In this blog post, I’m going to share exactly how I launched a brand-new product on Amazon UK and made more than £320,000 in sales in the first 18 months, which resulted in a NET profit of more than £85,000!
More importantly, I will show you HOW YOU can do the very same! Yes, you can start a successful, fully automated Amazon FBA business and make £2000, £3000 or more per month to replace your salary, finally quit your day job, and take back control of your life!
No, I’m not claiming to be making hundreds of thousands or millions of pounds, unlike so many self-proclaimed “gurus” on YouTube with their photoshopped screenshots! I’m talking about real money and real profit. In fact, to be completely transparent and open with you, I’m going to take you live into my account right now to show you the real numbers:
This is the Amazon account I created for this new product. As you can see, there are no sales for it prior to September 2017.
Over the last 18 months, I have sold more than 32,000 units of the product and made more than £320,000 in sales! This is from selling just one product in one niche with multiple variations.
Sure, those are only sales—what about expenses like Amazon fees, FBA fees and others?
Great question! I really hate it when people talk about SALES and only SALES! “Oh, I made two million in sales on Amazon last year!” That’s all great, but you should also mention that your net profit was only $50,000. That’s still a good profit, so just say it! People are far more interested in how much actual profit you made instead of just hearing about huge sales numbers!
This is especially important on Amazon. You could set a huge discount on your product, then drive massive amounts of traffic via paid advertising and make, say, $100k in sales in one month without actually breaking even. You could have $100k in sales and still LOSE money. So, SALES data alone doesn’t mean anything.
Let’s take a closer look at how my numbers break down.
I sell this product for £9.99. Obviously, it’s not all profit as there are many expenses involved. Such as:
- My product cost including shipping to Amazon’s warehouse is £1.25
- The Amazon selling fee is 15% or £1.50
- The Amazon FBA fee is £1.54
- VAT on the £9.99 charged is £1.67
If we add it all up, my cost of goods, VAT and Amazon fees combined comes to £5.96, which means that my NET profit for each unit sold is £4.
That’s a 40% margin, which is considered good on Amazon for a product that sells for £9.99. Even a margin of 30% would be considered very good in this price range.
£4 per unit sold may not sound that much BUT if you think about it, 1000 sales per month would result in a NET profit of £4000 per month or almost £50,000 per year.
That’s a pretty good income—something many of you would happily take in exchange for quitting your day job, right?
1000 sales per month may seem very high but it’s actually not. Amazon is such a MASSIVE marketplace with millions of daily shoppers! The scale of it is unparalleled. Most people don’t even realise just how big is it.
For example, would you believe me if I said that the bath towels niche alone on Amazon UK is worth several hundred thousand pounds per month? What if I said it’s worth several million dollars on the Amazon US site? It’s true.
What about something much smaller, like cheese graters? Thousands of cheese graters are sold on Amazon UK alone every month, resulting in overall sales of more than £50,000! That’s just one small item, just in the UK, and chances are there are many people who live off the profits they make selling those cheese graters!
We’ll get into the numbers—and the tools I use to show you these sales numbers—later on. For now, I just wanted to illustrate how MASSIVE the Amazon platform is. When you realise the true potential of it, selling 1000 units a month and making £50k profit per year doesn’t seem so unrealistic.
If we go back to my business for a second: I have sold more than 32,000 units of this product over the last 18 months. This should mean that my profit is:
32,000 x £4 = £128,000, right?
No, that’s not my final profit number as I have spent money on ads too. Amazon offers their own pay-per-click ads system where sellers bid against each other to show their listings in the search results. This is an integral part of any Amazon FBA business nowadays. You simply calculate these ad costs into your bottom line.
As you can see, I have spent more than £40,000 on ads, so this needs to be subtracted from my profit number of £128,000. As a result, my FINAL pre-tax profit is closer to £85,000. This is still great in my opinion for a brand-new business that is selling just one niche item!
Also, most of this operation is completely hands-off, meaning that I have spent very little time on the business. Once you set it all up, it runs on autopilot as Amazon deals with the stock, order processing, shipping, returns, customer emails and everything else!
I created this article for one reason: to show you real-life proof that Amazon is the NUMBER one, fastest-growing business opportunity and that those of you who get on this train right now will take part in the biggest eCommerce revolution since the invention of the internet. And here’s why….
I truly believe that this is the opportunity of a lifetime. If not lifetime, definitely the best business opportunity in this decade – I’m talking about the Amazon UK marketplace.
I was selling on eBay for more than 10 years. I started back in 2005 and basically, it was the Golden days, the beginning of the best era on eBay. The wild west time for the platform – demand was already massive and increasing aggressively, competition was very limited and non-existent in many categories, rules were very relaxed and basically anyone with a bit of brainpower and understanding of how importing works, could make good business on eBay.
But fast forward to the current situation and I see eBay as a dead end. I have completely stopped selling on eBay and no, it’s not because all of the rules, competition or Late Delivery metrics, I actually survived all of that perfectly fine.
The main reason I quit eBay is because on eBay the lowest price almost always wins and it doesn’t matter how good your product is!
eBay just don’t get it! They push the cheapest listings to the top, no matter the quality of the product or customer service the seller provides.
Sometimes it seems that EVERYTHING can be bought on eBay for £3 to £4 and even cheaper. It is a bargain hunter’s paradise, ripe with tax evasion and the World’s biggest marketplace for low quality goods.
Somehow it manages to survive as people go to eBay now with one idea in mind – to get a bargain! And then they expect overnight delivery, a high quality product and instant customer support. It has become such a flawed marketplace nowadays that no wonder many people struggle to make it work!
Amazon is something totally different, with different rules, different customer attitude and most importantly – product QUALITY is the most important aspect! Nothing else really matters on Amazon apart from how good the product you sell is and what customers think about it (seen by product reviews).
You can’t simply source rubbish product and sell successfully on Amazon! As soon as the first customer reviews come in and they’re bad, you are basically done!
The product will be pushed back in search results to places that no one will ever see it. And even with paid ads it will be impossible to make a profit as because of those bad reviews your conversion rate will be terrible.
And this is simply awesome!!! I LOVE IT!!! This means that people like me, who really want to sell high quality products and put effort into creating amazing brands, get rewarded by high search rankings and sales! Not like on eBay where PRICE is the main ranking factor and basically you have to work on super low margins to make any decent sales volume.
Here are just a few reasons why you should want to build your business on Amazon’s platform:
- People LOVE Amazon! They just do and it’s no surprise – they’ve built a great brand.
- People TRUST Amazon! They know how reliable it is and they know that if something goes wrong with their order, Amazon will rectify it.
- FREE Shipping with Prime! Millions of people in the UK have Prime membership which means they can get free shipping on their Amazon orders. And who doesn’t like that?
- Amazing Shopping Experience! Amazon’s interface is so well made and with One Click purchasing, it really does take literally just a few clicks to make a purchase on Amazon. This really increases conversion rates.
- Massive Customer Base! Amazon has such a large and loyal customer base. There are millions of people in the UK who only use Amazon for their online shopping needs! They don’t go to eBay or Google when they need something – they start their product search directly on Amazon. And by some recent studies it shows that by 2020, more than 50% of product searches in the world will start on Amazon. Not eBay, not Google, but Amazon!
- Effective advertising options! Amazon has done a really good job on their advertising tools for sellers. It has a very effective but at the same time SIMPLE paid per click system built in and it just works! You can basically launch a product on Amazon and get sales coming in almost instantly. When I launched this product, I got the first two sales in within 2 hours or so and made 16 sales in total that very first day! Yes, it was all from paid advertising but it was actually profitable from day one!
- Hands-free inventory! One of the biggest advantages of running a business on Amazon is obviously the Fulfilment by Amazon service! It’s the first time where you can run a physical eCommerce business hands-free, which means that you don’t have to deal with order processing, storage and shipping on your own! It’s all taken care of for you, 24/7 on total autopilot! Talk about those good times at the beach with a margarita in your hand!
- Very limited customer support! Another great benefit is that you really don’t have to deal with customers anymore! If you use FBA, Amazon will take care of customer support and your involvement will only be used on certain occasions when Amazon customer service needs your input.
- Seller metrics taken care of! Basically, as long as you sell products that comply with Amazon’s rules, your seller metrics will be fine! As all FBA orders are exempt from many metrics and for example – if you get a negative seller feedback for late delivery or something else that is directly related to order processing, Amazon will automatically remove it for you! So you basically don’t have to worry about shipping related issues at all – Amazon takes full responsibility for you. This is such a relief after years of trying to stay within eBay’s rules, especially the Late Delivery metric.
- Global scale! Amazon offers so much growth opportunities with their tightly integrated regional websites! If you start selling on Amazon UK, you can later on easily expand into European marketplaces, North America or even Japan! It all works from the same interface so you’re already used to it – you don’t have to learn everything from scratch.
These are just a few reasons why Amazon is THE PLACE to be in 2019 and the years to come – it really is a dream come true business opportunity and what’s more important – it’s only now starting to really pick up in the UK which means there are tons of untapped business opportunities!
Not many people in the UK realise this – in the USA Amazon is the number one online selling platform. It’s more popular than eBay, by far. Just take a look at Google Trends data, comparing searches for eBay and Amazon in the US:
As you can see, eBay sees a steady downward spiral while Amazon increases slowly year on year with a more aggressive gain in popularity this year AND very huge spikes in December as so many people like to shop for Christmas presents on Amazon. Funnily enough – there’s almost no spike in December for eBay which could mean that for presents people are looking for something of higher quality? I hope so!
This is so important to understand as right now, this moment, is that PERFECT opportunity for people to get into this and create amazing businesses out of it!
The next 10 years will be so crucial and I truly believe that if you don’t do it right now, you’ll regret it later on! I have been involved with physical products for a long time and this moment reminds me of the early days of eBay! If you ask me – this is the wild west time for Amazon UK – something you simply can’t afford to miss out on!
eBay can still be ok for people who want to make some additional income by selling un-competitive items that are not over-saturated yet or say second hand goods. These concepts still provide a good income potential but IF you’re looking to build a serious business online, replace your income and even more – become a millionaire one day, Amazon IS THE best place to do it, trust me. Especially now, when it’s all only starting and growing at a massive speed.
And remember – Amazon, even though it will become saturated sometime in the future, right now it’s in its BABY stage in the UK & Europe and there are thousands of opportunities you can get into!
And even in the future, when more and more people start selling on Amazon, I will survive and you will too – as unlike on eBay, price is NOT the only/main ranking factor – product quality and reviews are!
I don’t know whether you’ve noticed this but the vast majority of people are LAZY! Super lazy if you ask me! They just want to make easy money without putting work in. They look for shortcuts at every corner – be it market research, product sourcing or branding. They just do it all half-cooked and then they get half results.
And again – I LOVE THIS! I seriously look at all those people who don’t put any effort into their businesses and it puts a huge smile on my face! This situation means that anyone who is willing to put hours and effort into this process will easily out-compete others on Amazon!
Don’t think that with this new business I’m selling something totally unique or in a market that’s without competition! Far from it!
There are tons of people selling the same product and even 3-4 serious, long term businesses who have been selling that product for years! They just haven’t done the best they could – and when I entered this market with a MUCH better product, better brand and presentation, I simply dominated it from day one!
There are still many other products I want to release under this brand but my plan is to completely dominate this niche by the end of 2019 and simply be THE BEST seller and offer THE BEST products in this niche! And I will achieve it by working hard, working smart and bringing real value for people.
Ok, I hope you’re still with me and I hope you’re not bored because I want to share some more info with you and even give you the first steps that you can take today, right now, to start your own Amazon business. So let’s talk more about what kind of business concept works best on Amazon.
Best Business Model for Amazon
When I started selling on Amazon a few years ago, I already knew exactly what I would do – the same thing I did on eBay – selling my own branded goods!
The difference though is that on Amazon the private label concept works even better than on eBay because:
1. People are looking for high quality products!
For some reason Amazon attracts more people who are looking for higher quality products in comparison to eBay. They don’t expect to buy say a high-quality silicone spatula for a quid or two with free delivery.
They will more likely look for a high-quality set that retails for £10. And this makes a massive difference in terms of what profit margins we, as sellers, can achieve!
On eBay people are happy to have 5%-10% profit margin while it’s not uncommon to achieve 20-30% on Amazon, and even 40%+ like with my example.
And unlike eBay, you won’t have to pack orders all day long to make a 50p profit on each sale! Sometimes it does look like largest sellers on eBay make just 20p or so profit on each sale, which is ridiculous if you think about all the overheads they have when getting thousands of orders per day.
2. You have lots of options to feature your brand!
Amazon LOVES great brands and they don’t just say that, they also provide us tools for emphasising our brands on the Amazon platform. When you register your brand for Brand Registry, you can use the Enhanced Listing editor which allows you to create beautiful listing descriptions.
And you don’t even need a special template for it as Amazon provides templates for you! All you have to do is provide images and texts! Brand owners on Amazon are also protected from other sellers using your brand name in illegal ways plus get access to Amazon Stores functions and other great features, like having a VIDEO in your listings!
All in all, if you do build a solid, long term BRAND based business with high-quality products, Amazon will provide all the tools you need.
3. Price is by far NOT the most important factor in rankings!
This is THE reason why the private label products concept is a perfect match for Amazon!
The main reason why we create a brand and brand our products is obviously to stand out from the competition and to be able to charge higher prices for our products! And we can do exactly that on Amazon!
We can sell a product for above the market’s average price and still rank very highly in search simply because people will leave great reviews and our conversion rate will also be super high.
Amazon doesn’t really care about the product price! They know that if people convert, it’s a good offer, and if reviews are good, it’s a good product!
Just think about it – Amazon makes their fees based on an item’s price – the higher the price, the more money Amazon makes. So Amazon is actually INTERESTED in selling items for higher prices so that they can make more money in fees!
Obviously, the price should be within some kind of limit but this all just proves that we should NEVER get into price wars with other sellers when selling our own brand products as the price is in essence irrelevant. All this, of course, applies to a situation when you have done your homework and really put effort into creating an amazing brand and product to sell.
I could talk for hours about why the Private Label products business concept is by far the most lucrative but I hope you get the point here – when you create your own branded products, you set the price, you control the brand, and you own the product listing which means that no one else will be able to sell from your listing.
If you consider doing wholesale, retail arbitrage or selling un-branded items on Amazon – forget about being successful! Unless you want to work on the lowest price game that is, similar to eBay. On Amazon you won’t get your own listing, no, your offer will be listed along all other sellers selling that item, sorted by lowest price first.
Amazon aren’t stupid! While they’re in business to make money, their main business philosophy is to give customers the best possible deal! So if you sell a branded car air freshener, exactly the same item 8 other people are selling, obviously Amazon will list the cheapest offer first as it’s exactly the same product from all sellers!
So seriously, forget about selling branded products or wholesale products on Amazon – it’s not a BUSINESS but arbitrage game! Private label products, your own BRAND, is the way to go – don’t even question it!
For those of you who don’t know what a Private Label business is – it simply means that you’re working directly with manufacturers who put your own brand name, usually your logo, on the product itself and often the packaging too. You can take it even further and have a unique product created for your brand, but more on that later.
Please DON’T be scared by this or put off! Creating a brand, while admittedly a tedious task, can be done by almost anyone and on very low budgets! You won’t have to spend thousands on this as most elements of it can be outsourced quite cheaply. So just don’t let this be your main obstacle and certainly don’t let it scare you off this whole business model.
OK, now, let’s quickly talk about TWO common myths about selling on Amazon.
1. FBA is THE Only Way!
(Even though others will tell you otherwise!)
As you all know by now, a massive advantage of doing business on Amazon is that you can use Fulfilment by Amazon which means that you send goods in bulk to Amazon and they will fulfil orders for you. You don’t ever have to process, pack and dispatch an order! How cool is that?
Apart from affiliate marketing and information products businesses, Amazon FBA is the closest you’ll get to selling virtual products, hands-free!
You can really enjoy all the benefits of your business fully – you can travel the world and your Amazon business will practically run itself for you.
Amazon does not pressure you to use their FBA service BUT I highly recommend you do so! For several reasons:
1. Trust from Customers.
People on Amazon just prefer to buy from listings that are fulfilled by Amazon, as simple as that! And it’s not hard to understand – Amazon is well known for their precise fulfilment operations and their customers are fully aware of that! They know that they will get delivery as expected and there won’t be any problems.
If you give buyers an option between buying the EXACT same product from a listing that is fulfilled by Amazon and fulfilled by a seller – which one are they gonna choose? It’s obvious of course!
Why take a risk on a seller who you don’t know when you can rely on Amazon’s system which you have used time and time again.
2. Combined purchases.
Often people buy several products at the same time on Amazon and they specifically try to buy from Amazon itself or from 3rd party seller listings that are fulfilled by Amazon. Why? Again, they know that in most cases everything will be sent to them together, in one shipment.
This is especially important for customers in Europe who shop on Amazon UK – if they buy from separate sellers, shipping costs will be quite high while when buying everything from FBA listings, they can save a lot of money on shipping.
3. Easy returns.
As much as we, as sellers, hate returns, we always have to look at everything from a customer’s perspective. An easy returns process is not only an important conversion booster, it’s basically a golden standard in today’s eCommerce world.
Customers need to know that if something goes wrong with an order, they can return it easily, hassle-free. And Amazon and FBA listings offer just that – hassle free returns! Yes, this probably does increase overall return rates compared to if you were to ship goods on your own, as the returns process on Amazon is so easy for customers BUT remember one thing – if you sell high-quality products and you don’t mislead customers in any way, they’ll be happy and your return rate will be very low.
4. Prime Customers.
I should have probably listed this first as it is a MASSIVE selling point! Prime members get free delivery on orders as well as various EXPRESS delivery options available for items that are Fulfilled by Amazon.
This is a HUGE conversion rate booster!!! We can’t calculate it precisely but I have seen cases where sales double after a seller converts from self-fulfilled option to FBA.
5. Hands Free operation.
As I already mentioned several times, using FBA means that you don’t have to deal with the tedious order processing task anymore which leaves you plenty of time to grow your business, research new products, build your social presence or simply take time off whenever you feel you have deserved it!
For people who are new to all this, it may not seem that important but those of us who have been dealing with order processing on eBay for years will know how amazing this system is! The business runs automatically, 24/7 and you just receive those “Amazon has dispatched the item you sold” emails all the time, day or night – without you doing anything!
6. Seller metrics.
Amazon has various, very strict seller metrics in place and if you think eBay is hard to comply with, see what Amazon has to offer! There is customer support performance level, order defect rate, shipping performance, order cancellation and many other things you need to stay within certain, very low limits.
But if the product is high quality and you offer good & quick customer service, you won’t have problems meeting these standards. And here’s the good news – with FBA items you DON’T have to worry about shipping, order processing, returns and related standards!!! Amazon takes full responsibility for those metrics as they’re the ones that do that job for you! And this is a very important difference between a business where you fulfil orders on your own and a FBA business.
As you can see – Fulfilment by Amazon is the ONLY way you want to do business on Amazon as there are so many advantages!
Yes, of course it does cost money BUT if your margins are good enough, it won’t be a problem. And just think about it – if you’re building a true business and will process hundreds or even thousands of orders one day, you’ll still have to rent a warehouse and hire employees, which will cost a lot anyway!
The beauty of using FBA for your Amazon business is that you can grow and scale your business as quickly as you can! There are no hurdles and you can sell 100 orders one day and 1000 orders the next day – it won’t cause you any problems!
There may be some specific cases where using FBA won’t be the best option, like if you deal with palletised items or say you have thousands of SKUS with very low quantities and low sales velocity. Or if the goods you’re selling are prohibited by the FBA rules but you can still sell them on Amazon.
But these will be individual cases! For most products, small and medium, you MUST use FBA to make the most out of Amazon’s platform. And it can work even for super cheap products as long as they’re small!
There’s a special Small & Light scheme for such products and the costs are actually very reasonable. There are some rules for items to be classed as small and light of course:
- It should not sell for more than £9
- It has to be sent as a letter or small letter
- It must weigh no more than 225g
And if your items falls into these specifics, it will cost just 60p in fulfilment fees for small letter items or 80p for large letter items.
So basically, if the item is less than 225 grams in weight and can fit within the large letter format and you sell it for less than £9, Amazon will only charge you 80p for order fulfilment and you get all the perks previously mentioned using the FBA service!
There are endless products that will meet this criteria and if you’re working with a small budget, I would actually recommend you look for such products – small, super cheap products you can import from China for less than a $1 or so, send via courier and then sell on Amazon via their Small & Light program for around that £7.99 or £8.99 price point.
OK, so far so good, don’t you agree? But I’m sure you would like to learn more about the actual product selection and market research process as it’s usually the biggest problem people struggle with – the age old question – what products should I sell?
While this article is not really based around that, I will give you some valuable tips and show you how you can start doing product research on Amazon straight away, after you finish reading this post.
2. Product selection is important BUT over-rated!
Doing proper, in-depth market research is crucial, don’t get me wrong, but I do think that most people overthink this step in a way that they spend too much time trying to find some hidden gem –trying to find that golden nugget that will make them rich! Good luck with that!
I don’t think of product selection in that way – to me the most important thing is EXECUTION!
By that I mean – the work you put into doing market analysis, understanding what customers don’t like about current offerings, sourcing a better version of the product, creating a really good, valuable brand with a story, and presenting your item in the best possible way.
You shouldn’t be too concerned by competition on Amazon as if your product is BETTER, quality wise or feature wise, it WILL get noticed, trust me!
Remember, the biggest ranking factor on Amazon is your sell-through rate and reviews and if your product delivers on both fronts, you can achieve top search results even in very competitive markets! Yes, it may take longer than with products with less competition but it doesn’t change the fact that you can do it if you are patient.
While there are many untapped product opportunities on Amazon UK right now, in most cases there will still be competition, but not all competition is equal – especially on Amazon!
I don’t call it a real competitor if the product has 3.5 star reviews, they use some blurry product images taken with a web camera, they don’t effectively uitilise the listing title, bullet points etc. – and that’s not even talking about keyword research, a proper description or using Enhanced Brand content. That’s NOT your competition as you can out-perform them on all these aspects easily!
Going back to product selection – as I said, don’t overthink it and waste months trying to find a perfect product. You’ll be much better off just starting with something – pick one simple, cheap product; source it; create an amazing listing and start selling! Get the process going as no matter how many video tutorials you watch, you’ll only truly learn when you start doing everything yourself.
The beauty of Amazon is that you can sell all kinds of products from one account and even have them properly branded as Amazon offers the option of registering multiple brands under one account! This means that you don’t necessarily have to think long term when you are just starting out – you don’t have to commit to any product group! Just find a product that sells and fits your buying power and get the process started!
Basic Product Research Explained
Ok, so I know what you’re probably thinking now – this all sounds AWESOME Andrew, but what should I do next?!
You should start with product research obviously and while this won’t be a fully detailed guide on how to do it, I will give you a Quick Start guide to at least get you going!
First of all – you’ll need some kind of Amazon research tool that can show you demand & competition for any given product you research. There are tons of such tools out there but the most popular one, and one that I have been personally using for years is called Jungle Scout.
With Jungle Scout you can quickly evaluate demand and competition on the go using their Chrome tool and also do more interesting research and product tracking via the Web Tracker tool. Let me quickly explain to you how it all works.
On the Jungle Scout website there are two products and in the beginning it may look confusing:
- Chrome Extension
- Web App
For the Chrome extension there are two versions – the PRO version that costs $197 per year and the LITE version that costs $97 per year. The main difference is that PRO tool will also instantly show FBA specific metrics, like FBA fees, dimensions and weight.
Let me now show you how the Chrome tool works so you have a better understanding – once you purchase and install the tool, it will add a small icon to your Chrome browser. And you can activate the tool by clicking on that icon.
For this tool to work, you have to be on Amazon of course – it could be a search page, a product page or a seller store-front page. As long as there are products listed, Jungle Scout will instantly start populating data for you. And it will work on Amazon.co.uk, Amazon.com, Amazon.de and all other major Amazon marketplaces.
But most of the time you’ll use this tool on search results, so let’s do a sample search right now and see what Jungle Scouts comes up with!
In the top part of the tool it shows average monthly sales, average sales rank, average price and average reviews. I personally don’t pay close attention to these metrics as average is average – it doesn’t really give us any definite answers.
The Opportunity Score (ONLY comes with the PRO subscription) in the top right corner is a very good indicator though as in most cases it matches my own manual observations.
So if it shows as High or Medium demand with low competition, that’s a very strong signal that you have found a good potential product.
But the most important data is shown in the main section of the tool and it applies to all listings found on that page:
- Product name – this is the listing title and you can hover over it to instantly see a preview of the listing, including the main image, review score and rating.
- Brand – this simply shows the brand for each product listed. This is a valuable indicator that can instantly show you whether a product is brand dominated or not! If most of the listings on the first page have just one BRAND name, it’s a very strong indicator that there’s brand domination or even patent issues involved with this product.
- Price for the item and Category in which it is listed.
- Rank. This one is very important to understand as it will be mentioned in several places in the future. Rank or Best Sellers Rank relates to the position in sales for that particular item in the parent category on Amazon. The lower the number is, the higher the level of sales. For example, a rank of 1 means that that item is the MOST popular item in that category and an item with a sales rank of 100 means it’s the 100th most popular item in that category. So the smaller the number, the higher that item is in terms of best sellers and therefore the more sales it generates.
- Monthly/Daily Sales. This shows how many items are sold from that listing, per month or day. It’s important to understand that this number is approximate and won’t be 100% accurate at all times. Why? Because here’s how Jungle Scout and many other Amazon research tools work. Amazon does not give them sales data, they don’t share such valuable information with everyone. So instead Jungle Scout uses the combination of Best Seller Rank and inventory levels for products they actively monitor in their database to calculate approximate sales per month. So for example, they know that an item in that category which has a sales rank of 100, makes 500 sales per month. Then you research an item that is listed in the same category and has a sales rank of 105. They know that 100th ranked item makes 500 sales per month so the 105th will be a little bit less. And they use calculations to give you that estimated number. I hope that makes sense? Even if you don’t fully understand how it all works now, it’s fine – just so you know, these numbers are not 100% accurate but you’ll be able to get more accurate results by using the Jungle Scout web app, which we’ll cover later on.
- Revenue. This would simply be the estimated revenue generated by that listing in one month and is calculated by multiplying the price by the estimated sales.
- Reviews. The total number of total reviews that item has received.
- Rating. The average review, in terms of stars. This is an important indicator as you’ll find out later on – a product which has very high ratings on the majority of first page listings, may not be the best product to go with as it simply indicates that people are already very happy with what the current sellers provide – it will be very hard to improve the product. On the other hand, if you see an average review score between 3 to 4 stars, it’s a clear indicator that most current offers on the market lack in quality or something else and usually it’s a perfect opportunity to get into that market, improve the product and outcompete everyone else.
- Seller. This shows who sells that item – AMZ means that Amazon sells the item, FBA means that it’s sold by a seller using Fulfillment by Amazon and FBM means it’s sold by a seller who fulfills their own orders. There’s no definite rules here but obviously I like to see products where many listings are fulfilled by the merchant, which means that if I go into that market and use FBA, I will have a much higher chance of converting those customers with my listing. Many people are afraid of entering into markets where products are also sold by Amazon. I personally don’t see it as a big problem at all! Amazon will usually have one listing and it’s Amazon’s own brand, which is more like a super value/generic type of product brand. There’s plenty more spaces on the first page for your product, which will have a much more specific and powerful brand! So unless Amazon completely dominates that product by having the top 5 to 10 listings, I wouldn’t worry about it at all!
- LQS – Listing Quality Score. Lastly, there’s a very handy indicator that Jungle Scout creates and it shows the overall quality of the listing. This takes into account the number of images the listing uses, the keywords, bullet points, description and some other elements.
You can also click on Extract next page results at the bottom part of the tool to get more results on the same screen.
On the right side there are 3 other handy tools:
Cloud icon – this shows the most used keywords by all the listings you analysed on the page. This is super handy when you start working on your product title, listings, and backend keywords.
I like to use this tool on the Amazon USA website where sellers are more sophisticated and most top listings are properly optimised for the best keywords.
Google trend – something you could research on your own using Google’s free tool but it’s so handy to have it built into Jungle Scout! With the click of a button you instantly see where the popularity of that product is going in the long term.
I’m sure I don’t have to remind you that it probably wouldn’t be a good idea to invest in products that show a very clear downwards spiral in popularity. (fidget spinners anyone?)
Download CSV – you can make a screenshot, share your research data on Facebook, or download it as a CSV file. I personally don’t use these because I like to use the Web App to track my products and the research I’ve done.
And this brings us to the big question – what is the Jungle Scout web app and why do you need it? It seems that this Chrome tool does everything we need, right?
Going back to the Jungle Scout website, there are monthly web app subscription plans available and they start at $25 per month if you take the yearly payment plan or $39 per month on a monthly billing cycle.
There’s also a middle plan at $40 and $69 and a top plan which will set you back $99 per month on a monthly plan or $50 per month on a yearly plan.
There are 2 major differences between these plans:
- How many products you can track at any given time. And by track I mean individual product listings which you’re monitoring with the Jungle Scout software.
- Niche Hunter function that comes only with Standard and Business plans. This is an excellent way to discover new products to sell on Amazon based on various criteria you set.
Talking about the Product Tracker function – why do we need to monitor products? Because as I explained earlier, Jungle Scout’s Chrome tool only shows approximate sales data based on the Best Seller Rank. It’s not the most accurate indicator.
So what the web application does is actually manually check stock levels for the listing you have added and this way it can precisely calculate how many units a month are sold from that listing.
So for example, if on day one there are 100 units in stock and on the second day only 90 are left, Jungle Scout knows that in the last 24 hours there were 10 sales. And by checking stock levels every day, it can precisely calculate sales per week, month and even longer periods of time.
So what I personally do is I search for various product ideas on Amazon, use the Chrome tool to see if there’s any potential and then I manually add those listings to the web tracker to start monitoring them and get precise sales statistics for each listing I want. The process is very simple as you can click on the button directly in the Chrome tool and the listing will be added to your web app account.
But it doesn’t end there – an even more important function of the web app is the product research function located under the Product Database section.
There you can search for millions of product ideas on Amazon and not simply search, but actually FILTER them out based on your criteria!
Usually you’ll want to start by selecting which marketplace you want to sell on – in this case I select Amazon UK.
Then in categories you can manually select which categories you want to investigate. I would recommend picking just one or two categories to start with otherwise you’ll get so many results that you won’t be able to go through them in days!
On the right side we can use various filters to narrow down our search results. For example, I want to see products that sell for at least £7, have at least 100 sales per month and are standard size.
You can then sort results by Total Sales, Items sold and many other data points. I usually like to sort them by highest sales first to see what’s hot in these categories right now!
Obviously most popular items, with the highest sales numbers will attract higher levels of competition, BUT as I said previously, you shouldn’t be that worried about competition on Amazon as IF you can sell a better product, a product that people will LOVE, you can still be successful, even in competitive niches.
And that’s how Jungle Scout works, in a nutshell. You use the web app to discover products, then search for the product on Amazon, use the Chrome tool to get approximate sales & competition data and then add listings to the web app tracker to get precise information on sales for that product.
It does sound a lot more complicated than it actually is! 🙂 Just give it a go, try for yourself and soon you’ll see how interesting product research can be when you find so many interesting products – products you could potentially sell and build your business around!
And it’s so cool that we can do research on regional sites too – as for example – I often do research on Amazon.com and find many interesting products people are not yet selling in the UK. This is a great advantage for people wanting to sell on Amazon UK!
There are many more tips & tricks I would like to share but we have to move on to other things…
The Key To Success – Unique Offer & BEST Quality Item!
This is probably THE MOST important section of this whole article. If you’re still with me, it means you really want to make this work. And congratulations on that! You’ll succeed if you listen to what I’m going to tell you now.
As I already mentioned – most people are lazy. Super lazy. If you ask me – 99% of people who think they want to create a successful Amazon business are far away from reality. They think that they want to make it happen but they actually don’t want it hard enough. They lack that true entrepreneurial desire, that HUNGER that makes us go above and beyond what’s considered the norm.
Why is that important? Because if you are not willing to put your BEST, your absolute BEST, into this, don’t even start! As you’ll end up like all those people who meh, do product research for 2 hours, meh – find a supplier or two, meh – import a product from China, without any extra work and then wonder why they can’t sell it, why they don’t have good margins and so on.
The same thing will happen to you IF you take this all lightly and believe you can achieve awesome results with minimal effort!
If we go back to my own business and product which I spoke about at the beginning of this post – don’t think for a second that I didn’t create the absolute best offer on the market, as I did!
I cover it all in detail in my Amazon Sharks video course but you have to understand that extraordinary results come from extraordinary effort!
Don’t let this scare you off – you may now be thinking that you need to be a genius to make this whole thing work. No, as I said, most people are lazy which means that you ONLY have to do slightly better than they do and you’ll already outcompete them, right? I don’t know how else to say this but it really is important – work hard for your dream and put those hours and late nights into this process, then you will see amazing results.
First step of the Market Research process is to find product ideas. Then, the most important thing, once you have found a potentially good product, is to LEARN it inside out! And by that I mean – you want to become an expert on that product, in a matter of a few days, one week max. How do you do that?
You’ll start by reading ALL reviews available for that product on Amazon UK and Amazon USA. Often you’ll find that there aren’t that many reviews for a product on Amazon UK, that’s why you want to use Amazon.com too.
If there are hundreds of reviews on the UK site alone, you can leave .com out of picture if you want to…. OR you can still choose to read all the Amazon.com reviews too, as you really want to make this work, right? I’ll leave you to figure that one out on your own…
Anyway, so you want to read reviews and make notes along the way – you’ll in particular write down positive and negative comments that people mention, especially ones that repeat more than once as these are the things you want to keep in mind when you source your product.
Obviously you will want to try to implement all positives people are talking about and eliminate or at least reduce the negative aspects.
For example – you research dog towels and you see that people mention that everything is good but the size of the towel is rather small. Don’t you think this creates an opportunity to source an ultra large dog towel and advertise it as that?!
Or people say that the towel is great but it takes a long time to get dry. Why not create a double pack and directly address this problem as customers can now use the second towel while one dries?
I hope you see where I’m going with this – by learning what people like and what they don’t like, you can create the ULTIMATE, best version of that product which will almost guarantee you super high conversion rates and 5 star glowing reviews.
It’s not rocket science! You simply take a product that sells well and fix any issues people have!
And you don’t have to create something new here – all you’re doing is improving an existing product. Often all it takes is just the use of higher quality materials. Suppliers in China will happily assist you with your needs and they can actually produce very high quality products, if you’re not just playing the lowest price game.
Other times all you have to do is change the colour of the product, or alter one small function/feature, add an accessory, create a 2 pack or 10 pack, change the material or packaging. It really is that simple.
And the best part is that you WON’T have to figure this out on your own! You’ll simply learn this from reviews people leave on Amazon – they will tell you exactly what you need to do to improve that product!
I really believe that this is the most crucial step of all – doing proper research into reviews, seeing what people like and don’t like and creating that ultimate version of the product. That’s why I said in the beginning of this video that I’m not that worried about competition as I know that my product and listing will simply be the best and people will vote for that by leaving great reviews!
Ok, this post is getting ridiculously long, so let’s recap what we have learned so far and more importantly – go over the exact steps you need to take next!
Here’s What You Should Do Next
Luckily for you, now you’re fully aware of the situation and this great opportunity that Amazon presents.
If you’re seriously interested in the finer details, as well as my accumulated tips, tricks and strategies from 15 years of successful eCommerce selling, the Amazon Sharks program has 100 step-by-step video lessons that will take you through everything you need to know (PLUS get my PERSONAL support along the way!):
But for now, you can simply start working on your business by doing proper market research, as I explained in this post.
Your first task is to sign up for Jungle Scout. Next, you need to put in some serious time by researching at least 50-100 products! By the time you have finished, you will have at least 2-3—probably much more—products that show good potential.
And please DON’T tell me that you can’t find good product ideas to sell on Amazon! That’s total rubbish! I have shown you so many ways you can find those products, so there are no excuses, not anymore! The Jungle Scout Product Database will give you thousands of product ideas to work through!
The most important thing right now is to just get going! I really hope you won’t leave my blog and carry on like nothing happened. Or even worse, continue “chasing your dream” by passively watching all those stupid teens on YouTube showing off their fake money, rented Lamborghinis or the AirBnB they paid for with YouTube ad money. Just don’t do it.
This is an opportunity like never before and when I say that, I mean it. I have witnessed eBay’s golden days and I have seen how it all collapsed just a decade later. Don’t be that person who looks back and says, “ah, I wish I had started that Amazon business back in the day, when it was all so easy and accessible.” This is that moment. It’s up to you to grab it with both hands!
If you’re interested in personal guidance and want to tap into my 15 years of experience, definitely check out the Amazon Sharks video course at AmazonSharks.com.
Start by watching the overview video and get inspired by the success stories of other course members. More than 500 people have joined the program and many of them are already turning their business dreams into reality.
If you have any questions about the things I have covered here, please leave them in the comments section below. I will personally reply to all of them within 24 hours, Monday to Friday.
Ok, that’s about it for now. Thanks for reading, especially if you read it all the way to the end. Remember, this is your opportunity to really take action towards that business and life you’ve been dreaming of—there has never been a better time!
Bye, bye for now.
Click Here to Leave a Comment
Great post! This has been really helpful to us whilst getting started.
I’m wondering if you might be able to shed any light on something which seems to be not so black and white…
Is it prohibited to include the website of our new, private-label product on the product packaging? If so (which would seem reasonable) then do we need to obscure this from our product listing images?
The Amazon Seller Central UK guidance (linked below), when taken literally, reads that the product/brand website cannot be included in product/listing description fields, or emails. It does not specifically call out product images and we have been able to find examples of FBA products which do show their web address on the product photos of their packaging.
Our intention for our product/brand website is simply for product information and is absolutely not for sales (FBA will be our only sales channel). For purchasing, the website will actually direct people to Amazon. However, we have included the website address in our logo/packaging design.
Thanks in advance!
I have been thoroughly researching online opportunities and the number of scams out there are crazy! Thanks for this very thorough article. Your in-depth article makes me confident about the quality of your training. It is good to have the opinion of someone from the Uk as most of them that I have found are from the US. My questions:
1. Will your training take someone from complete beginner (willing to put in the time and effort) to amazon seller? And all that is required in between?
2. If my mum has her own catering business (which is now not happening anymore due to covid) can that be used as the business for selling on Amazon?
Thanks for your comment and interest in my Amazon Sharks video course.
1) Yes, absolutely. The course covers the process from A to Z, in an easy to understand, step by step manner. I show my own, real-life account and business examples throughout the course, so it’s very easy to understand/follow what I teach.
2) Yes, you can use an existing business to sell on Amazon. The only thing you need to worry about is how it will affect your tax situation, but I cover this in detail in the first module of the course, including the best business registration forms etc.
Hope this helps Annie & let me know if you have any further questions.
I’ve read a lot of blogs about how to AMZ FBA recently and this is definitely one of the best so thank you. My question is about your course and how frequently you update your video content. The world has changed dramatically over the last few months. How do you keep your content fresh to reflect the developing scenarios? I’m very interested in joining.
Thanks for your comment.
I update my course every year. As for the Covid crisis – it didn’t change the way you start an Amazon FBA business. The only thing (in that regard) that has changed is – demand on Amazon for most products has skyrocketed. But it hasn’t changed the way we source products, do branding or madvertise on Amazon.
I would like to start selling on Amazon and I’ve been taking some courses on Helium 10. However, I’m curious on how much would you recommend for a beginner to invest in order to start selling in UK?
Take a look at this post in which I talk more about the financials of starting a new Amazon FBA business:
When you have sourced a product , do you get them shipped to an Amazon warehouse?
Yes, that is correct – to be able to use the FBA program.
I’m Looking For A Business I Can Run Whilst Still Working Full Time And FBA Seems To Fit The Bill, Can You Give Advice On How To Open A Business Bank Account? How To Deal With The Earnings And Tax I Would Pay, And Is There A Possibility Of All Your Students Ending Up Selling The Same Item And Ergo Ending Up In Competition With Other ?
Thanks for your comment.
In Amazon Sharks course I cover this in detail – what business form to choose, how to register, how to handle taxes/accounting etc.
No, there are hundreds of thousands of products that you can sell on Amazon – I only take 20 people into program every month, chances of you ending up selling the same product are very slim. And even if it happens, it doesn’t change much – it would simply be another competitor. It’s not like we’re looking for products with no competition at all – there will always be other sellers selling the same product.
Hope this helps Peter & let me know if you have any further questions.
A mindfield of learning for a newbie. How do you know a product has longevity. Need this for the effort required to create own brand product and get it too market. Have done Arbitage selling on Amazon because of this fear. Any advice Andrew in order to take the plunge on your training. Not fearful of hardwork but fearful of 100% commitment to a branded product that does not sell well. Monies easily lost.
And how present are you for support.
Thanks for your comment and interest in my Amazon Sharks program.
Product longevity will purely depend on the choices you make during the product research stage. Using Google Trends, common sense, we can easily see if a product has long term potential or not. For this reason I always recommend staying away from super hot/trendy items with short market cycle (like fidget spinners). You want to choose products that are in demand today and will be in demand in 5 years time.
With that being said, you never want to build your Amazon business around just one product, that’s too risky. You will be slowly building up portfolio of 5, 10 or more products over time and this will diversify the risks. When you see that a product slowly dies off, you simply sell it out and move onto next product ideas.
As for my support – when you join Amazon Sharks program, you get direct chat/message system access with me where you can ask any questions and get answers within 24 hours, Mon.-Fri. usually I reply within 12 hours or less.
Hope this helps Sarah & let me know if you have any further questions! 🙂
Great article! I’m really trying to get into e-commerce. I have read loads of articles but yours has been the best to date. You mentioned selling high quality products and brand them. How on earth can you do that? I’ve heard this mentioned before but I would have no idea where to source these products and how to put a brand name to them. Do you have to create a company and then add that brand name to sourced products? Where would you go to get the brand added to the product?
Thanks again for such an in depth article.
Thanks for your comment.
It’s a massive, complex topic and judging from your comment (no offense :), you have to do some serious studying to learn more about how this whole process works.
In a nutshell, you find a supplier/manufacturer for a product (usually in China), create your own brand name, outsource logo design, create custom packaging design (if needed) and give it to your supplier. They will put the logo on the product, create custom packaging and send goods to you. Then you sell those goods on Amazon and/or any other online marketplaces.
If you want to learn more about how this all works, take a look at my Amazon Sharks program:
Hope this helps Julie & let me know if you have any further questions.
Firstable congratulations for this fantastic page!
I want to start in Amazon FBA in the UK, but I have been reading that it is recommended to set it up with a Limited company as later will be difficult to change it from sole trader to company. However, I haven’t got a company yet so I would need to set up a new one and a new business bank account.
My question is, will it be a problem if I register a newly registered company? I have read on the internet that amazon may suspend your account if the limited company is pretty new.
Is that true? or what do you recommend me to do?
I would appreciate your comments.
Thanks a lot
Thanks for your comment.
Yes, ideally if you start out with an Ltd. company, especially if you plan on using it anyways. And you’re right – “upgrading” from a Sole Trader on Amazon to an Ltd. company is a tricky and lengthy process. So ideally you should start out with the Ltd. company from day one. I only recommend using the Sole Trader business form for people who know that they will stay in that status for a foreseeable future.
But no, I have not heard of any problems with brand new Ltd. companies and Amazon – this is the first time someone brings it up to me. I can’t see how the age of the company makes any difference? If it’s a legit company, all the paperwork in place, it should be all fine. People, including my clients, do it all the time and so far I haven’t heard of any problems.
Hope this helps Nick & good luck with the business! 😉
Thanks a lot Andrew, I really appreciate it,
You’re welcome! 🙂
Thanks a lot for your time, I really appreciate it.
Quick question about selling products that compliment a buyers first purchase. I sell tennis racquets and want to offer buyers a discount on purchasing racquet vibration dampeners during the racquet buying process. This is commonplace on Mercardo Livre (Brasilian eBay) for example to buy a football shirt and be shown an offer for shin pads as well to tempt you into buying a combo, before moving to the payment page. Is this even possible on Amazon UK? Is there a term for it perhaps that i’m not aware of? Thanks.
Thanks for your comment.
No, sorry – that is not possible on Amazon.
Most you can do is create another listing where you sell the bundle of both items together, at a discount.
Hi Andrew, Nathan here. For Amazon FBA, do you recommend a business registered in UK or elsewhere? In UK, do you recoomend LTD or LLC? Thank you.
Thanks for your comment.
It really depends on where you’re based?
If you’re based in the UK, register your business (Ltd. company) in the UK.
Hope the year is going fantastically or you personally so far!
I wondered how you have been progressing with your bid to go wholesale? I have recently been a approached by a would-be stockist who has asked if I would be open to wholesale.
So far they’ve only requested production time and we haven’t discussed price or anything of that nature.
I have no idea where to start, nor what to expect in terms of margins. Can you provide any tips or advice on what to look for and whether it is infact a worthwhile ventuer in your opinion?
Thanks for your comment.
In terms of margins you have to start with the retailer in mind – what will be the retail price for the item and then you can workout expected wholesale price.
Most retailers want a 2.4 multiplier on the price they pay you. This means you multiply your wholesale price (ex-VAT) by 2.4 to get the retail price. For example, if you can wholesale the item for £4 + VAT, expected retail price will be £4 x 2.4 = £9.6 (most likely they will round it up to £9.95, £9.99 or even £10).
The other way around that is to take the retail price and simply divide it by 2.4. For example, if retail price is £9.99, divide it by 2.4 and you get £4.16 – this is the expected wholesale price.
Then you simply have to decide whatever your margin is good enough to sell at that price or not.
With higher priced items the multiplier will be lower and there are, obviously, always exceptions. But this is a general guideline on the pricing when dealing with wholesale customers.
Hope this helps & good luck with the business! 🙂
I’m not going to lie, I feel so deflated! I have been reading up on your easy auction business which I purchased about a year and a half ago now (it’s taken me ages due to my young boys) I’ve finally got some time on my side and boom, not only can I not login anymore, you don’t stand by it at all. I was really enjoying learning everything with your videos as slowly as I was but I felt I was getting somewhere. I don’t know the first thing about Amazon, I’m always happy to learn but don’t fancy paying out more money. Is there anyway I can get a hold of your eab videos and templates still? I completely understand why as you always have to move on with the times but I’ve come sooooo close now to being ready with my eBay business!
Thanks for your comment.
Yes, of course – get in touch with me via my support desk (or send a message via the live chat) and I will send you info on how to access EAB videos.
Nice post Andrew. What sort of search volume would your main keywords have in order to achieve sales of 50 plus a day? I am about to launch a product and its 2 main keywords have search volumes of approx 5k a month each, what type of sales would you expect to see for this type of search volume (assuming everything else was done right)
Thanks for stopping by.
That’s the wrong way of looking at this – why do you want to complicate things and use un-reliable search volume/data?
All you need to do is use Jungle Scout and see what current sales numbers are and then you can easily see/calculate how much sales you can make per day, depending on how good your offer will be (how much market share you can take, how high you can rank etc.).
I wouldn’t base any decisions based on vague search volume data.
Good job as always Andrew!
Thanks Andrew! 🙂