It is said that everyone comes up with at least one business idea worth millions in their lifetime. Jeff Bezos, came up with his during a plane flight. Intrigued by predictions about the success of the internet, he set up a tiny online bookshop based in a private garage in 1995. Initially, the service was to be called 'Cadabra' after the magical 'Abra- cadabra'. Catchy, right?
The service's first lawyer, Todd Tarbert, was of a different opinion, however. He noticed a significant similarity between the name and the word "cadaver", which means "corpse" in English. In the end, it was decided that the name should refer to the world's largest river. Today, we already know how apt that comparison was. In one of Bezos's biographies, you can read about a bell that rang when another order came into the garage. After a few weeks, the idea was abandoned because... the bell rang non-stop! In just the first month, Amazon sold books to residents of 50 US states and 45 other countries. Bezos immediately invested in further developing the company. The product range was expanded to practically everything. Today, it is safe to say that Amazon is the largest global e-commerce platform in the world. It currently has more than 310 million active users and more than 6 million sellers.
Does Amazon need to be taught?
On the internet, you can find a plethora of courses for Amazon users, not just beginners. This is not to say that the platform is not intuitive and can't be navigated without specialised knowledge, quite the contrary. On the contrary, the service provides a multitude of features to boost sales and make it easier to operate on the platform. So what do you need to know to be successful on Amazon? Below you will find some basic information that will make your first steps on Amazon easier.
A beginner's guide on Amazon
- Start with a good plan
Determined to enter foreign markets specifically with Amazon? Good for you! Now is the time to make a good plan. Even before investing, it is a good idea to check the demand for your planned sales. In order to do this, it will be useful to be able to search the Internet in depth - there are numerous reports, forecasts and news available online. Of course, it is best to look at those written in the language of the country whose market you want to enter. It is also a good idea to research the platform itself, to get a feel for the potential customer and to check availability with competitors. Of course, the most professional solution would be to put your planning in the hands of a qualified marketplace agency such as Commercebay. Our experts will help you realise the potential of your business right from the start.
- Credibility is key
Amazon chooses its business partners with great care. Buyer comments and shop traffic are the cornerstones of a good life on the platform. For the same reason, first-time sellers should prepare themselves for full account verification. At this stage, a CEIDG statement, credit card and bank account number are essential. In addition, a bill, such as an electricity or internet bill, as well as a scan of the account custodian's identity card will be useful to fully confirm the company's details.
The time for full verification varies from a few weeks, even up to several months. It all depends on what is to be sold. To trade in, for example, dietary supplements or electronics, the relevant certificates will be needed. In this way, Amazon ensures the safety of its customers and thus builds the platform's reputation.
- Which selling plan on Amazon to choose?
It depends on how much momentum you want to start with and how much you invest. Of course, the more you put in, the greater the range of opportunities you will get, but rest assured, Rome was not built in a day.
The platform offers two types of sales - individual and professional.
The individual sales plan is the default option when setting up an account. This option will be suitable if you assume monthly sales of up to 40 items. For the individual sales plan you will pay 0.99$ per item sold plus commission.
The professional sales plan is recommended to most sellers because it allows them to benefit from Amazon's full capabilities. Among other things, it provides the option to use nomen omen, professional tools and advertising, access to reports and sales results. It is also worth knowing that the professional plan allows you to list in all categories, even those blocked for the individual plan. For this option, you have to pay 39.99$ per month and add a commission fee for each sale and any processing fees.
A commission fee is charged to each product sold, regardless of the sales plan. It ranges from 6% to 45%, depending on the product category, but the most common is 15%.
- Which sales model will be appropriate?
The sales model is really your mode of operation. Depending on your plans, you have two options:
FBM- Fulfillment by Merchant
In this case, Amazon is just an intermediary platform for selling your company's product. As a seller yourself, you are responsible for shipping the goods to the customer, taking care of returns, complaints and all customer service. A big responsibility, yes, but at the same time the FBM guarantees the greatest control over the whole process.
FBA- Fulfillment by Amazon
In this case, your role ends with sending the goods to the warehouse. Amazon takes care of the rest of the process-packing the goods, sending them to the customer, dealing with returns, and resolving any shipping issues. This option is of course correspondingly more expensive. It consists, among other things, of the cost of storage or shipping. It is worth bearing in mind, however, that sellers who switch to FBA see a significant jump in sales, not least because their account has the possibility of achieving Prime rank, and this inspires confidence in Amazon's customers.
- Seize the opportunities and act!
We mentioned Amazon's myriad possibilities earlier for good reason. It's worth getting to grips with them in order to squeeze this lemon to its limits. But not all at once.
To begin with, for example, it is useful to know what an account marked "Prime" is. Seller Fulfilled Prime, as this is the correct name of this option, obliges the seller to ship the purchases within two days, as well as cover the shipping costs. Simply joining Seller Fulfilled Prime is free, but the seller must pass a trial period and meet several conditions. The number of cancelled transactions must be no more than 1%, on-time shipping is 99%, and Amazon-ordered shipping is at least 95% orders.
It is also worth knowing what a Buy Box is, which is nothing more than a 'buy now' button. Most transactions are carried out using this button, and sellers who do not have it are at the bottom of the race for customers, because the Buy Box works on the basis of an offer competition. Several, a dozen or even dozens of sellers are connected to a single offer. The order is key here - the platform places sellers according to their sales data, account performance and price.
Finally, we would like to emphasise once again that newcomers to Amazon may feel overwhelmed by the number of possibilities on the platform. Don't worry, even the old-timers will be surprised by more novelties. Therefore, if you want a really professional approach to your beginnings on international Amazon, and Bezos is not you, it would be a good idea to do it with the help of professionals.
As a marketplace agency, we will help you plan the launch of your business so that your idea, the one worth millions, results in live cash!
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