Is it still worthy to start Amazon FBA in 2023

Is it still worthy to start Amazon FBA in 2023 ?

It’s true that Amazon is competitive. But it is also true that it’s the place where you can get massive success! They half of the year has already finished. Over the last two years, the number of sellers on Amazon has increased a lot. They number of Amazon buyers has increased 69% at the same time. So, it’s not so late to start your FBA business. But keep in mind if you don’t start your business properly you may lose your investment as well.

In this post, I will try to explain in detail what you should consider to find out the most of FBA (Fulfilled By Amazon) and how you can run a profitable Amazon FBA store.

If you think of e-Commerce in the US you have to think of Amazon first. Amazon alone has captured the 38% of e-commerce market in the US. So, it’s needless to explain how much you can do on Amazon. This year has already done good in e-commerce and the rest of the time will be great as well. E-commerce analysts predicted that the total global e-commerce will stand to 8.1 trillion by 2026 from the current 5.3 trillion. You can grab that opportunity by opening an Amazon FBA store since it’s the biggest right now in US.

Let’s look into the bright side of Amazon’s FBA business model:

  • Reach to Amazon’s loyal customers: Amazon gets the biggest number of e-commerce visits in US. 300 million active users visits Amazon every month. So it’s a big opportunity for any individual or a small business.
  • Take benefit of Amazon’s network: Once you send the products to Amazon fulfillment centers Amazon will take care of everything forward. Even the customer service will be taken care of by them. This system minimizes the effort and spending for a small business.
  • Winning the Buy Box with FBA: Since you are already planning to start an Amazon business you must be familiar with Amazon Buy Box. If you intend to win the Buy Box for a particular product FBA sellers are in the priority list.

Down-side of Amazon FBA business model:

  • FBA Fees: Amazon FBA fees and referral fees are high. So, if you don’t understand them properly may face problem in running your business.
  • Competition is high: Since the number of seller in Amazon high so does the competition. So you should have proper planning to compete other sellers.
  • Easy to return: Handling return is a big challenge in Amazon. Amazon decent return policy due to this some sellers face high return on their products.

What you should expect from Amazon ?

Every new sellers want to know the reply of a very common question ” How much can I earn from Amazon? Frankly speaking, it depends on a lot of factors. But, I can give you an overall idea of what the other sellers are earning. As per Jungle Scout analysis, Amazon sellers are earning in the following segments:-

  • 50% of Amazon sellers sell anywhere from $1,000 to $25,000/month
  • 13% of Amazon sellers sell $25,000-$250,000/month
  • 22% of sellers sell under $500/month

So, from my point of view initially, you should target low but of course, you can scale it later.

Isn’t it too competitive? 

The easy answer to this question is of course it’s competitive. Recently, I was checking the number of seller in a particular ASIN, I found that around 98 sellers are competing against each other. So, you can understand the competition level. But, the competition depends on a lot of factors mainly the business model you chose. I will explain this in another post.

What do I need to start?

Opening an Amazon store is quite easy. Amazon has two types of accounts:

  • Individual
  • Professional

Amazon_Professional Vs Individual

If you are serious to work with Amazon I suggest you to go for a professional account. Even though it will cost you $39.99 per month. You can know more about account opening from this link.

My Opinion 

No business is easy, neither is Amazon. But, I have seen so many sellers who started from zero and now selling a hundred thousand per month. So, if they can do why you can’t? If you need any help can communicate with me. I will give you free advice to get you started.

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