Selling on FBA can turn you into a millionaire, and there are thousands of people around the world making a successful living working from home as a full-time FBA seller.
At the same time, there are thousands upon thousands of others that have failed. Some have failed so badly that they went into massive debt from their FBA business. The stats are alarming, It should be good to learn from others’ failures more than you learn from their success.
Why people fail at Amazon ?
PROFITABILITY AND SELLING ADJUSTMENT
As an FBA seller, especially if you’re just starting out, you might find yourself chasing sales and admire your revenue data. Yes, it’s fantastic to see that your product is taking off and it’s flying off the FBA shelves, but this kind of mentality can hurt your business and even lead to failure.
The problem with this mentality is that sellers start engaging in price wars with others. They care more about the units sold instead of their bottom line. Sure, as an FBA seller you want to make as many sales as possible, and you want to increase your revenue. Even so, it’s the profit that you make that will turn you into an Amazon Millionaire.
Engaging in price wars hurts everyone and can quickly turn into a race to the bottom disguised as a race for more sales. Don’t do this! Instead, focus on providing real value to your customers and keeping prices at a comfortable profit margin.
You might not sell quite as many units, but you’re definitely going to make more profit by selling less.
Entrepreneurs like to do things themselves. I get it. I had the same mentality when I started. I wanted to quit my job so I could become my own boss and never answer to anyone. I would be in charge of my own success, and Amazon FBA was the perfect avenue for this dream.
Doing it all myself worked well in the beginning when I was only making a few thousand bucks a month, but once my store started to grow, I realized that I needed some help. I was spending way too much time researching products, updating my inventory, and pricing my products. It was hard at first, but I bit the bullet and hired virtual assistants to help. Now that I’ve become successful over the years, I look back on this decision as a critical moment that defined my success.
If you want to survive in the long run, you need to get some help before you’re overwhelmed and forced to scale back or shut down altogether.
CHECKING DATA AND ANALYSIS
This final reason FBA sellers fail is probably the most common. All too often, sellers ignore the data Amazon provides on their store, and they instead follow their emotions to make important decisions. This happens most often when it comes to choosing the products to sell.
Someone might love quirky doormats and decide that since they’re passionate about the product category, they should sell it exclusively. However, once the initial sales data comes in, they see that it’s not selling too well at all. They ignore the data and continue selling the products because they’re sure that the data is wrong, and make excuses to themselves.
Don’t do this! Amazon provides this data for a reason, and numbers never lie. If you see a product isn’t selling well, it’s time to liquidate it and try something new. Yes, it isn’t the ideal outcome, but it’s a business, and to become a successful FBA seller, you need to know how to read the numbers and make informed decisions. Thanks to Jamie Davidson.