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Amazon FBA: A Profitable Option for The German Mittelstand to Sell Multi-Channel

Are you an entrepreneur or working for a German Mittelstand and looking for an easy way to sell your products? Do you wonder how Amazon fulfillment works and what are the best Amazon seller tools? Is Amazon optimization a priority for you? Do the ins and outs of Amazon FBA shipping perplex you? Do you have trouble determining what the top selling items on Amazon are?

“More and more small and medium-sized businesses are choosing to join the Amazon Marketplace and sell right alongside Amazon to reach customers around the world,” explained Peter Faricy, Vice President for Amazon Marketplace in a recent statement. “Entrepreneurs and small business owners are succeeding on Amazon – they sell half the products that Amazon customers buy, and more than 140,000 small and medium-sized businesses surpassed $100,000 in sales on Amazon in 2017.” A solid 43.5% of all online sales were captured by Amazon in 2017. A big draw for brand owners, entrepreneurs and small and medium-sized businesses is the ability to use Amazon’s Prime two-day shipping for its products.

To help you succeed in selling on the Amazon Marketplace and start earning money, we’ve gathered some of the top tips for you:

Fulfilment by Amazon (FBA) is different than simply selling on Amazon (FBM –  by Merchant). With FBA, sellers harness Amazon’s vast infrastructure to warehouse units, pack and ship orders and even provide customer service for those orders. You can sell your own label products and let Amazon take care of order fulfillment for you. This is a big deal/game changer for many small businesses owners who had previously relied upon Amazon FBM.  

More about Fulfillment by Amazon fees

You don’t have to use FBA for all your products. You can mix and match with Amazon FBM. Sure, Amazon FBA boosts your product’s buyability and discoverability and makes you eligible for Amazon Prime/Amazon Super Saver. But sometimes you may wish to retain order fulfillment control and save on costs by listing some products with Amazon FBM.

Think multi-channel. You don’t need to be an Amazon-only seller. Many sellers make Amazon their main marketplace but still retain their own website and online store(s). Other sellers focus most of their energy on their e-commerce site yet rely upon Amazon to boost additional sales. Some businesses choose to list only certain products with Amazon FBA. Be multi-channel.

With Amazon FBA, you still need to take care of the transportation of your good from your home or factory to the Amazon warehouse. Here is where a good freight forwarder comes in. FreightHub logistic experts are skilled at stick-handling Amazon sellers’ documentation and customs clearance – see how. At FreightHub, we ensure that your shipment is packed, palletized and labeled to strict Amazon standards.

Staying organized keeps you in the game. As an Amazon seller, you are dealing with a lot of moving parts. You will want to receive updates on your shipments’ progress to the warehouse. Consulting FreightHub’s dashboard for all shipments and documents streamlines the process. FreightHub also has an Operations Manager who will pro-actively handle any issues for you.

Copywriting and quality product photos matter. Whatever the content you create (product titles, bullet points, product descriptions or keywords), the writing should reflect how potential buyers are approaching the product.  Think like the buyer. Keywords should reflect how the buyer would describe what they are looking for. Use as many relevant terms as possible. For foreign Amazon marketplaces, use writers who speak the native language. With Amazon, you can use a tool called “Translate your Products” to get wording that is translated and verified by native speakers. Multiple, high-resolution images including a lifestyle image significantly enhance the product listing.

Tools like Google AdWords and paid search promotions on Amazon will help your products stand out.  Twenty-five percent of Amazon sellers use Google AdWords, as well as social media campaigns, such as Facebook promotions to enhance the visibility of their products. As well, Amazon explains the benefits of using its in-house advertising solutions on its Amazon Services page. They are 1) sponsored products for the promotion of individual listings and  2) Headline Search Ads. “Advertising on Amazon is an easy way for you to promote your listings. Ads appear right where customers will see them, such as the first page of search results or product detail pages. You place bids on relevant keywords, and if your bid wins and your ad matches the search, your ad gets displayed to shoppers. These targeted ads can bring your products to a new audience and help you maximize your sales.”

Take the lead on the question and answer section of your product listing. You don’t need to wait for customers to ask questions first.

Build up customer reviews by asking for feedback which many FBA sellers neglect to do. The power of reviews is a well-established feature of today’s shopping experience – customers want to know with whom they are dealing with and with just a few clicks. One need not be afraid of negative reviews (See “Unsatisfied ‘Customer’ who Ultimately Helps Your Business“) – they can be an opportunity to explain, problem-solve and transform bad will into good. Besides, all good reviews can sometimes make a product seem suspect.

Watch prices. The fees on Amazon FBA can be costly. Competition is fierce, your profit margin may be lower than what you expected as an independent seller. Beware of surprising tax obligations, fraudulent sellers who seek to imitate and undercut your product, and long-term storage costs. There are some trade-offs and challenges when you list on Amazon– a trade-off for the high-traffic, higher sales volumes potential offered by Amazon.

Experiment with markets. Germany is now ranked the #2 marketplace after the USA. With the European seller account, you can create and manage product offerings in several marketplaces such as Amazon.co.uk, Amazon.fr, Amazon.it and Amazon.es.

Experiment with options in inventory. Selling on Amazon FBA is a custom process. Competing with the same product offered by Amazon Retail is next to impossible as Amazon will invariably get the Buy Box. Without an exclusive sourcing relationship, Amazon sellers will be unlikely to receive a sufficient pricing advantage to survive (making basic retail arbitrage a less attractive option). Resellers will be forced to lower their prices too much to compete. Selling oversized or Hazmat products are rarely worth it. Many sellers who do not have their own product find it worthwhile to rely upon inexpensive overseas sourcing such as Alibaba and develop private label brands.

Get creative with marketing. Offer an “add-on” product to your listing. Make every effort to get on “Top Ten” lists for your product category. Think outside of the box.

Are you ready? Get started today! Amazon seller help is not far away. You can begin your Amazon FBA journey by taking the first step of learning about becoming a seller at Amazon Services Europe.  You can also join the FreightHub University Facebook community today to explore all issues related to FBA shipping. This is a place where you can freely exchange ideas and triumphs with other Amazon FBA sellers and e-commerce shippers who have had first-hand Amazon FBA shipping experience.