How do you proceed about starting your own wholesale business?

Company Formation

You must first establish the company, whether in the United States or the United Kingdom.

You will also require a bank account and a website.

Contacting Brands 

After registering your company, you must locate brands via the seller tracking approach or a Google search and contact the brands with which they are connected. And you must contact them using your company’s name to obtain permission to resell them using your Amazon account. When they allow you to resell their products on Amazon, they will also provide you with wholesale pricing, such as a price sheet.

Scanning Sheets

You must scan the sheets they offer you with using a tool such as scan limitless. You can filter in that tool, and it will give you everything you desire, such as profit margins, ROI, buybox, MAP Policy.

Evaluating Products

The records that scan unlimited will give you will need to be manually checked for your better comprehension, plus you will need to include other costs such as prep and shipping inbound fees.

Ordering + Prepping

You have to purchase products based on sales velocity, ship it to a prep center for preparation, and finally ship it to an Amazon warehouse.

What are the fees that an Amazon wholesale business must pay?

Purchase cost of inventory

You must buy merchandise in wholesale model and pay the cost of doing so, whether it is 50 or 200 or 2000 units.

Shipping cost

There is a delivery cost you must pay to that brand from which you purchased the products; you can inquire about shipping costs by providing them with your address.

3PL Cost

When your inventory is delivered to prep, you must pay them for labeling. You must label all of your units, and you need pay additional charges if you want to construct a package or do any customization.

Inbound fees

You should also include inbound services fees, which are the costs of using Amazon’s partnered carriers (UPS and FedEx) to ship your product from prep to Amazon warehouse

Referral Fee

The amount that Amazon charges is determined by the category of your product. A wholesale seller’s referral fee ranges from 8% to 15%. 

Storage Fee

If you don’t have a warehouse, you can store your products in Amazon warehouses using the Fulfillment by Amazon (FBA) service.

Amazon storage fees are the costs incurred when sellers store their inventory in Amazon warehouses. When you utilize this service, you must pay various short-term and long-term storage rates.

FBA Fee

If you use FBA services, Amazon will transport your product from the Amazon warehouse to the customer and charge you fees based on the product category, dimensions, and weight.

Thing to Avoid

• Avoid over-saturated products

It’s just that certain things have a large supply and a low demand. In this scenario you will not get a good sales

• Avoid fragile & products

The chance of a fragile item being destroyed during shipping and delivery and arriving broken at your customer’s address is increased. 

• Avoid Hazmat Products And Dangerous/Flammable Goods

More prep is needed for such products increasing its costs and Amazon requires additional approvals before allowing you to sell such products.

Steps to routinely monitor once a product is live on Amazon

Once your product goes live, you must monitor their buybox several times each day to determine sales velocity.

For example, what price the buybox is, and if you met that price, you’re still in profit or not

How many sales do other sellers make?

Before you go out of stock, you must determine how many days you will need for restocking, such as your shipment and prep time.

You must reschedule according to the dates listed above.

Before restocking, make sure your products still meet the criteria. If so, go ahead and refill.

This post was written by Aniqa Tahir from our Brand Reselling Team.