You’ve probably heard Amazon FBA pop up in your TikTok or IG feed.
Also known as Fulfillment by Amazon, it works by sourcing at-cost products from manufacturers and re-selling them for profit on Amazon. The business relies on Amazon’s automated delivery system to fulfill orders (hence the name), resulting in a largely hands-off business model.
It’s one of several e-commerce business models that are becoming increasingly popular in recent years due to low startup costs, huge profits, and ease of scale.
But truth be told, it was once even easier.
Before Amazon became the retail hulk it is now, sellers could get away with listing any old product – be it yoga mats, novelty mugs, stress-relief balls, you name it – and churn crazy profits.
However, as Amazon has become more popular, so has the competition.
So while there are still tons of profits to be made, it takes more strategy and patience to become a successful seller than in years prior.
But the question remains, is Amazon FBA a good investment of your time and money in 2023?
Yes. In fact, If you’re serious about starting and scaling an Amazon business, the answer is absolutely. Here’s why starting an Amazon FBA business, in my opinion, is still well worth it.
Flexibility and Locational Freedom
A friend of mine recently asked me for advice about a predicament. She could either stay at an in-person job she enjoyed or take a chance at a remote job opportunity with a 10% pay cut.
My advice? Start selling on Amazon!
Jokes aside, it’s seriously a no-brainer: go with the remote job.
Of course, this is just my two cents, but remote work saves you from countless indirect costs vs. an in-person job that it’s hard to justify staying for a measly 10% in 2023 for the following reasons:
- Commute times (that you’re not getting paid for)
- Increased gas prices/Transit fares
- Car maintenance costs
- Costs of lunches/eating out
- Expenditure for clothes/professional wear
Not to mention the stress and impact on one’s mental health.
That being said, Amazon FBA is a 100% fully remote business. It can be done from anywhere on the planet, and you can work whenever you want, with ultimate flexibility.
I love hearing stories of people replacing their 9-5 jobs with remote work, and how their lives improved as a result.
If you’ve been searching for a remote business opportunity but can’t seem to find one that fits your skill set, I highly recommend considering Amazon FBA as a viable option.
Sets A Sturdy Business Foundation
Have you ever got mad at a boss and thought, “How does this idiot have a job? I could do better!”
Well, you probably could.
One of the biggest takeaways from my six years on Amazon is just learning how to run and manage a business. And yes, I learned the hard way at times, but I’ve said it before; business is just problem-solving. It’s simply finding a solution to someone’s problems (and charging them for it).
So if entrepreneurship, or running an Amazon business sounds intimidating, it’s really not. Trust me, I felt the same way.
But there are plenty of resources available to learn from to cut down on expensive and time-consuming mistakes.
After a bit of experience, it’s easy to scale to new niches, enter more competitive markets, and increase monthly profits.
Use the capital to re-invest in Amazon, or cash out your account however you’d like. I recently discussed how sellers are even churning huge profits by selling their Amazon seller central accounts.
Tax Write-Offs
For those new to business, great news!
Starting your own business can actually lower your tax burden (if done correctly).
First off, you’ll only pay taxes on your business’ profit. Let’s say for example, that you begin your Amazon journey in November, but don’t make any actual sales this year. You won’t be liable for any business-related taxes the following spring. Only after you begin churning profit will you need to pay a percentage of taxes on those profits.
Imagine another scenario. Let’s say that you’re a U.S. based W-2 employee, work a 9-5, but decide to start an Amazon side hustle that you manage from your home office. Under certain scenarios, (and if you’re profitable) you’ll be able to write-off a portion of your mortgage/rent, phone bill, and utilities; ultimately lowering your cost of living.
Make sure to set up an LLC and business bank account, and keep your business expenditures completely separate from your personal purchases.
Keep track of all receipts, invoices, documentation, and above all else hire an accountant. They’ll be much more knowledgeable in tax code, and you won’t have to deal with the stress of doing them yourself.
Inexpensive Start-Up Costs
There’s no way to sugarcoat it, it’s expensive to live these days. It’s also pricey to start your own business. But you’ll pay significantly more if starting a physical brick-and-mortar business versus an online business like selling on Amazon.
After renting, purchasing equipment, furniture, office supplies, and cost of labor, business startup costs add up fast.
Since Amazon FBA can be done from a laptop,and doesn’t require a physical office or location, you’ll be working with less startup costs than an on-premise business.
You’ll still have to account for inventory costs, and other business-related costs.
For a full breakdown of Amazon-related business expenses, check out this YouTube tutorial.
Amazon Protection
Despite some complaints, Amazon is overall a great company to do business with.
They’ve taken great steps recently to cut down on fraud and scams to make the platform a safer place for those serious about selling on Amazon.
Programs like Amazon Brand registry help protect your product from being copied or counterfeited, and gives you access to countless selling perks that will make your FBA journey worthwhile.
Some folks are rightly hesitant about both purchasing large orders from overseas and investing so much into Amazon. After all, the company has most certainly received some bad press as of late, But take it from an experienced seller, while not perfect, Amazon does have both sellers and customers’ best interests at heart.
There are Always New Trends and Markets
Trends come and go. As an Amazon FBA seller, you’ll want to capitalize on them.
Just like in-person stores and shopping malls, product selection is constantly evolving in order to fulfill customer demand.
That means they’ll always be new markets, niches and micro-niches to launch products in.
Even more, customer trends change seasonally, and despite those who disagree, I believe there’s plenty of opportunity selling seasonal items.
Let’s Start Selling on Amazon
My Amazon Winners Academy (AWA) mentorship guides you through the entire Amazon FBA process and provides a community of support with others on the exact same journey.
AWA gives you a much-needed safeguard from costly mistakes, dead ends, and failed product investments.
So whether it’s solving issues with your Seller Central account, creative approaches to product \research, scaling to new markets and niches, validating product ideas, customer service issues, and more, we’ve got you covered.
Learn more about it here.
