A Breakdown of the Five Top Options for Selling on Amazon

By The Selling Family

Does your head sometimes start to spin when you look at all of the different ways you can sell on Amazon? It’s great to have choices, but sometimes they can overwhelm us!

We typically say there is no right or wrong answer to the question about which model is “best.”

There are so many factors to consider, including your own experience, situation, tolerance for risk — and simply preference. We chose retail arbitrage because we like it and are good at it, but that’s not the model for everyone.

Today, we are going to help you sort through the choices by providing a definition of the most popular selling formats, then give you our recommendations for the best training programs and educational materials related to each.

By the time you’re finished reading this article, you should have a good understanding of what model is the best fit for you, as well as where you can go to learn more!

First, a rundown of the five models you’ll see the most. These include: Retail Arbitrage; Online Arbitrage; Wholesale; Private Label; and Drop-shipping.

Retail Arbitrage

Retail arbitrage is when you purchase a product at a retail establishment and then sell it at a higher price on Amazon. It’s essentially “flipping” merchandise, or what is often described as taking advantage of market inefficiencies.

For example, you might find an MP3 player on clearance at Walmart for $15 that it sells on Amazon for $35. After Amazon fees and its cut, you might make a profit of about $10.

Pros:

• This can be a really inexpensive way to get started selling on Amazon
• No minimum investment to start
• Easy model to understand

Cons:

• This can be the most time-consuming of the business models, as you have to physically find and restock inventory constantly
• Related to the above, this is not a passive source of income
• Mileage; you have to drive from location to location

Retail arbitrage is our specialty! It’s where we got started and originally found success — Jessica was able to replace her income in a few months and then bring Cliff home from his job in about a year’s time.

If you’d like to learn more about this model, check out our Amazon Boot Camp, where we take you step-by-step through the process of setting up your account through making your first sale, and teach you what you need to know to grow from there.

The course includes video modules, custom printable and checklists and a bonus section. More than 3,500 people have taken the course!

We also have an accompanying private Facebook seller group where you can ask questions and share your successes with thousands of other members.

Online Arbitrage

In online arbitrage, you do the same thing as with retail arbitrage, except that you do your sourcing online.

Instead of heading to Walmart, you might go to walmart.com. There are hundreds of websites available, from large chain stores whose names you recognize to a bunch you may never have heard of.

Pros:

• A true work-from-home model
• More sourcing opportunities available, as you don’t have to physically drive from one store to another
• Product is shipped to you, so you don’t have to lug it in your car — plus you usually receive boxes and packing materials that you can re-use when you ship your inventory to Amazon
• Source at any time, not just during store hours
• Good way to complement your retail arbitrage and add more product

Cons:

• This is a little more difficult to learn because there is so much product available and you can spend a lot of time looking in the wrong places
• It can be easy to buy too much
• Sometimes more difficult to tell whether the product on the retailer’s website matches the Amazon listing, so you can be more prone to error when purchasing

Over the last few years, we’ve added online sourcing as a major way to find inventory during the first three quarters of the year.

It allows us more flexibility to spend time with our young son, plus it complements the products we find when we do head to the store to do retail arbitrage. We can also buy in larger quantities.

We’ll teach you how to do the same in Online Arbitrage - ABCs of Online Sourcing.

Our video course is set up in four easy-to-follow modules.  Among other topics, we teach you how to find good stores to source from; the key differences between sourcing product online versus at a brick and mortar store; our favorite tools; and ways to determine how much competition you’ll have.

Wholesale

With wholesale, you typically buy direct from the manufacturer - or from a middleman - and buy in larger quantities in order to get a lower price than you would at a retail establishment.

Pros:

• Lower purchase price means higher profit
• When your purchase price is lower than other sellers, you have a better chance at winning the Buy Box because you can go lower on your sales price if needed
• Buying in larger quantities allows your business to be more passive. It takes less effort to sell 100 of the same item than it does to sell one of 100 different items.
• You can scale your business

Cons:

• Larger investment of capital
• Bigger risk than retail arbitrage because you are buying larger quantities. There is always a chance you get stuck with large amounts of a product you can’t sell.

If you’re interested in pursuing this model further, we recommend the Unstoppable Amazon Academy by Robyn Johnson.

Robyn is the author of The Unstoppable Entrepreneur and hosts The Unstoppable Entrepreneur podcast. She has sold more than a million dollars on Amazon.

This course includes basics for beginners, but is designed for sellers looking to grow their business to $50,000 a month or more.

Some of the lessons and modules include: scaling retail arbitrage; Wholesale sourcing at higher margins; Introduction to Amazon SEO; hiring and training virtual assistants; business basics; and an introduction to bundling.

The Unstoppable Amazon Academy, which is a subscription, offers a monthly or annual payment option.

Private Label

Private label refers to the practice of purchasing a product and then putting your own branding onto it. Many times, sellers will purchase product from China and then attach their own brand, logo and marketing to it.

Pros:

• Little to no competition because you are the brand owner
• More control over price

Cons:

• Riskier than retail arbitrage and wholesale because the product typically has no ranking or sales history to draw upon
• You typically must purchase in larger quantities

For training on this model, we suggest Proven Private Label (PPL), a primer on how to start your own Private Label product line. You can buy just a book or go for the mentoring program (which we recommend).

The program teaches you how to find the “golden gaps” on Amazon, which are products people are searching for but can’t find.

It shows you how to find products and market them, and walks you through each step, from brainstorming to having your own Private Label product you can resell on Amazon, eBay, or elsewhere.

The teaching includes 6 mentoring modules, 20 PDF lessons and a private Facebook group.

Topics include how to choose your product; contacting suppliers; creating a listing; brand name, logos and packaging; and advanced strategies.

Drop-shipping

When sellers drop-ship, they purchase from a retailer or wholesaler and then have the order sent to the customer. We recommend against this practice.

Pros:

• Sellers don’t handle the merchandise

Cons:

• Lack of quality control; seller doesn’t have the opportunity to inspect the product, nor to ensure that packing and shipping is handled in a way you would approve of

This is not an area we have used or explored, so we don’t recommend any particular training for it.

(SOURCE)

The Biggest Mistakes I Made With My 

First Wholesale Order

By Stephen Smotherman

About 6 months ago, my very first wholesale order was delivered to my house… Of course, I had to take a picture. We worked as fast as we could to prep and send this huge wholesale order to Amazon. As soon as our wholesale shipment arrived at Amazon, we started to see some sales… but then things started to go terribly wrong. Sales started to slow and prices began to tank.

To make a long story short, I ended up actually losing money on my first wholesale order. Sure, I was able to get almost all of the capital back, but overall it was a massive failure.

If you know me, then you know that I’m a “glass half full” kind of guy, and I was able to turn this epic failure into a learning experience. Since mistakes were made, I thought I’d share with you the 6 biggest mistakes I made in my first wholesale order (and the last mistake was the biggest) so that you can set yourself up for successful future wholesale orders.

1. Ordered too many items

When ordering products from wholesalers, the items you buy usually come in cases, so buying only one of an item is usually not a possibility. I knew I was going to need to buy multiples, but I must have had my head in the clouds because I bought way too many items.  I honestly should have known better.

Any time you try something new, it’s usually best not to jump headfirst into the deep end… but instead to wade in slowly until you get used to the water. In my first wholesale order, I went way too deep and ended up with plenty of inventory that took forever to sell. Some of them I may even be paying long-term storage fees for soon.

2. Spent too much money

I mean, waaaaaaaaaay too much money. When you’re dealing with a wholesale supplier, they’ll usually have what is called a Minimum Opening Order amount. Different wholesalers will have different minimum amounts that they’ll need for your first order. They have these so the wholesale supplier knows that the buyer is a serious buyer and will be worth the time and energy to work with.

For my first wholesale purchase, the Minimum Opening Order was around $350, but I think I got caught up in the excitement and totally blew past that minimum. I ended up tying up a lot of my sourcing capital that could have gone to my retail or online arbitrage sourcing.

When you make your first wholesale order, be sure to not go too far above the minimum. Not only do you not want to use too much of your sourcing capital on a method you’re not yet confident in, but you’ll also want to make sure the items you order meet your expectations. Once you find success in your opening wholesale order, then you can go back and get more.

3. Ordered time-sensitive goods

I ordered items that were focused around a specific season, and for the wholesale order to be successful, I needed these items to sell quickly. It turned out they didn’t all sell in time and when the season passed, I had to drastically lower my prices in order to get the sales and to avoid any additional monthly or upcoming long-term storage fees.

It’s probably best to order items that should sell well all year long when it comes to your first wholesale order. I ended up putting all of my eggs into one basket hoping that all these items would sell by the end of that season, and I ended up paying for it.

4. Didn’t Negotiate

I’ve negotiated deals to get a better price most of my life. I can do it at garage sales, thrift stores, and at retail stores with store managers. Most of the time I’ll say, “If I buy all these items, will you give me a discount since I’m buying so many?” Most of the time I can get a small percentage off of the overall total. That one question has saved me thousands of dollars… but for some reason, I just never thought about it with this order.

Now, don’t get me wrong, I understand trying to negotiate a better deal on the first order isn’t always the best way to introduce yourself to a supplier, but remember mistake number 1 and 2 from above? I ordered way too many items and spent way too much money. If I was ordering the minimum, I would not have asked for a discount, but since my first order was a great deal higher, I think I could have negotiated a better deal.

5. Made faulty assumptions

I made two very incorrect assumptions that cost me both time and money. My first assumption was assuming that my shipping was going to be free. I guess with all of my online purchases in the past, I assumed an order this big would qualify me for free shipping. I had no basis for this assumption, and when I saw the final shipping costs, it ended up eating into the profits I had calculated.

I also assumed that the items I was buying would not come poly-bagged. My first wholesale order had many items that were going to need poly-bagging in order to send to Amazon. I ordered a ton of poly-bags and suffocation warning labels so that when the items arrived, I could bag them up and ship them to Amazon quickly. As it turned out, the items were sent already poly-bagged and had a printed suffocation warning label on them. So now, I have what seems to be a lifetime supply of poly-bags in my office.

When you are making your first order, don’t be afraid (or too proud) to ask your supplier questions. Even if you think the questions are elementary, go ahead and ask so you are able to make knowledgeable decisions.

6. Didn’t realize difference between a manufacturer and a distributor

This ended up being my biggest mistake. If I could have known this and applied that knowledge to my wholesale sourcing strategy, then most of the other mistakes from above could have been avoided.

When you purchase from a manufacturer, you’re buying directly from the maker of the product. You’ll be able to buy your inventory with the highest possible discounts. You might have to go a little deeper when buying from a manufacturer, but knowing you’re getting the best deals usually outweighs how deep you might have to go.

On the other hand, when you purchase form a wholesale distributor, you’re working with a middle-man who needs to take his cut of the profits. The distributor buys directly from the manufacturer and then marks up the inventory so that he can make a profit. Then the distributor offers up these wholesale items to us with smaller minimum orders than the manufacturer requires.

As you may have guessed by now, my first wholesale order was purchased from a distributor. When I got my huge wholesale order processed and sent to Amazon, I immediately began to see some sales come in, but after a short time the competition started to come in (who probably got their inventory from the manufacturer at better prices) and the prices tanked quickly.

In the end, I was able to recoup almost all of my capital back from that first wholesale order. I know some people will think that it was a waste of time and money, but I don’t see it that way at all. While the order ended up not meeting my expectations, it did provide many valuable lessons. I have taken these lessons and applied them to future orders and have seen great success.

Aside from my first wholesale order, I simply love sourcing and creating wholesale orders. I’ve found some great companies to work with and have reordered many items over and over again. I’m most thankful to my wholesale mentors Dan and Eric from The Wholesale Formula. After taking three different courses on selling wholesale items on Amazon and not finding the success I was looking for, finally the teachings from The Wholesale Formula just plain worked!

Right now, the cart to purchase The Wholesale Formula is open, but it will only be open for one week. The cart will close on Thursday, January 26th at midnight.

SPECIAL BONUS worth well over $300:

I believe in this course so much that I’m ready to give you a special bonus package worth over $300. If you purchase The Wholesale Formula through my link, then I will give you access to ALL of the following digital eBooks and video courses for free. You’ll get:

The Reseller’s Guide to How to Keepa Camel ($97)
The Reseller’s Guide to a Year in FBA ($67)
The Reseller’s Guide to Board Games ($49)
Married to Reselling ($27)
and you’ll get access to our newest book/video course (coming soon!)

The Wholesale Formula is a video-driven course put together by my wholesale mentors, Dan Meadors and Eric Lambert. Their methods in this course have actually saved me from repeating my massive failure with my first wholesale order.

One of the best parts of The Wholesale Formula is their money back guarantee. If you’re not satisfied with the course, you can get 100% of your money back. You really don’t have anything to lose here, but so much to gain.

This course will walk you through exactly how to add wholesale to your Amazon business in a way that I’ve never seen taught anywhere else. I’ve completed three different wholesale courses and this is the only one that taught me the methods that actually worked!

(SOURCE)

The Wholesale Formula Review

By Jordan Malik

You're here because you're wondering "should I get The Wholesale Formula to grow my Amazon business" or take it to the next level.

The short answer (my opinion) is yes. If you've been struggling with your Amazon sales, or trying to find profitable, replenishable products, or if you really want to ramp things up year-round (not just Christmas) then give The Wholesale Formula serious consideration. (Full disclosure: I'm an affiliate partner of The Wholesale Formula)

If you are enrolling, note that I'm doing things no other Wholesale Formula partner is doing: I'm providing really valuable bonuses ($990+ worth), but I'm also giving you a full look inside the program in the above video.

But I first want to get a couple things out of the way:

1.) The price. The Wholesale Formula is (at press time) $1997. It's a one-time payment, lifetime access, with a 30-day no questions asked 100% money back guarantee. And yes, it's worth much more and I'm going to tell you why in #2 below. But please don't buy The Wholesale Formula if you're nearly broke, and/or if this is the 2nd or 3rd time you've spent money on a course and haven't followed all the way through. (If you want to regroup and 'start from scratch' and you're on limited budget, check out my free resources here.)

The Wholesale Formula is serious stuff. It's for Amazon sellers who need a step-by-step plan for true growth.

2.) Remember, the price is a relative bargain. My Boston University MBA cost me over $35,000 in 1998 (it's probably $50,000+ today). I've expressed it publicly many times over – the MBA was, for me and many others, virtually worthless because nothing in it prepared me for the real world of making real income on my own. An MBA (for the most part) is theory and quickly outdated when 'real business world' hits.

But programs like this one are real. They're actionable. And many sellers just like you are earning real 5- and 6- and 7-digit revenues when they follow the formula.

You're noticing I'm not calling this a 'course.' By calling it a 'course' I'm lumping it in with some of the same old that's old there. It truly is a formula. When people (in business or life) follow a formula, they tend to dramatically increase their chances for success. The two founders Dan and Eric are not 2 guys that dropped out of the sky to suddenly announce they're experts in wholesale and amazon. No, they've painstakingly documented every step to their own multi-million dollar Wholesale business and provided it to you in the Wholesale Formula.

Remember: You've asked me for this help via your submitted survey responses. I'm always asking you 'what do you need from me?'.  You've said, very recently:

• "My Amazon sales are in a rut."
• "Competition is high."
• "I'm tired of retail arbitrage
• "I want to source more, more profitably, with less work."

The Wholesale Formula is solving those problems for hundreds of Amazon sellers now, and the're trusted partners of mine. So if you're ready, get The Wholesale Formula. But: If you get it, please take action. It's no good if you buy it and do nothing

Check out my video review and let me know what you think.

- Jordan

P.S. You can enroll in The Wholesale Formula until January 26, 2017.

(SOURCE)

Amazon FBA Wholesale - Don't Make These Mistakes!

In this Amazon FBA training video, Stephen shares the 6 mistakes he made when placing his first wholesale order. Don't make these mistakes when you are sourcing wholesale for your Amazon FBA business!

Advanced Wholesale Training For Beginners On Amazon In 2017 [ Part 2 ]

9 Reasons Why You Should Add 

Wholesale to Your Amazon FBA Business

The more you talk with Amazon FBA sellers from all walks of life, the more you understand why each seller prefers the sourcing model used in their business.

Some folks love the thrill of the hunt, and they thrive on getting out there and scanning to their heart’s content at garage sales and thrift stores. Other sellers enjoy working retail arbitrage into their daily routine, or they love the huge profits that come from RA during the Q4 selling season. Some sellers live in a remote area or their time is limited, so they choose to do online arbitrage (OA) or wholesale. Still others like all aspects of product development and marketing, so they dive into private labeling.

Today I want to focus on one method of sourcing for Amazon FBA: sourcing from wholesale suppliers. We’re going to have a couple more posts after this one, so stick with me to learn more about where to find wholesale sources and other wholesale time hacks. But for today, let’s discuss the top 9 reasons why you should consider adding wholesale sourcing to your Amazon FBA business.

1. Profit potential

We’re all in this business to make profits, right? Well, selling items sourced via wholesale has huge profit potentials. You can find items with great return on investment (ROI) for resale on Amazon because you buy them at a low wholesale price, compared to what other sellers are getting by buying from retail sources.

2. Go both wide and deep on inventory

Buying via a wholesale account gives you the opportunity to search their catalog for several different profitable items in one product line, and you can then buy larger quantities of those items than you would be able to if sourcing via RA or OA. Once you’ve done your research on the sales history data on CamelCamelCamel and Keepa, as well as researching how much your competition has in stock (we use the How Many? extension for doing this research), you can make an informed decision and buy as many of an item as you feel comfortable buying, rather than being limited to what’s on the shelf at the retail store.

But you don’t have to worry about making a huge wholesale order of only one item to meet a company’s minimum purchase requirement. You can order a few of several different items, test them out, assess the results of your sales, and make a decision about reordering and possibly going deeper.

3. Opportunity for consistent replens

“Replen” is short for replenishable. A replenishable item is one that is profitable to buy over and over again because you can sell through the item at a decent rate. Replens can be a lovely cash cow for your business, since all you have to do is order, send to FBA, sell, order, send to FBA, sell, and repeat, repeat, repeat. Finding a replen today saves you time tomorrow by not having to repeat your sourcing research once the item sells out. You’ve already done the research – now all you need to do is reorder and send that item in again. It’s a much more time-efficient process than the one-offs that come with RA, OA, garage saling, and thrifting.

4. Potential for less competition

If an item isn’t available from retail sources at a low enough price to resell on Amazon BUT you can find it at a wholesale source, you will have lower competition. If you’re sourcing items that anyone can find at a retail store and resell for profit, it’s often only a matter of time until a ton of sellers jump on that listing. Sourcing via wholesale opens the door of opportunity to find unique items that RA and OA sellers can’t source at your buy cost.

5. Predictable cash flow

Once you have found several replens through wholesale sourcing, you can get to a place in your business where you have more predictable cash flow. Often with RA, OA, and thrifting, you will see ebbs and flows with your sales throughout the year, depending on what’s going on in your part of the country or in the stores where you like to source. Wholesale sourcing can provide more stability when it comes to ordering products to sell consistently throughout the year.

6. Saves time

Like I said above, finding a wholesale replen saves you a ton of time when it comes to not having to constantly be out sourcing for more one-off items to resell. It could take you all day to drive around town and spend $800 on RA finds, or you could spend a couple of hours doing wholesale research and find a great replen, place an $800 order, and then just reorder when you’ve sold out.

Another way wholesale saves time is when it comes to prepping your inventory. Wholesale items won’t have stickers to remove, and they often (though not always) come already poly bagged. You also can save time in listing the items. Instead of having to list and price 20 one-offs from RA clearance, you could list and price one item with 20 multiples from a wholesale source.

7. Easier to scale the business

As your FBA business grows, you will need to find ways to scale the business. Scaling your business means being able to increase your output. There are only so many garage sales in your town every week, so unless you hire folks in other towns to source for you, you can’t scale an FBA business based on garage saling. Same with retail arbitrage – you only have so many hours in the day to drive to retail stores, so you will need to hire someone else to source if you want to scale your RA business. But with wholesale, it is much easier to keep your business simple, source large amounts of inventory, and process it without needing to hire help. In fact, if you use a prep and pack center to process your inventory, you can grow your Amazon FBA business even more through wholesale.

8. Protects your seller account

Many Amazon FBA sellers experience great anxiety over the thought of being suspended because of claims by customers, especially claims of inauthentic products. As of this writing, Amazon is accepting retail receipts as proof of your source for inventory, but it’s often more difficult to prove your case with Amazon using retail receipts than using wholesale invoices – not to mention, at any point Amazon could stop accepting retail receipts altogether. Adding wholesale sources to your Amazon inventory gives you a level of protection for your seller account.

9. Become a brand approved seller

Brand restrictions on Amazon can be tricky when you’re looking for good retail sources for inventory. There’s nothing worse than finding an awesome item for resale, only to discover you are restricted from selling that brand. But with wholesale sources, you have the potential to work with Amazon and the manufacturer to become a brand approved seller. It requires some time and effort to get approval, but if you’re successful, you have the potential to make even more profits with even lower competition.

Now you have plenty of good reasons why you should consider adding wholesale to your Amazon FBA business. Stay tuned because in our next blog post, we’ll share with you how to find profitable wholesale accounts.

For the longest time I had wanted to add wholesale to my Amazon business. I have actually gone through 3 different wholesale courses to teach me how to do it. Each time I went through a new wholesale course, I would try what was taught, and I kept coming up empty. It was extremely frustrating… then I scheduled a phone call with Dan, one of the guys behind The Wholesale Formula. That conversation opened up my eyes to things about wholesale I’ve never thought about before. I took his advice and began to find multiple wholesale accounts.

Would you have wanted to listen in on that conversation? Unfortunately, we didn’t record the call, but Dan and his business partner Eric recently recorded an entire video series that focuses exactly on adding wholesale to your Amazon FBA business. The best part? It’s free! So many people think that you have to have thousands of dollars or special connections to start selling wholesale items on Amazon, but that’s just not true.

In this free video series my wholesale mentors, Dan and Eric, will teach you exactly how to find profitable items to buy via wholesale so you can experience growth in your Amazon business.

Now here’s the deal. These free videos are only going to be accessible for a limited time, so you need to click here and watch today.

(SOURCE)

How To Make $10,000 Per Month From Wholesale - Amazon FBA

When it comes to making money selling wholesale products on Amazon FBA you need to do a lot of the work and research yourself. If somebody else is doing all the research and work for you, then you can rest assured that they are also buying the same products, which means they will probably be less profitable once you get on them. 

Amazon FBA Wholesale - Add profits to your Amazon FBA sourcing

In this Amazon FBA training video, Stephen discusses the benefits of adding wholesale sourcing methods to your Amazon FBA business.