Building A Profitable Online Business With Amazon Fba

One year ago, my Texas home was about to be sold and I was ready to become a full-time Digital Nomad.

Although I had an online service company that I could run from anywhere, I realized I needed to build up additional revenue streams.

I was familiar with Shopify, FBA, and Ebay. I was curious about how they could be used to generate passive income. However, I didn't know how to start. So I decided to take her course to learn how to create an additional revenue stream online.

Getting Started

I had no expectations from the start, other than to learn more about the industry so that I could determine if it was feasible and financially viable for me as a newcomer.

As I delved deeper into the information, I found myself alternating between feeling scared and excited.

Natalie's positivity, joy and determination made it possible for me to persevere. The whole process was so out of my comfort zone that I felt paralyzed by fear and anxiety at times.

It became clear to me that this was a viable income stream and would allow me more freedom than my service-based business. I didn't stop!

Locating a Product

The right product selection is a key part of Amazon's success.

How do you select the right product? You can do a lot of research!

After weeks of analyzing idea after idea, I was finally presented with hard data which confirmed that my ideas weren't profitable. Natalie was already working on her product and had received samples. She was now ready to ship them.

I was inspired by her progress to keep going.

Here is a brief overview of the steps that I and others took during the product research phase. Sometimes, we repeated steps 1 through 4 many times.

Steps to Amazon Product Research:

Research – Using tools such as Amazon, Jungle Scout & Merchant Words for finding and vetging ideas

Locate Manufacturers - Use Alibaba or similar online systems to locate suppliers for your product

Contact Manufacturers - Most sellers contact me via email, but I have seen some online at trade shows and in person with them.

Negotiate with Manufacturers - After receiving manufacturer responses, you can begin to negotiate price, design and minimum order quantity (MOQ), among other things.

Get Product Samples -Receive product samples to touch, test and compare

You can negotiate again - The price is more difficult to negotiate at this stage. However, you can make design changes and packaging requests after testing the product.

Make an Initial Order - Place your initial order with the manufacturer and pay a down payment

Inspect the Finished Product You'll need a third party to inspect the product once it has arrived at the destination country.

Ship Product - This is more complicated than it sounds

Promote Product - Use social media to promote your product. Run promotions, ads and giveaways to get some sales and build your reviews

You want a product that is affordable at least $20, small and lightweight, with a profit margin of at minimum 30%, or $8 USD.

Two different product ideas were presented to me and I was given samples. However, I was confronted by the costly realities of shipping them due to their weight and size.

Perseverance

Four months later, I found myself in a situation where I had not even decided on a product to sell while Natalie was making sales. I had also left my country to travel full-time.

While I was still researching different ideas, things did slow down as I adjusted to my new country and learned how to balance work, travel, and new responsibilities.

Our group continued to meet weekly, supporting each other, so I persevered.

After having seen my first two product designs, I decided to go back to the drawing board. I knew that I wanted something small and lightweight.

It was then that I discovered it. A jade face massage roller.

It was something I hadn't heard of before but I was intrigued. I reached out to suppliers and received samples.

Multiple friends and acquaintances were able to test my five samples. They gave me incredibly valuable feedback. They provided valuable feedback that was different from my initial opinions. It helped me choose the right roller design and manufacturer.

Final decision: Rose Quartz Roller with Rose Gold Metal Accents.

The Waiting Game

This stage was not without its challenges, but there was some back and forth with the manufacturer. But it was mostly a time of waiting for the products to be manufactured.

More waiting, as the products are shipped from China to the USA.

I did my best during this stage, creating my listing and familiarizing myself with my Amazon Seller Account. But I was anxious to see if all the things I had hoped would work.

Product Launch

Finally, Amazon received my cartons. They began to add them to my inventory.

I created my Amazon ads and notified my social media followers. I also kept an eye on the situation.

My daily sales increased from 1 to 2/day to 3 – 5 a day in the first two weeks. They grew steadily to 8 sales per day, then to 14.

After months of anxiety, doubt, and overwhelm, I could see the improvements and this stage was filled with excitement!

Although 500 units seemed like a lot, I was confident that I could grow my sales and the reviews I had received.

I was able to launch at the beginning December, which allowed me to see my sales rise as Christmas approached.

My first day of big sales saw 181 units sold!

I was shocked and checked my account several times to make sure it wasn't a glitch. It wasn't.

Sales resumed normalization the next day and I was back at 37 units by the end of the day. It's an understatement to say that watching sales fluctuate is a rollercoaster!

In my first month of stock, not knowing what to expect, my goal was to sell 250 rollers, or half my inventory. Despite sales dropping, I still managed to exceed that number so I was happy with my current progress.

The roller coaster ride was not over. The next day I sold 215 more units, and was out of stock.

Surprise. Surprise. Excitement. Fear. They were all present that day.

The costs

You may be asking yourself, "So how much did it actually cost?"

Here's my breakdown of costs for the essential items/services I believe are necessary to launch my product (all in USD).

Jungle Scout Chrome Extension – $177

Merchant Words Subscription - $9/month

Domain Name - $10

All Product Samples - $247

GS1 UK Code – $157

Amazon Seller Account Subscription – $40/month

Listing creation for free - $47

Photo Editing Service – $11

1000 Units + Box + Logo + Shipping - $7.025

Product Inspection Service - $118

Total costs: 8,298

After Amazon deducted their fees, my payout for the 500 first units I sold was $5,892. Double-check your fees with the Fulfillment By Amazon calculator.

Amazon will also take the monthly subscription fee and any advertising costs out of your revenue before you receive your payment. This is then directly deposited into your account.

It is possible that you have noticed that I ordered 1000 units, but sold only 500. Aha! Because I was so anxious to get my product out before Christmas, and had already missed Black Friday, I asked my supplier to ship only half of my order.

I thought that they would only need 500 units to start with and could ship those out before all units were finished, which would help me save time. They still produced 1,000 units after I sent my shipment. *Sigh*

I sure missed some sales in the last few days before Christmas, not to mention the momentum lost by being out-of-stock for nearly a month. I realized that I didn’t know what I did not know, and sold 500 units in just two weeks.

Last Thoughts

I am now more determined to learn everything I can about Ecommerce, and how to sell on Amazon FBA after my initial success.

While I have many questions and areas that I need to work on, I feel it is a viable and scalable option while I travel full-time.

Sometimes you just have to take a chance, even if it means you are forced into unknown territory.

You can't have freedom without sacrificing your lifestyle.

Although it took me 3 months to make 3k, I made it.

It taught me perseverance, discipline, and courage that are so valuable.