Amazon Wholesale Business Guide
Everyone looks for ways to maximize their earning potential and meet their financial goals. For some people, this means learning how to generate additional sources of income. If you’re looking for additional sources of income, you may want to learn how to sell wholesale on Amazon.
Whether or not you already run an Amazon store, becoming an Amazon seller and selling wholesale on Amazon can be a great way to generate extra income. From clothing to consumer goods, there is a wide range of products that you can sell wholesale on Amazon. While this path does take dedication, it can provide a steady income if done effectively.
In this article, we walk you through how to sell wholesale on Amazon. Continue reading to learn more about selling in bulk on Amazon or use the links below to skip to any section in the article.
- What Is Selling Wholesale on Amazon?
- Differences Between Standard Selling and Selling in Bulk on Amazon
- Why Sell Wholesale on Amazon?
- How to Sell Wholesale on Amazon
- Final Notes
What Is Selling Wholesale on Amazon?
Selling wholesale on Amazon is when you purchase products in bulk at a discounted price and resell these items to consumers. As an entrepreneur, selling wholesale can be a great way to place your products in front of more people. At the same time, it does require that you buy larger quantities of items when compared to the standard selling method.
Differences Between Standard Selling and Selling in Bulk on Amazon
Standard selling is different from bulk selling on Amazon. Below, we look closer at the differences between these two selling methods.
With standard selling, you list each item individually and set its price. When someone buys it, they pay that price plus shipping costs. This can be a good option if you only have a few items to sell or if you want the freedom to change your prices whenever you need to.
Selling in bulk on Amazon is a business model that involves purchasing products in bulk from a manufacturer and then reselling them on your Amazon store. Purchasing large quantities of products directly from a manufacturer typically allows you to get a discount. This makes it possible to sell the products individually or in bulk amounts for a profit.
Why Sell Wholesale on Amazon?
There are many reasons why one might want to sell wholesale on Amazon. Below are just a few of the primary benefits that selling wholesale on Amazon offers:
- Reach more customers: With millions of active users, Amazon offers you a chance to reach more potential customers from multiple locations, not just yours. By selling through this channel, you’ll be able to tap into Amazon’s massive audience and connect with buyers all over the globe.
- Increase your sales: When it comes to online sales, Amazon has the lead. In 2017 alone, Amazon generated nearly $178 billion in sales. That adds up to a pool of potential buyers you never thought existed. Selling through this channel can help increase your sales and grow your business faster than ever before.
- Save time and money: One of the best things about selling through Amazon is that you can save time and money by doing so. This selling platform has easy-to-use tools you can use to start selling within minutes.
- Maintain a steady inventory: Selling wholesale on Amazon can enable you to move products quickly, yet still maintain your inventory. Buying directly from manufacturers means that you can negotiate the best prices and consistently remain supplied.
Pros vs. Cons of Selling in Bulk on Amazon
As we mentioned above, selling in bulk on Amazon provides sellers with several benefits. However, selling wholesale on Amazon isn’t a perfect business model—there are some cons to consider as well. Read on to compare the pros and cons of selling in bulk on Amazon.
Some of the pros of selling wholesale on Amazon include:
- Faster customer ordering: You can list all your items as single inventory items. When you do, customers will be able to purchase them with one click.
- Access to high-demand products: This may require some research on your part. However, you can find access to products that have not saturated the retail market yet.
- Lower purchase prices: By investing in larger quantities of products up front, you can often get a lower price per unit, which can save you money in the long run.
- No need for private labels: As a wholesaler on Amazon, you’ll be selling products that are already produced by manufacturers. This means you won’t have to spend time, money, or energy creating your own unique products.
On the other hand, some of the cons of selling wholesale on Amazon include:
- High storage costs: When you buy in bulk, you’ll need someplace to store your inventory. Whether this is a warehouse or a storage unit or even your garage, the bulk selling model requires that you have a place to store your goods, which could end up costing you.
- Large upfront investment: Because it’s wholesale, you have to purchase larger item quantities to sell to your customers in bulk. If you’re not sure if you have the capital for wholesale, you may want to try reselling or dropshipping on Amazon instead.
- Time-consuming product research: You can find plenty of opportunities to sell in-demand products to customers not already saturated by the market. However, it may take you a while to identify the right opportunities. This also may require you to build relationships with suppliers before you can even acquire the items you want to sell.
How to Sell Wholesale on Amazon
To sell wholesale on Amazon, you first need to create a seller account and open an Amazon store. Additionally, for those using the wholesale business model, you may need to obtain a business license or seller’s permit in order to operate. Make sure to research applicable local laws before you begin selling.
Once you’ve registered, you’ll need to provide some information about your business, including your company name, contact information, and tax ID number. You’ll also need to specify whether you’re selling products that are already listed on Amazon or if you plan to list them yourself.
How Much Money Can You Make Selling Wholesale Goods on Amazon?
It all depends on the products you choose to sell and how well you market them. Generally speaking, you can expect to earn anywhere from 10% to 50% profit on each sale. Therefore, if you sell a product for $10, your profits may fall between $1 and $5.
Of course, many factors influence profitability. The price of the product, competition among sellers, shipping costs, and other associated fees all play a role in determining how much money you can make selling wholesale goods on Amazon.
With a little research and effort, it’s possible to turn a healthy profit by selling wholesale items online. Just be sure to choose products that are in high demand and have low competition among sellers.
You may have more to learn about how to sell wholesale on Amazon before you launch your first wholesale selling campaign. However, you must start somewhere. Try to find products that have a respectable profit margin but don’t have too many competing sellers.
You’re also going to have to exercise some patience as you build relationships with the right suppliers and put together your Amazon wholesale business. This may require some swift negotiation skills, a little networking on your part, and, of course, the right tools.
Use Helium 10 to gain access to an all-in-one tool for Amazon sellers everywhere. With Helium 10, you can conduct product research, optimize product listings, and review analytics. This enables you to effectively manage your e-commerce business, which in turn can help you boost profitability and grow.
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