Starting out as an Amazon seller can be intimidating at first. Here is a detailed guideline on how to easily set up an Amazon seller account. The dilemma for people who don't have an established e-commerce business but want to get into selling is how to sell on Amazon without keeping inventory in-house.
Fortunately, Amazon is no longer restricted to individuals who have partnered with them or shipped their goods to their facilities. Selling on Amazon without inventory is a popular trend among people looking to transition to eCommerce sales but with little or no prior experience.
Learning how to sell on Amazon without inventory will help you speed up the product development and launch process so you can start making money as soon as feasible. Discover how to make a passive or full-time income without having to store your merchandise using this beginner's guide to selling on Amazon.
Advantages of Selling Without Inventory on Amazon
- You won't have to pay for your own warehouse space because you'll have it stored for you by a third party, whether through Amazon FBA or dropshipping.
- Selling without inventory lets, you concentrate on your company's marketing and branding aspects.
- This new Amazon selling method allows you to reach out to new clients by focusing on underserved markets while looking for new things to sell.
- There is no need for a large initial investment: You'll have to pay Amazon sign-up and monthly fees. Here is the Amazon fee schedule for the US.
- It allows for a more flexible work schedule, allowing you to plan your days according to your preferences.
How to Sell on Amazon Without a Product Or Inventory
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Dropshipping is a popular alternative for many sellers who wish to start a private label business but have no funds because it is a low-cost venture. It is the practice of promoting and selling things that you have not stored or maintained.
When you sell items through a dropshipping service, you're usually only responsible for promoting and selling the items. Here is how to dropship on Amazon.
To get started with dropshipping, you'll need to be able to pick the correct topic, analyze your rivals, and find a dropshipping service you can trust. Your choice dropshipping provider will assist in the fulfillment of the order and will keep track of the inventory they are in charge of at all times.
Dropshipping on Amazon Marketplace
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Dropshipping is permitted on Amazon if certain criteria are met under the seller agreement terms. Basically, you must always be identified as the product's seller of record, and all third-party supplier information must be removed from any packaging or invoices provided to clients.
Furthermore, as a dropshipper, you are responsible for accepting and processing customer returns.
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Advantages of Dropshipping:
- Low to no-cost startup: Using a dropshipping service to sell is one of the most cost-effective ways to start selling things for a profit.
- Test items more quickly: It's considerably faster to test the viability of items this way than creating your own and buying too much inventory.
- Obtain useful information: Sell a range of dropshipping products while gathering data and analytics in real-time to learn more about your online audience and the demographics you're aiming to reach.
- Sell through several sales channels: you can reach a larger audience by selling through Amazon, your e-commerce website, or social media.
- You can run your business remotely: as all transactions and logistics are handled online, giving you the freedom and scalability to grow at your speed.
- Dropshipping has decreased administrative costs because you won't be handling shipping or storage.
Disadvantages of Dropshipping:
- Lack of flexibility: Because you are bound to another manufacturer's products, you will have little control over how you create your items.
- It's a hit-or-miss situation: There's no assurance that a dropshipping website's products will sell or satisfy buyers.
- Competitive: There is a lot of rivalry in the dropshipping industry.
2. Third-Party Fulfillment Centers or Third-Party Logistics (3PL)
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Third-party fulfillment centers are suppliers that assist eCommerce professionals with inventory management. They store your inventory, pack orders, and handle the shipping, tracking, and customer service processes.
Consider hiring a 3PL provider if you can't find an Amazon no-product platform that works for you or if you're looking for other choices. Most businesses profit from partnering with 3PLs, especially if they expect a spike in sales during a specific season.
Additionally, businesses experiencing rapid year-over-year expansion may find that their current infrastructure is unable to keep up with the high demand and turn to a 3PL. This option is best for sellers who do not sell products from their house or who have grown beyond their home operations and need additional help managing big order quantities.
To begin using a 3PL solution, you must first research the target audience and credible third-party logistics businesses in your area. Before deciding on a 3PL system, consider how much revenue you expect to generate and what features and shipping options are available.
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There are several local and regional fulfillment centers that can satisfy your demands. Still, Amazon FBA is by far the most popular because of its well-known brand, reliability, and extensive resources.
A 3PL service includes the following:
- Reverse logistics
- Services for pick-up and delivery.
- Receiving, collecting, and examining.
- Warehouse storage and inventory management.
- Full truckload (FTL) and less than truckload(LTL) shipping solutions.
Advantages of 3PLs:
- Enhanced management autonomy
- Save time devoted to logistics so you may focus on other aspects of your business.
Disadvantages of 3PLs:
- Lack of physical inventory control.
- The initial expenditures will be high.
- Product distribution has less flexibility.
However, the benefits far exceed the drawbacks of growing and scaling your online business. Maintaining customer demand and a good level of service is critical to your business, and it's easier to do with an Amazon FBA business.
3. Digital Products
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Selling your digital products is another way to generate money on Amazon without any inventory. Downloadable audiobooks, digital versions of your publications, and print-on-demand products, such as selling t-shirts on Amazon or art prints, are all examples of digital products. Here is a detailed guideline on how to sell digital products on Amazon.
If you want to sell uploaded books, audiobooks, or papers, you can sell them on Amazon as a traditional seller. But, first, you will need to register with a third-party print-on-demand (POD) service to sell POD products like t-shirts or coffee mugs. After that, you may link your POD account to your Amazon account to promote your print-on-demand items.
The Advantages of Selling Digital Products:
- Startup expenditures and investments are minimal to non-existent.
- Anyone can use it, even if they have no prior expertise in the e-commerce space.
- Possibility of determining your price and profit margins.
Disadvantages of Selling Digital Products:
- In some markets, it's extremely competitive and oversaturated.
- It might not be easy to gain awareness and reach when you first join the market.
- There is no assurance of sales or success.
- High commission fees.
4. Fulfillment by Amazon (FBA)
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Simply put, Amazon's FBA program is defined as "you sell the item, and we send it." The FBA program works by holding your products at Amazon fulfillment centers, where workers pick, pack, and ship them as needed and provide any necessary customer service. In exchange, Amazon gets a monthly fee and a share of each transaction made to your site.
Amazon also assists FBA sellers by providing various tools and benefits, such as rapid, efficient shipping, global recognition of the Amazon brand, and comprehensive reporting. FBA is the way for sellers who want a complete solution for their e-commerce brands and access to Amazon Prime subscribers.
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To succeed as an FBA seller in 2022 and beyond, you'll need to understand SEO, social media, and other facets of internet marketing. FBA offers numerous benefits as well as downsides.
Advantages of Amazon FBA:
- The option to send things directly to Amazon avoids needing a warehouse.
- Using Amazon's prestige to increase the visibility of your products
- Amazon provides direct customer service 24 hours a day, 7 days a week.
- You'll get access to one of the world's largest fulfillment networks.
- An all-in-one fulfillment and shipping solution frees up time for you to concentrate on other elements of your business.
- Even if you are new to eCommerce selling in any capacity, flexible options that allow you to work at your own pace are available.
Disadvantages of Amazon FBA:
- Fees for referrals and commissions on individual sales.
- You must manually keep track of things in stock due to the lack of notifications when inventory is low.
- Storage fees can add up quickly depending on the things you're holding vs. your selling rate and profit margin.
- Pricing and fees are difficult to control because relevant markets often determine them.
How to Begin Selling on Amazon FBA Without Having Any Inventory:
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FBA is simple to use and does not necessitate much training or preparation. To get started, you'll need to do the following:
- Create an Amazon seller account.
- You may learn more about selling on Amazon and the various fees or monthly prices you may be required to pay based on the sort of platform you intend to utilize.
- Set up your FBA account from Amazon's seller account site.
- Select products to sell in your Amazon store.
- Choose a reputable supplier to dropship your products or send them to one of Amazon's fulfillment centers (depending on which method you choose).
- Create product listings and specify the sort of FBA inventory you want to deliver to an Amazon warehouse directly.
- Follow Amazon's packing requirements to prepare your purchases.
- You can also check the current Amazon routing and shipping requirements list to ensure you're taking the right measures for your products and location.
- Begin marketing your Amazon store to get customers to click on your listings and purchase your items.
Amazon FBA vs. FBM
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Amazon sellers can choose between becoming an FBA (Fulfillment by Amazon) or an FMB (Fulfillment by Merchant) vendor. Individual sellers ship products directly to Amazon's warehouse through Amazon FBA. After that, Amazon is responsible for all storage, packaging, shipping, and customer service.
On the other hand, FBM vendors post their products on Amazon but handle all logistics, including storage, shipping, and customer service. As an FBM seller, there are two approaches to handle shipping and handling to scale and build a smooth operating workflow. One option is working with a third-party fulfillment center, while dropshipping merchandise is another.
The Best Methods for Sourcing Inventory for Amazon FBA
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1. Retail Arbitrage
Buying things at a discount from retail stores and reselling them on Amazon for a profit is known as retail arbitrage. Sellers use this strategy to look for clearance and liquidation sales where retail prices on things are considerably reduced, allowing them to be resold for a profit.
Though time-consuming, this way of procuring FBA inventory is one of the most cost-effective because it does not often involve mass purchases. In addition, this is a wonderful way for individuals who are new to Amazon FBA to gain a sense of how the program and services work.
2. Purchasing in Bulk
Purchasing wholesale is purchasing a big quantity of things at a reduced cost directly from the manufacturer. The objective is to select dependable suppliers with whom you can establish long-term partnerships to maintain a consistent supply and demand for your clients.
Rather than having large orders delivered to your home or business, you can have them shipped to an Amazon fulfillment center and held there, where all logistics are handled.
3. Online Marketplace
Online marketplaces such as Alibaba, ThomasNet, IndiaMart, and eWorldTrade are other ways to find FBA inventory. This strategy, like wholesale, is purchasing in quantity at lower costs from international online marketplaces.
It's critical to be cautious of any counterfeit items when conducting product research and sourcing through these online channels. As you source things, think about pricing and quality, and keep an eye on customer service responses to see how satisfied they are.
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Frequently Asked Questions(FAQs)
1. Is it Possible to Make Money on Amazon Without Owning Any Stock?
Yes. You don't need to keep stock to generate money on Amazon using services like FBA, Merch by Amazon, or third-party inventory solutions. However, when done right, knowing how to sell on Amazon without inventory can be rewarding.
2. Is it Necessary to Purchase Inventory for Amazon FBA?
No. You can sell packaged products you already own, objects you uncover when antiquing, or even items you obtained for free via Amazon FBA. As long as you're ready to get creative with your inventory, you can use FBA in various ways.
3. Is there a Minimum Quantity of Goods that I must Sell on Amazon?
No, there is no minimum stock needed to start selling on Amazon right now. You can sell products as quickly as you like with Amazon FBA because the program is extremely flexible regarding when users must sell. Additionally, there are no deadlines or time constraints for selling with a Merch by Amazon account, so you can work at your own pace.
Knowing how to sell on Amazon without a product or with an Amazon platform built-in might help you decide which option is best for your future endeavor. Once you're familiar with the system, there are limitless opportunities to develop a six-figure Amazon business without inventory, from employing an FBA provider to using a dropshipping solution.
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