How to get started with Amazon FBA

I've been selling on Amazon FBA for a few years now. I started with very little, and have grown my business into a nice income.

I am a member of many facebook groups, and this question often comes up: What do I need to get started on Amazon FBA?

First of all, you need to be ready to work our ass off. Lazy sellers fail every day. Aside from a strong will and motivation, there are some basic supplies you will need to get started.

• Avery re-positionable labels. Get the 5160 re-positionable, as they are the ones supported in Amazon Seller Central. You can get them on Amazon directly.
• Laser printer. Amazon hates inkjet printed labels because they tend to smear, even months after printing. You can get by starting out with an inkjet, just be sure to put scotch tape over the printed part of the label. I absolutely recommend getting a laser printer. You can get one on craigslist for under $50.
• Shipping tape. Don't get "packing" or "moving" tape. Get high quality shipping tape. The packing and moving tapes aren't quite as sticky or strong. You'd hate to have your inventory fall all over a UPS truck floor.
• Packing supplies. Bubble wrap, newspaper, paper bags, balloons, plastic bags, etc. Amazon forbids packing peanuts. Don't use them. Amazon will complain. Repeated use of packing peanuts can get your listing privileges suspended. Since I do a lot of shopping at retail stores, I have a ton of plastic shopping bags. I reuse them as packing material. I also use trash can liners for "air bubble" packing. You just have to tie 2 or 3 good knots in the bag for it to stay air tight.
• Scotty peelers. These handy little guys help with peeling off retail price stickers. If you do any retail arbitrage or buying from liquidation stores, they will come in handy. They are cheap, so there's really no excuse to waste your time using your fingernails. You'll be amazed at how quickly these bad boys remove stickers. You can buy them on Amazon directly.
• Goo Gone. This stuff can be purchase from Home Depot or Lowes. It is used to remove the "goop" left over after removing retail stickers. It also removes sharpie marker, crayon, and much more. You can also get a product called "Goof Off", but that stuff is very powerful. It also has quite a strong smell, so you have to use it in a well ventilated room, and you have to use latex gloves to protect your skin. I just use Goo Gone, as it doesn't require any skin protection or ventilation. It actually has a pleasant smell. In the event that you need something stronger, try using the alcohol based hand sanitizer. If it won't come off with that, it won't come off.
• Shipping boxes. I personally use the Home Depot small and medium moving boxes. They exceed Amazon's and UPS's box strength requirements. The medium boxes are just perfect for shipping without getting an oversize charge. When you send your inventory to Amazon FBA, Amazon gives you a significant discount on the shipping. I've had 49 lbs. medium home depot boxes going from Seattle to Chattanooga for $27. If you can fill up a medium home depot moving box and keep it just under 50 lbs., you will get the best possible price for shipping.
• Shipping scale. For your first few shipments, you can use the "bathroom scale" method. This method is: stand on your bathroom scale, note your weight, then stand on the scale with the box. Subtract your weight from the second total, and you have the weight of the box. Bathroom scales aren't as accurate as they need to be for long term FBA shipping, but it will do for your first "testing the waters" shipment. The best solution is to buy a shipping scale. I personally use the Weighmax 2822, 75 lb shipping scale. It uses a single 9v battery that lasts for months (also can use an included AC adaptor).
• Scouting App on your smartphone. If you're doing retail arbitrage, you will need a smartphone with a cellular data plan, a barcode scanner, and an scouting app. Scanpower has a very good app, if you're willing to pay a monthly subscription. But, a cheaper alternative is "Profit Bandit". It costs $15, one time fee. Profit bandit has a significant limitation of only 20 competitor listings, so you should always push the little Amazon "a" icon to visit the product listing to verify the buy box price. If you can't afford either of these, you can use the "Amazon price checker" app. It isn't a great alternative, but at least you can quickly look up an item and see some basic information. The limitation of the price checker app is that it doesn't give you the sales rank for most items, and it doesn't calculate your payout the way profit bandit and scanpower do. I strongly recommend using Profit Bandit or Scanpower.

Some additional supplies that will be helpful down the road:

•  Shrink Wrap and Polybags. Amazon requires extra prep for some items. Often, the extra prep involves shrink wrap or polybagging the item. Shrink wrapping requires an impulse sealer (the machine with the bar you press down that melts the plastic together) and a heat gun (or a good hair dryer). Polybags are simply thick, clear, plastic bags to protect an item and keep bundles together. All you need for polybagging is the bag itself, and some clear tape to seal it. Be sure to put the FBA label on the outside of the bag, not inside where it isn't scannable. For a short term shrink wrapping solution, try the UPS store or Office Depot. Some UPS Stores have the impulse sealers, others don't. Most Office Depot stores have impulse sealers. They do a nice job, and it's fairly cheap (I paid $1 per item), and they do everything including the heat gun shrinkage. When you do decide to buy an impulse sealer, be sure to get the 16" version. You can get by with a 12", but there are times when only a 16" will do, then you've got to run down to Office Depot, which is a pain.
• Dymo Labelwriter. In my not so humble opinion, the Dymo Labelwriter 450 is the best option for printing labels one at a time. It is also the most widely supported printer for third party apps (like scanpower and inventorylab). Just as with the avery labels, be sure to get the re-positionable labels. I use the 30334 repositionable labels, as they are supported in Seller Central's "scan and ship", as well as inventorylab. Because these labels are created using heat, you never have to buy ink or toner for these printers. They are also workhorses. I've printed up to 300 labels in a 3 hour period, and it never failed me. If you're doing this on a budget, try searching craigslist for "dymo". You can find them for $30 - $40, which is half the new price on Amazon.
• Barcode scanner for your prepping and shipping process. Once you really get into this, a barcode scanner will save you having to type in your UPC when listing your inventory and prepping it for shipment. I use this basic USB barcode scanner, and it works well for me.

You'll eventually need more prepping supplies. I encourage you to go on facebook and find groups dedicated to helping Amazon sellers. A few decent groups are: Amazon Sellers, Fulfillment By Amazon Sellers, and Thrifting for Profit. Please note that Amazon Sellers is an open group. As such, any questions you post there will be visible to your facebook friends. The other two are closed groups, so you can ask questions and participate without your friends seeing and judging.

A few tips on prepping and shipping:

•  Remove all retail stickers, especially price tags. Nothing will get you negative feedback faster than a customer who sees that you purchased an item on clearance and flipped it for a profit. There's nothing illegal or immoral about doing that. It's call capitalism. But some people would feel cheated, so please remember to remove all retail stickers.
• When taping a shipping box, be sure to get the flaps touching end to end. Apply the tape as demonstrated in the image. I tape it once over both flaps to get the flaps aligned and snug against each other, then 3 times the other way (along the seam of the flaps). Make sure you have 3 - 4 inches of tape on either side of the vertical side of the box.
• Make sure you put packing / cushioning material around anything fragile. If it is very fragile, perhaps it should be bubble wrapped and / or put in it's own box for storage at the fulfillment center.
• When you shake the box, nothing should move around. Keep in mind that your box will be severely manhandled by UPS. Slapping a "fragile" label on the box doesn't change how UPS handles it. If anything, a disgruntled worker might "accidentally" drop your box. Make sure you pack it in such a way that nothing will be damaged if the box is dropped from 2 feet in the air. You should also pack it to support other boxes on top of it. Remember: If your box is improperly packed, UPS won't take any responsibility for damage.
• When prepping your inventory, be sure every time is NEW. I don't mean eBay new, I mean Nordstrom or Neiman Marcus NEW. That's what Amazon customers expect. If it is dusty, or has goop on it, clean it off. Remove any sharpie markers or other markings using Goo Gone. When you put it in your FBA box for shipment, it must be in perfect condition. If it is not in perfect NEW condition, list is as another condition. Don't try to list anything that isn't in perfect condition as NEW. It isn't enough to list as new and put some warning in the condition notes. On Amazon, NEW MEANS NEW.
• Amazon isn't the place to sell expired ANYTHING. You cannot sell expired sunscreen, toner, ink, cookies, or anything else. Don't try it. You will get busted, and you could lose your selling privileges.
• If you are doing FBA or fulfilling orders yourself (Merchant Fulfilled or MF in seller parlance), DO NOT send your contact information or promotional materials with your shipment or inventory. Amazon absolutely forbids promotional material or contact information in FBA inventory or shipments you send directly to a customer. If you need to contact a customer, do so using Amazon's messaging center inside Seller Central. Even in the messaging center, DO NOT send any promotional material or contact information.
• You will need to collect and remit sales tax in your state, as well as any other state where you have "nexus". This essentially means any state where Amazon houses your FBA inventory. Amazon does a good job of calculating and collecting the taxes, but you have to give them your state sales tax information, and you have to remit the taxes to each state. It isn't a huge hassle, as most states only require yearly remittance for beginning sellers. The particulars of this are somewhat up in the air at the moment, as Congress seeks to pass a law to simplify the whole thing. The current bill has an exemption for sellers with under $1 million in sales, but there's no guarantee it will be in the final bill (if it passes at all). Even if the $1 million exemption is passed, Amazon is known for their "one size fits all" policies. It is very likely that they will require new-ish sellers to abide by the law, even if they have under $1 million in sales. If you also sell on eBay or Etsy, you'll need to start collecting and remitting sales tax in your "nexus" states on those platforms as well. If you have any questions, please ask a tax accountant or post a question on an FBA facebook group. I'm not an expert, and this should not be considered legal advice.

At the end of the day, you get what you put into this business. If you work hard, invest, and learn, you can succeed. In this business, effort pays off and laziness leads to failure. You don't have to be extremely business or internet savvy to make money with Amazon FBA. However, you have to be willing to work hard and reinvest your earnings back into the business. Your take-home pay will be small as you get started. But it can become a full time income (and even more) if you put in the time and effort.

Ask for advice on facebook groups. As you can see, you don't need a ton of money to get started. I started my business with $200 cash, after registering the LLC and buying shipping supplies.

One final note on buying on credit. Unless you are able to afford to pay off your balance every month from a day job income (not from Amazon sales), I recommend not using a credit card to buy inventory. As you get started, you'll make mistakes. You can start out at liquidation stores, thrift stores, garage sales, and estate sales to minimize the impact of mistakes. Just make sure you learn from your mistakes, and pay for the mistakes out of your own cash. There's nothing worse than putting a "sure thing" on a credit card, only to struggle to pay it off when the bill comes. The best way to run this business is DEBT FREE.

Good luck to you!