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Amazon Seller Program

What Do You Need to Become a Seller on Amazon?

To sell on Amazon, you must reside in a listed country on Amazon's registration site. The list includes most countries, except Russia and Belarus as of July 2024. You need a valid phone number and an internationally chargeable credit card. Account registration requirements vary by country, outlined below under “Create an Amazon Seller Account.”

How to Sell on Amazon

Selling on Amazon is simple, and the company explains it in detail on its website. Consider these basic steps:

1. Create a Business Plan

A well-thought-out business plan is essential before selling on Amazon. If you already have a business, consider how adding Amazon as a sales channel will complement your existing ones.

Your business plan should include:

• Product details and competitive advantages over existing Amazon products
• Sourcing methods (self-manufacture, third-party production, wholesale purchase)
• Financial projections considering Amazon’s fee structure

2. Find a Profitable Niche

Amazon offers nearly every product imaginable, except those forbidden by law or its own rules. A popular book even called it "The Everything Store."

As of 2022, Amazon's top five categories for independent sellers are:

• Health and personal care
• Beauty
• Home
• Grocery
• Apparel

These categories attract many buyers but also have high competition. Finding your niche on Amazon requires market research and trial and error.

3. Do Your Market Research

Besides various market research tools available, Amazon offers exclusive ones like the Product Opportunity Explorer, which provides data on customer searches, available products, and sales performance.

Amazon prohibits certain products, including illegal, unsafe items, or those requiring prescriptions. It also lists "restricted" products that may need preapproval before sale. Categories with restricted/prohibited items include alcohol, explosives, human parts, medical devices, and offensive materials.

4. Find a Product Supplier

If you are not making your products yourself, you'll need a supplier. You have two options: hire a manufacturer to create white-label products or buy ready-made products from a wholesaler.

Working with a wholesaler is usually easier unless you want unique products. Wholesalers buy large quantities directly from manufacturers and sell them to retailers.

Amazon suggests, "For flexibility in selecting products without dealing directly with manufacturers, consider working with a wholesaler. They have products ready for you, so you don't need to handle product development or raw materials."

5. Place an Order with Your Supplier

Ordering from suppliers typically becomes easier over time as one gains more insight into the demand for their products, seasonal variations in sales, and other factors. Initially, it is important to carefully consider the quantity of products to order, based on expected sales and practical considerations, such as storage space availability.

Many wholesalers have minimum order requirements and offer discounts for bulk purchases. As Amazon notes, "With wholesale, the goal is to purchase enough to benefit from the wholesale discount but avoid ending up with more product than you can distribute."

6. Create an Amazon Seller Account

Amazon offers two types of seller accounts: individual and professional. The primary distinction between the two lies in their fee structure, although professional accounts also provide additional services.

With an individual account, sellers pay Amazon 99 cents for each sale made. In contrast, a professional account incurs a monthly fee of $39.99, irrespective of the number of sales. For those who sell 40 or more items per month, the professional option is advantageous.

To open either type of account, the following information is required, in addition to your name and email address:

• A bank account number and bank routing number
• A chargeable credit card number
• A government-issued national ID number
• Certain tax information
• Your phone number

To register for an Amazon Seller Store, visit sell.amazon.com and click "Sign Up". Select a selling plan (Individual or Professional) and set up a Seller Central account by providing business and personal information. After creating the account, you can list and price your products, choose a fulfillment method, and explore promotional options.

Begin Registration:

Steps to Start Selling on Amazon

1. Visit sell.amazon.com and click "Sign Up":

• If you already have an Amazon customer account, you may use the same email and password for your selling account.
• Otherwise, create a new Amazon account by selecting "Create your Amazon account".

2. Choose Your Selling Plan:

• Select the Individual or Professional selling plan based on your business requirements and sales volume.
• Individual plans feature lower monthly fees but higher per-item selling fees.
• Professional plans include a monthly subscription fee but offer lower per-item fees.

3. Register and Create Your Seller Account:

• Complete the necessary information, including business details, contact information, and tax information.
• Identity and bank account verification may be required.
• Specify your business location and type.
• Provide personal information and billing details.
• Add product information and details about your Amazon store.
• Once registered, you will gain access to Seller Central.

4. Configure Your Seller Central Account:

• Review your public seller profile.
• Consider registering with the Amazon Brand Registry for brand protection and access to the Store builder.
• Select a fulfillment method, such as Fulfillment by Amazon (FBA).

5. List Your Products and Begin Selling:

• List your products in Seller Central.
• Price your products competitively.
• Utilize Amazon Ads to promote your products.
• Create an Amazon Storefront to showcase your brand.

Additionally, specific registration requirements may vary by country. For instance, in the United States, Amazon states, "You will need to go through an online step-by-step interview that will determine whether you need to complete a W-9 form (as a U.S. taxpayer) or a W-8BEN (as a non-U.S. taxpayer). You might also be required to provide additional documentation such as scanned copies of a passport, national ID, bank account statement, or credit card statement."

If at any point you wish to switch from one type of account to the other, this can be done.

In addition to the aforementioned account fees, Amazon charges a “referral fee” on each sale, which is a percentage of the sale price and varies by product category. For example, consumer electronics, clothing and accessories, and lawn and garden items each have different referral fees. In many categories, the referral fee is 15%, but it can range from as low as 3% to as high as 45%. Most categories also have a minimum referral fee of 30 cents.

Another optional expense to consider is advertising fees. Advertising on Amazon increases visibility and provides more prominent placement on the site.

According to the U.S. Federal Trade Commission (FTC), which is suing Amazon, advertising fees "have become virtually necessary for sellers to conduct business." The FTC alleges that these combined fees force many sellers to pay close to 50% of their total revenues to Amazon, harming both sellers and shoppers by raising the prices of thousands of products sold on and off Amazon.

The FTC, joined by 18 state attorneys general in its September 2023 lawsuit, accuses Amazon of being a "monopolist that employs a set of interlocking anticompetitive and unfair strategies to illegally maintain its monopoly power." As of March 2024, the case remains unresolved.

7. Create an Amazon Product Listing

To sell on Amazon, create a product listing in Seller Central. Provide a product identifier (UPC, ISBN, GTIN, or EAN), a SKU number for inventory tracking, and details like the description, price, and shipping options. Follow Amazon's technical specifications for images. Amazon also offers best practices for effective listings.

8. Manage Inventory

When selling on Amazon, you can either use Amazon's inventory and fulfillment services, where your products are stored and shipped from Amazon's warehouse, or manage storage and shipping yourself. Amazon boasts over 400 fulfillment centers, some as large as 28 football fields, holding millions of items. Managing inventory means balancing between having too much stock that might not sell and not enough to meet customer demand. Amazon offers tools to track inventory and reorder when supplies run low.

9. Advertise and Optimize Your Listing

Amazon offers paid advertising to boost your listing's visibility. You can also optimize your listing to attract more traffic.

The Amazon site suggests using primary keywords in product titles, starting with the brand name if available, and keeping titles about 60 characters long. Describe items in clear, concise bullet points, ideally no more than five.

Amazon provides tools like Manage Your Experiments for A/B testing different versions of a listing to determine the most effective one.

The Bottom Line

Selling on Amazon allows individuals to start a business or expand an existing one by using Amazon as a sales channel. However, it is not free, so prospective sellers should examine all associated costs carefully.

FIND THE PRODUCT YOU WANT TO SELL EASY ON SMITH DISTRIBUTORS AMAZON MARKETPLACE. 

SMITH DISTRIBUTORS offers free Drop Shipping services to all customers. Whether you want to set up an online store or sell on Amazon.com, you'll find everything at smithdistributors.com. We manage inventory and online accounts, saving you from costly investments and complex systems. 

AMAZON SELLER (AUTOMATICALLY): (IT IS NOT FOR AMAZON FBA)