Learn the 7 things you need to do BEFORE launching on Amazon with FBA.
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***Other Links Mentioned in this Video***
►► Sales Tax Obligations: https://www.youtube.com/watch?v=P9aBe9sFWJs
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Before Launching on Amazon - Have a Launch Plan to Get Sales
On Amazon, the vast majority of sales come through people typing in items they want to purchase into the search bar and then picking an item to buy from the list. That is why if you want your product to sell well on Amazon, you need to have a plan for how your listing is going to get on the first page of results.
The most important factor for how Amazon chooses which items go there is something called “sales velocity.” They will greatly favour items that are making the most sales.
What you need to do then is use Jungle Scout to find out how many sales your top competitor is making, and then beat them for 2 weeks. To do this, you’ll need to have a plan in-place for how you’ll match their sales (discount coupons are the most common strategy for this).
Before Launching on Amazon - Take Incredible Photos of Your Product
Sales velocity is the most important factor when Amazon chooses which products to promote, but there is another - conversions. The higher your conversion rate, the more likely Amazon is to promote your products.
Amazon have tested it and found that product photos are the #1 conversion factor. So get a test product sent to you and have professional photos taken of your product.
Before Launching on Amazon - Get Friends & Family to Buy Your Product
Another important conversion factor is reviews. Luckily you don’t need to have hundreds of reviews to make organic sales, but having a base of 10+ reviews is a good start. The easiest way to get reviews is to get your friends and family to buy your product and to then leave you a review.
In addition, get your friends and family to search for your targeted keyword on Amazon, scroll through the item listings and THEN buy your product. This will send a strong signal to Amazon that they should rank your product for that keyword.
Before Launching on Amazon - Have a Plan to Get Reviews from Customers
A big reason why you should get your friends/family to leave a review is because anonymous customers rarely leave reviews. If you do not have a plan in-place to get reviews from customers, the conversion rate of purchase-to-review is less than 1%. However, if you have an email sequence in-place (Jump Send is a great way to do this) asking customers to leave a review, you can more than double your conversion rate.
Before Launching on Amazon - Form a Limited Liability Company (LLC)
To starting selling on Amazon, you DON’T need to legally form a company. You can start selling immediately as a sole proprietor. However, we strongly recommend that you consider forming an LLC because it protects you in-case anybody tries to sue you since it gives you “limited liability.” What this means is that creditors can’t go after you personally if your company gets sued. It isn’t necessary to form an LLC, but it’s the safe thing to do.
Before Launching on Amazon - Have a Back-up Cash Plan
When you sell on Amazon, you do not get paid straight away from your customers. Instead, Amazon holds your money for 2 weeks as a new seller. This means that you need to be able to pay for expenses in the meantime and not rely upon the money that you have earned as a seller on Amazon.
In particular, you want to have a plan in-place for how you will be able to pay for new inventory in-case your product starts selling well, as Amazon does not like it if you run out of stock, so you need to make sure you always have inventory in the FBA warehouses. Before you launch on Amazon then, make sure you have some way to pay for expenses (so have some cash set aside, or have a credit card).
Before Launching on Amazon - Know Your Sales Tax Obligations
Make sure you read about your sales tax obligations. Even if you don’t live in the United States, you may still be required to collect and pay sales tax within certain states. We have a video here on this channel which discusses what your sales tax obligations are, so that you don’t get an unexpected tax bill!
Thanks for watching - if you have questions please leave them as a comment below.