One of the fundamental components to a successful Amazon FBA business is product sourcing. Beyond product pricing, listing optimization, and marketing, your product choices have a huge impact on whether your Amazon business succeeds or fails. That is why you should consider essential Amazon FBA product sourcing factors like product profit margin, customer demand, and sourcing methods. Product sourcing serves as the basic foundation of your Amazon business, and the subsequent discussion below will help you achieve a successful product sourcing endeavor.
What is Amazon FBA Product Sourcing?
The majority of online sellers do not manufacture their own products. Most sellers rely mainly on trusted sources for their inventory.
Such reliance on inventory items is aptly known as product sourcing. It is basically a process by which a business attains a product to sell online from domestic or international sources.
In the context of Amazon FBA, the reliance of an FBA seller on a manufacturer, wholesaler, or sourcing company for their Amazon inventory is construed as a form of Amazon FBA product sourcing.
The Different FBA Product Sourcing Methods
When searching for Amazon FBA products, there are various product sourcing methods available. Understanding these will help you refine your product research, price and cost calculation, and negotiate deals.
This product sourcing method is widely used and involves finding a wholesale supplier who can offer you various types of inventory items. Currently, the most popular online directory for wholesalers is Alibaba. The online platform is primarily a B2B marketplace where online sellers can connect and carry out transactions with wholesalers from China.
Working with a product manufacturer is another method of sourcing for Amazon FBA products. It is considered an excellent alternative to wholesalers since it removes intermediaries and their accompanying fees. Dealing directly with manufacturers also gives you leverage when it comes to product customization and private label. However, you should be prepared for the required minimum order quantities (MOQ).
Alternative destinations that experienced Amazon sellers use for product sourcing are existing marketplaces or retail stores. Retail stores like eBay, Shopify, and Walmart are good examples. Others would call this method online arbitrage. This method of FBA product sourcing involves buying discounted products through these retailers and raising the price for profit when selling on Amazon.
Another avenue for sourcing your Amazon products are trade shows. By attending retail business conferences, product exhibits, and trade shows, you can widen your connections and selection of potential Amazon inventory sources. These events will introduce you to various suppliers, manufacturers, and even fellow retailers in the industry. To narrow down your options, it would be best to join trade shows that are highly relevant to your niche market or target shoppers.
Some Amazon sellers use product sourcing companies to do the heavy lifting. These companies will search for the best products for your Amazon inventory at the most competitive prices. Since you are outsourcing the product sourcing task, be prepared to allocate a portion of your profit to these companies.
Tips for Successful Product Sourcing
When it comes to product sourcing, take your time and be sure to do your due diligence. To help improve your product sourcing activity, here are some tips to follow:
Thoroughly Research Your Products
Market research is essential for a successful Amazon business. Check trending products on Amazon categories as well as social media platforms to give you a better perspective on what product to consider for product sourcing.
Evaluate Your Product Sources
To give you an assurance of the outcome of your product sourcing transactions, you should verify your product sources. Whether domestic or international, verify the legitimacy of your suppliers, manufacturers, or sourcing companies and check if they’re registered.
Ask for Samples
Before you commit to any product source, it is always wise to ask for samples to give you a better grasp of what you are going to be selling. Asking for a product sample is a vital sourcing strategy so that you can scrutinize the quality of your potential Amazon inventory.
Have Backup Suppliers Ready
Like with any business, you should always have a plan B, plan C, or even plan D. This is especially true if you are planning to source FBA products overseas. Having backup suppliers, both domestic and international, will help you avoid disappointing your Amazon customers and undermining your inventory.
Complementary Amazon Seller Tools
To complement your efforts in finding the best products and product sources, here are some reliable Amazon sellers tools that could help take your Amazon business to greater heights.
Product Research Tools: This tool relies on advanced product search data to help you find high potential and low competition products for your Amazon business.
Amazon FBA Calculator: With the help of an FBA calculator, you will better understand the fees and profit margin of a specific product related to a fulfillment method, FBA or FBM.
Amazon Repricer: An automatic Amazon repricer will give you an upper hand when it comes to competitive pricing, price wars, and winning the Amazon Buy Box.
Feedback Tool: With the help of this seller tool, you can improve the feedback rate of your Amazon business. This will encourage shoppers to leave comments on your listings.
Inventory Management Tool: An ideal use for high-volume sellers, this seller tool will help you manage your inventory to avoid delays and other stocking issues.
Alternative International Product Sources
It cannot be denied that Chinese suppliers are the top choice for Amazon seller inventory sourcing needs. However, there are other alternative destinations when it comes to sourcing Amazon products. Here are some of the alternative platforms for your international product sourcing needs.
FBA Product Source Korea
FBA Product Source Taiwan
FBA Product Source Vietnam
Amazon FBA product sourcing requires time and effort for research and evaluation. Obtaining the best products sometimes demands trial and error, and the same goes with your suppliers. Hence, you should scrutinize your product sources thoroughly. Be flexible enough to introduce changes to your current inventory when new ideas come along. And with the help of the Amazon seller tools mentioned above, you will find it easier to source and list your Amazon inventory.