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If you’re aiming to be a merchant in Amazon, you might have heard of the FBA option. FBA stands for Fulfilled by Amazon. With this feature, you don’t have to be completely in charge of the fulfillment of you the products you’re offering. Instead, Amazon will be in charge of sorting your products in their warehouse as well as with shipping, packing, package tracking, managing refunds, and dealing with returns. FBA is highly beneficial for independent sellers and small business owners. It is a lot cheaper than doing your own fulfillment. However, before starting your new venture selling on Amazon, we’d like to remind you to avoid some key mistakes. The following Amazon FBA mistakes will help you avoid additional costs and adverse consequences.
Note: These common Amazon mistakes are listed in no particular order.
Ignoring the Terms and Conditions of Amazon
Be sure to thoroughly read the terms and conditions set by Amazon. Absolutely avoid missing something or forgetting any terms along the way. Violating these terms and conditions can get your seller account suspended. This mistake can also be costly for Amazon sellers… Especially if you have already shipped your items to a fulfillment center! You won’t be able to ship the items out if your account is suspended! Even worse, you can’t ship them out, so you still have to pay the Amazon fulfillment center for keeping your items.
We also suggest reviewing the terms and conditions whenever you are planning to make some changes in your product listings.
Too Much Competition For Your Product
There are about 2.5 million sellers in Amazon. Unless you are producing your own unique goods, there’s a huge chance that multiple sellers are already offering the same items in your product listings. That’s why before you start selling a specific product, you have to be aware of the number of your competitors. Also search if there are already established ones. The key is to offer products with less competition. This means you’ll also have a greater chance of expanding your market share.
On the other hand, if you think you can still pull off a product despite the number of competitors, you can look into how much the competitors are offering them. See if you can afford to offer lower prices to help attract more shoppers. Of course, remember to consider your items’ landing cost. Remember that Amazon users/buyers (or any e-commerce buyers in general) tend to prefer lower-priced listings.
Not Completely Knowing Your Product
Know your products well before uploading them to your listing. This can help you provide more detailed Amazon product descriptions. It can also help you easily answer the questions of users about your products. It’s good to note that answering the queries of shoppers can also help you convert them into actual customers.
Completely knowing your product also means that you know about your competitors. This can also help you avoid Amazon FBA seller mistake # 2!
Not Optimizing Your product Listing and Not Considering Amazon PPC
Amazon shoppers use keywords when searching for the items they want to buy. If you are a new seller, it will be hard for you to get into the first page of Amazon’s search engine results pages (SERP) for almost every generic search term possible. So if you want to be more visible… We recommend that you use a more unique or specific keyword, or a less competitive search term. This is where keyword research comes in.
It’s a must to search for keywords related to the product you’d like to offer before actually making a listing. This can help you realize the actual number of search results related to your product. Usually, the results in the first few pages of Amazon SERPs are the listings of more trusted sellers or those with plenty of reviews or orders already. It would be difficult to compete with established merchants which is why you may want to consider Amazon PPC.
Amazon PPC (pay-per-click) is where you pay Amazon when a potential customer clicks on your ad. This advertising option is available in three different formats: Sponsored Brands, Sponsored Products, and Product Display Ads. Sellers often believe that if their products are good enough, it would sell on their own, but it’s not always true especially if you have plenty of competitors out there. In fact, it is not bad to spend on advertising when you’re new in the business. You can first establish your Amazon profile as a seller with the help of PPC, then get more exposure and engagement as you go on.
Not Prioritizing Amazon Listing Optimization
Aside from keeping in mind the best keywords to use for your products, you also have to prioritize your product descriptions. In every listing, there’s a product description where you have to type in some of the best things about your product. You can just put a generic description of your product, or come up with your own. We prefer the latter, of course. If you come up with your own, you might as well make it enticing by describing the product as if you are talking to a potential customer face-to-face.
Apart from including a detailed product description, you also have to provide other product information such as the brand name, color, material, etc. As much as Amazon buyers often inquire on a specific product, they also opt for detailed listings that contain almost every information they need.
Not Updating Your Inventory and Stocking Too Much Products
New Amazon sellers usually deal with less inventory volume as compared to more established Amazon merchants. But still, they have to manage their Amazon inventory system properly to prevent supply shortages which could be bad for a seller’s Amazon profile. If you’re a new seller, you must monitor the number of orders you receive, and regularly update your inventory to prevent this from happening.
Meanwhile, storing way too many products in the Amazon fulfillment center could also be costly because you have to pay storage fees for these items extra. For more practical reasons, we suggest that you send out products to the fulfillment center only when they have been ordered by your customers already. This way, the item/s would be shipped out immediately to customers, and you don’t have to pay additional storage fees.
Ignoring Other Costs
Apart from storage costs, you should also keep an eye on other costs related to the procurement of your products. If you will source your products abroad, you also have to take into consideration the freight costs, while keeping in mind the weight, volume, and type of product you’re planning to offer. It is cheaper to acquire ocean freight services than air freight. Some people think that sea transit may take more time as compared to air transit, but there are sea freight services that provide faster transit times. You just really have to spend time in research.
Also, keep in mind that the more volume you ship out, the cheaper your freight costs could be. But before you order more supplies, you must also learn to predict whether you can sell them easily or not. Buying more wouldn’t be worth it if you’ll just keep the items longer than they should be kept.
Ignoring other costs may affect your profit margin. Cutting off unnecessary costs in the procurement process can help you end up with a more decent price margin, and you can even provide more competitive retail prices for your products.
Taking note of these common Amazon FBA seller mistakes can help you avoid committing them and from suffering from potential unnecessary costs in the future. If you have more questions about Amazon FBA in general, feel free to reach out to us because we’re more than willing to help you get answers.
If you have questions or insights to share, please feel free to post them via the comments section. Please also consider joining our Facebook Group where we discuss any questions you may have about running an Amazon business.
We are SellerMetrics, our Amazon PPC Software helps Amazon sellers, brands, KDP Authors and agencies navigate Amazon Advertising PPC via bid automation, bulk manual bid changes, and analytics.