What do I need to get started with FBA?

What do I need to get started with FBA?

Recently I have been getting a few questions from readers who are just getting started to see what I think you need to get started selling on amazon’s FBA program.  Most recently there were comments on my February financial results post from Sabine and Sharon requesting this, and there have been a couple emails as well, so the readers have spoken and that’s what today’s post will be about.

For a frame of reference, I will be looking at this as to what I think is needed if you want to sell via FBA on at least a part time basis, and never having sold an item via FBA before but have an amazon seller account in place.  So let’s get started with what I think is needed based on my experiences thus far.

First, and most importantly, you need to have the right mindset about FBA and be willing to be constantly learning throughout the process.  FBA requires a good amount of learning and work to get everything up and running, and as you get started at times it will be frustrating.  If you stay persistent in learning the rules, searching for inventory, consistently sending what you find into amazon, and stay diligent with this process, you will begin to see results relatively quickly.  The more you put in, the more you will get out.  It won’t always be easy, but it will be worth it as it helps you to reach your financial and lifestyle goals.

There really are not that many tools that you need to get started with FBA.  Here are a few supplies/tools that I think are worth getting right away:

The first item that I think is essential is a smartphone with a scanning app.  The scanning app will provide pertinent information about the items you are scanning right on your phone and will help you to decide which items are good to purchase for resale.  If you are an iPhone user, I would recommend first trying out either the brand new Amazon Seller app that amazon created, or the Scanpower Gateway App which is a new release from Scanpower that is completely free.  Search for “Scanpower Gateway” in the app store and you will find it, there is not a website exclusively for the app.  If you are an android user, as I am, currently your options are Profit Bandit or the Amazon Mobile app.  The amazon mobile app is free but is designed for purchasing from rather than providing the information you need to make a sourcing decision, so I think it is worth spending the $15 and getting Profit Bandit.  HERE is a link to a post I did awhile back  about Profit Bandit, and it will show you some screenshots as well to help you make a decision.  The amazon seller app and Scanpower Gateway both have Android versions in the works, so they are worth a look when they come out.   No matter which one of these you pick, use one of them, a scanning app is the #1 tool for this business in my mind.

You could definitely make the case that a scanning app, a computer with internet, and a printer, are all you need to get started selling on amazon via FBA.  When I sent my first FBA shipment in I did not even have a scanning app.  However, the scanning app I would recommend having day one, and the following additional tools and supplies will make your life quite a bit easier and I would buy them day one if resources allow (listed in order of which I would purchase them):

The first is a USB Barcode Scanner.  This will make listing items dramatically easier than typing in every UPC into amazon.  HERE is a link to the exact model that I have and use, but I would tend to think spending a few extra dollars and get one that includes a stand such as THIS ONE would be worth it.  All of these do basically the same thing, so shop and around and see what you think is the best deal for you, but buying one of these will save you a ton of time.

The next item that I would buy right off the bat is a shipping scale.  You could get by with a bathroom scale initially, but you will tend to estimate on the high end to be safe, and getting an accurate shipping scale should pay for itself over time.  HERE is a link to the one I use, and so far I have no complaints.   

A quick note about the printer that you would need for selling via FBA.  An inkjet printer is fine for printing off packing slips and shipping labels, but per amazon’s rules an inkjet printer is not acceptable for individual item labels.   If you only have an inkjet printer, I would recommend utilizing amazon’s label service, (more info HERE) initially and paying the $0.20 per item.  Once you know you are going to stay with selling via FBA and are regularly sending in items, I would then look into a thermal printer.

The next item that I would buy right off the bat would be poly bags for creating multi-packs, and for bagging items that are required to be bagged by amazon (certain liquid items and toys that are not completely sealed are 2 examples). Having these on hand makes creating multi-packs very easy, and it’s also easy to bag items where it is required.  I purchased THESE to provide me with a good variety of bag sizes.  They are also available on amazon from this seller, but I like to purchase them on eBay to get the 2% back in eBay Bucks.  Having them on hand makes life easy, and I have found that selling multi-packs (particularly in grocery) is a profitable strategy.

Next I will discuss how I would keep track of finances, receipts, etc.  For receipts, I would recommend setting up a system to store these electronically.  I would recommend scanning all receipts and then saving to Evernote, Dropbox, or your computer, and then maintain the paper receipts in a folder.  I keep a folder of receipts for each month should I need to go back to review old paper receipts.

In regards to tracking inventory and sales, I would recommending creating an excel spreadsheet for tracking.  For keeping track of inventory, I would recommend documenting: item ASIN (amazon stock information number), where purchased, date purchased, purchase price, and price listed for.  For keeping track of sales, I would document the following for each item as they sell: ASIN, net payout amount, purchase price, days it took to sell, and calculate your profit on each item.  You could cross reference the inventory and sale files to calculate profits and determine how long items to take to sell.  Going through item by item helps you to get a very good idea about how long items take to sell, as well as learning what items sell better than others.  If you are constantly entering the same item into your sales spreadsheet, there is a good chance you should buy more of that item, or look for items similar to the item that is selling.   You will have to find the actual system that works for you, but tracking as much as possible will give you the best idea of what is going on with your business, and help you pinpoint areas where you are making the most profits (to find more similar opportunities) and those where you are losing money or making lower profits (to minimize these occurrences).  Microsoft Excel would be my go to for keeping track of inventory and sales.

Lastly, I will cover some books/resources that you might want to consider depending on your experience level, and what categories you are interested in selling in.  I don’t think that any of these are essential for success, but I have all of them and found them to be well worth the investment.  Also, as far as courses for selling on FBA, I have not been a part of any dedicated courses on the subject, so I really can’t comment on if they are good value or not.  My route to learning has been through trial and error, and by reading books/guides.

The first book is Arbitrage by Chris Green.  I found this book to be a very good introduction to the process of FBA, and it definitely gave me some ideas of how to utilize the FBA program.  This book is available for purchase from amazon HERE, and is also often free via the Kindle Owner’s Lending Library if you are an Amazon Prime member.

All of the other books/guides that I have purchased related to FBA have been from Jessica Larrew.  The first was Liquidation Gold which contains some great information about purchasing from liquidation stores, and tips to help make sure trips to these stores are profitable (I would make sure you have liquidation/discount stores in your area before picking up this one).  The next was her HBA webinar which is an introduction to selling Health and Beauty products on amazon.  Before watching this webinar I had sold very few if any HBA products.  Since watching the video, I have expanded these categories to a fairly significant portion of my business.  I am not sure how much this webinar directly contributed to the level of my current HBA sales, but it definitely got me started in the category and I am glad I did get started.  The last of her books Grocery Goldmine, I did a full review of HERE.  This one is a more substantial investment, but if you are interested in selling groceries it will definitely get you off on the right foot.   If you are looking to get into sourcing from Liquidation Stores, HBA items, or get into the grocery category, all of these guides are worth a look.

All of the above are things I would look into if I was just starting FBA today.  I have purchased all of the above products and guides, and all have been well worth the price I paid.  With that being said, purchasing any of these tools or guides will not make you successful on their own.  You have to put in the time finding products to sell, getting them into amazon, and then managing them from that point forward.

As you start to do more volume via FBA, there are some additional tools that are worth looking into.  I will put together another post in the near future that covers some of the additional tools that I am using, and explain why I find them beneficial.

UPDATE 1/15/2015: I now have a page showing all of the products and services I am currently using, you can find it here: www.onlinesellingexperiment.com/resources

If there are any other aspects of getting started on amazon that you would like my take on, or have any tips to share about getting started, please let me know in the comments below.  Or feel free to email me at grant.ryanj@gmail.com.

Also, I just created a facebook page for the blog, check it out HERE!

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