When starting to sell on Amazon, most people tend to overlook and rush on choosing the product that they are going to sell. Most people get stuck looking for the ‘perfect product’ and never get started at all. In this guide, you’ll gain a deep understanding of what drives product profitability and what actually makes a good product.
- Small, lightweight, and easy to ship
It is one of the most important characteristics of a profitable product as small items don’t cost too much shipping fee and reduced storage. The bigger and heavier your product is, the more expensive shipping is. And shipping is typically the 2nd biggest expense in this business. You also want to avoid fragile products and products with lots of moving parts. The actual numbers from Amazon FBA’s classifications are: Small Standard-Size (15-inches) and Large Standard-Size (18-inches). Staying within these size limitations will ensure your product fulfillment fees stay low (and your profit margins stay high).
- Durable and non-breakable
You may also want to avoid fragile products that easily break during shipping. Find products that do not quickly wear out, or more specifically, one that yields utility over time rather than being completely consumed in one use.
- Simple and not complex
In finding your products to sell, you may also want to consider products that can be easily understood, set up, and used by the consumers. The more complex a product is, the higher your return rate, which again drives up shipping costs.
- Price ($15 – $100)
Any product selling under $15 is going to have almost no profit margin left after paying sales fees, advertising costs, shipping & handling, storage, etc. So if you’re just getting started and want to make any decent sum of money in this business, you can automatically cross off any product selling under $15. On the other end, the higher the selling price of a product, the more it’s going to cost you to get started selling it.
Quick checklist of other requirements to come up with the right product:
- Products that make at least 10 sales a day (The better the average sale units per day, the better the profits. However, baseline criteria choose products that sell at least 10 units per day.)
- 2-3 products with less than 50 reviews on the first page
- Not seasonal products. They can be sold year-round
- Proper room for product optimization and improvement of present listings
- Multiple product-related keyword opportunities
- Quick and easy product sourcing from China
- Ability to expand your brand with related products
- Can make a superior product over similar products in the market
- Product encourages recurring purchases
- The product should not have any legal issues
Other Concepts You Should Know:
- Understand the Product Life Cycle – One of the most important concepts in e-commerce that nobody talks about. You can not succeed with products that are outside of the growth phase of the product life cycle.Instead of typing out an explanation of the product life cycle.
- Don’t Fear Competition –Get excited about the products you might birth into this world, and don’t underestimate how much better you’ll make your product for your customers over time. You can’t attack this process from a fear mindset. You have to attack it from an abundance mindset. The only thing to fear is a lack of competition – which signals a dead market not worth anybody’s time.
- You Must Add Value – When you’re first starting out, you don’t want to immediately start customizing your product. The trick to getting started is finding a product with growing demand, and growing with that demand. Find the sweet spots where a lot of buyers are searching for that product, but not a lot of sellers are offering that product. That allows you to start with a relatively simple, unmodified product. And then with each order, you want to keep trying to add more value based on customer feedback and ranking data.
Here’s a quick guideline for bad products to sell on Amazon:
- Mechanical and demand high quality standards
- Fragile or require a lot of preparing to ship
- Large volumes are being sold daily on Amazon
- Sold in large retail stores
- Amazon restricted categories