of months of selling. This also leads to the first replenishable product. I found that I am still selling, so I can show you what it is. but I can tell you what I make from them. I buy the product for$ 6.99 flat. I then sell it for $22.99.. I make around an 8$ profit and sell multiple a day. That’s without listing optimization and I expect this to rise to 10 per day within the next few months. Thats $2,400 a month from one product. This leads me to why I'm stopping. this issue for me with Retail arbitrage is that it's not scalable. You have to put time into going out and sourcing to make money. It's not a get rich quick scheme or even a get rich scheme. This is because the amount of profit you make is proportional to the amount of time you put in. I prefer something that I can put time into once and simply maintain for an hour once a week. If you are thinking of starting a retail arbitrage store, you need to know that this business strategy does require real dedication of time, and it's just something that I can’t commit to with school. Now to the part you have all been waiting for: how much money I made? The simplest way possible to break it down would be Revenue, Cost of goods, FBA fees and selling fees, And if we do the math like this, we can see that in a month we have sold $3,912 in products and after all fees, we have profited over a thousand. This puts us at 75% return on investment. This is where most youtubers would stop, but this does not take alot of expenses into account, the biggest one being subscriptions. They will completely kill your profit t Now, if we look at the chart that accounts for expenses, we can see that the numbers are alot less appealing. I had $330 dollars in expenses and that took our return from investment from 75% down to 53%. Let's break down the hourly pay becau.