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Selling on Amazon – Starting Your Online Retail Business

As you probably know from my previous posts, I recommend that anyone who is just starting to sell online start on Amazon.  Of the marketplaces I’ve sold on they’re the easiest.  They let you do as much or as little as you want.  If you want to just have your listings show up on Amazon, and do all of the order fulfillment and customer support yourself, you can.  If you want to just buy products, send them to an Amazon warehouse, and have no more to do with the sales process, you can do that, too.

Your desired level of involvement will change over time as your sales grow and your objectives change.  At first, with small volumes, you may as well handle the order fulfillment yourself, it doesn’t take much time or storage space.  Eventually you’ll reach a point where it’s taking a lot of your time and holding you back from growing sales, and you’ll want a fulfillment service to take that over from you.

The two things that generally constrain your sales are time and money.  Time to find new products to sell, which should always be a big part of the time you spend on your online business, and money to buy additional inventory.  As a retailer you can only sell what you buy, so having capital to buy more inventory is essential to growing your sales.

In terms of time, always keep track of how much time you’re spending on each aspect of your business, and actively spend time every week thinking of ways to reduce it.  Reducing how much time you spend on any activity will free up more time to look for additional products to sell (to help, here is a free list I update monthly with items to sell on Amazon).  This isn’t rocket science, if you actively spend time thinking of ways to become more efficient every week you’ll find them.  Maybe not every week, but you will find them.

Money is trickier.  I recommend that you not borrow money.  Not every product you sell is going to sell well, you don’t want to borrow money to buy inventory that you can’t sell.  If you’re just starting out and don’t have much money for inventory, you can look for one-off products to sell in outlet stores and the like.  It’s a lot more time intensive to sell one-off products, and I don’t know of a way to really ramp up to large volumes doing that, but if you’re just getting started and need a way to generate profit to but more inventory it’s a path that can work.

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