Author Topic: Amazon FBA side gig recommendations  (Read 5135 times)

PAFire

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Amazon FBA side gig recommendations
« on: April 07, 2016, 06:06:16 PM »
Hi all,

DW and I have some extra time now that she has finished her graduate program, so we were considering getting started with Amazon selling to make some side income. I know that some of you recommend getting started with a product such as books, but I wanted to start this topic and solicit other suggestions for what to sell that might require less time shopping in thrift stores since we both work full time.  (That extra time I mentioned earlier is the two-three hours we see each other at night as opposed to the previous one hour.) 

So, I throw out the question to you--what would you recommend we try to sell on Amazon?  Any products we may be able to get regularly online and ship to Amazon when buying?  Also, any recommendations on FBA versus shipping items ourselves?  It seems as if FBA is easier, but we still have to ship the products to Amazon, so I am not sure.  We are looking for fairly steady income streams as opposed to simply isolated selling of random items around the house if that helps to narrow down our choices.

As always, thank you for your guidance.

Miss Piggy

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Re: Amazon FBA side gig recommendations
« Reply #1 on: April 07, 2016, 08:55:13 PM »
I don't know about Amazon, but my brother in law manages a warehouse club, and he has customers who come in and buy everything he has in stock for one item (such as a certain Serta pillow, for instance, or UGG earmuffs that are on clearance), then they turn around and sell it on ebay.

PAFire

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Re: Amazon FBA side gig recommendations
« Reply #2 on: April 08, 2016, 04:18:35 PM »
I don't know about Amazon, but my brother in law manages a warehouse club, and he has customers who come in and buy everything he has in stock for one item (such as a certain Serta pillow, for instance, or UGG earmuffs that are on clearance), then they turn around and sell it on ebay.

That sounds like an interesting plan.  Are you referring to a Sam's Club/Costco-type store?  I wonder how those people keep their shipping costs reasonable, which seems to be the main issue I am projecting.

CATman

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Re: Amazon FBA side gig recommendations
« Reply #3 on: April 08, 2016, 04:53:11 PM »
A good rule of thumb I learned is to ask yourself 2 questions. Can I do this better than someone else? Can I do this cheaper than someone else? If you can answer yes to either of those then you've found your product. I'd search around Amazon for some products you have some knowledge about and see what the answers to those questions are. If you answer yes then I say go for it.

Miss Piggy

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Re: Amazon FBA side gig recommendations
« Reply #4 on: April 08, 2016, 04:58:52 PM »
That sounds like an interesting plan.  Are you referring to a Sam's Club/Costco-type store?  I wonder how those people keep their shipping costs reasonable, which seems to be the main issue I am projecting.

That's exactly the kind of club I'm referring to. I know for some items for which the box doesn't really matter (such as a pillow that's sold in a box), they use the item box as the shipping box (obviously more securely taped).  They get REEEEAAAAALLLLLYYYYYYY good clearance prices at the store, so they can afford a bit for shipping and still make a good profit.  And they avoid big, heavy items.

It's big business for the people who work at it. Some will go to every club/store in a region and buy all of one particular clearance item. Then make significant money reselling said item.
« Last Edit: April 08, 2016, 05:00:46 PM by Miss Piggy »

randymarsh

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Re: Amazon FBA side gig recommendations
« Reply #5 on: April 08, 2016, 09:37:21 PM »
Definitely give it a shot. The start-up costs are extremely low.

I've been doing FBA for about 9 months. I'm not extremely profitable ($700 before taxes in 2016), but I'm about to make a big push and see what I can accomplish this year. I think with more effort I can do $1000/month gross profit.

The thing with thrift stores is that they're insanely profitable, but can be time consuming. Things I've sold from thrift stores:

  • $3.99 textbook for $45. Net profit of $29.35
  • $1.07 Xbox video cable for $54. Net profit of $41.51
  • $6.45 ink cartridge for $60. Net profit of $41.88

I've found that you get much quicker making buying decisions after time. I can now go in a thrift store and spend less than 20 minutes looking for items. I know what sells and what doesn't and what will sell but not worth the effort and time. At first though, it was pretty frustrating. I could spend an 1 hour at one store and end up buying stuff that took months to sell or resulted in a loss.

Clearance aisles at Target, Walmart, etc. can be good, but I've found it's really store dependent. Some stores around me never have anything. Others have tons of profitable items.

I found these Crayola paint packs at one store for $1.97. Selling on Amazon for $15. Profit was only $10, but I bought like 10. So that was an easy $100.

Don't only do clearance. There are tons of items that are regular price at stores but sell for 3X on Amazon. I found this screwdriver for $20 that sells for $60.

Good luck!

PAFire

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Re: Amazon FBA side gig recommendations
« Reply #6 on: April 09, 2016, 10:49:27 AM »
A good rule of thumb I learned is to ask yourself 2 questions. Can I do this better than someone else? Can I do this cheaper than someone else? If you can answer yes to either of those then you've found your product. I'd search around Amazon for some products you have some knowledge about and see what the answers to those questions are. If you answer yes then I say go for it.

Those questions are quite salient and provide me with an excellent starting point.  I have begun examining some Amazon categories this morning and will continue my research throughout this weekend.

That's exactly the kind of club I'm referring to. I know for some items for which the box doesn't really matter (such as a pillow that's sold in a box), they use the item box as the shipping box (obviously more securely taped).  They get REEEEAAAAALLLLLYYYYYYY good clearance prices at the store, so they can afford a bit for shipping and still make a good profit.  And they avoid big, heavy items.

It's big business for the people who work at it. Some will go to every club/store in a region and buy all of one particular clearance item. Then make significant money reselling said item.

Thank you for the tip.  I suppose that weight issue makes sense as well as using the actual item's box to save time and money on finding other shipping boxes.  My wife and I are planning a Sam's Club run next weekend, so I plan to do some research on the clearance items while we are there.  Thank you for the suggestion.

I could spend an 1 hour at one store and end up buying stuff that took months to sell or resulted in a loss.

Good luck!

Thank you for the item suggestions.  It seems as if thrift stores do offer quite a bounty; do you use the Amazon seller app on your phone to determine items' profitability?  I saw that some people mentioned using this app while others discussed using paid apps.  Any recommendations for helping to identify those profitable items more quickly?  Thank you again.

randymarsh

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Re: Amazon FBA side gig recommendations
« Reply #7 on: April 09, 2016, 11:51:07 AM »
Thank you for the item suggestions.  It seems as if thrift stores do offer quite a bounty; do you use the Amazon seller app on your phone to determine items' profitability?  I saw that some people mentioned using this app while others discussed using paid apps.  Any recommendations for helping to identify those profitable items more quickly?  Thank you again.

I use the Amazon app occasionally, but since I pay for www.inventorylab.com, I get their app Scoutify for "free". It's much better overall. It calculates your profit based on your buy cost and you have links to CamelCamelCamel within the app. The benefit of the Amazon app is that it tells you if you're not allowed to sell the item you just scanned (I'm not approved to sell in Auto or Health and Beauty for example). Comes in handy if I find say a small air compressor designed to be kept in the trunk of your car. It might be categorized as Auto or it could be Home Improvement. I can only sell the latter.

Experience is really the best teacher. But the big thing with Amazon is that it's not eBay. If a customer on Amazon buys something listed as "New", it had better be new. There are items I find at thrift shops all the time that I could probably sell but the box is in such bad condition I don't bother. The profit on one item isn't worth getting a bad review, plus they'll probably just return it anyway.

My best thrift store items seem to be sort of unique/niche. Book sets are often good. I found this old encyclopedia set for children (theme was Charle Brown) for like $10 and sold it for $40. I sold a 99 cent VHS tape(!), brand new, for $80. It was some movie from the 50s.

At big box stores, it's really trial and error. I've had success with home improvement type items and believe it or not, children's bedding (sheets and comforters branded with Star Wars or Despicable Me, etc). Sometimes you just get lucky. I was at Target to get something for myself when I noticed they were having a huge bedding sale. Items that normally wouldn't have been profitable suddenly were so I walked out with $300 worth of sheets.

Spend a few minutes scanning even at stores you might not think would have anything. I've gotten a surprising number of things from Home Depot.

I try to make at least $10 per sale. I've gone lower than that (if I can buy 10 of 1 item and make $7 on each one, I'll probably buy it). Ideally you want to be making more than that so you can afford to lower your price if other sellers or Amazon start competing. The good news is that I rarely lose money and when I do, it's usually a loss of $1-$5. Some sellers do a lot of consumable items, but you have to be approved in those categories and it's harder and harder to get that approval. If you can sell makeup, you might find lipstick on clearance for $1 but it's selling for $7. Your profit per item is only $2 but if you can sell 10 or 20 units a day it adds up. I've seen Target end-caps with dozens of marked down items like this. This is low margin, high volume route.

PAFire

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Re: Amazon FBA side gig recommendations
« Reply #8 on: April 11, 2016, 02:48:30 PM »
TheFinancialStudent,

Thank you for that thorough reply.  Excellent advice about the differences between Amazon and eBay, namely the importance of item quality.  I think I will try out some thrift store shopping this weekend coupled with our trip to Sam's and hopefully end up with some products to try out.

I will definitely check out the Scoutify app, too, although I may stick with the Amazon app until I get things going.  Also, thanks for the advice on profit margins.  That was one of the large unknowns I had in terms of a minimum level of profit since I used the Amazon calculator and noticed that inexpensive items' revenue gets eaten quickly by the Amazon fees, whereas items above $15-20 seem like more profitable bets.  Again, as you pointed out, I suppose it comes back to volume versus profit margin, too.

Thanks again for the great advice.

randymarsh

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Re: Amazon FBA side gig recommendations
« Reply #9 on: April 11, 2016, 03:38:14 PM »
I used the Amazon calculator and noticed that inexpensive items' revenue gets eaten quickly by the Amazon fees, whereas items above $15-20 seem like more profitable bets.  Again, as you pointed out, I suppose it comes back to volume versus profit margin, too.

Yeah it's really hard to make money unless the selling price is at least $15 and preferably closer to $30. Even on a $15 item, your buy cost better be like $1 or less or it's just barely worth it.

Something I also wanted to mention is that the best seller rank is important. You want items that are going to sell quickly. I've bought quite a few things that didn't sell for 60+ days and that sucks for cash flow.

I learned this the hard way with some Christmas themed purchases. I bought for $100, selling for $200+. I didn't get them to Amazon in time and the holiday season was winding down. So I have about $500 worth of these items stuck at Amazon and the price has plummeted since January. I can either lower my price and hope someone buys them during the off season or keep it profitable, but wait until October/November for demand and prices to pick up.

If you have the capital, this is actually a great strategy. But when you're just starting out you want to recoup your investment ASAP to buy more product.