Amazon is more than a website where you buy the goods you need or want. They also offer a lot of ways to make money. There are people making millions of dollars selling on Amazon. Good for them! But just a fraction of that would change most people’s lives. If you could use a little extra coin, then keep reading and see if something interests you.
1. Fulfillment by Amazon (FBA)
Amazon FBA is the preferred way to sell your products to hundreds of millions of Amazon customers. With this program, you send in your goods to an Amazon fulfillment center. They will take care of picking and packing them for orders and delivering them to buyers. They also handle all the returns and customer service. Since most products have several sellers, FBA sellers tend to get the sale. The Amazon marketplace is one of the best places to sell online.
Fees for selling on Amazon
There are fees involved when you sell with FBA. The most important thing to note is that Amazon charges $39.99 per month for an FBA account. You then need to find products to sell, have them shipped to you for labeling, etc. Next, you pay to ship them to the fulfillment center, but at a special shipping rate.
Once sold, Amazon charges you their fees to work their magic, which is around 15%. Also, if your product takes a while to sell, there could be storage fees.
But don’t worry, you can still make money. It is so much cheaper than starting a physical retail business. Way cheaper! And you can’t beat the traffic Amazon brings to their site every day. People visit their site intending to buy something.
Just to give you an idea of a real-world example: I purchased 10 copies of a new game for $23.50 each. By the time I added in all the shipping and Amazon fees, my costs were $42.46 each. I sold the games for an average total sales price of $62.07 each, for a profit margin of $19.61 per game. This is a 46% return on my initial investment for each product sold. So you can see how you can earn extra money on Amazon.
You might be wondering where Amazon sellers get their merchandise to sell on Amazon. That’s a topic for another post. But here are the usual sources if you want to sell products:
Where to source products
You can create your own product, as in something you make or have manufactured.
You can create your own brand from products sourced from places like China. The items should be labeled and packaged with your logo and branding. They called this selling private label products and they will have their own Amazon page with you as the only seller. Sometimes this is referred to as white-labeling or brand-creation.
You can buy products from wholesalers and sell them on Amazon at a marked-up price. You will need a resale certificate from your state, which is usually very easy to get. Reselling wholesale products is the preferred way to source inventory to sell on Amazon This is how a significant percentage of sellers do it, but this leads to a lot of competition with several sellers selling the same product.
You can buy products at other stores, such as Walmart, Target, or thousands of others, and sell products for more on Amazon. We know this as online arbitrage if you source online. There are many software programs that can help you with online arbitrage. You can find a list of them here.
You can buy products at local stores or find items at garage sales or Goodwill to send to the beast that is Amazon. We know this as retail arbitrage, which takes more time than online arbitrage. Retail arbitrage is extremely competitive and difficult to scale. This is because you have to continually find new deals to buy and resell on Amazon. There are a lot of sellers who have gotten their start this way and if you don't have a lot of money to start with, this is the way to go.
You can resell used books, games, and toys. This has worked really well for me.
This might seem overwhelming, however, there are lots of ways to learn how to sell on Amazon successfully.
Seller Fulfilled Prime allows you to store your items in your own warehouse. You must ship Prime orders the same day someone orders them. Like the FBA Amazon seller, SFP sellers are more likely to get the sale over other third-party sellers who don’t have the Prime designation.
There are no fees, except you have to pay the shipping charges. Other extra expenses are the need for a warehouse and hired help.
Amazon is very selective about who gets to sell with the SFP program because you have to perform with the same precision as Amazon.
The requirements to become a Seller Fulfilled Prime merchant include:
Shipping over 99% of orders on time
Offering Premium Shipping Options
Having an order cancellation rate of under 0.5 percent
Using Amazon Buy Shipping services for at least 98.5 percent of orders
Allowing for all customers inquiries to be handled by Amazon
Delivering orders with Amazon’s Seller Fulfilled Prime carriers
With this option, you’re responsible for the entire fulfillment process and need to ship products yourself. You are also responsible for your own returns and some customer service. This option lowers your costs. FBM sellers don’t get the sale as often as they would if they were using one of the first two selling methods.
Most buyers on Amazon only look for items that sell as “Prime”, since they get fast and free shipping. But you will still get sales and also pay much lower fees to Amazon. This works great if you also sell other places like eBay or your own online store and want to make money on another avenue.
When deciding which of the three professional sellers to be, there are other considerations as well:
Use FBA (Fulfilled by Amazon):
Products are small and light
Products are fast-moving
Products are low-priced
Products are your own private label products
Use SFPS (Seller Fulfilled Prime):
You are a multi-channel retailer
Products are heavy or oversized
Products ship in multiple boxes
Personalized or customized products
Products are perishable
Products require traceability
Use FBM (Fulfilled by Merchant):
Products are slow-moving items
Products are heavy or oversized
Products ship in multiple boxes
Personalized or customized items
You have free help with shipping and packing
selling on amazon hand-drawn graphic
4. Amazon Associates (Amazon Affiliates)
If you have a blog and website, you can drive traffic to the Amazon website when you promote products to your readers by being a part of the Amazon Affiliate program. We also call this being an Amazon Associate. If any of your redirected visitors buy from Amazon, you will get a commission.
And it doesn’t even have to be the items you recommended. If they follow your Amazon Associates link, you get a referral fee on anything they buy as part of the Amazon affiliate program, but usually only in the 24 hours after they visit the Amazon site.
Try not to get too excited because the referral fees are not that high with the Amazon Affiliates program and you might not make as much money as you expect. It depends on the product and category and can range from 4 to 15%. Still, you can earn a referral fee if you have a blog and a lot of followers with the Amazon Associates program.
The Amazon Associates program is probably the most popular affiliate program on the Internet and there is a reason for that.
If you have an artistic streak, then Merch by Amazon might be a good way for you to make money on Amazon. You can upload your artwork, choose a product that you want the artwork printed on, and set a price. You can make artwork for T-shirts, long-sleeve T-shirts, sweatshirts, hoodies, etc. Amazon is always adding new printable items.
If customers order your product, Amazon Merch handles the printing, shipping, and customer service. For instance, a T-shirt sold for $25 will net you almost $12 in royalties.
You can join the Amazon Flex program, deliver products to customers in your local area, and earn money. According to the Amazon Flex page, you can earn $18 to $25 an hour as a Flex associate. You can set your own working schedule and there are opportunities 7 days a week.
If it’s available in your area, you can apply to be a delivery warehouse associate. This differs from working in a fulfillment center. Your focus will be on getting packages delivered to the customer. There are both full and part-time positions available.
You will work out of one of these Amazon locations:
You can apply for a job as an Amazon Work-from-Home Customer Service Associate. Even though you are working from home, the position isn’t available everywhere. The base pay starts around $15 per hour and is a good way to make extra money.
There are also non-customer service positions for those with a qualified technical background. Other jobs include cloud tech, account managers, engineers, advertising associates, and technical trainers.
Since Amazon is quickly becoming one of the largest employers on the planet, there will continue to be new opportunities to work from home for Amazon.
Almost every state has an Amazon fulfillment center. Fulfillment associates can earn $15 per hour or more. Work inside an Amazon warehouse includes selecting, packing, and shipping customer orders.
This is a fast-paced position, with a full-time schedule. Shift options include overnight and days, and usually at least one weekend day.
You can self-publish eBooks through Amazon Kindle Direct Publishing. For books priced between $2.99 and $9.99, you earn 70% of the purchase price. For books priced outside that range, you earn 35%.
Think about things you know other people might pay to know. If you are an artist, you could publish a collection of your work. Your book could also be fiction or you can write about something you are passionate about. The authors who make the most publishing their books typically write on one topic and write a lot of books. Some authors claim to make over $40,000 per month with Kindle Direct Publishing.
If you’re already creating a Kindle book, it makes sense to add a paperback version as well. Amazon has this covered with an in-house print-on-demand service called KDP Print. As the author, you will earn a 60% royalty before deducting printing costs.
You’ll need to create a separate book file and cover for your paperback. They handle KDP Print books through the same author dashboard as Kindle Direct Publishing and are an excellent way to make money on Amazon.
If your book is suitable for audio consumption, then you can earn a nice royalty and passive income. It will also make you look more legit if you have audio, Kindle, and paperbacks to offer your customers.
Amazon created the Audiobook Creation Exchange (ACX) to make it easy for authors to create audiobooks. There you can find narrators to produce your book for you or upload your files if you’re doing it yourself.
Self-published authors earn 20%-40% royalties through ACX. How much you make depends on the distribution options you select and how your producer gets paid.
If you have a soothing voice, then you could make money using recording audiobooks. You can narrate books for others who need audiobooks recorded as an audiobook narrator and producer. You will also need to know about audio engineering equipment.
You will make fixed-price bids on projects that authors post on ACX. You can also opt to take a share of the audiobook royalties when it sells. In both cases, you’ll submit your audition and compete with other narrators.
If you are a craftworker or an artisan, you can apply to be one of Amazon's Handmade sellers. Think of it as Amazon’s version of Etsy. It is so much easier to sell on their platform than a retail store.
You control your own prices and can ship out your items yourself. The fees are much higher than Etsy, as they charge 15% commissions and a $1 minimum referral fee. A percentage-based cost for selling products on Amazon is usually 7-15%, based on the final selling price.
Amazon is also very selective about who they allow into the program. But Amazon Handmade is so much easier than selling in retail stores and talented artists do well.
The Handmade Sellers program is open to Artisans who make:
Home Services allows assemblers, house cleaners, handymen, etc., to sell their professional services to Amazon customers in their area. If you’re adept at fixing a leaky faucet, cleaning, landscaping, or organizing, then you could find work here. It is Amazon’s version of Angie’s List.
When a customer uses your professional services, Amazon will take a 15–20% cut of the transaction. They are also selective in who they choose, and you will need to have general liability insurance.
The Amazon CamperForce program brings together a community of enthusiastic RV’ers. Amazon hires campers for a variety of seasonal opportunities. They allow you to choose from seasonal assignments in a variety of locations. Your responsibilities will be in the areas of picking, packing, stowing, and receiving.
Sometimes Amazon will cover your campsite fees and may even pay for some of your utilities. Some CamperForce members make $600 or more per week.
Amazon will pay you for used books, games, DVDs, Kindle devices, tablets, cell phones, and other products, giving you another opportunity to make money with Amazon’s trade-in program. This option won’t earn you any cash, but Amazon will pay you with an Amazon gift card.
Submit your items, and Amazon will estimate how much they will pay you. They give you a free pre-paid USPS or UPS shipping label too, so all you have to do is package up the item and send it off.
If you’re in the mood to purge, check out what your items are worth to Amazon. Keep in mind that the items need to be in good condition for them to be accepted.
Alex Skills are the commands used by Amazon’s popular Echo devices. You can build special Alexa voice apps, called “skills”, a unique way to make money on Amazon. As a “skill” developer, you can set your own price and earn 70% of the revenue when users buy it.
For example, Nick Schwab created a free ambient noise skill. He now has 10,000 paying customers for a premium subscription version, priced between $0.99 and $1.99 a month, and is clearly making money. He bought a Tesla with his earnings.
There is also an Alexa Developer Rewards Program to encourage developers to build out the ecosystem of skills that already exist. You can get direct access to tools to help you develop “skills” for Amazon.
You can join Amazon Mechanical Turk Program to help others with tasks that require human interaction and make money on Amazon. Tasks include data entry, transcription, categorizing, and image recognition. There are many other tasks, as well.
This is not exactly high on the list of recommendations, as it has a sweatshop mentality. Some users know how to game the system, causing an unfair playing field. If you are sitting at a mindless job doing nothing, why not make some coin with the Mechanical Turk program?
Experienced video gamers can earn serious money broadcasting their games live on the Amazon-owned Twitch.tv. Twitch streamers make money with a share of the site’s subscription fees, advertising on their channels, donations, and selling merchandise to their fans. We estimate the most popular players to be bringing in $300,000 or more per year!
There are many ways to make money online with Amazon. How much money you make depends on the avenue you choose. And since Amazon never stops creating new avenues, there will undoubtedly be more clever ways to make money with them.
If you know of other ways to make money on Amazon, let us know in the comments below. Thanks for visiting us today and wishing you the best.
Our website is here to help with tons of resources for Amazon sellers. Just start at the home page and check out mentors, courses, tools, software, prep centers, and lots of other information.
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