In this article, we will discuss the basic concept of private labeling and reselling on Amazon. You will learn some of the pros and cons of private labeling and the advantages and disadvantages of Amazon reselling. 

Amazon Private Labeling vs Reselling on Amazon: Which Is Better? 

What Is Reselling on Amazon?  

Reselling, in general, refers to a business model where a person or the “reseller” purchases discounted products from multiple suppliers and sells them to consumers at a profit. 

An Amazon reseller has several options when it comes to reselling on Amazon. The most popular choices for reselling on Amazon are Amazon wholesale and Amazon arbitrage.

Arbitrage generally means purchasing discounted products at a brick-and-mortar store or online retail shops to sell them online at a higher price. When arbitrage is performed online, it is known as online arbitrage. In contrast, retail arbitrage pertains to sourcing products from physical stores. 

Some of the go-to destinations of Amazon sellers for retail arbitrage include department store’s discounted sections, thrift stores, and outlet shops. Amazon sellers who are into retail arbitrage utilize seller scanner apps to help them determine the product’s profitability.    

Furthermore, an alternative to arbitrage is wholesale. Amazon wholesale ensues when an Amazon seller purchases low-cost or discounted existing branded goods in bulk and sells them individually on Amazon for a higher price. 

What Is Private Labeling on Amazon?

Currently, Amazon private label is the widely utilized business model by Amazon sellers. A survey of nearly 5,000 Amazon sellers revealed that around 67% of sellers are into private labeling. 

So what is private labeling on Amazon? 

Private labeling refers to buying generic products directly from manufacturers and reselling them on Amazon with your logo on them. 

Once the items have been ordered from manufacturers, Amazon sellers can have complete control of almost all aspects of the product. It may include but is not limited to product specs, packaging, marketing, and branding. 

Essentially, a private label is having a product manufactured by a third party and selling it under the business owner’s brand name.

The Pros and Cons of Amazon Private Label and Reselling 

To improve your understanding of the eCommerce landscape and Amazon marketplace, here are relevant insights concerning the pros and cons of private labeling and reselling on Amazon. Knowing these important details can help speed up your decision-making process. 

What Are the Advantages of Reselling on Amazon? 

Quick Start

One of the reasons why sellers choose to resell items on Amazon is because of the quick headstart it can give. Once you have created your Amazon FBA or FBM account, you can start listing the items you sourced from your retail or online sources. 

Since reselling on Amazon can utilize the arbitrage model, you can have an advantage in terms of product sourcing proximity. You do not need to wait longer for inventory items from overseas since you can source your products from local sources.  

Lower Financial Risk 

Since reselling on Amazon will not necessarily require purchasing items in bulk, sellers have the option to start with a small investment. Hence, making it an ideal business for online sellers who are risk-averse and budget conscious. 

Quick Expansion 

Reselling on Amazon lets you quickly expand your business since you can add a wide range of products, even without having to shell out a considerable investment. Stocking more products for your inventory is less expensive because reselling sources will not necessarily require you to purchase items in bulk. 

What Are the Disadvantages of Reselling on Amazon?  

Less Pricing Control

Since you will not be selling your brand, you will likely have less pricing control over it. To improve your pricing strategy, you can use an Amazon repricer that can automate price adjustments in real-time. Thus, allowing you to obtain a competitive edge over other Amazon sellers. 

Less Product Control 

Since you will be purchasing and selling items of other brands, you have less room for product improvement. You cannot immediately introduce changes to the product since you are not its brand owner. Hence, you cannot build your own unique and cohesive brand. 

What Are the Advantages of Amazon Private Label?

Brand Autonomy

Since you will not depend on other brands for your inventory, you can establish your own brand identity. You have the freedom to build your brand from start to finish. You can pattern your brand according to your business values and reputation, creating the brand reputation you envision.

Better Quality Control 

You can have better control over the quality of the product you are ordering from the manufacturer, especially if you will set the product’s specifications to pass industry standards. If updates are needed, you can simply instruct manufacturers to apply updates based on the specifications you send. 

What Are the Disadvantages of Amazon Private Label?

Waiting Period

Since inventory items for private labeling businesses are usually ordered from manufacturers from countries like China, India, and Vietnam, it will require a waiting period before you can list your products online. 

Significant Investment

Unlike reselling, private labeling will require substantial capital. Private labeling can be costly because you will have to shell out more money to order items in bulk and have them delivered from overseas. Moreover, you will also incur additional expenses in the form of insurance and tax fees. 

So Which Amazon Business Model Is Best For You? 

Choosing between private labeling and reselling on Amazon likely relies on your preference and capacity to start a business. If you prefer to start your Amazon business with less effort and capital requirement, you can choose Amazon reselling. 

On the contrary, if you want complete control over your product and have the capital to purchase inventory items in bulk, you can start your Amazon business using the private label model.   

To maximize your business potential, strategic planning combined with the proper use of Amazon seller tools can help you achieve a competitive advantage regardless of the Amazon business model you choose. 

The most popular by far, however, are wholesale and private label.

Over two-thirds of Amazon sellers sell private label products. Nearly a third are wholesalers. Compared to retail or online arbitrage, or becoming a dropshipping vendor, these two methods dominate. Wholesale and private label are unique in their own ways, with their respective pros & cons. 

By the end of this article, we hope you can make a comparison between the two, and figure out which method works best for you!

What is Wholesale?

Wholesaling involves purchasing goods in bulk and then selling each unit on Amazon. 

Wholesale products, unlike most other products, have one key difference. They are existing products that have product listings on Amazon already.  So if you’re looking to sell wholesale on Amazon, essentially you will be adding units to existing product listings and acting as a reseller.

Wholesale – Costs & Profitability

Notably, the start-up costs of selling wholesale on Amazon are lower. Nearly 50% of Amazon wholesale sellers spent less than $2500 to launch their wholesale business. This is because buying products in bulk generally comes with hefty discounts. Furthermore, wholesale sellers don’t have to invest into marketing their products, because they are reselling already established brands.

In terms of profitability, most Amazon FBA wholesalers earn over $5000 monthly. Wholesale is an attractive prospect to many sellers, because the start-up costs are fairly low for a very decent profit margin! It provides a level of security that other methods do not provide.

Wholesale – Pros & Cons

Despite having a lower start-up cost, wholesale has its benefits and limitations. Most of the pros stem from the fact that the brand you are reselling for has most of the business processes handled, for example:

Pros 

• There’s no need to create new product listings for an established brand
• Wholesaling is less time intensive because there’s no need to build your own brand
• Do not have to deal with IP infringements yourself, the brand owner does
• No advertising or marketing costs, products are already in demand 
• Lead time for replenishment is shorter because wholesale products are locally sourced
• Easy to scale your business because once one brand takes you on, more brand deals are likely 

Still, like any other business model, it comes with some cons.  

Cons

• Partnerships with established brands are difficult to obtain, you must really offer something of value to their business
• You have to place high-volume orders every time, which means your budget for replenishments must be high
• A wholesale license/permit is required to resell any products on Amazon, you need to be approved by relevant authorities for this
• Other resellers will be selling the same products, which causes price erosion
• The fight for Buy Box is highly competitive between resellers, especially for established brands
• You have to maintain a good relationship with brand owners, meaning you have less freedoms as a business owner

Overall, wholesale is a mixed bag, especially for sellers new to the concept. Sellers with wholesaling experience and/or a good network will find it much easier than inexperienced sellers. Still, do not be discouraged, once you have brand deals, wholesaling is a very stable source of income.

Tips for Wholesale Sellers

How do I get started?

Before anything else, get a wholesaling license. If you’re in the US you need to register your business. After this, apply for an EIN with the IRS. An EIN is an Employee Identification Number and it’s free to get.  It will take 4-5 weeks of processing, during which you can start cold emailing and cold calling potential brands to resell for. 

What kind of products should I sell?

Product choice depends on a lot of factors, mostly on what type of brands you seek out. The top 3 product categories for Amazon wholesalers are: 

1. Home & Kitchen
2. Toys & Games 
3. Sports & Outdoors

We recommend doing market research to find high-demand products, doing some cost-benefit analysis, and then reaching out to those brand owners. Once you’ve signed on with a brand and have your EIN,  you can start selling immediately.  

How do I find a wholesale partner?

Finding a brand owner willing to take you on is the biggest challenge to wholesaling. Once you’ve crossed that hurdle it’s a smooth ride. When it comes to convincing brand owners, we find there are 3 key things every seller needs to do: 

1. Do your homework

Brand owners have no reason to take you on, other than what you bring to the table. Brands already have dedicated teams to run their Amazon stores, so what you need to do is set yourself apart. Show concrete ways in which you can improve their existing listings, their product photos, and/or their PPC strategies. 

1. Provide useful insights

State your skillsets right off the bat, and point out areas where you can add value.  Many big, established brands have trouble selling on online marketplaces compared to their brick-and-mortar stores. Figure out how you can make their transition easier. You can even scour customer reviews and provide insight into how they can improve their product for customers. Make sure you have the data to support these claims though, or you’ll be rejected immediately!

1. Don’t give up 

You may send hundreds of cold emails and still not receive a reply, so don’t give up! Keep following up, we recommend on a weekly basis. If you show your dedication, brand owners will take note and be impressed by your tenacity.

What is Private Label?

Private label involves purchasing generic products from 3rd party manufacturers, then selling it under your own brand on Amazon.  This means that the manufacturer doesn’t have rights over the brand label on the product, that’s yours – essentially, a “private label.”  

Private labeling is markedly different from wholesaling. Private label sellers create their own brands, so this means they need to create product listings themselves. Each private label product has to have a variety of labels & identifiers stipulated by Amazon. These include GTIN, UPCs, SKUs, FNSKUs, and finally, a unique ASIN assigned by Amazon. 

Private Label – Costs & Profitability

Private label brands aren’t established brands. This adds a couple of steps in launching a private label business compared to wholesale. Private label sellers have to create their own brand, design logos & brand content, market their products, and run much more robust PPC campaigns.

Over two-thirds of private label sellers spend well over $2500 in start-up costs. In terms of profitability, over half made over $5000 monthly.  Looking at purely numbers, there are no glaring differences between wholesaling and private label.  The key difference here is how much more time-intensive creating your own private label brand is.  

For this reason, private label is seen as quite a high risk but high reward business! There is no established brand to fall back on… Yet there is a lot of freedom to run your business exactly the way you want to, which is what attracts e-commerce entrepreneurs to this business model. 

Private Label – Pros & Cons

As mentioned before, private label is high risk and high reward. It’s a time intensive business and the success of a private label brand on Amazon is very much tied to this. The more time and effort you invest into your private label business, the more likely it is to succeed.

Most of the benefits of private label stem from the freedom you have as a business owner. For example:

Pros

• You have full control over the creative processes, you can design your own logo and even create custom packaging 
• The only partnerships you have to maintain are with your manufacturers and any 3PL agencies you want to use 
• Order volume is highly negotiable and you can find suppliers who offer a lower MOQ 
• You’re automatically on the Buy Box as the sole seller of your product, you don’t have to fight for Buy Box share 
• You are your own boss. You don’t need to ask permission to add any variations & customizations to your products
• For new, specialized products there is much less competition compared to established brands
• Profit margins can be very lucrative, depending on how in-demand your product is you can actually increase your margins very fast

Of course, there are some cons to selling private label on Amazon:

Cons

• High workload, need to create your own brand, logo, product design, labels, packaging and so on 
• Have to incur marketing and advertising costs for your product listings, including Amazon PPC 
• Very time consuming, have to frequently optimize product pages, product listings, images, backend search terms and PPC ad campaigns
• No quality assurance for your products, because you have to find and vet your supplies yourself 
• A longer lead time because most private label products are imported from cheaper, overseas suppliers
• Need to deal with listing hijackings, IP infringement, and other types of fraud on your own
• Without an established brand, there is no brand loyalty, so you have to generate good reviews & ratings to climb to the top 
• Demand fluctuates for new products, and is difficult to forecast which means your profitability and income is not always stable

Private label gives you full autonomy over your business but as you can see that can be a double-edged sword. It’s important to remember Amazon FBA provides sellers an established supply chain. Launching your own business & creating a brand is easier on Amazon than anywhere else, so don’t balk at the challenges!

Tips for Private Label Sellers

How do I get started?

To get started with private label on Amazon, you need to register your business with the relevant authorities. Provide your tax information, fill out some forms and then you can register to become an Amazon Seller. Once you’ve registered, you can begin immediately.

Most private label sellers take 3 months or less to launch their own brands on Amazon.

What kind of products should I sell?

For a successful private label product, extensive product research is an absolute must. If you go in without having done your research, your brand is sure to fail. We recommend using Amazon tools to find product opportunities, and identifying untapped niches to sell in.

As a basis, the top 3  Amazon categories for private label sellers are: 

1. Home & Kitchen
2. Kitchen & Dining
3. Sports & Outdoors

These intersect with the best categories for wholesale too, which is mostly established brands. We recommend looking into other categories too, you never know what brilliant niches you could find.

How do I start private labelling?

Selling private label on Amazon is an easy step-by-step process:

1. Register your business legally and then sign up to be an Amazon Seller 
2. Create your marketing materials, meaning your brand name, brand logo, and etc.
3. Do your product research! Find a niche, crunch some numbers (cost, demand, revenue) and establish your profit margins for each product
4. Purchase GTINs, UPCs, and create ASINs and product detail pages for your product
5. Source your product, get in touch with suppliers & negotiate MOQ and costs, conduct factory inspections and request samples
6. Prepare your products. Then assign inventory to them on Amazon Seller Central. 
7. Ship your products to Amazon, and then you’re ready to start taking orders.
8. Manage your product listings, optimize them and run PPC ad campaigns for your ASINs

There are many useful guides on starting an FBA business that you can refer to.

Final Thoughts

We hope that you found this article a helpful guide to selling both wholesale and private labels on Amazon. Armed with this information, we hope all Amazon FBA sellers can make an informed decision on which business model to pursue.

Company Description

We are SellerMetrics, an Amazon PPC Software that helps Amazon sellers, brands, KDP authors and agencies scale their Amazon Advertising PPC via bid automation, bulk manual bid changes and robust analytics. 

About the Author

I am Erika Sharma, an employee of SellerMetrics. Our mission is to help Amazon Sellers navigate Amazon PPC, by offering them the knowledge and tools to kickstart their Amazon PPC optimization process without hassle.

What is Amazon Follow? 

Amazon Follow is another update on the Amazon store interface that features a “Follow” button similar to social media pages. 

This update is part of Amazon’s Brand Registry program that allows the emailing of marketing materials to shoppers who opted to follow a specific brand. The Amazon Follow button is found on both the store page and the videos on Amazon Live. 

Amazon Seller Central: Screenshot (cropped) of Nespresso store on Amazon, uploaded by SparkCatch; Retrieved May 25, 2021, From https://amzn.to/3vfhR9A

The inspiration behind the Amazon Follow button is founded on Amazon’s belief that by simply notifying shoppers about a product launch or brand promotion, customers “feel even more appreciated…and they are more likely to become loyal and engaged repeat customers.”

The follow button aims to strengthen customer-brand relationships while providing an inspiration-driven shopping experience to customers. This also serves as Amazon’s response to the request of business owners to build more stable relationships with customers worldwide.

Who is Eligible for Amazon Follow?

Not all sellers are eligible to use the follow button on their Amazon store page. Currently, only registered brands with Amazon stores can take advantage of the Amazon Follow button via the Manage Your Customer Engagement tool. 

If you are a brand owner and wish to maximize the power of the follow button, visit the Amazon Brand Registry page and check if you are eligible. 

How do you set up an Email Campaign in the Manage Your Customer Engagement Tool?

Amazon Seller Central Help Library stipulated four simple steps to help brand owners set up an email campaign:

STEP 1: You need to upload your brand logo. The logo must be positioned horizontally (3:1 or narrower). It can have a black or white background for JPG or transparent background for PNG.

STEP2: You need to add a product. The product to be added must be a recently-launched product. This means that the item “must have been made available to purchase for the first time on Amazon within the last six months”

STEP 3: You need to choose a supporting image. The correct image to upload should be a lifestyle image or an image that explains the product’s benefits. Additionally, the chosen image must observe product image requirements.

STEP 4: Lastly, you need to schedule your campaign by choosing the time range for it to be sent. 

You should also take note that an Amazon team member will review your email content. The moderation team will check whether your email content follows the requirements set by Amazon. The review usually takes a minimum of 72 hours, which is why you should include the review timeframe as part of your email marketing schedule. 

Impact of Email Marketing on Your Business

The Amazon Follow button allows brand owners to reach customers through email conveniently. This serves as an email marketing portal for Amazon brand owners. 

Apart from building the brand’s customer relationships, here are some of the benefits of email marketing to an online business. 

• Brand Awareness 

By proper planning, design, and execution, consumers will become more mindful of your brand. When they need a similar product in the future, there is a good chance they will remember your brand immediately. 

• Convenient Shareability

Email marketing remains one of the most successful marketing tools because it can easily be shared. Offers, deals, and other brand promotions are easily shared through email, which the recipient may also forward to their peers. 

• Measurability

Email marketing is among the most highly measurable marketing strategies sellers can employ. Email marketing provides valuable and measurable information that showcases both the customer’s behavior and interests. Some of this important data includes subscriber retention rates, open rates, and delivery rates. 

• Cost-Effective

Unlike the traditional marketing method, email marketing is cost-effective since there are no print costs, postage fees, and other advertising charges to be incurred. On top of this, it allows you to expand your reach.

• Lead Generation

Perhaps the most crucial impact of email marketing on your online business is lead generation. With marketing tactics like Amazon Follow, it will be easier for Amazon sellers to entice customers with new products and establish a sales pipeline. 

Be Proactive With Amazon Follow

With Amazon Follow, brand owners are now given additional opportunities to reach out to customers conveniently. Maximizing this new marketing tool and other Amazon seller tools, like an AI repricer, will boost brand awareness and sales in no time.  

As an Amazon reseller, you have access to highly valuable data. And this data, coupled with your operational expertise gained from reselling and a little creativity, can be leveraged to build a more profitable, defensible business with significantly less competition by expanding into a private label offering.

Here is a quick, comprehensive guide explaining how Amazon resellers can start a private label brand.

What is a Private Label Brand?

A private label brand finds existing items manufactured by a third-party and sells them under its own branding. 

For example, let’s assume you wanted to sell vitamins. Instead of trying to track down all of the individual raw materials, formulations, bottles, and labels, you could instead work with a contract manufacturer that has pre-made vitamins ready to ship. Then, all you have to do is supply them with your logo and packaging concepts so they can add your “label” to the products.

Unbeknownst to the consumer, there are many brands that are selling the exact same product made by the exact same supplier. They’re just branded differently.

Why You Should Start a Private Label Brand

There are many reasons why you should start a private label brand, opposed to just reselling other brands on Amazon. And while reselling on Amazon can provide consistent, low-effort cash flow, it doesn’t give you much control over your business, and profit margins can be low.

However, when you start a private label brand, you can take advantage of the Amazon flywheel and remove yourself from some of the headaches of reselling.

Here are some additional benefits of creating a private label brand:

• Higher profit, since you choose your suppliers and don’t rely on reselling other brands that you’re buying at a markup.
• You retain more control over your listings through IP and Amazon brand registry and have the ability to optimize for higher conversions.
• You have a better opportunity to build a brand outside of Amazon and start accumulating customers loyal to your brand.
• Your business would earn value if you were to sell it since you own your IP, your customer relationships.

Steps to Start a Private Label Brand as an Amazon Reseller

Now that you understand what a private label brand is and the benefits of building this type of brand, let’s walk through the steps you can take to create a private label brand as an Amazon reseller.

Step One: Find What Private Label Products to Sell

Leverage your existing data and expertise.

You are selling existing brands on Amazon. And whether you’re selling a few hundred dollars or hundreds of thousands of dollars worth of product, you have data. 

This means you can leverage this data and category expertise to identify products with the most potential. 

Consider the products that (1) are most profitable (2) you possess the most expertise and confidence in 3) have minimal competition and (4) cause the least amount of issues and complications with Amazon.

For example, you may find that generic shampoo is highly competitive with thin margins and is therefore, likely not worth getting into. However, you may find in your data that some of the more niche shampoo brands perform well. And over the years, you’ve developed expertise in the hair care category so it might make sense to explore the idea of a niche hair care brand. 

Product Research

Your products represent your brand. Even though you aren’t physically making the products, each products’ quality will directly impact the success of your brand. So, take the time to conduct extensive product research to ensure your brand offers the best products on the market for your target category and price point.

Here are a few tips for conducting product research:

Step 1: Use the Right Tools

While you have plenty of internal sales data, platforms like Helium10 or JungleScout will allow you to leverage third-party data to further evaluate existing products being sold on Amazon. To find more product research tools, visit this Amazon seller tool directory.

Step 2: Identify Competitor Shortcomings

To determine this important factor, look at competitors’ Amazon product reviews and Q/A. With a little competition recon, you will understand their shortcomings. Once you garner this information, you can devise how you can make improvements and differentiate your new products.

Amazon.com: A Screenshot (cropped) of  customer review, Retrieved May 13, 2021; From https://amzn.to/33TnsXe

Step 3: Avoid Saturated Categories

The line between popularity and saturation can be fine. Yet, you must choose products with proven selling potential that aren’t overly saturated and have no opportunity to differentiate.

Step 4: Reduce Complexity

• Product Dimensions
  • You want your products to be small and compact. Ideally, you want your items to weigh 3lbs or less and fit easily into an average shipping box. The easier it is to transport, the lower your shipping and FBA storage fees. 
• Item Price
  • The higher you can feasibly sell your products, the more opportunity you have to capture higher margins. Shoot for items that can sell for at least $20. Additionally, the use of an Amazon repricing tool will also streamline your pricing strategy. 

• Seasonality
  • Seasonal products can be tricky, for the simple fact that they are inconsistent and are difficult to forecast sales. For example, if you sell Christmas sweaters and you under forecast inventory, you could sell out of inventory in November right before the busy season and thus, lose a considerable amount of sales. On the other hand, if you over forecast, you could be stuck with excess inventory going into the new year.
  • You can have seasonal products to boost sales for that season and offer evergreen products to balance the seasons. Additionally, you don’t want to start with a seasonal product as your very first product.

• Manufacturing
  • The simplest manufacturing plan is the best plan. The fewer moving parts you have for your product to be sold and reach your customer, the better. For example, a bar of soap will be much easier to manufacture than a custom electronic device. 

Bonus Tip: research your competitor’s businesses, not just their products. Evaluate their operational efficiency and try to find gaps in their process. 

For example, your primary competitor may have a 70% 30-day feedback score on Amazon. After reading a few customer complaints, you may find the competitor has issues 1) shipping orders on time and 2) that products are frequently damaged. 

Since you’ve been reselling on Amazon for a while, you likely have a good system in place and can fulfill orders on time (if you’re not using FBA) which will give you an edge. Additionally, since you know customers are unhappy about the condition of the product they’re getting from your competitor, you’ll want to ensure you have a more thorough quality assurance process in place and perhaps use more protective packaging.

Step Two: Finding Suppliers

Finding suppliers sounds much more complicated than it is. Here are a few ways to find the best suppliers:

• Find the right platform:
  • You could find a private supplier, but it might be easier to leverage a platform like  Alibaba that has thousands of suppliers available for your choosing.

Alibab.com: A Screenshot (cropped) of homepage, Retrieved May 13, 2021; From https://www.alibaba.com/

• Ensure each supplier meets your criteria:
  • Make sure the company has at least a five-year history.
  • Only work with gold status suppliers.
  • Find a supplier with a lower Minimum Order Quantity (MOQ), at least for your initial order and until your sales ramp up.
• Order samples and evaluate each product.
  • Get samples from three potential suppliers and carefully inspect and test each one to ensure quality.

Step Three: Branding

Branding is how you’ll differentiate your private label products and emotionally connect with your customers. If you’re not skilled in this area, seek out professionals – it’s worth spending extra to get this right. 

Here are the key elements of branding:

Choosing a Name

Make your brand name unique but easy to remember (and spell). Remember, if a customer wants to look up your private label’s offerings directly, you want them to find your brand easily. Make sure the name is available for a domain name and social media handles.

Creating a Logo

Much like your label’s name, you want your logo to be easy to recognize without being obnoxious. You want to use colors that reflect the tone of your brand. For instance, if you are selling baby items, you might want to use light, bright, fun colors. You can find graphic designers on Upwork or Fiverr. 

Packaging

Your packaging should display your label’s name, logo, and the name of the product. Ensure your packaging abides by all legal parameters (such as child-proofing, if applicable).

You want your packaging to be appealing to customers. However, the colors and the information need to reflect the product in its entirety. Therefore, if a warning label or specific usage direction is required, make sure the statement is clear, visible, and meets all requirements.

Step Four: Creating and Optimizing Your Amazon Listings

As a reseller, you may not have as much experience creating and optimizing listings since you’re typically ASIN matching. Here are a few quick tips on how to optimize your listings:

• • Title optimization: Always put the best keywords in the title and keep it under 70 characters.
  • Description: Be concise and exact, using plain language and offering as much detail about the product as possible while highlighting the benefits and differentiators of your product.

• Product photos: Product photos should be well-lit, conducive to detail, and show every relevant side of the product.

Amazon.com: A Screenshot (cropped) of  product detail page, Retrieved May 13, 2021; From https://amzn.to/3hy5pOc

Step Five: Getting Reviews

Getting reviews is an easy way to build customer trust and activate the Amazon flywheel. First and foremost, the only way to get good reviews is to provide a quality product with quality service. Then, you can leverage a platform like FeedbackWhiz to automatically ask customers for reviews.  

Conclusion 

Starting a private label brand as an Amazon reseller is one of the most productive ways to expand your business, which you retain the rights to, and have Amazon work for you. Even though it could take a healthy amount of work to gain traction with a private label brand, if you leverage your existing expertise and follow the steps outlined in this guide, you will find success.

——

About the Author:

Wesley Stryker is the founder of Commerce Caffeine, an ecommerce Software Discovery Platform that helps brands find the best Amazon seller tools and Shopify apps for their businesses. Wes has over 10 years of experience operating and consulting ecommerce businesses.

Amazon private label has become popular among Amazon sellers over the past years. In fact, it was reported that “Amazon’s private-label offering contains 7,217 products as of June 2019.” 

To serve as an overview of the private label on Amazon, this article will focus on the frequently asked questions by Amazon sellers and would-be Amazon Seller Central members. 

Common Queries About the Amazon Private Label

What Is Amazon Private Label?

One of the top Amazon seller questions would be about the characteristics of a private label on Amazon. It is the usual starting point of the many questions concerning selling private label on Amazon. 

In the retail industry, most Amazon sellers rely on suppliers for their Amazon inventory. However, Amazon sellers may also opt for private label products.

Loosely speaking, Amazon private label begins when an Amazon seller gets a third-party manufacturer or supplier to produce an inventory item under its own (seller’s) brand name, and with the intention of selling it under Amazon Seller Central. 

As far as the consumers are concerned, such purposely manufactured items are the Amazon store’s or company’s own brand.

Why Should I Engage In Amazon Private Label?

One of the popular Amazon seller questions would be the reason why engage into private label on Amazon. Venturing into the private label aspect of Amazon does not mean that sellers will have to withdraw from their current Amazon FBA operations. 

Apart from exclusivity, sellers also include private label products in their Amazon inventory because some sellers find that sourcing a single product in large quantities is a more effective business strategy. This is far more convenient than having to source many diverse products in small quantities. 

How Much Work Does Amazon Private Label Require? 

The work required to build a successful Amazon private label enterprise likely depends on the seller’s experience. As with any business, selling private label on Amazon requires sellers to learn the process.

For that matter, it would be advantageous for experienced Amazon sellers to enter into Amazon private label. The learning curve will be less demanding and time consuming for tenured Amazon sellers. 

Although experienced Amazon sellers are on a vantage point when it comes to selling private label products, newbie sellers may also learn the process and even master it. 

How Do I Choose a Private Label Product to Sell?

In this day and age where communication and digital marketing technology thrives, researching items to sell online has become easier. Generating an idea or choosing an item as a private label product for Amazon inventory can be done through the help of product research tools, such as SellerApp.  

When researching a product online, it would be best to stick with inventory items that are easy to design or develop. This will save sellers from being stuck in dealing with unforeseen production issues, including Amazon returns. 

How Should I Proceed With Amazon Private Label Products?

After deciding on a private label product, sellers should proceed with the process of creating the private label product. To achieve a successful private label item, the following should be performed by Amazon sellers:

• Research for high-demand/low-competition products (as discussed previously)
• Source researched products through a reputable wholesale marketplace
• Create your brand new Amazon listing
• Negotiate for shipment and have the product shipped to Amazon fulfillment centers
• Launch the product and perform advertising campaigns

How Should I Price Private Label Listings?   

Becoming a private label Amazon seller requires sellers to have at least a rough understanding of the price of the private label product. Some sellers use eBay auctions to get an idea of the possible Amazon price to follow. 

In pricing private label items, all expenses should be included in the costing, such as shipment cost, PPC costs, and other pre-sale expenses. What other Amazon private label sellers do is price their product slightly below the current market price for increased sales and visibility. 

However, such a method is simply a prelude for a subsequent price increase once the private label item has gained market traction. Alternatively, the use of Amazon FBA Fee Calculator will also help sellers with strategic pricing for their Amazon private label products. 

What Are the Advantages of Amazon Private Label? 

Whether on Amazon or other online selling platforms, a private label holds its own set of advantages. Adaptability is among the advantages of private label items. 

When it comes to market demand, things may shift suddenly. There might be other features that consumers may want to be added to a particular product.

In view of such a change, Amazon FBA sellers who also sell private label products can easily instruct their suppliers to make manufacturing tweaks according to the current market need, since their orders are private-labeled. 

In connection with adaptability, Amazon sellers also have control over the production. Sellers can conveniently instruct their suppliers to integrate or remove certain components of a private label product according to their preference. 

Is There a Disadvantage With Amazon Private Label? 

Like with all industries, disadvantages exist when it comes to selling Amazon private label. The main disadvantage experienced by most Amazon sellers is the difficulty of establishing brand loyalty. 

Since it is private labeled, building a significant brand may be challenging. The challenge of the process stems primarily from other already established brands whom you are competing with in the same niche. 

Expand and Explore Avenues for Profit

If you wish to expand your reach and market influence while benefiting from production, pricing, and branding advantages, private label is a must explore avenue.

However, it should be noted that taking on established brands is no small feat. That is why you should be prepared to commit both effort and resources to be successful with this Amazon venture.