16. Pack your shipments to Amazon correctly to avoid damage, delays and penalty fees – Amazon has some fairly strict requirements when you send items to their FBA warehouses. Here are some of their rules:
Choose the correct size box for your units. If you choose too large a container, you will need to fill it will sufficient packaging material so that the box will not collapse under the weight of heavier boxes during the shipping and receiving process. For best results, use a new, single-wall, corrugated shipping container with a high-burst or crush-strength stamp
Use a rigid box with flaps intact
If you are reusing boxes from previous shipments, be sure to remove any previous shipping labels or markings to avoid confusion by the carrier.
Wrap all items separately
Use adequate packaging material
Use strong tape designed for shipping
Do not use string or paper over-wrap
Do not use loose Styrofoam pellets for void filler. (Note – We fill poly bags with Styrofoam peanuts and use them to fill voids. That is OK with Amazon –just not loose peanuts)
Use a single address label that has clear, complete delivery and return information
Use two inches of cushioning between each of your units and the inside of the box.
Neither point-of-sale containers nor pallet-sized boxes, also known as “Gaylord’s,” may be used.
Boxes cannot be bundled together using bagging, taping, elastic, or extra straps.
If you are reusing a retail box to ship different products (for example, a large printer box to ship smaller media products), be sure to cover or remove any scannable barcodes on the outside of the box to avoid confusion during the receive process.
There are other rules, as well that you need to know about.
Suffocation labels – Any poly bag with an opening of 5 inches or larger requires a suffocation label on the bag.
Poly bag your bundled items. We used to ship bundled items in shrink-wrap but Amazon now requires all bundled items to be poly bagged.
You may not ship any glass container containing liquids or gels in glass jars larger than 4 ounces.
Expiration Dates – If you are sending any food items (including pet foods and treats) that have expiration dates, Amazon requires an expiration date label on both the outside shipping carton and on the product. The date must be at least 6 months out when you send it to Amazon. As the product nears its date if it has not sold Amazon will destroy it.
All of the packaged items you send to Amazon must pass a 5-foot drop test (This does not apply to products sent in the manufacturer’s retail box)
If an item arrives at Amazon without a product label, or suffocation label or requires Amazon to do any special handling prior to storing, you will be assessed a handling fee of 75¢ per item and you will receive a policy violation warning notice.
15. Go the extra mile to remove negative feedback – When ever I get a neutral or negative feedback, the first thing I do is immediately email the customer with a very sincere apology and I include a $10 Amazon gift card as a token of my sincerity. I do not ask the customer to remove the feedback in that email. What happens is the customer usually writes me back tanking me for caring and for the gift card. I then answer that email and do two things. I explain how the error was made and I request that they remove the feedback.
In the case of the bracelet issue I mentioned above, the woman was still upset because the bracelet was a gift and a new one could not get there in time. So I offered to mail a replacement bracelet to her sister whom the gift was for and we even gift wrapped it and sent it priority mail so she got it in time and I did that at no charge and she finally agreed to remove the feedback.
In all honesty this works about 60% to 70% of the time. There are just some customers who are so angry they wont budge so there is nothing you can do about that but live with the feedback. But if you can get over half of the bad feedbacks removed you can stay ahead of the game. Note: the magic number with Amazon is 95%. If you fall below that you automatically lose your featured seller status and your account is in danger of being cancelled.
14. Label your items and shipments correctly when sending to FBA – believe me I know from experience it is very easy to mislabel products. When you put a shipment together create some type of system to double check that each product has the correct label.
I once mixed up some bracelet labels. The bracelets were identical except for the color of the stones. I put the label for the bracelets with the blue stones on the packages of the bracelets with the clear stones and vice versa. I didn’t discover the problem until I got a negative feedback from a customer who received a bracelet with white stones when she ordered blue. I was able to get the feedback reversed, but it was costly (see next tip).
My system now involves a checklist and we do not package items in such a way that we cannot see the item through the package, which allows us to perform a double check as we are putting the items in the box to ship.
13. Raise your Average Selling Price (ASP) to reduce your fees and increase profit margins – Two of the fees you encounter in FBA are the Order handling fee ($1.00) and the Pick and Pack fee ($1.02). That totals $2.02. Now if you are selling an item for $12.99, those two fees combined take 15.5% of your margin. But sell an item for $27.95 and those two fees are only 7.2% of your margin.
Here is another example. These are three products I am selling in Amazon FBA and their fees:
Fees as a % of Margin
Silk wrap bracelet
Salt & Pepper Mill Set
So as you can see, the higher you go up in price the lower your fees as a percentage of your sale. So as you source inventory, look for products with a higher average selling price.
My goal is $35.00. I have not hit that yet but am working towards it. Currently I am just over $29 ASP. The reason is I have several fashion jewelry products that sell for just under $20, but I keep them because they are insanely profitable. My cost on those items is between $3.50 and $6.00, so even with the high fees, I am still making good money.
12.Reduce Storage fees with Just in Time (JIT) Inventory Management
Just In Time refers to getting your inventory to Amazon just before it runs out. This way you minimize the time items are in storage and therefore racking u storage fees. Also this means you have less cash tied up in inventory at any one time.
Amazon offers a feature called Replenishment Alerts. You can set an alert for fast selling products. You can set the alert at the number of units or weeks of cover. I know how long it takes me to order most of my products, get them delivered to me and then to Amazon so I tend to use “Weeks of cover” for my ordering threshold. When the item reaches the specified limit, Amazon sends you an email. Here is what you see when you set replenishment alerts:
Again here are some short tips so I am combining them in one post:
10. Use Larger Images and Follow Amazon Image Guidelines – Amazon now requires images to be at least 1006 pixels on a side in certain categories and encourages it in all categories. The reason is that the large size allows for buyers to use the zoom feature. Amazon also has other rules for their main image including that the product be shown on a plain white background. Log into Seller Central and Click here to see the entire listing of Amazon image guidelines.
11. Solicit Product Reviews – If someone leaves a feedback that mentions they liked the product, I always send them an email thanking them for the feedback and leaving them a link where they can leave a product review for the product. According to Amazon, positive product reviews can increase sales on those items by over 12%.
These two tips are pretty short and sweet so I put them in the same post:
8. Describe product accurately – this may seem like a no brainer, but believe me if there is even the slightest difference between the product you are delivering and what you describe in your listing, customers will notice. This will lead to returns and negative feedback.
9. Ask for Feedback – Amazon buyers seldom leave feedback unless you ask them. I currently use Feedback Five. This is a third party service that automatically sends out an email to each customer telling that if there is anything whatsoever wrong with the transaction to let us know and give us a chance to fix it. The emails are sent out automatically and contain a link for them to just click on and leave feedback. After 5 years on Amazon my feedback was still under 50. After just two years of using Feedback Five, my feedback is now over 750. And those emails have helped me prevent several negative feedback situations when customers contacted me first before leaving feedback.
7.Don’t trust UPC codes when listing items – When you have an item for sale, you enter the UPC code into the Amazon page where it says Add a Product. But it is your responsibility to make sure the item you are selling is the exact same item as listed on Amazon. What happens is that manufacturer’s update their products with new features and don’t always change the UPC code. This happened to me a couple of years ago. I bought some home security camera systems from a liquidation outlet. Unbeknownst to me, the reason the manufacturer sold to the liquidator was they had improved the item by adding a recordable disk drive but they did not change the UPS code. So I listed my item and when it sold I got everyone of them returned along with a couple of bad feedbacks.
It is your responsibility to make sure that what you are selling on Amazon is exactly like the product in the listing. Not only look at the photographs closely but read the full description and the specs to make sure what you are selling is the 100% identical product.
Both of these tips are fairly short so I decided to post them both on the same day.
5. Answer Customer Communications quickly – When you get a question from a customer, Amazon wants you to answer it within 24 hours and if you do not that is a demerit against your account. You can see customer questions in your Seller Central just to the left of the page and you can set up your account so customer questions are forwarded to your email so you can answer them even if you are not currently working on Amazon. With smart phones you can even answer them from your phone.
6. If you are merchant fulfilling ship all orders within 1 business day and always enter the tracking information – Amazon requires you to state the handling time for all products and to meet that expectation. Not doing so can lead to losing featured seller status and if your numbers are really bad you can lose your account.
4. Win the Buy Box to Increase Your Sales – Whenever a buyer does a search, several results come up. When the buyer clicks on one of the results, the page that comes up is the buy box. According to Amazon over 78% of all sales are made through the buy box, so winning the buy box is crucial to your success.
There are three ways to win the buy box every time:
Be the lowest price including shipping. If a seller’s account is in good standing and they are the lowest price including shipping, their product will go in the buy box ahead of other sellers. Note however, if a seller is in FBA, then Amazon assumes their shipping cost to be zero. The reason for this is that Amazon Prime members get free 2-Day shipping on all products and all other Amazon buyers get free standard shipping on any item or shipment that totals over $35.Here is an example: I am selling a set of chef’s knives for $129 + $9.90 shipping. So the total with shipping is $138.90. If an FBA seller has those same set of knives, he can price them at $137.90 – $8.90 over my selling price but, $1 under my total price and he will win the buy box because Amazon assumes his shipping cost is zero.
Sell an item than no one else has. If you find a unique item and list it on Amazon, since you are the only seller, you will have the buy box every time.
Use Amazon’s bundling Policy to Create Unique Items. If someone is selling the same item as you are on Amazon, think of creative ways to create a unique product bundle. For example, one of the products I sell is Hazelnut oil.
By creating a bundle of three cans, I created a unique item and win the buy box every time (until someone copies me which sometimes happens).
You can also combine products to create a unique item. This is a set of 4 kitchen knives I bundled together with a knife sharpener.
You can combine almost anything to create unique product bundles. The one rule however, is if you create a bundle that includes a media item such as a book or a DVD, you cannot list it in the media category and you cannot combine media products with other media products.
3. Follow The Rules – just like eBay, Amazon has lots of rules and regulations, but unlike eBay, they are fairly stable. Amazon does not change their rules and policies as often as eBay so once you learn them they are easy to understand and follow. Once you log into Seller Central you can access this page that has the overall Amazon policy agreement – https://www.amazon.com/gp/help/customer/display.html?nodeId=1161302
To find specific policies on selling, log into Seller Central and click on the help button. Then type Amazon policy into the search bar. When the page comes up look in the left hand column and you will see a detailed list of the various policies related to all of your Amazon activities.
Amazon also has a great resources page for FBA sellers. Log into Seller Central first and use this link to access the resources:
2. Sell with FBA – FBA stands for Fulfillment By Amazon. This is a program whereby you send all of your merchandise into Amazon and when it sells, Amazon ships it for you. Amazon also handles the customer service, communications and returns and refunds. Since we moved from merchant fulfilled to FBA our sales have more than tripled. It is true that fees in FBA are higher then merchant fulfilled, but your merchandise will sell so much faster that you will still make greater profits. And some of those fees are offset by the cost of boxes and shipping materials which Amazon supplies as part of the fee.
In addition consider the huge time saving of not having to individually wrap and ship 20 to 30 packages a day. This allows you more time to do high-value tasks such as product research and sourcing.
I just finished an article called Twenty Tips for Selling on Amazon.com. Since not everyone visits my articles page, I decided to blog one tip a day for the next 20 days.
Amazon is the world’s largest online retail selling site. When most people buy something on Amazon they think they are buying from Amazon. But, third party sellers sell over 33% of all items sold on Amazon.
I started my online selling career on eBay in 1999. In 2006 I became a seller on Amazon. Our Amazon business never really took off until 2010 when I joined the Amazon FBA program (I will explain this below). Now our Amazon business dwarfs our eBay business. We are selling approximately 6 to 7 items on Amazon for each one sold on eBay.
It is very easy to register on Amazon. Scroll to the bottom of the Amazon home page and you will see a list of Amazon services. One of them says Sell on Amazon. Click on that link and follow the prompts and you will be set to start selling within about 5 minutes.
Lets start with Tip #1
1. Register as a professional seller – There are three big reasons to do this
As an individual seller Amazon charges you 15% Selling commission plus 99¢ per sale. The fee to become a professional seller is $39.95 per month, but as a pro seller you are only charged 15% –and not the extra 99¢. So if you sell 40 items per month or more, you will actually save money on fees.
As a professional seller you are allowed to create listings for products that are not currently being sold on Amazon. You can also create product bundles which we will show you how to do later as they are a great way to increase your profits.
Amazon has several categories that are restricted and you must apply to sell in these (Clothing, shoes, jewelry and Auto Accessories are just a few). You must be a pro seller to apply to sell in these categories.
Today’s post is a guest post by Jennifer Dunn of SellerEngine Software
5 Shapes of Amazon Sales Rank by SellerEngine Software
Amazon sellers care about Sales Rank. An item with a killer Sales Rank can be a huge moneymaker for your business. But they can also be a total bust.
Why? Because Sales Rank is more than just a single number. An item’s Sales Rank at any given moment isn’t indicative of an item’s potential future performance.
Instead you need to look at an item’s historical sales rank and see what trends emerge. Only then can you start making smart buying decisions.
We’ve identified 5 shapes of Amazon Sales Rank that will help you choose great inventory.
The Seasonal is an item that’s only popular during a given time of year or on a predictable cycle. After a period of high sales, it quickly drops to the bottom of the pile, only to come back again in the future.
Recognizing seasonal items is easy if you have their history. Look for deep valleys and high peaks on a regular cycle.
If you’re buying a Seasonal item, you want to make your purchase before the boom begins, not as it’s ending.
The Steady is an item that consistent stream of sales that you can count on. You likely won’t be the only seller on a Steady item. However, if you can get a good deal, you’ll grab a chunk of that market for yourself.
Remember that 20% of the market for an item that sells 100 units per day is better than 100% of the market for an item that only sells once a week.
When looking at historical Sales Rank, Steady items have very few deep valleys and few high peaks. Instead their sales rank stays relatively flat over time.
These 2 shapes are just part of the Sales Rank Puzzle. We’ve identified 3 more trends that you can look for when you’re looking at an item’s historical Sales Rank, as well as tips and tricks for finding this data.
Learn how to build a professional Amazon business working from home. The Complete Amazon Marketing System is a two-volume printed training course that shows you how to get started selling on Amazon and then how to build it into a long term business.
Today’s post is a guest post by Jennifer Dunn from Outright. The end of the year will be here soon and you will have to start thinking about taxes. If this is your first year selling or if you have been selling and never did taxes for your eBay business, this is a great article for you to read.
There’s a lot that’s “sexy” about owning your own eBay store. Some get into it because they hate answering to a boss. Others start online selling because they want to supplement their income and love the wheeling and dealing aspects of reselling.
If there’s one aspect of owning your own store that’s never inspired someone to make the jump, it’s doing your own taxes. Can you imagine jumping into a new venture hoping to make more work for yourself than necessary?
Unfortunately, when it comes to taxes, you are making your life a little more difficult by starting your own store. If this is your first year in the online selling business, you may not know what to expect. Here are a few pointers to keep in mind as you navigate the tax landscape for the first time.
All eBay Stores are Businesses
Yes, all of them, including yours. This is a huge misconception many have about their eBay store or any online store if they see it as a “side venture” or “hobby.” You can consider it a hobby all you want; you can even tell your friends and family it’s just a fun little hobby you have.
The IRS doesn’t care what you think – to them, you own a business, and you owe money to them for it. If you make over $400 in income in a year – no matter where that income comes from – you are required to let the IRS know. The sooner you realize this the better, as you can treat it as seriously as you should. With a professional mentality you’re more likely to do everything right the first time, and get as much out of your taxes as you possibly can.
If you’re disorganized, it’s time to fix that. You’re not the first disorganized person to open a business and you certainly won’t be the last; but if you let your disorganization get out of hand, your business is sunk. You have to keep every piece of paperwork (physical or not) and you have to know where everything is.
Why? Because it all comes back up at some point. All those receipts you saved from your eBay conference visit can go towards deductions on your April taxes. All those sales you made in your home state last month require that you file sales tax. If you can’t find any of this paperwork, you’re going to be in for a giant headache and a world of hurt with fees.
Things Change, but Don’t Fret
New tax forms pop up from time to time, and rules will change out of the blue. It will drive you crazy, especially after you get a routine going. You’ll think the world is ending and nothing will be the same ever again.
Don’t fret! Two things are sure: you’ll adapt to the changes because things aren’t as bad as they seem, and you can always fix a goof. Earlier this year online sellers were fretting over the 1099K and it turned out to be totally harmless. And if you goof, you can always send in a corrected copy of your tax return after you realize the mistake, often without penalty. However, try to do it right the first time to avoid any headaches or ulcers.
Taxes are All Around You
Seriously, it’s time to get on a routine. Not only do you have April taxes to deal with (which are more complicated than ever now) you also have sales tax and quarterly estimated taxes to deal with. If you don’t get on top of these at some point they’re going to constantly hang over your head, driving you nuts. However, if you get on a routine (ask a tax professional if you need one) everything should be fine.
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