Between oversaturation of sellers, global supply chain woes, and two-bit “coaching” services designed purely to hawk ancient courses to viewers dazzled by lamborghinis, it’s easy to assume the Amazon FBA party is over. Failed sellers are shouting, “Amazon FBA is a waste of time and money!” and “Only 0.01% of sellers make it!”
If you’re one of those people wondering why would Amazon FBA be worth it in 2022, I invite you to flip the narrative: why would Amazon FBA be a waste of time in 2022?
Because with the wrong attitude, nothing you will ever do will work. But with the right attitude, you open yourself up to the possibilities.
Today, I’m going to take you through both sides of four common arguments against Amazon FBA to show you why it’s (still) a completely viable business model.
#1 Ecommerce rivals the brick and mortar model.
In recent years, ecommerce has been steadily catching up with the centuries’ old brick and mortar model. This has never been more true than throughout the Coronavirus pandemic when millions of people, out of fear of becoming ill by going out in public, turned to online shopping for just about everything, including groceries.
In 2020, the US alone processed $792 billion dollars in online shopping revenue, up 32% from 2019. That number then jumped another 16% to $919 billion last year.
But much in the same way that all souvenir shops in one city sell the exact same merch, isn’t ecommerce running out of originality?
The naysayers: Ecommerce is oversaturated.
Here is what they would tell you:
Everybody and their dog is selling ecommerce…on Amazon, no less.
Unless you’re a Flubber or Inspector Gadget style inventor, the best product you can create is an unoriginal knock off of someone else’s unoriginal knock off.
Sure, coaching “gurus” promise the secret to creating a truly unique product, but anyone legitimate would tell you, “There are simply not that many original ideas left.” And even if you do stumble upon one, you’ll face dozens of competitors hawking your idea in different colors, with more bells and whistles. All you have to do is search just about any item on Amazon and look at the floods of products that are all viable options.
Whatever product you launch, you will be up against an insurmountable amount of competition both for sales and simply views. Your own manufacturer might even rip you off and sell your product for cheap!
Those that tout (actual) Amazon successes most likely joined several years ago, before selling on Amazon was known as “a thing”. The only reason those older sellers haven’t bolted yet is because they either don't know what else to do or where to go, or they’re so established customers still choose their products over newer ones. Turns out Amazon is actually an older person’s game.
Additionally, you might have noticed the recent trends towards buying and sourcing locally. Specifically, there are large sectors of society who purposefully avoid buying anything online and especially supporting multi-billion dollar corporations who rely heavily on China.
If you do come up with a unique product, you’re much better off making it yourself and selling it in some “Made in Austin” type store down the street, not the online masses.
The successful: Ecommerce continues to gain momentum and expand the reach of brick and mortar stores.
Not only is ecommerce a viable option, it’s a growing opportunity. Ecommerce has yet to eclipse brick and mortar sales across the board, but that actually might not be so far into the distant future.
Ecommerce has been growing steadily for the past several years. That’s a good thing. When industries spring up too quickly, they tend to dissolve much faster than they appeared.
During 2020, a year shrouded in Coronavirus hype, global ecommerce grew 32% (thanks to said hype and concern). In 2021, global ecommerce sales grew by a modest 14% and constituted just 13.2% of all retail sales. There’s room to grow and the industry is doing just that: growing. Growth equals opportunity.
Case in point, there are more than 20 million ecommerce sites across the web.
Moreover, brick and mortar stores come with a lot of overhead (building rent, electricity and other utilities, employee salaries, etc.) and creating one product to sell on an established platform is a much more attractive retail attempt than leasing an actual space only to have to staff it and fill it with products.
Speaking of established platforms, for all the 20+ million ecommerce websites out there, Amazon receives just about half of all ecommerce sales. That’s bad news for 19,999,999+ other sites and platforms.
And while Amazon’s seller numbers are growing, so is the platform’s consumer reach. Amazon has continued to grow at least 20% each year for the past 15 years. That number jumped to 37% in 2020, totalling $386 billion in revenue that year, alone. And many of those sales came from third party sellers, just like you could be. In fact, in the fourth quarter of 2021, third party sales accounted for 56% of all Amazon.com (US marketplace) sales.
And that’s not just with old, established sellers and brands. A majority of new sellers report profits within their first year selling on Amazon (some within 3 months!).
Brick and mortar may not be disappearing, but neither is ecommerce. And if you’re dreams don’t amount to a full-fledged storefront, ecommerce is an extremely attractive alternative.
Already convinced and don’t need three more critically analyzed points? We will show you step-by-step how to take advantage of Amazon’s growth and find product niches that have not been tapped. Our product research method has helped hundreds of students find products with high demand and low competition, which made them six figures a year. Check it out here.
#2 The global supply chain is in crisis.
The Coronavirus pandemic and the Russo-Ukrainian War have certainly complicated the already-complex realm of global transportation. And yes, shipping lead times have increased exponentially while gas prices continue to climb like they’re competing against Mt. Everest…but does that mean retail and ecommerce are over?
The naysayers: The global supply chain crisis is insurmountable.
Here is what they would tell you:
Just look at the facts:
- US West coast ports—such as the Port of Los Angeles—have faced a continuous backlog of ships waiting to unload, delaying already-lengthened transport timelines.
- Shortages of inland truckers in the US have caused freight yards to move container inventory into short-term storage and billing the freight’s owners, often unexpectedly.
- China’s manufacturing output continues to escalate meanwhile the number of available shipping containers in China to transport all this new product are scarce.
- Strains on Chinese energy infrastructure, due to increased manufacturing logs, has caused energy shortages and reduced the number of hours manufacturers can manufacture. This has increased production timelines and product costs.
- High manufacturing costs coupled with increased transportation costs cut into product profit margins exponentially.
- Just One Dime coaches have been quoted as much as $60,000 to ship a full container load (FCL) via sea freight from China to the United States.
- Even trusted freight booking site Freightos has had to concede that sea freight transport times have jumped to 80+ days end to end.
Pack up your workspaces. For those that have already bought in, this was a “fun while it lasted” type ordeal. By pure assessment of the facts alone, there is no workaround to the disastrous state of international shipping.
The successful: There are workarounds to the current challenges posed by global trade.
Reality is tough right now…at least in this particular area. So what can be done?
Dutch footballer ⚽️ Johan Cruyff said, “Every disadvantage has its advantage.”
Every obstacle listed above boils down to two major issues: cost and time.
Manufacturing and shipping costs are too high?
Find a way to make a product that sells for a greater profit margin. If you’re stumped, Just One Dime can help; we’ll even send you unique product ideas that fit our core criteria. Bonus, when shipping prices back down, you’ll likely be able to maintain your higher sell price and make greater margin.
Shipping lead times are borderline ridiculous?
If you have products on shelves, begin your inventory planning for your next batch as if it will take half a year to get here (no one has seen lead times that long) so you don’t run into any inventory gaps that hurt your seller account’s health. Bonus: your competitors probably aren’t thinking that far ahead and will run into inventory gaps, meanwhile your products will flourish by comparison.
If you’re just starting to think about Amazon FBA and/or creating your own retail brand, pull the trigger and go. The longer you wait to move to action, the longer it will take you to move to profitability…especially in this transportation climate.
Bonus: similar to the upside for existing sellers, your future competitors selling now are probably not thinking about inventory planning and restocking as far ahead as they should. When your product hits the market, many competitors will be out of stock, which you can leverage for lower cost advertising that gets more shopper eyes on your products faster. Faster shopper attention equals faster conversions equals greater success.
#3 There is no guarantee that you will succeed on Amazon.
Many have tried selling Amazon FBA. Some are more successful than others. Yes, some sellers fail. But does that necessarily mean you shouldn’t try?
The naysayers: The failure rate on Amazon FBA is unacceptable.
Here is what they would tell you:
So why bother?
Amazon FBA is a waste of time and if you try it, you’ll just be wasting your own time and money.
Amazon wants you to think that the bulk of their sales come from third party merchants but in reality they just want you to come aboard so they can milk you for fees related to this, that, and the other thing.
Think about it: you have to pay Amazon a percentage of every sale you make. You have to pay fees just to sell on their platform. You have to compete against other sellers to pay Amazon the most money for advertising. You have to pay fees to use FBA.
Amazon punishes you if your inventory sits with them too long. They also punish you if you run out of inventory with more fees. And then they charge you to remove unsold inventory.
There’s simply no winning.
Sellers fail on Amazon every single day. The system is stacked and the odds that you’ll make it, even with help, are about 1:99.
The successful: Success on Amazon is not random; it’s about work rather than luck.
Nothing on this planet is guaranteed. Last I checked, Amazon was on this planet.
If you’re spiraling in the self-pitying mindset that success on Amazon is possible for everyone but you…well, first off, ditch that mindset. It will only slow you down and eventually guarantee itself.
I’m not saying selling Amazon FBA is easy. On the contrary, I’ll be the first to admit it’s hard (but step-by-step coaching can help).
I’ve launched dozens of products and some of them were busts. I’ve lost thousands of dollars to this industry, but I’m still successful. How?
Because I don’t give up. Because I work hard and when things get tough, I work harder.
The truth is like anything worthwhile in this life, you will face obstacles. You will be tested. There might come a point when you think giving up is your only option. And that is the precise point that you must keep going if you’re going to be successful.
Do your research.
Find resources that can help you, products that have consumer demand, suppliers who won’t scam you. You won’t find any of these things just lying around or on your social media home feed. But they do exist.
So no, success on Amazon is not guaranteed. That only means that lazy sellers won’t succeed. That’s not a blanket statement that you can’t succeed by any means.
#4 The Amazon FBA platform is difficult to figure out.
The Amazon platform is completely shopper-focused and friendly (which makes sense since that’s where the revenue comes from), but seller friendly?
Not so much.
Sure Amazon has resources for sellers, but they’re decidedly cryptic, especially for a platform that hosts over 6 million third party sellers.
So if you have plans to sell on Amazon, you not only have to pay for your products, shipping, fees, etc…but you have to pay for a coaching service, too. Right?
The naysayers: “Amazon course” companies will leave you high and dry.
Here is what they would tell you:
“Course” is a rather taboo term in FBA circles. And if you take a quick look around Reddit or the internet at large, it’s easy to see why: dozens of would-be FBA sellers claim to have lost thousands to scammers promising “fail safe”, guaranteed successes on Amazon. But in the end what do you get?
A big box of nothing.
Why is it that just about every “course”, “guru”, and “coaching” service that offers help for Amazon FBA features a car that costs upwards of $200,000?
If not a car (or in addition to one), there’s glamorous trips and shows, safaris and raves…not that any of that has anything to do with Amazon FBA.
Self-proclaimed “gurus” either have way too much time on their hands and no real interest in Amazon at all or are failed sellers who decided to con others into following their secret “success hacks” (those who can’t do, teach, right?).
With course prices in the thousands of dollars, you’d be better off hosting a large-scale fireworks show for your neighbors than investing in an Amazon FBA “coaching” service. 🎆
These “gurus” want to make you think they purchased that fancy car or hosted those cool events with their Amazon sales when really they’re just trust fund brats.
Case in point:
The successful: With the right information, anyone can make Amazon FBA work for them.
Don’t pick your coaching company based on their lambo. Anybody over the age of 25 (in the US) with a valid driver’s license can rent a flashy car for a few hours. Also, it doesn't take a genius to add fake testimonials to a website, and fancy cars and trips do not equate to the heart and grind needed to build a successful business.
To be frank, anyone that makes their Amazon FBA coaching video more about a car (not sold on Amazon) rather than their methodology, success rates, or anything remotely related to business is probably not the smartest investment.
There are coaching companies out there who actually have some substance behind them. There are coaching companies where you actually get what you pay for. And there are some, like Just One Dime, who can help you turn your initial investment into a thriving business that allows you to fire your boss and live the life of your dreams.
It doesn’t have to be Just One Dime. We are not the only legit service out there. Or the least expensive. But we do offer the best value.
We have dozens of testimonials if you’re dubious, though. And in many cases the sellers who have done testimonial videos for us have their own YouTube pages where they post these videos.
Also, we at Just One Dime much prefer Teslas to Lambos. 😉
Even if you opt for no coaching service, which is a perfectly viable option, you will likely find some (free) information elsewhere to guide you.
And if you do opt to go it alone, take accountability: it’s up to you to ensure that the information you choose is vetted, actionable, and relevant. Don’t blame a guru if you fall for their schtick. You make your own decisions.
As with everything, do your research.
I hope this read has allowed you to understand and consider both sides of the argument Is Amazon FBA dead? And I hope I have shown you that Amazon FBA is, in fact, not dead.
Amazon FBA is very much alive. Moreover, it’s a legitimate way that hundreds, if not thousands, of people worldwide have supplemented, and in some cases replaced, their incomes.
There are actually sellers who have made millions selling Amazon FBA. They do exist. I’ve even hired some of them.
More to the point, there’s no reason you can’t become one of them (not that you have to come work with me once you do). You just need perseverance, determination, and maybe the right tutorials and how-to guides to make it happen.
If you’d like to learn more about what we at Just One Dime can offer, how we can help and guide you along your journey, visit JOD.com/freedom, where you can apply to speak with a member of our team.
No games. No BS. We even offer a full refund within 14 days of purchase if you are not 100% satisfied with your purchase. We’re that serious about what we do: training entrepreneurs to build margin to do the things they love with the people they love.
Will you take a chance on yourself? If so, go here to book a meeting with one of our team members.