Selling on Amazon for Dummies 2021

Dummy's Guide to Amazon FBA
Seth Kniep
Mar 5, 2021
Start on Amazon
Raise your hand if you buy products on Amazon.

Do you know that every time you buy on Amazon you are making someone else rich? What if you were to put yourself on the other side of that equation and start receiving that wealth instead of spending it? 

Amazon generated $96.2 billion of revenue last quarter, growing 22% year over year.

Here’s the cool part: you don’t have to have an MBA degree. You don’t need any business experience. You don’t even have to open a business to start selling on Amazon. All you need is knowledge on how to do it and belief that you can. 

Today, I’m going to give you 6 steps on exactly how to start selling products on Amazon. 

Step #1: Open your Amazon seller account. 

You do not have to open a company to get started. 

Just start. 

Here is how: 

Sign Up to Become an Amazon Seller

Amazon will take you through two stages of setting up your new seller account: store owner and tax verification

Part 1: Store owner

Click “Create your Amazon account.” What you input will be your business email address. This can be any Gmail or Yahoo address. It's best to have your business email be separate from your personal email so important updates don't get mixed in with junk and spam.

Get Started on Amazon

Enter your email, and create a password. Click “Next.”

Create Your Amazon Account

Verify your email address. Amazon will send you an email with a code that you can copy and paste onto the webpage.

Amazon OTP
Verify Your Email Address

Select your country.

Select Your Country

Select your business type.

Select Your Business Type

Enter your name or business name. At this stage, we recommend you start with your personal name. 

Click “Agree and continue.”

Enter Your Name

Enter your information.

Enter Your Information

Select your account type. Select the professional seller account plan so that you save money in the long term and get access to a ton of essential Amazon features.

Select Your Account Type

Check the North America marketplace.

Check the Box to Register in North America

Enter your billing information.

Enter Your Billing Information

Enter your store information. You can name your store whatever brand name you want. 

Amazon Store Information

Enter your identity information. This will either be you as a sole proprietor or your business. We recommend that you start off as a sole proprietorship. A sole proprietorship is your default business type when you start a company as an individual. You usually don't have to file any paperwork with the government to become a sole proprietorship. You can later upgrade to an LLC easily. 

Amazon Identity Verification

Amazon will then email you stating you successfully set up your Amazon account.

This brings you to part 2 of setting up your Amazon store…

Part 2: Tax verification

At this stage, the application will take you through a Tax Interview

This is a simple W9 or W8 form that you fill out, answering questions about you or your business’s tax identity so that Amazon can report your income to the IRS (Internal Revenue Service) after the full tax year. 

When Amazon reports your income to the IRS, this goes on a form called a 1099-K and you will receive a copy as well. 

A W9 is for US-based Amazon sellers and a W8 is for non-US-based Amazon sellers.

In the Tax Interview, Amazon will request information such as your company type, federal tax ID (Employer Identification Number or Social Security Number), your tax name (you or your business) and the associated mailing address. 

Remember, even if you are not located in the US you can still open an LLC in the US and apply for an EIN (Employer Identification Number).

At this stage, the verification team goes over your application.

Keep an eye out for any emails and provide what they ask for. They may come back and ask for additional documentation.

Make sure you upload it within 30 days or your case will be closed. If this happens, you will need to start the process over and apply for a new Amazon account.

Once you are verified, you are now officially a third party Amazon seller, just like soccer moms, retirees, high schoolers, business professionals, burger flippers—all taking life into their own hands by earning money on the side or full time. 

Step #2: Find a huge-potential product. 

If you are new to this and would like some help, Just One Dime will research and find three huge-potential products for you. Apply here if you want the Just One Dime team to help you. 

How do you know if a product has huge potential? I’m going to give you 4 criteria, you can use to measure a product’s potential: 

1. Find a product with high demand. 

When a shopper buys a product on Amazon, that product has demand. The more often shoppers buy a product, the more demand that product has.

You can measure demand for your product when you find out the number of times customers have bought products like the item you want to sell.

For example, if you want to sell a cat bubble backpack, you would need to find out how many customers buy a cat bubble backpack each month to determine whether or not it’s a good product to sell.

To find out how well cat bubble backpacks have sold, we need to use a product research software like Niche Hunter.

Once you have installed Niche Hunter, go to Amazon and search for a product like the one you are going to sell.

Amazon Search

Niche Hunter will pull up data on the top 10 product results for whatever search term you type in. 

Amazon Product Niche Hunter

Niche Hunter shows that seven of the top 10 product results under “cat bubble backpack” make over $5,000 a month in revenue. 

Right now, the settings are set to show you how many products earn over $5,000 a month, but you can edit the dollar amount to be whatever you want. Say you want to find a product that can earn you even more cash every month.

Click on the gear icon in the right corner.

Niche Hunter Settings

A pop-up will appear where you can adjust the settings.

Niche Hunter Pop Up

Type in your desired revenue and click “Save Changes.”

Change Niche Hunter Settings

Niche Hunter will now tell you how many of the top 10 products earn $10,000 a month. In this case, 5 cat bubble backpacks make $10,000 a month in revenue.

Niche Hunter Demand Changes

As long as at least 3 of the top 10 product results meet both your demand requirements and ease of entry requirements, Niche Hunter will read “Great Market” status.

2. Find a product with high market ease-of-entry.  

A market is easier to enter when the top results have a small number of reviews.

When you first launch your product on Amazon, it will have zero reviews. That’s okay. All of the top selling products on Amazon started with zero reviews.

But when your competitors have a small number of reviews, like 100 or 200, but shoppers are still buying, that means shoppers accept low review counts for products like yours. Also, your low review count won’t seem so small to shoppers in comparison.

Low review counts also indicate new, emerging markets where you have the opportunity to bust in and take over.

If at least 3 out of the top 10 products similar to yours have a low review count, then that market is reasonably easy to enter. The more top products that have a low review count, the better.

Niche Hunter will show you when a market is easy to enter. Here, 5 of the top 10 cat bubble backpacks have under 200 reviews.

Ease of Entry

You can change the review count ceiling in settings by clicking on the gear. 

Change Niche Hunter Settings

A review count ceiling of 325 is as high as you should go.

Change Ease of Entry Settings

3. Find a product with room for improvement.

Give customers a reason to buy your product for even more money than they would want to pay for one of your competitor’s products. 

When you improve a product, you set yourself apart. You make it different or “differentiate” it.

Go to customer reviews to find out if there is a problem many reviewers critique that you can fix.

Say that reviews for cat bubble backpacks complained that their cats got too hot inside them.

Amazon Review

That is a problem you can fix.

If you tint the plastic like sunglasses, cats won’t get so hot inside their little portholes to the world. Now you’ve just given cat owners a reason to buy your product even when you have zero reviews. Shoppers would even pay more for that product.

If the top ranking products in a niche have a low review rating (3.5 stars), then you know there is an issue with the products. Find out what problem is widespread among your competitors that you can solve, and set yourself apart.

Niche Hunter will show you how widespread low ratings are among your competitors.

In this example, 3 out of the top 10 cat bubble backpacks have a rating less than 4.5 stars. This means there is room for improvement. 

Differentiation Opportunity

You can adjust the rating level in settings.

Niche Hunter Settings

4. Find a product with at least 40% profit margin. 

Margin = Profit ÷ Sales Price.

If you sold a cat bubble backpack for $50 but the cat backpack cost you $25 in manufacturing, shipping, and Amazon fees, then you made $25 profit from selling that cat backpack. 

That means you made 50% margin on that cat backpack because $25 profit ÷ $50 sales price = 0.5 (multiply by 100 to express margin as a percentage).

Profit margin is important because if you sold a cat bubble backpack for $50, but it cost you $49, then that $1 isn’t really worth your time and energy.

You have to know your numbers. Find out the maximum your units can cost in order for you to make at least 40% profit margin.

Calculate your maximum costs with this equation:
Sales Price x 0.6 = Cost Total ceiling for you to make 40% profit margin. In other words, your costs would have to be less than 60% of your sales price.

For example, if you sell a $50 cat bubble backpack, then multiply 50 by 0.6.

$50 x 0.6 = $20.

In order to make 40% profit margin on your $50 cat backpack and earn $20 profit ($20 ÷ $50 = 0.40), your costs cannot total more than $30.

Use Niche Hunter to find your costs and estimate your profit margin.

In Niche Hunter, tab over to “Top 10 Products.” You will then see previews for the top 10 product results.

Niche Hunter Top 10 Products

Click on the product results most similar to the one you plan on selling.

Click on a Product

A product preview will pop-up. 

Niche Hunter Product Preview

From here, you can adjust the selling price or cost per unit in the Profit Calculator. 

Niche Hunter says that in order to reach this 40% profit margin, your cost per unit (including shipping) cannot be any more than $14.17.

Hover over the “i” icon to see your “Net Proceeds Estimate.” From here, you can see the math that leads Niche Hunter to project your costs.

Net Proceeds Estimate

To find out if your per unit cost will likely be over or under $14.17, find out how much a product like this costs on sourcing websites like Alibaba.

On the product pop-up, click “Source on Alibaba.”

Source on Alibaba

This will take you to a search on Alibaba for the same term you used to search for products like yours on Amazon.

Your Product on Alibaba

On Alibaba, there are cat bubble backpacks being sold for under $14.17, meaning you can sell these backpacks and make more than 40% profit on them.

Step #3: Find a supplier to build your product. 

First, click “Source on Alibaba” on Niche Hunter.

This will take you to an Alibaba search using the same term you used when searching for products like yours on Amazon.

Second, filter suppliers by Verified and Trade Assurance.

When you click “Verified”, it means that Alibaba the company has physically gone down to that manufacturer and verified that they are a legitimate business.

When you click “Trade Assurance,” it means your supplier won’t get the funds until you tell Alibaba, “Yes, I received the product I paid for at the specifications we agreed on.” When you do trade assurance, you pay 30% of the production costs upfront and pay 70% once you know that the product is up to specifications.

Alibaba Trade Assurance & Verified Supplier

Find suppliers that look like they can produce what you’re looking to make. If they already make a similar product, great. If your product is more unique, you will need to select suppliers that work with the same materials your product is made out of.

Third, tell your supplier your exact product specifications.

Message at least 10 suppliers on Alibaba. Find out if they can make your differentiated product.

Chinese manufacturers are better than most designers when it comes to designing products, so it’s 100% okay if you don’t have professional blueprints of your product yet.

To message a supplier, click on the product preview.

Alibaba Product

Click “Contact Supplier.”

Contact Alibaba Supplier

Log in or create your Alibaba account.

Create Your Alibaba Account

Message the supplier. Use plain, simple English. But be as specific as possible when describing the product you want to make. Your first priority is to find out whether or not they can make your product.

When you are done, click “Send inquiry now.”

Alibaba Inquiry

Fourth, order a sample of their workmanship.

Your small group of suppliers will already produce something either similar to your product or made out of the same material as your product. 

Order a sample from each supplier. You will pay for this but don’t try and negotiate on the sample. Save that for the next step.

Choose the supplier that sends you the highest quality product.

Fifth, negotiate terms on larger order quantities.

The more units you order, the lower a price you can get them at per unit.

Be sure to ask your supplier, “If I get this many units, what is the price?” and “What if I get this many units?”

Start by asking for the price per unit for a quantity lower than you intend to order so that you can go up. Also, ask about what price you could get if you order more than you intend to order so that you can see how well the supplier adjusts their price.

Sixth, pay 30% of the production cost.

Make sure you know your profit margins in advance when you do product research!

Once you pay, your supplier will get started to produce your product.

Seven, conduct a product inspection.

This is much easier than it sounds. The Just One Dime community has a lot of inspector companies who can provide this service for you. 

You hire a third party to inspect your product once it has come off the assembly line. Give this inspection company specific instructions on what to test. 

If you, for example, specify in your contract with your supplier that your cat bubble backpack needs to have a water-tight bottom (for...spills), then your product inspector will make sure that the bottom is water-tight.

Eight, pay the remaining 70%.

Once your product inspector has cleared your units or your supplier has rectified any issues with your units, you pay the remaining 70% balance held up on Alibaba via trade assurance.

Step #4: Create your Amazon listing. 

1) Go to Amazon Seller Central, the seller platform you created an account for when you made a seller account.

2) Click on Inventory.

3) Select Add a Product.

Add a Product

4) Select your product category.

Use the same categorization as your top competitors.

Select a Product Category

Browse until you have arrived at the most specific product sub-category possible.

Find Your Specific Niche

5) Enter your vital information.

You need to have a product barcode to get beyond this stage. Go here to learn exactly how to get a barcode from the company GS1 step by step.

  • Enter your Product ID barcode information.
  • Under Product Name, describe your product using search terms customers would use to find your product.
  • Under Brand Name, type in the name of your brand. This is the public facing name of your business, not your or your company’s legal name.
  • Under Manufacturer, type in your supplier’s name.
  • Under Unit Count, type in how many items are in the unit you are selling. For example, if you sell a pack of six water bottles, you would type, "six water bottles."
  • Under Unit Count Unit of Measure, type in how many units you will be sending to Amazon’s fulfillment center.
Amazon Vital Info

6) Skip variations for now unless you have multiple versions of your product.

Amazon Variations

7) Enter in your offer information.

  • Set your price here.
  • Your Seller SKU is a description of the product.
  • Your quantity is the number of units you have to sell. Set this number to zero before you are ready to start selling the product.
  • Under Condition, select New.
  • Under Fulfillment Channel, select “Amazon will ship and provide customer service.”
Amazon Offer

8) Upload your enticing product images.

Amazon Images

You will upload 5 different kinds of images

Do not go cheap on photos. This is a one-time expense and you will more than make it back when you launch your product. The quality of your photos is the #1 factor influencing your sales after Amazon shoppers find your listing. 

  • Featured photo. This is your main photo. Make sure 80% of the real estate is covered in the image. Make sure the background is solid white. Present your product in the most beautiful way possible. 
  • Lifestyle photos. Show people using your product. Remember: people do not buy the product, but the experience the product brings them. The models in your photo need to create the experience visually for your shoppers. 
  • Tech Spec photos. These are photos that show technical details such as the material used, the measurements of each part, the strength of the springs, etc. Make sure the tech specs do not just provide facts but the value of those facts. 
  • Retail packaging. If your product has retail packaging, show it. Although the retail package has no real value, it carries high perceived value. A poorly packaged product implies a poorly made product. A product designed in world class packaging demonstrated beautifully in photos will get you more sales. 
  • Bundled items. If your product comes with extra items and accessories to complete the full experience, feature this in a bundle. 

9) Write a keyword-rich description that converts.

Amazon Description

Before you create your description, find your best keywords. Keywords are the search terms customers use to find your product.

For example, when you sell a cat bubble backpack, your keywords could include “cat bubble backpack,” “cat backpack bubble,” “cat backpack carrier,” “dog bubble carrier,” etc.

One of the best places to find keywords is in the titles of your top competitors. You can also find high volume search keywords by using research tools like Niche Hunter. 

Product Description:

Once you have your keywords, include them naturally as you write out your description. 

For example, “This kitty backpack carrier is perfect for cat travel on your days out or traveling on planes. Your cat will keep cool and comfortable with a tinted cat bubble shield. This cat bubble backpack carrier also…”

Amazon Product Description

Key Product Features:

These are the bullet points on your Amazon listing. Type the benefits of your product first and then elaborate with the feature that makes that benefit possible.

For example, if you sell a cat bubble backpack, start with the benefit “KEEP YOUR KITTY COOL” and then follow-up with the feature “Tinted plastic to keep your cat cool on your days out.”

Click Add More until you’ve written out the maximum of five Key Product Features. Include your best keywords in this section.

Key Product Features

Do not worry about Cspia Warning, CSPIA Warning Description, or the Legal Disclaimer.

10) Fill in your keywords so customers can find your product listing.

In Search Terms, enter in keywords that you were not able to fit in your product description. Separate your keywords with commas, and do not go above the set character limit. The box will tell you when you have exceeded the maximum number of characters.

Ignore the rest of the parameters on this page.

Amazon Keywords

11) Fill out the More Details section.

Amazon More Details

12) Click Save and finish.

How to Create Your Amazon Product Listing in Seller Central

Step #5: Have Amazon fulfill your products for you. 

Unless you love hearing the sound of packaging tape all day, get your product shipped into Amazon’s fulfillment center. 

  1. Create a shipping plan in Seller Central. 
  2. Save the shipping label as a PDF.
  3. Send that label to your supplier so they know where to ship the product. 

When your product shows up in the fulfillment center, it now shows as Prime from the buyer’s perspective. This means your product will sell faster, you can sell it for higher, and you won’t spend half the night shipping products to customers.

Step #6: Scale your Amazon business into a cash-flow machine!  

How? Pour your profits back into your business. 

If you want to grow this business huge, feed it! 

As your first product takes on a life of its own, you can spend less and less time on it—allowing you to find your next product. 

Use the profits from your first product to launch your second product. This creates exponential growth. 

Treat your first 100 customers like royalty. 

One of our students, Gal, did 14 million in the last 12 months. How? He re-invested his profits back into his company. Now his cash flow is so huge, he can do pretty much whatever he wants. 

Just One Dime Student Screenshot

If you would like to watch Just One Dime build an Amazon business in real time, you will love Build-a-Brand, a live-to-tape series where you get to watch like a fly on the wall—every single step from the biggest obstacles to the biggest wins, one growing a brand new Amazon store from scratch. 

Instead of feeling like an Amazon dummy, confidently go out and launch your own product. 

Tell me in the comments below: What topic would you love for me to cover next?


Product Research

2022 Guide

Find a product to earn you $10,000 per month!

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Seth Kniep

Married a pearl. Fathered 4 miracles. Fired his boss. Turned a single dime into $104,857. Today, a self-made millionaire, Seth and his team of 8 badass coaches teach entrepreneurs how to build passive income on Amazon.

Dead serious about building income on Amazon with eight successful coaches in a community of badass Amazon sellers? Join the Amazon FBA Mastery membership.

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