This article is part of a larger series on Retail Management.
Learning how to sell on Amazon can seem like an overwhelming and ambitious project. However, selling on the ecommerce platform requires only a few simple steps.
You’ll first have to understand its product restrictions and seller fees, then create a seller account and build your product listings. From there, you’ll need to manage your inventory and order fulfillment. Finally, because Amazon is such a competitive marketplace, you should manage your store’s performance.
Step 1: Understand Amazon’s Product Restrictions & Fees
Get acquainted with the platform’s product restrictions and fees as part of studying how to sell on Amazon. Knowing these stipulations will help you create a selling strategy and decide which products to sell. Some may be profitable and in-demand, but their associated fees and regulations can incur additional labor and/or costs—which is important to keep in mind.
Amazon Product Restrictions
Products sold on Amazon must comply with certain policies. Amazon has a full list of restricted products, but these are not all-inclusive. Consider consulting an attorney if you have questions about product regulations.
Additional regulations apply to the following:
- Certain product categories that require approval before listing (like jewelry, music, and watches)
- Some elements of the Fulfillment by Amazon (FBA) program; if you wish to use FBA, you should also review its product restrictions page
- Certain products in California
- Products that claim to be “FDA Cleared” or “FDA Approved” or include the FDA logo in associated images
Amazon Seller Fees
Amazon seller fees include account and product fees. Account fees, or seller plans, come in two subscription levels—$0 and $39.99 per month.
Product or referral fees range from 6% to 45% of the product’s selling price, with the average seller paying 15%. You’ll also need to fulfill and ship your orders, which varies widely in cost depending on your product and your fulfillment method.
Interested to know how much it costs to sell on Amazon? Read our in-depth guide to Amazon seller fees.
Step 2: Sign Up for an Amazon Seller Account
You need to register as an Amazon seller before selling products. Registration involves subscribing to one of two seller plans.
Step 3: Create Your Product Listings
Amazon sellers can create product listings in two ways: by adding your items to existing product listings or creating new product listings.
Still deciding what to sell? There are a variety of ways to source profitable products to sell.
Most sellers follow traditional business models, like selling products they make themselves or reselling wholesale goods. But some reach beyond traditional means and source products through print-on-demand services, private labeling, dropshipping, and more.
Ideal Amazon products are in-demand but also generally lightweight, sturdy, and evergreen. Read our guide to the best products to sell on Amazon.
Adding items to current listings is by far the easiest method, and it’s how most beginners get started on Amazon. So we’ll begin there:
Manually Add Your Product to an Existing Listing
You’ve probably noticed that many products for sale on Amazon have multiple sellers, as shown below:
The second and third sellers in the list above added their items to this existing product listing. It might seem like a waste of time because of the existing competition—however, remember that the majority of sellers only keep a few items in stock. So as others sell out, your listing will be the one available—and the one that shoppers buy.
Manually adding your product to an existing listing is accessible from your Seller Central Dashboard. You can follow the steps below:
Manually Create a New Product Listing
Amazon Professional sellers can create entirely new product listings for items not already sold on the marketplace. Generating new listings takes more time than adding products to an existing listing. However, it allows you to create a high-quality listing that sells using keyword research, product images, and detailed item descriptions.
Remember that not all product categories are open to all sellers. There are some product categories that require a Professional seller account, while some require approval to sell. There are also products that third-party sellers cannot sell.
To create a new product listing, you need the following information:
- A product identifier: GTIN, UPC, ISBN, or EAN to specify the exact item you’re selling; find out more about which identifier is relevant to your product listing in Amazon’s listing requirements
- An SKU: A product ID you create to track your inventory
- Offer details: Price, product condition, available quantity, and shipping options
- Product details: Name, brand, category, description, and images
- Keywords and search terms: Applicable keywords to help buyers find your product
You also need to build out your product detail page. If you’ve ever shopped on Amazon.com, you’ve seen one. Product detail pages are where customers find all of the vital information about an item.
- Title: 200 characters max, capitalize the first letter of every word
- Images: 500 x 500 or 1,000 x 1,000 pixels to increase listing quality
- Variations: Colors, scents, or sizes
- Product description bullet points: Short, descriptive sentences highlighting key features and benefits
- Featured offer (“Buy Box”): The featured offer on a detail page; customers can add to their cart or “Buy Now”
- Other offers: The same product sold by multiple sellers offers different prices, shipping options, etc.
- Product description: Keywords improve the chances that people will find your listing
Manage Your Product Listings: Use a Bulk Upload or Product Feed Tool
If you’re a Professional seller, you also have the option to add many product listings at once by uploading all of your product data using a spreadsheet.
Additionally, if you also sell on your own website or plan to in the future, you can directly connect your products to Amazon. Here’s how both of these options work:
Step 4: Manage Your Inventory on Amazon
Accurately managing inventory is key to your success on Amazon since the platform will dock your seller rating for not promptly shipping items on that show as “in stock.”
Like the product listings methods described above, you have several choices when it comes to inventory management. Whichever method you choose, stay diligent about it to keep your Amazon seller rating high.
Amazon automatically reduces your inventory count as your Amazon items sell. If you sell only on Amazon, this should keep your counts correct. But if you sell the same stock on your website or in a retail store, you’ll probably need a different solution.
Step 5: Set Up Product Delivery or Fulfillment
As an Amazon seller, you have three options for delivering your products. First, you can do it yourself—maintaining your inventory and shipping products to customers—which is called merchant fulfillment. You can also let Amazon package, label, and ship products through FBA, or you can use a third-party fulfillment provider.
Step 6: Manage Store Performance
Once your store is up and running, you need to learn how to monitor, analyze, and promote your store’s performance.
Monitor Your Store's Key Metrics
Amazon is a customer-centric marketplace and holds its sellers to a high standard. It expects you to provide a seamless and satisfactory customer experience every time. Amazon requires these minimum key metrics that you should take note of:
- Order defect rate (a measure of a seller’s customer service standards): < 1%
- Pre-fulfillment cancel rate (initiated by the seller before shipment): < 2.5%
- Late shipment rate (orders that ship after the expected date): < 4%
Anything that falls outside these metrics might earn your store a negative performance review and affect how high or low your product listings rank on Amazon.
You can monitor your performance targets in Seller Central. Amazon also has a list of best practices for its sellers.
Earn Quality and Valid Customer Reviews
Customer product reviews play an essential part in the Amazon shopping experience. They benefit sellers and customers alike.
Seller University is an online resource from Amazon. It lists videos that feature step-by-step guides, tutorials, and training to help you start (and grow) your Amazon business.
Learn How to Advertise
Amazon offers advertising solutions for sellers to reach and engage shoppers. You can use these advertising methods through Seller Central:
- Sponsored Products: These ads for individual product listings on Amazon help drive product visibility and, ultimately, sales. You can find them on search results pages and product detail pages.
- Sponsored Brands: These search-result ads feature your brand logo, a custom headline, and up to three of your products. They help to showcase your brand and product portfolio.
- Amazon Stores: These custom, multi-page shopping landing pages enable sellers to share their brand story and product offerings.
Offer Promotions and Coupons
Promotions are an incentive for customers to purchase now. You can offer three types of promotions in your Amazon store: money off, free shipping, and buy one get one free. You can also offer percentage or money-off discounts with digital coupons.
Amazon is an incredibly accessible platform that welcomes all kinds of sellers—from individuals selling a few items per month to power-sellers moving thousands of products each day. Now that you’ve learned how to sell on Amazon, you know there are many ways you can sell on the platform, but the competition is fierce—and it is a demanding marketplace.
You need to approach every Amazon product opportunity from a profit perspective. This considers the cost of the goods you sell and the time it takes to source products, create listings, manage inventory, and ship orders. Once you understand the basics, you can make decisions to help balance efficiencies, increase net profits, and find ways to grow.