Do you want to increase your online revenues and grow your business? Why don’t you consider selling private label products on Amazon? You can either sell your product as “retail arbitrage”, or through private labeling or the most popular way is how retailers sell their products on Amazon.
Whether you are a new seller on Amazon or an established seller on Amazon or a reseller, the idea of expanding your product line can be profitable. Manyatimes, it becomes expensive and time consuming for many retailers. And in such cases, private labelling comes for rescue.
What is private label selling?
Basically, private label products are those products which are manufactured by one company and are promoted, branded and sold by another company. For example, many brands in the fashion industry, source their products from a wholesaler and add a logo, and wrap it up under a brand name – that’s private labelling.
All you need to do is find products that are in demand and are being manufactured by an unbranded name. Source these products and brand them as your own products!
What are the advantages?
In certain categories there are brands competing for similar products. This can diminish your profit margin. By taking into consideration such “white label” products you can cut-off your competition on the marketplace and gain the profit you desired.
Also, you do not need to worry about creating a new product from the scratch. You just need to research about the demand of a particular product and be creative in terms of packaging and marketing. This will help you in standing out from the rest and creating a brand.
You can even choose to manage your own fulfilment along with shipping and storage. This will lead to no interference while managing the Amazon account. You will be in total control of your Amazon account. This gives you freedom to solely make your decisions be it regarding a product or regarding the finances.
“There are now 135 private-label brands and more than 330 Amazon exclusive brands on Amazon’s retail sites around the world.” TJI says.
What types of products have a private label on Amazon?
It becomes necessary to carefully select a product for the private label because the product needs to be such that is in demand. The best type of products are those which are cheap to purchase and can be sold at a higher price after you have added your twist of branding. Popular products that can be sold under private labeling are:
How to sell such products on Amazon?
1. Decide your product.
It is obvious that you will not intend to sell those products that have too much competition or are not in demand. So your first step will be to decide a product that is suitable to get a private label. The criterias that you should always keep in mind choosing a new product are demand, price, availability, competition and seasonality. High demand with profitability is the perfect combination for you. Aim for those products where you can get 40 to 50% of profitability.
2. Find the right suppliers.
Since you now have an idea about the kind of product you are looking for, the next step includes looking for a supplier to get the product at the best price. You can use marketplaces like Alibaba to get a list of the wholesalers globally. There are two things that you should keep in mind at this stage:
If you face some difficulties with the order, will the manufacturer help you?
Do you need to place a large order or you can begin with by testing with a minimum quantity?
You have to be cautious about the quality of the product. Remember, if your product has a bad quality you will not be able to survive on Amazon. You can even ask for a few samples before you agree to carry the business forward.
3. Work on your brand.
Once you are ready with the products that are right for your goal, you will need to brand these products and design the packaging of these products. You will have to think upon the following things:
You can go with a simple label or a full-scale packaging design that includes instructions or ingredients. Keep in mind that branding plays a key role in sales and marketing. Branding can lead to an average revenue increase of 23%. Invest in some graphic designer because this is an important stage.
4. Figure out the fulfillment.
Will you go for in-house fulfillment or opt for Amazon’s FBA? You can also go for dropshipping. All you need to do is consider the cost of shipping, picking, packing, warehousing before deciding anything. Your shipping process and your fulfillment process will determine your ratings as an Amazon seller. Make your supply chain efficient!
5. Start selling!
Once all this is done start making a website with the help of which you can sell your product. You can also use social media platforms to advertise your product. Your customer service should be one of your forte. Your team must have a dedicated approach towards the customers – be it while answering a question or while receiving a returned product. You will only survive if you know how to approach and satisfy the customer’s needs.
You don’t need an expertise for this field. All you need to do is some good research before you totally invest upon any product. Once that is done then you can set your foot on the marketplace!