How Do I Start an Amazon FBA Business? Top 5 Seller Mistakes You Should Avoid

August 12, 2021
Written by Kevin Wong
How do I start an Amazon FBA business

If you find yourself wondering, "how do I start an Amazon FBA business?" then you are reading the right article! As a new seller on Amazon, you should enroll your products on the Fulfilled By Amazon (FBA) program. This program is recommended for beginners like you. Your inventory will be sent over to Amazon warehouses, and they will be the ones to send it out to your customers. The program also removes the hassles of packing and shipping your products on time. 

Being a new Amazon seller makes you prone to making some common mistakes that most new sellers encounter. While this is completely understandable, making sure you avoid these mistakes is crucial since Amazon is pretty strict with its regulations. It does not matter whether you are new or not— you will be penalized for making such mistakes.

On the other hand, most sellers' mistakes on Amazon were not done deliberately or had anything to do with breaking the rules. Usually, these are things that you have failed to research thoroughly.

If you find yourself in this position, don't think much about it— you are not the only one who has encountered these. Most new sellers on the platform usually are not familiar with how Amazon works. In addition, it takes some time to get over the learning curve, so you have to be patient with it.

However, it will also be more beneficial for you to avoid these top mistakes that most sellers on Amazon make. Check them out below:

1. Having the wrong Amazon seller account type

The first step is to register an Amazon account for your business. You can register it either under a professional or individual seller account. Both have their advantages, but most sellers fail to research the difference between these two accounts.

Most sellers are lured with the lesser risk that the individual seller account provides but do not know that this account is capped at selling 40 products each month. So if you are targeting to sell more than 40 products per month, it is best to register for a professional seller account instead. 

While it is really easy to remedy this mistake since you have to change the type of account for your business, it would still cost you the time and effort to make this change. You also have to understand how Amazon FBA business works if you want to use that as your fulfillment method. 

2. Pricing your products wrong

Another common mistake that most sellers make is that they price products on Amazon wrong. It can either be a case of underpricing or overpricing. To avoid this, make sure you've done complete and comprehensive market research. It is more than knowing who your target audience is, but it is also knowing how well your competitors are doing, may they be a direct one or not. 

If you are new on Amazon, the best way to introduce yourself is for you to either price your products low or add a new feature to it that is not present with other brands. As a new Amazon FBA seller, you might be tempted to price your products as cheaply as possible. This move will cost you a substantial amount of money in return for a few sales. You will also have to take into consideration the Amazon FBA fees that you will have to shoulder. These fees consist of the storage, order processing, and shipping of Amazon on behalf of you as the seller. 

3. Breaking Amazon's rules

There is a reason why Amazon gets you to agree with their Terms and Conditions. Since there are many sellers on the platform, Amazon is pretty strict in making sure that every FBA seller follows the rules. One of the most expensive mistakes you can make is violating anything written on the terms and conditions page. These violations, no matter how small they seem, can get your Seller Central account suspended. This can cost you all the investments you have made for inventory, production, and staff training. 

One of the rules that sellers usually break is the prohibited products to sell on the platform. If you want to be an effective seller, make sure you are familiar with what to sell on Amazon FBA. There is a complete list on Amazon's Terms and Conditions website that you can also look for. You can go through Amazon's terms and conditions for sellers. Remember that you must NOT simply skim on these pages; rather, take time to read and understand what is on it. 

Some of the rules are technical, so familiarizing yourself will help you be more aware of these. Ensure that you are keen on abiding by them to avoid any possible violations that may lead to account suspensions. 

4. Ordering more than what you are capable of selling

Books on Amazon are one of the best-selling products that you can consider selling. Going in as a new seller will make you want to target the same sales velocity and volume that current products in this niche are already doing on Amazon. You are most likely to achieve this if you are selling the same product; however, you have to order your inventory conservatively if you are selling in a different niche.

If you are getting your inventory from an offshore manufacturer, you can choose to order the recommended minimum amount of inventory, which is 500 units. This number may be a good number to start with, but it is important that you consider if you are capable of stocking 500 units all at once since you are just a new seller. Also, since you do not have enough data to support your products' demands on the platform, you cannot be sure how much inventory you should have. 

So before you order your inventory, you have to be sure that you can sell all of these in a specific time frame. The more time your inventory sits in the warehouse, the more money you are losing.

5. You don't pay attention to your listings

Your listings are what you should rely on to make a sale. If not optimized, you will not be able to close the deals you are looking forward to having. Therefore, it is very important to learn how you can properly optimize your product listings. 

This is what most sellers fail to put their full attention to. It is not as simple as thinking of a catchy title and putting in details about the new product. It is more than just capturing a good product image that will captivate your customers. You also have to make sure that everything in your listing is optimized; otherwise, you are just wasting a lot of your time and money.

Key Takeaway

Selling on Amazon is not easy. A lot of sellers are making mistakes that could cost a lot of money. With that said, make sure to avoid making the same mistakes. 

Do you need help with your Amazon seller FBA account? Work with a reputable Amazon seller account specialist today! Are you ready to talk about starting a business on Amazon? Send us an email at [email protected], and we will get you started with your dream business in no time!

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