Did you know that Amazon private label brands grossed $450 million in sales in 2017 alone?
Now, how would you like to get in on a piece of that action? Of course, successful private labeling comes with a steep learning curve.
You can’t go into this business as a “get rich quick” scheme. It takes patience, strategy, a long-term commitment to the process, and some serious marketing chutzpah. If that sounds like you, read on for solid tips on how to get started.
Selling Private Label Products on Amazon
Before delving into the nitty-gritty of how to private label products, let’s outline the basic concept further. In a nutshell, you purchase generic products at wholesale prices, re-package them, and re-market them as your own brand at a markup.
That means creating compelling packaging and a captivating logo. Ultimately, your success lies in how much better you can market your products than the competition.
How much can you expect to earn from this type of business? Once you’re established and your brand has gained recognition, you can expect a passive income of $1,000 to $2,000 monthly.
But it won’t happen overnight. And it’ll involve some serious elbow grease on your part. If you don’t mind rolling up your sleeves and diving in, then marketing private label products could prove your ticket to consistent passive income.
Product Selection 101
Your product sets the tone for your entrepreneurial efforts. First off, it should solve people’s problems. It should also represent a product that you feel passionate about or else you’ll end up peddling junk.
Needless to say, then, you should devote more time to researching and finding the best products than any other area of your private label business. Of course, you’ve got a wide variety of products to choose from, so where should you start?
Harness the power of Amazon by checking out their best-selling products lists. While these lists get compiled to help consumers know which products to purchase, they provide succinct, valuable means for conducting pre-market research.
What to Look For
Instead of betting on products that you don’t thoroughly know, these lists let you narrow down your search based on products that consumers love. Why is this so important? A well-loved product means an easy product to market.
To help you narrow your search even further, keep the following characteristics in mind. Look for products that prove:
When it comes to generic products, you want to look for items that don’t rely heavily on recognizable branding. So, avoid the Adidas and Juicy Couture. (Major brands don’t allow private labeling, anyway.)
Instead, hone in on products that lend themselves to easy packaging and rebranding. Such as flashlights, headlamps, kitchen utensils, insulated water bottles, and coffee thermostats.
We’ve already discussed the importance of finding products that customers love. But don’t forget to look for lightweight products to cut down on your shipping expenses.
In the e-commerce world, how you ship products can make or break your business.
Okay, once you’ve found a product that meets the criteria above and fills your head with great marketing ideas, it’s time to get “inspired.” This involves a little espionage.
Why? Because you need to have a thorough understanding of the competitive landscape before you can ride in on your white horse and take over.
So, hop on Amazon and do a search for the type of product that you’d like to sell. Then, spend some time pouring over the results. In fact, we recommend tracking your findings in an Excel document.
Create data categories and then start noting important factors such as:
- Number of reviews
- Quality of the listing
- Amazon best-sellers ranking
- Product pricing
- Quality of product photos
- Quality of logo and content marketing
Some of these factors will prove subjective. But the point remains looking at what your competition’s doing so that you can see where to distinguish your brand and marketing efforts.
Once you’ve gone over the first five to 10 listings, you’ll start to develop a much better sense of what makes for a good review as opposed to a bad one. You’ll also gain a more objective opinion of whether to go any further with this product.
So, what indicates a market ripe for private labeling? Among the best indicators of serious potential within a market remain:
- Average or poor-quality listings
- Most best-sellers ranking below 1,000
- Few reviews
- An optimal price point between $10 and $40
Product research requires lots of time and energy. Don’t feel afraid if you spend hour upon hour pouring over Amazon’s pages and results to find a diamond in the rough.
Once you do stumble upon that golden egg, your efforts will pay off. Unfortunately, the research doesn’t stop there. Now you’ve got to locate the best supplier for your product.
Find a Supply
Congrats! You’ve found a great product concept that you can get behind. Now, it’s time to find a supplier for your market.
In most cases, this will require working with an overseas manufacturer. What’s one of the best resources when it comes to researching and finding international suppliers? Alibaba.
For example, take a look at the beauty and personal care supplier listings that they offer. After perusing the site, you’ll quickly realize you have options.
As you start contacting suppliers, remain calm and confident. In your conversations, come prepared to negotiate more than just prices. For example, ask about their MOQ and whether or not they’ll come down on the sales unit minimum.
Time for Some Branding
Once you’ve found your market and a supplier who lets you private label their product, you need a great logo and some snazzy marketing materials. But what if you know zilch about graphic design or marketing?
Never fear! Websites such as Upwork and Fiverr facilitate connecting with reasonably priced professionals to fulfill your graphic art and marketing needs. Each website comes with unique quirks and procedures.
But once you get the process down, you’ll feel confident hiring freelancers to help you realize your entrepreneurial dreams. Then, once your design files sit in hand, forward them to your supplier and place your order.
Prepare to List
Depending on your supplier, you’ll wait anywhere from two to four weeks to receive your shipment. In the meantime, hit Amazon hard again. Scrutinize listings looking for examples of what works.
Read through Amazon’s best practices to create listings that lead to conversions. Their suggestions will include:
- Describing why your product proves valuable
- Explaining how your product works
- Opting for high-quality images
- Highlighting your unique selling proposition (USP)
Once you’ve got your listing together, you’re almost ready to sit back, relax and watch the money start rolling in.
Put the “Passive” in Passive Income
Before you proceed any further, you need to sign up for Fulfillment by Amazon (FBA). FBA handles all of the picking, handling, and shipping for you. That way, you don’t get bogged down in the day-to-day minutiae.
FBA also allow you to grow your business more rapidly. Instead of worrying about whether or not you can handle all of the orders coming in, turn it over to the experts for a fraction of your profits.
While you’re at it, invest in repricing software to put the “passive” back in passive income. This software automatically controls your pricing strategy.
It can help you dominate your market. Serious about private labeling? Then, learn more about this technology before your competition does.
Amazon Private Label Rocks
Amazon private label rocks if you know how to use it. Fortunately, if you follow the tips above, you’ll end up well on your way to bringing in some serious earnings.
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