How to make money on Amazon

Sell Products and Services with Amazon

The following tactics are all about selling. While selling isn’t the only way to make money on Amazon, it’s one of the most common, and there are several different ways to do it. Even if you don’t want to sell a physical product, read on. You may find a method of selling on Amazon that surprises you! 

If you’re ready to go from experimenting with a business to developing a serious side hustle — or even a full-time business — you’ll want to check out Earnable, my program that gives you everything you need to start and grow your own business. Click here to learn more.

Deliver Packages

Best for: Active people who don’t mind driving

Amazon ships packages through the regular mail, but it also has two separate programs for delivering its own packages. 

The first is a full-time job available through one of Amazon’s regional Delivery Service Partners (or DSPs). You won’t be working for Amazon itself, but rather one of its contractors that provide you with a dedicated van, so no other equipment is needed. Pay rates vary, but generally start around $15 per hour. 

If you prefer to keep your day job for now, most people looking for a side hustle prefer Amazon Flex. This side gig pays between $18 and $25 per hour, and you’re required to provide your own mid-sized car, van, SUV, or a truck with a covered bed. 

It’s an app-based system and you sign up for delivery blocks through the app as it fits your schedule.

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The Benefits of Outsourcing Tasks to Help You Increase Sales

Listen, a lot of Amazon experts and courses will emphasize the value of pictures, bullet points and listing titles. I am not saying those are not important.

They are, as is:

  1. Customer service.
  2. Compliance.
  3. Advertising.
  4. Listing management.

You need to make sure all of these things get done and are done well.

But, you certainly don’t have to do them yourself.

1. Increase efficiency

Are you genuinely adding value to or eliminating waste within the process (like using Amazon integrated shipping software or automating sales tax reporting) or are you trying to “hack” Amazon?

Make no mistake, Amazon doesn’t want to be tricked, so even something that works, for now, may not work in the future.

Stick with proven productivity enhancers like the software programs out there for sellers like you.

And always gut check yourself: “Are you productive or busy?”

Focus on productive to get the most efficiency.

2. Free up time for more important business activities

The more you outsource, the more you can focus on increasing your margins, finding and negotiating better prices on products and with services and building out your longer term strategy for increased revenue.

If you are bogged down in the details, you can’t see the bigger picture.

3. Start new projects quickly

Test fast. Fail fast. Course correct.

Amazon is constantly coming out with new tools and products.

For instance, Store Pages, Enhanced Product Content, Amazon Homemade and more.

As a general rule of thumb, in a large technology company invests in building something out, it isn’t a bad idea to be an early adopter on the tool.

Doing this can help you to gain early visibility, traffic and sales and the company works to market the new tool.

And, you can’t keep track of all the updates if you’re head is too far in the weeds. Outsource manual, repetitive tasks and focus on growth.

Sell Your Own Items

Best for: People with a scalable product to sell

Aside from Amazon’s FBA program, you can also sell your own products in a few different ways. After all, people sell their own beauty products, shelf-stable food items, or imported items directly through Amazon all the time. 

Bumblebee Linens is one example. Steve and Jennifer Chou started their business after being inspired by their own wedding favors. They began importing fancy napkins and fabrics to personalize and sell through their Amazon shop and other online outlets. 

It worked so well that Jennifer was able to quit her job, and now the couple also teach people how to start ecommerce businesses through their aptly-named site, MyWifeQuitHerJob.com

4. Mechanical Turk

Mechanical Turk is a great earning opportunity for part-timers. Amazon outsources a lot of its work and submits these jobs on Amazon Turk.

In this program, you are required to work virtuall

In this program, you are required to work virtually from home. The requester places the job on the Mechanical Turk marketplace where a worker who is interested in the particular work can offer its services.

The nature of work could be anything including filling out a survey form, data validation, etc. 

It’s a great opportunity for you to earn some extra income in your free time.

The purpose of Mechanical Turk is to complete projects faster by cutting down the work into micro-tasks.

It is very simple to join, just create a worker’s account and fill out the required information.

Workers can choose any task they want to work on.

Workers can choose any task they want to work on. However, it is a better option for US citizens as they receive payments instantly.

Looking to Q3 Amazon revenue guidance

Amazon said it expects continued progress in the present quarter.

  • Net sales are expected to rise between 13% and 17% in the third quarter from a year earlier, the company said. That would put revenue for this quarter at between $125.0 billion and $130.0 billion, or to grow between 13% and 17% compared with Q3 2021.
  • Operating income is expected to be between break even and $3.5 billion. That compares with $4.9 billion in last year’s third quarter.

During the quarter ended June 30, 2022, Amazon reported:

  • North America sales of $74.43 billion. That’s up about 10.2% from $67.55 billion a year earlier.
  • International net sales dropped for a second consecutive quarter to $27.07 billion. That’s down 11.9% from $30.72 billion a year earlier.
  • A net loss of $2.0 billion, compared with net income of $7.8 billion a year earlier. The company cited a $3.9 billion pre-tax write off from its investment in electric-vehicle maker Rivian Automotive, Inc. for the loss.

Percentage changes may not align exactly with dollar figures due to rounding.

Bloomberg News contributed to this report.

7. CamperForce

This is a great earning opportunity for someone who owns an RV. Amazon CamperForce is a program to earn some quick seasonal money.

The duty of a CamperForce associate is to select a

The duty of a CamperForce associate is to select a seasonal task in a location. When the season arrives, Amazon will assign an area then you will have to store, pack and receive Amazon packages within the designated area in your RV.

For your services, you can earn up to $550 per campsite. Check out this page for more CamperForce detail.

Determine Your Selling Strategy

There are two ways to sell through Amazon:

  1. Sell directly to Amazon
  2. Sell on Amazon yourself

Let’s break each of these down and look at a couple case studies so you can determine which is right for you.

1. Sell directly to Amazon

Don’t try to beat Amazon at its own game.

Amazon is growing its direct catalog, so swim with the tide – not against it.

Aside from Amazon becoming your customer instead of your competitor, selling directly to Amazon eliminates the job new sellers are worst at, i.e. forecasting and marketing your product become Amazon’s duty.

EDITOR’S NOTE

The promotion of your products remains your brand’s responsibility unless you pay Amazon to do it for you.

According to James Thomson, former head of Selling on Amazon,

“If you sell to Amazon, Amazon doesn’t promote anything unless you step up and pay big marketing dollars. Promoting your brand remains your responsibility.”

Also, many items sold by Amazon sell for more and faster, all things being equal.

There will be a margin difference for FBA sellers that are not competing against Amazon here.

In other words, selling unique goods on Amazon currently not already sold there is how you make the most margin.

Re-read the chapter about why re-selling is the least practical method to Amazon success to understand why this is.

So, let’s see: selling directly to Amazon puts you on the right side of the future, is easier and leads to more sales.

Keep in mind; this doesn’t mean it is right for everyone, but it certainly is an option.

2. Sell on Amazon yourself

This isn’t [necessarily] a contradiction to the previous section.

Start by selling on Amazon yourself if you find it easier to get up and going, or use this to complement your sales to Amazon.

Selling on Amazon along with selling to Amazon keeps Amazon honest and doesn’t allow the whims of their algorithm to lead to stockouts of your products.

Selling to Amazon also allows you to jump-start sales of new products by giving Amazon’s bots the confidence they need to start bringing it in themselves.

EDITOR’S NOTE

This practice is not recommended for most sellers, especially sellers that are novice to selling on Amazon.

Consult an Amazon consultant before using this method.

A Case Study: How to Sell to — and on — Amazon:

A sheet metal factory in the industrial space wanted to come out with a line of consumer products to sell on Amazon.

Based on some cursory searches on Amazon for sheet metal products and knowing the limits of their machinery, they created a simple folding work bench to be used in congested garages and sheds.

It was made with the machines they already had, hardware they were already buying and sheet metal they already stocked.

Actual Factory

Actual Prototype of Product on a Wall in a Factory

Actual Prototype of Product on a Wall in a Factory Hallway

Their initial production run was four units.

Their initial production run was four units.

Yup, four.

The total cost of labor and materials was less than most people’s weekly grocery bill.

They put up an Amazon listing and sold two units in the first week.

Actual Amazon Listing Taken Shortly After Product Went Live

After that first week and with lifetime sales of o

After that first week and with lifetime sales of only two units, the sellers, who had created an account to sell directly to Amazon, offered the product directly to Amazon.

The price offered to Amazon was similar to the net amount the company received from Amazon when selling through Seller Central.

Since selling commission and shipping costs were no longer part of the equation, the sellers could sell their product to Amazon for significantly less than $149.95 without actually cutting into their margin.

Within a week of submitting the product, the company received an order from Amazon for five units.

Although Amazon’s Order Had Not Yet Shipped They Still Promoted the Product

Despite only two sales, the product moved to the t

Despite only two sales, the product moved to the third result in relevant keywords, in a similar position to items with as many as 138 reviews.

Of course, a sale of five items to Amazon is small

Of course, a sale of five items to Amazon is small time, but the idea of going from product concept to the top of the rankings on Amazon in a few weeks is possible.

It is highly unusual, but it is doable.

How to Make Money on Amazon – Checklist:
  1. Identify what items make sense for you to sell on/to Amazon.

  2. Check if the items are already sold on Amazon. Check interest and competition.

  3. Compile the necessary information to submit those items to Amazon. Collect pictures, feature data, and descriptions.

  4. Identify the processes an Amazon order will follow.

  5. Search for and implement software services that simplify these steps.

  6. Outsource any tasks that are not already performed and core to your business.

  7. Create and document processes.

  8. Submit the product data to Amazon (Seller Central or Vendor Express).

  9. Process order.Practice makes perfect. Test, learn and iterate to help drives sales.

  10. Practice makes perfect. Test, learn and iterate to help drives sales.

Rising fees

During the first quarter, Amazon raised its price for its Amazon Prime service in the United States. In the second quarter, it also boosted Prime prices across Europe and imposed a 5% fuel and inflation surcharge on merchants who use its Fulfillment by Amazon service.

Olsavsky defended those decisions during the call with analysts.

“We added that fee grudgingly in May to compensate for some of the inflationary pressures we’re seeing. I don’t want to give you the idea that either of those increases came close to covering our costs,” he said.

Industry observers said the price hikes were to be expected.

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“Amazon Prime’s European price hike isn’t surprising after the past year of inflation and labor shortages. While it’s inevitable that some shoppers could discontinue their memberships with a price raise, I’d expect most Prime members to stay enrolled. In our past research, 75% of consumers said faster, free shipping was the top reason for joining Prime. And it was also the top reason for renewing Prime,” said Matt Kates, senior vice president at loyalty solutions provider Clarus Commerce.

Amazon’s Business Segments

Amazon divides its business into three segments: North America, International, and AWS (Amazon Web Services).The first two of these segments, North America and International, refer to geographical breakdowns of Amazon’s retail business. They generate revenue from retail sales in North America and the rest of the world, as well as from subscriptions and export sales for those areas.

Retail can be broken down further into online stores, comprising the bulk of sales, and physical stores.Company-wide, online stores accounted for $66.1 billion in sales in Q4 FY 2021, or about 48% of net sales, while physical stores generated $4.7 billion in sales, or about 3% of net sales.

North America

Amazon’s North America segment dominates its net sales, accounting for $82.4 billion in Q4 FY 2021. That is an increase of 9.3% from the year-ago quarter and comprises about 60% of the company’s net sales for the quarter. The segment posted an operating loss of $206 million during the quarter, a significant deterioration from operating income of $2.9 billion in the year-ago quarter.

Aside from retail, the other primary source of revenue for North America is subscriptions, including Amazon Prime, which offers unlimited free shipping and unlimited streaming of movies, TV shows, and more.

International

Amazon’s International segment consists of Amazon’s retail business for consumer products and subscriptions for internationally focused online stores.It also includes export sales from those stores, but not those from North America-focused online stores.

The segment reported an operating loss of $1.6 billion in Q4 FY 2021, a significant deterioration from operating income of $363 million posted in the year-ago quarter. Net sales for the International segment fell nearly 1.0% YOY to $37.3 billion, comprising about 27% of total net sales.

Amazon Web Services (AWS)

Amazon Web Services (AWS), launched in 2006, provides services to businesses, government agencies, and academic institutions to store information and deliver content. Amazon says AWS provides an “infrastructure platform in the cloud” for a variety of “solutions” such as hosting applications and websites, providing enterprise information technology (IT), and content delivery.

Amazon’s AWSsegment generated net sales of $17.8 billion and operating income of $5.3 billion in Q4 FY 2021. Net sales grew 39.5% and operating income rose 48.5% compared with the year-ago quarter.Although net sales from AWS are below net sales for the North America segment and International segments, AWS’s operating income is substantially higher.The AWS segment accounts for about 13% of total net sales. Because the other two segments posted operating losses in the fourth quarter, AWS accounts for all of the company’s operating income.

Amazon controls about a third of the global cloud market, substantially more than its next closest competitor. AWS’s biggest rivals are Microsoft Corp.’s (MSFT) Azure and Alphabet Inc.’s (GOOGL) Google Cloud.

Bonus: Create a Course to Help Other Amazon Sellers

Do you already have a profitable business making money on Amazon? If so, you may be able to share your knowledge and experience with paying customers. Creating an online course and consulting with clients are two of our favorite business models because they have low overhead and the ability to earn serious money. If you’re an Amazon expert, why not create a course to help others become one, too?

With so many options to choose from, you can get started with your Amazon side hustle today.

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