There is no one answer to how much money Amazon sellers make. Instead, it depends on various factors such as the seller’s resources, how long they have been on Amazon, their dedication, and their selling methods.
However, as this article shows, sellers can make substantial profits with minimal investments if they use the right tools and strategies. It may come as a shock that most Amazon sellers make at least $1,000 a month off their Amazon products. However, as a Jungle Scout survey shows, it seems turning a profit as an Amazon seller is more feasible than you might think.
This article discusses how much money Amazon sellers make. It also examines how to boost your profits by using Amazon seller tools and following critical selling strategies such as carving out your niche, analyzing your competitors, and actively marketing your products.
At Seller Mobile, we understand the financial opportunities becoming an Amazon seller provides. Our wide range of Amazon seller tools will help you earn consistent profits and achieve sustainable growth. Continue reading to discover the financial opportunities awaiting you as an Amazon seller.
How Much Money Do Amazon Sellers Make?
The most common seller method for Amazon is Fulfillment-by-Amazon (FBA). As with any other business model, selling with Amazon requires fees from the sellers. However, it simplifies the selling process to attract more customers without adding to their company infrastructure.
Most Amazon sellers make at least $1,000 per month in revenue, but some super-sellers can make more than $250,000 each month. Most Amazon sellers tend to reside in the $1,000-$25,000 range, translating to annual sales around $12,000-$300,000.
About twenty percent of Amazon sellers make between $25,000-$250,000, placing them in the mid-tier Amazon seller range. Only about six percent of Amazon sellers earn more than $250,000, slotting them in the “super-seller” category. Twenty-six percent of Amazon sellers make less than $1,000 in monthly sales and 4 percent of sellers aren’t aware of their sales numbers.
However, answering how much money Amazon sellers make is more about profit than sales.
How Much Do Amazon Sellers Profit?
Small business owners often struggle to make wide profit margins when they start. However, with Amazon, you don’t have to handle many of the infrastructural constraints of a small company. For example, with Fulfillment by Amazon, you have access to Amazon’s many resources, including their warehouses spread across the nation.
Due to the lack of infrastructural costs, it’s relatively easy for sellers to turn large profit margins. Up to two-thirds of sellers achieve profit margins higher than 10 percent and as much as a third of sellers see profits above 20 percent.
How Much Money Does It Take to Start Selling on Amazon?
One of the beautiful aspects of selling on Amazon is that you can start with under $1,000 because the Amazon platform eliminates operational costs, such as email marketing, web hosting, and graphic design. However, Amazon sellers should start small and then continually invest in their business to ensure sustainable growth.
You need to consider three central departments when budgeting to sell on Amazon: inventory, tools and supplies, and training.
You sell inventory on Amazon and it is a primary factor for your bottom line. Amazon is a reselling business, so starting small and purchasing things wholesale provides insight into what sells on Amazon and what doesn’t. If you spend all of your seed money at once, you take unnecessary risks that can result in significant losses.
Tools and Supplies
The more tools you can use (inventory and profit trackers, for example) to bolster your Amazon seller account, the better. You don’t need to incorporate every tool in the shed right away, but you want to make sure you have the essentials when you start and add from there.
Education helps any seller looking to bolster their profits right away- the more you learn about how Amazon’s platform works, the more likely you are to avoid the mistakes lesser-educated sellers make. The more you learn about seller tips and strategies, such as keyword research and inventory analysis, the more successful you become.
Advantages of Selling on Amazon
There are numerous advantages to becoming an Amazon seller, including traffic, shipping and fulfillment, established infrastructure, and the chance to build customer loyalty without worrying about a customer service infrastructure.
In September 2020 alone, Amazon received 2.4 billion visitors. Think how much you could expand with that influx of customers. Becoming an Amazon seller means that you can access all of Amazon’s traffic.
Not every visitor will fit your target market, but there’s no doubt you’ll increase your brand reach and start expanding into new markets with your products. Plus, when your niche customers visit Amazon, they’re already looking to buy, simplifying the click funnel process.
Shipping and Fulfillment
With FBA, you never have to worry about shipping prices and fulfillment processes. These services let you focus on your product descriptions and what matters most: making sales.
Established eCommerce Infrastructure
When you become an Amazon seller, you don’t have to design an eCommerce website. eCommerce websites can range from $10,000-$500,000. The cost of an eCommerce website depends on the complexity of your business, the platform you use, and how long the design process takes.
Becoming an Amazon seller drops those costs to zero, letting you integrate your products with the existing infrastructure that makes selling easy and accessible.
When customers buy your products from Amazon, you enjoy the added benefit of your customers associating your brand with Amazon. Amazon is an established company that has earned the trust of its customers. Becoming an Amazon seller lets you enjoy that trust without having to implement costly measures.
How to Start Selling on Amazon
After deciding you want to become an Amazon seller, you need to complete the following steps to start making profits. Before you can make money, you need to make your profile, add your products, and use keyword descriptions to gain your customers’ attention.
At the basic level, you need to complete the following steps to start selling on Amazon:
- Choose and pay for an Amazon seller plan. You can choose either the individual sale option or a subscription model with a professional program.
- Decide your selling strategy- Start creating your brand or decide which brands you want to resell.
- Create your seller account.
- Add your products with keyword-rich product descriptions, so your niche customers find you before your competitors.
- Set your pricing model and incorporate the appropriate Amazon seller tools.
One of the easiest ways to start making money as an Amazon seller is to choose Fulfillment by Amazon (FBA).
Fulfillment by Amazon (FBA)
Fulfillment by Amazon takes most of the legwork out of selling your products on Amazon. Using these services, Amazon handles all of your shipping, packaging, and customer service operations. Additionally, you eliminate inventory and storage costs by bundling into one service.
With FBA, you sell your items to Amazon and you use FBA storage in one of Amazon’s vast networks of warehouses where they fulfill the order every time someone buys one of your products. With Amazon handling all of these aspects, you can focus on your Amazon marketing strategy and on expanding your catalog to increase your profits.
Tips for Amazon Sales Success
Amazon makes selling easy, but with that ease comes stiff competition. Learning some tips to boost your sales will help you begin to turn a profit as an Amazon seller.
The first tip for Amazon seller success is to proactively market your products. Simply listing your products will most likely result in minimal returns. However, using tools such as social media and a blog to market your Amazon seller business positions you to reach more of your target market. You can also use tools and apps that enhance the user experience and customer engagement.
Finding the Right Niche
Carving a niche on Amazon is crucial to seller success. Because it’s convenient and easy to sell on Amazon, you have to compete with many sellers. That’s why narrowing your target market can bring rewards and boost your sales.
If you have a similar product to other sellers on Amazon, you should differentiate your inventory with more specified products. For example, you can target specific buyers and more obscure products in established markets to improve visibility.
Learn Your Competition
Understanding your competition lets you in on their successes and failures and can give you a leg up on their selling tactics. You can view their pricing, marketing, and presentation strategies to improve on established methods. The Amazon marketplace is constantly evolving. If you want to avoid stagnation, you need to analyze and outperform your competitors.
Maximize Your Profits
Starting small with Amazon is a good strategy because it allows you to control your growth and ensure stable expansion. But just because you start small, doesn’t mean you should stay small. If you want to make Amazon a profitable endeavor, you need to expand your inventory.
You should also take advantage of busy buying seasons. Retailers make most of their revenue during the holiday season. The same rings true for Amazon sellers (Cyber Monday).
Conclusion- How Much Money Do Amazon Sellers Make?
Making money on Amazon takes a defined strategy and comprehensive planning. Sellers who combine these elements will achieve success. But, ultimately, how much Amazon sellers make comes down to how much time and effort they’re willing to expend.
Sellers who cut operational costs by utilizing Fulfillment by Amazon, conduct thorough competitor research, and capitalize on niche markets will reap Amazon’s many rewards. However, because the Amazon marketplace is widely accessible, it is also highly competitive- there is no guarantee that you will make money as an Amazon seller.
That’s why, here at Seller Mobile, we dedicate ourselves to providing you with the necessary tools and insight to help you achieve success as an Amazon seller. With tools such as our price and cost analysis, automated repricer, and competitor tracking, you can take full advantage of all Amazon has to offer.
Register today to start taking full advantage of the Amazon marketplace.