Do you want to know what types of products are best for selling via the Amazon FBA program? You’ve come to the right place.
It’s not immediately obvious what kinds of items are most suitable for distributing via Amazon. But there are certainly preferable product features and market conditions that’ll maximise your chances of generating a steady, substantial profit after all costs.
So to help give you a head start with your FBA career, I’ve written a detailed list of 10 things you should look for in an Amazon FBA product.
1. Small & Light
If your product is small and light, it works out cheaper in each of the following phases:
- Sourcing: Heavy & large items will cost much more in delivery costs than small & light ones of the same retail value.
- Storage: Amazon charge storage fees for all units held at a fulfilment centre based on calendar month and your daily average volume. The bigger your items, the more you’ll end up paying. Learn more on inventory storage fees.
- Fulfilment: Amazon fees increase with the dimension and weight of the item (standard or oversize). Hence why you’d prefer your item to be small and light.
2. Retail Value Of £/$/€30-40
Aim to source a product that sells at a retail price of around £/$/€30-40. This is, in my opinion, the ‘sweet spot’ where the product is relatively cheap to source, but priced high enough to generate a profit on FBA.
Here’s why £30-40 is a sensible product retail value for new FBA Sellers:
- High volume of sales: we all purchase items that fall within this price bracket. It’s not too pricey for an average Amazon customer.
- Medium customer expectations: customers won’t expect the world for £30-40. They will however expect the product to perform its intended purpose as per the product description/images. If it does that, you shouldn’t attract too many returns or complaints.
- Sufficient markup: many successful Amazon FBA businesses are built around products selling for £30-40. As an approximate guide, aim to sell your (small, light) product for a retail price of at least 3x the amount you purchased it for.
Just bare in mind that there’s a ceiling on what customers will be willing to pay for your product. So be realistic with your forecasts.
3. Profit Margin Of £/$/€10+
Aim to earn a profit of £/$/€10 per product sale after all costs have been factored in. Your essential costs include the unit price, shipping, import duties, and Amazon fees. But it’s wise to also factor in the expected costs of damaged goods, and advertising (if applicable).
Let’s consider a scenario where your product earns just £2 profit per unit sale:
- Sales volume: you’d need to sell 5x the number of units to equal a product which makes £10 per unit.
- Work load: it’s no more work to sell an item that earns £10 than an item that makes £2.
- Returns: if you receive too many product returns, and those items become unfulfillable, then your £2 profit may be turned into a loss.
- Risk: the small profit margin of £2 could be wiped out by fluctuations in the cost per unit, delivery/import fees, advertising costs, or Amazon fees.
There are of course cases where an item produces a profit of less than £10 per sale but your markup covers both the customer return rate as well as any fluctuating costs. You need to assess every case on an individual basis.
4. Good Design & Quality
No amount of branding, marketing or keyword optimisation is going to save a poor product. To put it simply: don’t invest in a product that has flaws.
Before you decide to source a product in bulk, you need to order several samples (ideally of different specifications) to make sure your chosen item is robust, works as intended, and is made from suitable quality materials. When you receive those samples:
- Get them into the hands of potential consumers to gather some feedback. Does it do what its supposed to?
- Decide if you need to upgrade the quality — or downgrade it to slash costs. Does the pricing still work?
- Pretend that you’re the worst customer imaginable. Find out how easily your product breaks!
- Consider whether the supplier is capable of delivering the quality you need, or if you need to look elsewhere.
Remember that your product’s future success hinges on its positive reviews. So be critical of your product samples. Take the time to make changes until you’re satisfied that it’s ready to be sold.
Leading on from ‘Good Design & Quality’ is another, more specific consideration: how fragile is your product?
Many products are made from the finest quality materials — but they’re far too easily broken during transportation, or by the end user. Damaged goods will eat into your profits. With that in mind I’d avoid products made from:
- Inflatable materials prone to puncturing
- Flimsy moving parts
- Brittle materials that crack/shatter easily
- Small parts that can be lost
While you may be able to resolve some of these problems by providing suitable packaging and instructions, there’s plenty of easier options you could explore first.
6. Weak Competition
Many products are saturated with dominant sellers, with excellent ratings, armed with a bankroll large enough to reduce their margins and out-spend you on product marketing. Would you want to compete with them?
To succeed on Amazon FBA you’ll need to pick your battles wisely. This means avoiding fierce competition, and concentrating your time and money on products where you can actually compete.
As a general rule, I would avoid competing against products with a 5* rating and over 100 reviews; this suggests they’re a long way ahead of new entrants. Focus on items with less ratings, and less competing listings.
However, be aware that some seemingly-untapped products are being ignored by FBA Sellers for a reason: they don’t sell. Seek the right balance of product popularity and potential to compete. Ideally you want a product that’s popular, but has no dominant sellers.
7. A Niche You Understand
Do you have any peculiar hobbies and interests outside of the mainstream (some of which you may not want to admit)?
Sure you do. And that’s where you hold valuable knowledge and experiences that the vast majority of others don’t have. This is where you’re likely to identify an opportunity to either create a unique product, or compete against existing ones on the market.
You’ll be surprised to see how many niche products are overlooked by FBA Sellers simply because they do not fully understand the needs of the consumer.
There’s profit to be made from small, untapped niches, and I’ve touched on the subject in my post: Can You Grow An Amazon FBA Business On A Low Budget?
8. Potential For Expansion
While you’re searching fort a product to sell via Amazon FBA, think about other related items in the same niche. A collection could become the future of your business.
Experienced FBA Sellers will tell you that once you have one item of inventory selling consistently, launching another related item becomes much easier. This is because your products leverage from one another:
- Increased exposure: customers can see your range of products by clicking the brand name on any of your listings. In addition, Amazon will often show related products to potential buyers.
- Product searches: when a customer searches for one of your items on Amazon, other products in your range may also show up — provided they’re closely related.
- Brand loyalty: previous customers may return to you to buy other products. This level of trust is only formed if you maintain high standards.
9. Not Dangerous
Amazon restricts dangerous goods defined as “substances or materials that may pose a risk to health, safety, property, or the environment while storing, handling or transporting because they contain flammable, pressurized, corrosive, or otherwise harmful substances.”
While there’s some obviously hazardous items (such as knives), other more conspicuous items also fall into the same category. Many of these items are somewhat harmless when stored at home or in a storefront, but may pose a risk when exposed to certain specific conditions such as radical movements, or temperature and/or pressure fluctuations.
All sellers have to declare whether their product is hazardous before listing it as FBA inventory. But Amazon reserves the right to flag your product in the future — which could lead to the loss of inventory and/or your Seller account.
Think carefully about whether your product could be dangerous. Play by the rules.
Nowadays there’s so much competition on FBA that you can’t simply expect to re-brand an existing “private label” product and achieve success. Consider the following:
- Based on your price quotations, can you realistically compete with other sellers of your product?
- Do you have the brand identify to better your competitors?
- Are you able to differentiate your product from your competitors?
- Will your marketing campaign be stronger than those used by your competitors? Can you afford to do it?
Being unique is everything. I prefer creating my own custom made product, unlike others on the market.
For tips on finding unique FBA products I recommend reading my post: Private Label Vs Custom Made Products.
Finding Good FBA Products Becomes Instinctive
Once you become an experienced Amazon FBA Seller you’ll start to look at everyday items in a totally different light.
It becomes instinctive to appraise the products you buy, own, or browse at on the high street. You’ll give more thought than ever into what makes a product a success or a failure.
No doubt, from time to time you’ll look at an item and think to yourself: “this would be perfect for the FBA program!”. Just be sure to start out by following the 10 suggestions I’ve provided in this post.