You probably heard the term Amazon FBA and you might be wondering, “what is FBA?”
Well, if you’re genuinely curious about it, I have something exciting for you.
Pull out your magnifying glass and zoom in on the finer points, and together we will gain a better understanding of larger issues.
Here are 17 Little-Known Factors That Could Affect Your Amazon FBA.
Amazon – like most Amazon FBA programs – wants you to believe you can build and run a successful e-commerce business that’s automated, profitable, and generates cash around the clock in less than 90 days…
With just a couple hundred dollars in inventory…
Sounds a little too good to be true, huh?
Look, as far as most online businesses go, you could do a lot worse than Amazon FBA.
But does that mean it’s the best solution for you?
That’s what we’ll find out in this Amazon review.
The biggest things you have to consider here are:
- Inventory Management
- Product Selection
- Time to Profit
While you can make good money with Amazon FBA, it’s not as easy or simple as most course creators make it sound. Let’s break these 3 down real fast:
1) Inventory Management: If you’re doing an FBA business, the promise is that you don’t need to worry at all about inventory, because Amazon takes care of packing, shipping, customer service, etc.
However, you still need to get products to Amazon. And Amazon has very strict rules all sellers have to follow when preparing products for their warehouses.
This includes packaging, labeling, and registering products in their system. If you’re preparing all products yourself, you’ll spend a TON of time on this step (potentially 4-5 hours a day). So if you’re looking for a passive, automated business that runs itself, this might not be the best fit.
Now, yes, you can hire an Amazon prep center to do all this for you, but that eats into your margins. And remember that Amazon takes around 30-40% in fees for using the FBA program, so your profits are pretty tight to begin with.
2) Product Selection: E-commerce is a cyclical business. “Hot” products are always going in and out of fashion, which means, as an Amazon seller, you constantly need to be on the lookout for the next big thing.
That means monitoring trends, searching for products that might be popular down the line, and constantly in a rat race to – essentially – predict the future.
Sure, you can play in the evergreen market (things people always need and buy), but how much profit margin are you really going to get on meal prep containers, rubber spatulas, and golf umbrellas? Especially when there are hundreds of thousands of other sellers all swimming in that same ocean.
And because you’re constantly hunting for new hot products to sell, that takes up all the valuable time you could be using to travel, explore, read, surf, hike, or whatever else.
3) Time To Profit: Now, this isn’t the slowest turnaround time, but if you think you can put a dollar into inventory today and come out with two tomorrow, you’re sadly mistaken. From the time you first buy products to sell, you could be looking at anywhere from 4-12 weeks before you see a dollar come back.
And it could take twice as long before you break even.
Now, that’s not terrible, but what if you could start building a different (non-Amazon) income stream today, and see your first profits tomorrow?
What if you could build a passive income stream that’s actually passive?
An income stream that doesn’t require:
- Low margins
- Constantly looking for the next hot product
An income stream that brings in consistent revenues every single month (from a couple thousand dollars to well over $10,000)?
An income stream you could actually build in your spare time, and grow as large or as small as you want to, without having to spend hours a day packing, prepping, and researching?
If that sounds like something you’d be interested in, check out Digital Real Estate.
This is nothing like Amazon FBA, and that’s probably a good thing.
However, if you’d still like to know more about Amazon keep reading.
What Is Amazon FBA?
Amazon FBA is a service that was launched by Amazon in 2006. Third-party vendors may use it to automate order fulfillment and delivery. and you may begin utilizing it with a $5,000 beginning deposit.
The idea is simple: the vendor sells, and Amazon delivers.
Amazon has accomplished its aim of supporting small businesses by using its fulfillment capabilities and world-class customer service infrastructure.
In essence, the brand aimed to share its business model with others and educate third-party merchants on how to earn money the “Amazon Way.”
The continual expansion and adaption of the Amazon model to meet the needs of the ever-changing consumer landscape and online retail environment is both a blessing and a curse for those who have enrolled.
Keeping up with current trends and industry demands may not be difficult. The most difficult component is keeping up with the program’s constant changes and improvements to the method, rules, and other features.
The fact is every form of money-making opportunity has advantages and disadvantages. That is why, if you want to understand more about what these elements are for Amazon FBA, you should read on.
17 Facts You Might Want To Know About Amazon FBA
Several elements that impact your Amazon business, and to be honest, covering them all would take more than a day, so I’ve selected 17 key facts that you should be aware of if you intend to join or are currently a member of the Amazon family.
This list will supply you with sufficient information about Amazon FBA:
Profit Is High
The majority of the 9.7 million Amazon FBA sellers make between $1,000 and $25,000 per month. As a result, it’s a wonderful online eCom option for anyone seeking a side hustle or a consistent revenue producer.
However, keep in mind that there are several factors to consider before presuming you can make this much through the Amazon marketplace.
The Importance Of Buy Box
As an Amazon seller that sells a product actively, you have a chance to win Buy Box.
It may sound unfamiliar for people new to this platform, but for people who have been here for some time now, they know that winning a Buy Box enables your product to be added to buyers’ carts, which has a huge upward effect on your sales.
When you place an item on their inventory, you’ll only be charged for both the storage space and the actual delivery of the item(s).
Being an Amazon Prime member, you even get free two-day delivery and free shipping on qualified goods with no additional costs. This could be great for a fba seller.
Shipping Costs Rates Discounts
Amazon is truly one of the leading companies in the eCom world.
Shipping expenses become lesser as a result of agreements with major shipping companies.
This is awesome for everyone involved. Sellers using FBA ought to spend little money on delivery. With Amazon’s extensive distribution network, buyers get the best delivery costs and with Prime, they even enjoy free shipping.
Delivery Processing Is Quick
FBA products immediately get the Prime label and are eligible for free shipment (to the customer) and expedited shipping times under the Prime program. It’s included in the service, so you won’t have to pay or charge more for shipping to accomplish that. That’s great when trying to keep fulfillment fees down.
Track Product Supplies
Keeping track of what you have in stock is called inventory management.
Inventory management includes the process of placing orders, keeping items, and replenishing supplies that are running short. To prevent mistakenly selling an out-of-stock item, fulfillment by the Amazon system monitors the inventory performance index.
No need to do it yourself. They’ll handle it in the Amazon fulfillment center.
Save Money With Your Self-Made FBA Shipping
The company will choose the warehouse that is most suitable for your items when you send them to them.
Your products may be relocated to a different warehouse by Amazon after some time. These may sometimes be called fulfillment centers.
When this occurs, the buyer must bear the cost of shipping. Amazon does not pay for shipping to the new facility.
Requesting a custom delivery plan from their customer inquiries department can help you avoid unexpected expenses and warehouse adjustments.
Understanding your target market and the countries where the majority of your orders are being transported is essential if you want to create an efficient shipping strategy.
FBA Account Can Be Suspended
As an Amazon seller, you must abide by the company’s policies.
Your account might be at risk if you don’t follow these rules.
Here are a few things that might result in you losing your Amazon selling privileges:
- Two unpermitted accounts.
- Fake reviews
- Not meeting standard quality
- A violation of intellectual property laws
No Sales Quota
If you wish to participate in Amazon’s Fulfillment by Amazon (FBA) program, you don’t have to meet a monthly sales quota.
Products are not all created equal, and Amazon knows this. Some products have a higher demand than others.
FBA services are available to all businesses, including those with slow-moving goods.
Fulfillment By Merchant
In the Amazon Fulfilled by Merchant fulfillment model, Amazon sellers are in charge of delivering their items to customers once they’ve made a purchased from the online retailer. Either the seller or a third-party logistics service provider may take care of FBM.
This requires you to visit the Amazon Fulfillment centers regularly, which can be a hassle.
You may deliver straight to Prime subscribers in the United States from your storefront.
Although enrolling for this is better for the people who own physical stores.
Amazon FBA Fees Inventory You’ll Need To Watch Out For
The Fulfillment Fees
For every cubic foot of merchandise that you keep at an Amazon fulfillment center, you’ll be charged a specific price.
Refer to the picture above for information on how they measure your items.
The Inventory Storage Fees
Charged per unit for picking, shipping and handling, product returns, packing your orders, and customer service.
The FBA income calculator may be used to get an idea of what your fees will be and to get a preview of those fees.
The Removal Order Fees
A per-item fee is charged by Amazon if you want them to return or dispose of your goods. Keep that in mind when you factor in the fba fees as well.
The Long-Term Storage Fees
All things that have been in a fulfillment facility for more than 365 days are assessed monthly, and you may be charged for your slow-moving items.
You may avoid long-term storage expenses if you keep your inventory in good shape.
The Unplanned Services Fees
An additional fee is levied when goods arrive at a warehouse without adequate packaging or labeling, resulting in the need for unanticipated services.
The Returns Processing Fees
When Amazon gives a consumer with free return shipping, the customer is charged for the purchase.
Now that you have the information, it’s up to you whether you make use of it or not.
Is Amazon A Scam?
So, is Amazon a scam? Not technically. You can make money with this program, but it’s definitely not as easy as Amazon makes it sound.
There’s a ton of work to be done upfront, no real guarantee of success, and – most importantly – you need to do a ton of volume to make any real money.
Now, there’s nothing wrong with front-loading the work and making the money later.
But if you’re grinding it out for 3 months and then your reward is 15% profit on a $12 product (which comes out to $1.80), it’s not really worth it.
What if, instead, you could do that same 3 months of work (in your spare time), and your reward was a $500 to $2,000 payment that came in every single month (recurring revenue)?
And what if you actually didn’t need to wait 3 months? What if you could get started today and have your first payment in a week?
And what if you could double it next week?
Well, that’s the power of Digital Real Estate.
And, unlike with Amazon FBA, you can legitimately do this from anywhere. It’s a true lifestyle business.
Your laptop and an internet connection is all you need.
Some of the most successful students in this program run their entire 6-figure businesses from:
- A camper in the middle of the woods
- A beach chair on the water in Mexico
- A small villa in Greece
They’re able to travel around, living their lives first, and focusing on their income second.
Because even if they stop working for an extended period of time, the money keeps coming in.
So adventure, memories, and experience are the top priority.
And they never have to worry about how to pay for the next trip, or consider asking for time off.
If this sounds more like the type of life you want to lead, just click here to find out more about Digital Real Estate.
Are There Alternatives To Amazon?
Yes, there are plenty of other business models to choose from if you want to pursue making money online. Here are just a few:
What Is My Top Recommendation In Making Money Online In 2023?
Our review team has spent months researching, reviewing, and vetting dozens of business models and thousands of programs.
While there may be no “perfect business”, the research IS conclusive:
Whether you’ve never made a dollar online, or you’ve been in this space for a while but never really “made it,” Digital Real Estate is for you.
1) It’s Flexible: got an hour a day? You can do this. Ready to drop everything else and dive in full time? You can do this. Yes, the more time you put in, the faster you see results. But even with a little time each day, you can move the needle in a Digital Real Estate business.
And because this system is so flexible, you don’t have to constantly be working to make more money. It’s called PASSIVE INCOME because if you stop working, the money doesn’t.
Imagine taking 3 months off to just tour around Europe, rent a cabin in the woods to write a book, hike the Appalachian Trail, or live on the beach and surf all day.
This is only possible if you have an income stream that’s not tied to your time.
2) You Own & Control EVERYTHING: With Amazon FBA, you don’t really own anything. Yes, you technically own the products before you send them into an Amazon warehouse, but that’s it.
You don’t own the sales platform, you don’t own a brand, and you don’t own the customers.
Not to mention, Amazon can literally shut you down at any time if they believe you’ve violated their constantly changing terms of service.
So you’re building a business that could be completely taken away from you in the blink of an eye.
With Digital Real Estate, you own the assets, which means you have all the power and all the control.
3) Little To No Startup Costs: It’s possible to get into Digital Real Estate with zero dollars upfront. Because, using the strategies outlined in this program, you can get a client to pay you BEFORE spending a penny out of your own pocket…even before you do any work.
Even without getting paid in advance, you can have your first Digital Rental Property up, running, and generating profits for less than $100.
4) No Inventory: As mentioned above, spending 4-5 hours a day prepping and packing products to send to Amazon is a huge time commitment.
Plus, you constantly need to be buying new products if you want to maintain your business. You need to spend even more money if you want to scale up.
With physical products, you’ll always have limits on your time and freedom.
With Digital Real Estate, a 100% online business, you never have to worry about that.
5) Easy To Duplicate: Ok, here’s the best part: once you have your first Digital Rental Property up and running, you can literally DOUBLE your income with a few clicks, a couple keystrokes, and a single phone call (and you don’t actually need the phone call).
Remember: each Digital Rental Property is worth $500 to $2,000 a month in semi-passive income (over 95% profit). Every time you decide to create another one and increase your income, it gets easier.
Because you have more knowledge, more experience, more results, and more momentum.
If you wanted to double your income with Amazon FBA, you’d have to double your inventory OR your profit margins. And, guaranteed that’s a lot harder than a few clicks and a few minutes of your life.
6) Make Money Helping Real People: This part is what makes it all worth it. Amazon FBA is a decent way to make yourself money, but it doesn’t improve anyone else’s lives.
After all, there’s always someone else selling rubber spatulas and umbrellas. That might be fine in the short term, but in the long run you may feel like you’re missing a purpose.
With Digital Real Estate though, you’re actually helping people by solving your clients’ biggest problem…
Small, local businesses need more customers, and with Digital Real Estate, you are unleashing a flood of happy, paying customers for these businesses.
You make money by helping them make money.
Not a big, faceless corporation either…a small business owner who’s using that money to put food on the table for their family, start a college fund for their kids, or take care of a sick parent.
Once you see how Digital Real Estate makes a real impact in the lives of real people, you’ll sleep like a baby with a big smile on your face.
Now, the choice is yours. You could continue browsing, looking at opportunities like Amazon which could one day make you money.
You could continue researching, never making a decision.
OR, you could take a look inside, consider what you really want, and join a program that makes your dreams a reality. At the same time, joining a community of over 2,000 successful students that are living life on their own terms thanks to Digital Real Estate.
A consistent, reliable, semi-passive stream of income that doesn’t depend on you or your time to keep producing profits.
All while genuinely helping real people who are grateful and happy to pay for it.
If this sounds more like what you want out of life (or if you just want some nice side income), click here to learn more about Digital Real Estate.