14 Day Amazon FBA Challenge

Amazon FBA ChallengeDay 1 – 14 Day Amazon FBA Challenge

Welcome to Day 1 of the 14 Day Amazon FBA Challenge. The purpose of this challenge is to send in a shipment of at least 25 items to Amazon in 2 weeks. If you are experiencing slower sales, one way to combat this is to continue to send in shipments on a consistent basis.

My name is Adrienne Dupree and I am from Maryland. I have been selling on Amazon since November 2014. I also sell on eBay. I do Retail Arbitrage, Online Arbitrage, Wholesale and Private Label. I would love for you to join me in this challenge.

So let’s start. In the comments, please do the following:

  1. Introduce yourself and tell everyone where you are from
  2. How long been selling on Amazon?
  3. Do you sell on other platforms? If so, which ones?
  4. What methods are you using in your Amazon business? Retail Arbitrage, Online Arbitrage, Wholesale, Private Label

Day 2 – 14 Day Amazon FBA Challenge

FBA stands for Fulfillment By Amazon. Amazon FBA is a program that allows you to buy products, ship them to Amazon fulfillment centers, sell them and have Amazon ship them to the customer.

You may think that this is impossible to buy products and make a profit, but it is not. You would be surprised at how much some products are selling for but there are a lot of reasons for this. Some products are seasonal which means they are not always available. A lot of seasonal only products may be hard to find in stores. Some people in rural areas do not live close to stores so it is easier to buy things on Amazon. Also, some people like the convenience of shopping online and getting their merchandise in 2 days.

With Retail Arbitrage, you go to stores and find products that are selling low enough that you can make a profit by selling them on Amazon. Online Arbitrage is similar to Retail Arbitrage except you are shopping online instead of physically going to stores. A lot of the brick and mortar stores have an online presence as well.

Some people do not like to go stores to shop, so Online Arbitrage is a better option. Also, you can send online orders to a prep company. The prep company will prepare the shipment and send it into Amazon on your behalf.

I love Retail Arbitrage because I like the hunt. I also do a lot of Online Arbitrage as well.  The one thing I like about Online Arbitrage is you don’t have to deal with stickers which can be a pain. Have you ever tried to get multiple clearance stickers off without damaging a box? It is definitely an art to it.

What is your favorite, Online Arbitrage or Retail Arbitrage? Tell us why. If you are not doing either one, which one will you start with and why?

Day 3 – 14 Day Amazon FBA Challenge

Products that you sell on Amazon are broken down into categories. Some of these categories are wide open and some require you to get approval before you can sell. You must get approval for the categories that have a star. Below are the categories:

  • Automotive*
  • Baby
  • Beauty*
  • Clothing and Accessories*
  • Grocery & Gourmet Foods*
  • Handbags*
  • Health & Personal Care
  • Home & Kitchen
  • Jewelry*
  • Luggage & Travel Gear*
  • Office Products
  • Patio, Lawn & Garden
  • Pet Supplies
  • Shoes*
  • Sports & Outdoors
  • Sunglasses*
  • Tools & Home Improvement
  • Toys & Games
  • Watches*

Even if a category is not restricted or you are approved in a category, there still may be products that you cannot sell. There are some brands that you cannot sell until you get approval. Most of these approvals require you to turn in some number of wholesale invoices. There may also be a letter required from the manufacturer as well as an application fee. In some cases, the entire brand may not be restricted but there may be products that are restricted. However, if you are restricted for a particular brand, sometimes the approval is automatic so always try.

Ungated is a free Chrome Extension that shows you the categories that you are already approved in as well as provide you with information to make the process of getting approved in restricted categories easier.

What are you favorite categories to sell? Mine are Clothing, Groceries and Toys. Start thinking about the what categories the products will be in that you send in to Amazon.

Day 4 – 14 Day Amazon FBA Challenge

In order to find profitable products on Amazon, two things that you need to understand is the Best Sellers Rank (BSR) and sales velocity. BSR is based on Amazon.com sales and is updated hourly to reflect recent and historical sales of every item sold on Amazon.com. This number is by Amazon categories. The lower the number, the better the item has sold. For example, a BSR of 1 is better than a BSR of 1000. However, the lower the BSR, generally the more competition you will have.

You also need to take into consideration the category. For example, a BSR of 100,000 in Home & Kitchen is better than a rank of 100,000 in Toys & Games. There are approximately 61,195,359 products in Home & Kitchen and approximately 5,708,201 products in Toys & Games. A rank of 100,000 in Home & Kitchen is in the top 0.2% and only in the top 1.8% in toys. You can download a complimentary Sales Rank chart and even get on a list to receive an updated chart monthly.

Sales velocity is the rate at which a product sells. This is usually measured by the month, the week or the day. Typically, products with a lower BSR have a higher sales velocity but you must also take into consideration the category. Some categories are more popular than others. You can download a complimentary Sales Velocity chart.

Two free tools that help you interpret sales rank history and sales history are Keepa and Camel Camel Camel. To ensure you make the best buying decision you want to evaluate all the information that is available to you. Not only do you want to look at the current information such as BSR but you want to look at a product’s price and sales rank history. CamelCamelCamel is a site that allows you do to do this. You want to make sure that you just don’t have a temporary spike in BSR or is this a product that has been performing over time. It can also help you evaluate seasonal products. Keepa is another tool that has comprehensive price history graphs as well as price drop and availability alerts. This tool will even show if Amazon is in stock.

If you want to learn more about CamelCamelCamel and Keepa, I recommend Stephen Smotherman’s course, The Reseller’s Guide to How to Keepa Camel: Using Amazon Sales History to Make Smart Sourcing Decisions. This course will break down exactly how to use CamelCamelCamel and Keepa to make smart sourcing decisions. There are also some complimentary videos on Sales Ranks, CamelCamelCamel and Keepa.

I like to stay in the top 5% of the sales rank in a category but will go to 10%. You need to determine what you are comfortable with. Please study the sales rank and sales velocity charts so you are familiar with the percentages. I suggest you take a copy when you go shopping or save it to your phone.

Day 5 – 14 Day Amazon FBA Challenge

Outside of checking the Keepa and Camel Camel Camel charts to determine if I am going to buy a product, there are some other factors such as:

  • How many other sellers
  • Amazon on listing
  • Profit
  • ROI

If there a lot of other sellers on a product, then I tend to stay away from it unless it has a very low rank. I like to typically stay under 10 to 15 sellers. If Amazon is on the listing, I move on. Some people like to compete against Amazon but I am not one of them. Lots of people will tell you that Amazon shares the buy box but that has not been my experience. You need to determine what is the lowest profit you are willing to take as well as the ROI?

Now there is a difference between Profit and ROI or Return on Investment.  Revenue is your sold cost or how much you sold the item for. Profit is your Revenue or Sold Cost minus your Costs of Goods Sold. Costs of Goods sold includes how much you paid for the item plus sales tax if applicable. Some people also include the cost of shipping materials such as polybags and shipping to Amazon. I do not.

  • Revenue = Sold Cost

  • Profit = Revenue or Sold Cost – Costs of Goods Sold

Profit Margin is a measure of profit over cost. It is calculated once your initial investment is recouped.

  • ROI = (Revenue – Cost) / Cost

Would you buy if Amazon was on the listing?

How many is too many other sellers?

Do you have a ROI that you use when making purchases?

Do you have a Profit Margin that you use when making purchases?

Day 6 – 14 Day Amazon FBA Challenge

The biggest question new sellers or sellers in general have is where do I find products to sell on Amazon. The question is everywhere. You can find products in almost any store. There is a misconception that you must find clearance or sale merchandise to find profitable products. That is not true. There are plenty of opportunities to find profitable products that are not in the clearance aisle. You can find products in stores and online.

Below are some of the places that you can find products in retail stores:

  • Discount Stores
  • Target
  • Walmart
  • Kmart
  • Dollar Stores
  • Drug Stores
  • Grocery Stores
  • Wholesale Club Stores
  • Toy Stores
  • Convenience Stores
  • Specialty Stores
  • Thrift Stores

Almost any store will have products that can be sold. Be creative and have an open mind. You will be surprised what you can find. Don’t overlook “Mom & Pop” stores or a store that you only have in your area.  Products that are only available in your region can be very popular on Amazon.

When you are sourcing products in discount stores and thrift stores, please ensure that the products are new if you are listing them as new on Amazon. The packaging must be in pristine condition as well. There should be no dings or dents in the boxes.

One book that I recommend on Retail Arbitrage is Arbitrage: The authoritative guide on how it works, why it works, and how it can work for you by Chris Green. He also has a Retail Arbitrage online course, Arbitrage and Amazon’s Fulfillment By Amazon (FBA) Program.

If you are interested in sourcing in dollar stores, then I recommend the following book: Dollar Store Arbitrage: How to Make $100 a Day Selling Dollar Store Finds by Abigaile Hunt. I started selling on Amazon in the middle of November 2014 and I bought many things and continue to buy from dollar stores.

If you are just starting out and do not have a scanning app, then download the Amazon Seller App. You can either find it for free for your iPhone or Android phone.

Your assignment is to go shopping and find 5 profitable items.

Day 7 – 14 Day Amazon FBA Challenge

We are halfway through the challenge. I hope that everyone is on track. Remember, you need to send in 25 items to Amazon as part of this challenge. It can be 25 of the same item or 25 different items. Today’s post is more about scanning products. You can use the Amazon Seller App which is free or you can use other 3rd party tools. I also use Scan Power MobileScanPower Mobile is also a 3rd party application that you can download on your phone. It is free if there are free licenses available. You can also view CamelCamelCamel and Keepa charts on the ScanPower Mobile app. This app is free but sometimes it is not available. You will have to try back if it is not available for free.

restrictedEven though I use ScanPower Mobile, I always scan with the Amazon Seller App to make sure I am allowed to sell the product. I could be restricted from the brand or the category. The picture to the left shows you what is displayed on the Amazon Seller App when you are restricted.  Also, the product could be considered HazMat. If so, you can not send it into the warehouse. You would have to sell it Merchant Fulfilled instead. In the beginning, I just used the Amazon Seller app but the reason I switched is because I can easily get additional information very quickly with other apps. While you are scanning, make sure you are buying products that you can actually send in to the warehouse.
Did you complete your assignment from yesterday? Did you find 5 profitable products that you are allowed to sell? Today’s assignment is to find 5 more products that you can sell. If they are profitable, actually purchase them. Leave a comment and let us know how many products you bought today.

Day 8 – 14 Day Amazon FBA Challenge

By now, you should have found some profitable products to send into Amazon and now you need to get your products ready for shipment. If your products have price stickers on them, then you need to take them off. You need to do this carefully so you do not damage the packaging. I use Scotty peelers and Goo Gone but there are other things you can use. Some people use a heat gun or even a hair dryer. Check out my post, How To Get Labels Off Your Products, for more information.

If your products are not completely covered, then you will need to put them in polybags. I also use these to protect items. I use the self-sealing ones that already have the suffocation label printed on them. This way I don’t need suffocation warning labels and don’t need a heat sealer to close the bags. For more information on polybags, check out Polybags And My Amazon FBA Business.

Once you have prepared your products, you now need to put them in a box. You can buy boxes from Home Depot, Lowes, Walmart or a variety of other places. You can also order them online. If you spend at least $50, UHaul will deliver for free. You can also use free boxes. The boxes do not have to be new. The only type of boxes that you can not use are alcohol boxes.

Once you pack everything in your box, you now need to add packing material to secure your products. You can use bubble wrap, craft paper or plastic bags. Newspaper and packing peanuts are not allowed. If you use plastic bags, put the bags inside of one of the bags and close it up. If your box is much bigger than it needs to be, you might want to resize it.

Once your box is full, you tape it up and weigh it. Now you are ready to print your shipping labels and send your box to Amazon. To find out more about the supplies you may need, you can check out our supplies list.

Do you have all of your supplies? How did you take your labels off? Where are you getting your boxes? What type of packing material do you plan to use? Let everyone know.

Day 9 – 14 Day Amazon FBA Challenge

Did you know that there are various ways to send your shipment into Amazon? You can use FedEx or UPS. FedEx was added in January 2017. I have never used FedEx. I always use UPS. If you use UPS, there are several ways to get your packages to UPS. You can drop them off at a UPS Store, Staples, UPS or even have them picked up. You can sign up for a Smart Pickup account which is free for the first year.

I have observed that where my boxes are dropped off affects how long my merchandise gets to Amazon. UPS comes to the UPS Store once a day in the evening to pick up packages. I have 2 UPS centers close to my house. One is very close, so I use them if it is close to closing time or I don’t want to deal with traffic. The other one is about 20 miles away but the traffic can be very bad. The one further away is a hub, so things move quicker. They are also open on Saturday. I have also observed that when I send packages on Friday, they typically don’t leave UPS until Sunday night or Monday.

You can track your packages by going to your Dashboard, click Inventory and then click Manage FBA Shipments. You should observe how long your packages take to get to Amazon so you are prepared during Q4 to get them to Amazon as quickly as you can.

How do you plan to send your 25 items into the Amazon warehouse?

Day 10 – 14 Day Amazon FBA Challenge

When you sell your products are Amazon, there are some fees associated with it. There are FBA fees, storage fees and even fees is you Merchant Fufill.

Amazon FBA Fees

If you are using Fulfillment by Amazon (FBA), below are the following fees that you must take into consideration:

  • Per Item Fee
  • Fulfillment Fee
  • Referral Fee
  • Inbound Shipping Fee
  • Weight Handling Fee
  • Storage Fees

Per Item Fee – If you have a Professional Account, then you do not pay a per item fee. If you have an Individual Account, then you pay 99 cents per item sold.

Fulfillment Fee –  This fee includes order handling, weight handling and pick & pack. Pick & Pack is when Amazon picks your items out of the warehouse and packs them in a box to deliver to the customer.

Referral Fee – The referral fee for most categories is 15% of the sales price.

Inbound Shipping Fees – There are shipping fees associated with shipping your merchandise to Amazon. These fees must be taken into consideration as well.

Weight Handling Fee – The outbound shipping weight is calculated for each order by adding the packaging weight to the unit weight. For most products that weigh over a pound, the greater of the unit weight or the dimensional weight will be used. The total is rounded up to the nearest pound. The outbound shipping weight is then multiplied by the weight handling fee.

Storage Fees – The are two types of storage fees: Monthly & Long-Term. These fees are charged for all merchandise that is stored in an Amazon fulfillment center. It is charged based on cubic feet. The monthly storage fees are charged monthly. There are two types of long term storage fees – 6 months and 12 months. If an item has been in the warehouse at least 6 months on the 15th of August or the 15th of February, you will be assessed 6-month long-term storage fees. If an item has been in the warehouse at least 12 months on the 15th of August or the 15th of February, you will be charged 6-month and 12-month long term storage fees.

Amazon Merchant Fulfilled Fees

If you sell items using the Amazon Merchant Fulfilled program, then you will pay referral fees and variable closing fees if applicable.

Day 11 – 14 Day Amazon FBA Challenge

Now that you know how to determine if a product is profitable, you have your shipping supplies and you know where to find products, it is time to ship your items to Amazon. At a high level, there are basically 10 steps to get your inventory to Amazon.

Step 1 – Go Shopping and Find Bargains

In previous days in this post are instructions how to find bargains.

Step 2 – Add Product to Your Inventory

Once you bring your merchandise home, you need to start the process of preparing it to go to Amazon. The first thing you must do is add your product to your inventory. As a newer seller, I recommend that you only sell items that are already in the Amazon category. You can add new products but that requires more work and you must drive traffic to the listing as well.

Step 3 – Determine Price

Based on what other sellers are selling the item for, what you paid for the item and the Amazon fees you will be charged, you need to determine the price of your item. Make sure you take into account all of the fees you will be charged.

Step 4 – Add Product to a Shipping Plan and Enter Quantity of Product

Once you determine your price, you need to add your products to a shipping plan and enter the quantity that you will be sending in. You will need 30-Up labels for printing.

Step 5 – Print Labels

Once you have added all your items to your shipping plan, you must print out your labels.

Step 6 – Put label over barcode/UPC

Now that you have printed the labels, you must put the label over the barcode. This is also called the UPC.

Step 7 – Prepare Product

Depending on the product, there are different preparation steps that are required. If the product has a price tag, you need to remove it. Using a Scotty Peeler makes this much easier. Some items need to be put in a polybag or bubble wrapped . If the item contains more than one item, then you want to make sure that you include a “This Is A Set label. If you are using a bag and it does not have a suffocation warning on it, then you need to affix a suffocation label to it if the opening is 5 inches or more. I also do this if I bubble wrap something that is not put inside of a bag.

Step 8 – Approve Shipment

Once you approve the shipment, you will know where you are sending your products. Sometimes everything goes to one warehouse and sometimes not.

Step 9 – Pack Boxes & Weigh Them

Once you know what warehouse your products are going to, you can pack your boxes. You should try to use boxes that are as close to the size of the items you are packing as possible. If your box is too big, you can always use a box resizer and a box cutter to resize the box. You can use craft paper to fill the box and protect its contents. You can also use plastic bags. Put plastic bags inside of one plastic bag and tie it up. Once you have secured your boxes with tape, you must weigh them.

Step 10 – Print UPS labels and Take Boxes To Be Shipped

Now that you have weighed your boxes, you can now print the shipping labels. If you are shipping via UPS, you can get free shipping labels from them. You affix the labels to the box and you can now take your boxes to be shipped. You can drop them off at UPS or a UPS Store. Staples will also accept UPS shipments.

Day 12 – 14 Day Amazon FBA Challenge

By now, your merchandise should be on the way to the Amazon warehouse. While you are waiting for it to be checked in, you can track your shipment. Go to your dashboard and select Inventory. Once you select Inventory, select Manage FBA Shipments. Select your shipment and you will see how it travels across the country to the Amazon warehouse.

If you are using UPS, you will see the following three statuses as your package moves from one UPS facility to another:

  • Package arrived at a carrier facility
  • Package received by carrier
  • Package has left the carrier facility

Once it arrives at the Amazon warehouse, the first status you will see is Delivered. This means that UPS has reported that your shipment has been delivered to the Amazon warehouse. The next status is Checked-In. This means Amazon has reported that your shipment has been delivered. Once your shipment has been delivered, it will move to Receiving or Processing. This means that the contents of your shipment are being scanned and added to your inventory. Once your shipment has been fully processed, it will move to a Closed status.

Day 13 – 14 Day Amazon FBA Challenge

We are on the home stretch. This is the next to the last day of the challenge. Please leave a comment and let me know how many items you have sent into Amazon. Once your items have been checked into the Amazon warehouse, you may see something strange when you look at Manage Inventory. The items are active, they have been fully processed but the quantity is 0. Where is your inventory? This happens to me on a regular basis. Most of my items are shipped to the Charlotte, NC warehouse which is a distribution warehouse.

A distribution warehouse gets your product and then ships them to other warehouses. This is good and bad. It is good because I don’t have to ship to a lot of warehouses. It is bad because my items end up on backorder until they are shipped to their final destination. Your inventory is in a reserved status. Find out more by reading Why Is More Inventory Reserved?

Day 14 – 14 Day Amazon FBA Challenge

Today is the last day of the Amazon FBA Challenge? Did you meet your goal of sending in 25 items? If no, reread this post and send your items in. This challenge was focused on using the Retail Arbitrage Model. If you would rather not go to stores, then you can use online arbitrage. With this model, you buy products online.

Many of the brick and mortar retail stores also have an online presence. There are also stores that are only available online. If you really don’t like to shop in stores or you are in a remote area, you might want to consider shopping online.

If you shop online, please make sure that you take into consideration the extra time that will be involved. You must wait for the merchandise to be delivered to your home. Some stores have an option to order online and pick up in the store. This normally gets rid of shipping fees.

One book that I recommend on Online Arbitrage is Online Arbitrage: Sourcing Secrets for Buying Products Online to Resell for BIG PROFITS by Chris Green. He also has an Online Arbitrage online course, Online Arbitrage – Buy Products Online to Resell.

You can also use tools to assist with Online Arbitrage such as Tactical Arbitrage. For more information on Tactical Arbitrage, read My Go To Online Sourcing Tool – Tactical Arbitrage.


Comments

14 Day Amazon FBA Challenge — 20 Comments

  1. I am Cynthia Charleen and I live in Dallas, Texas. I am now officially approved to be a FBA seller but have not sent even one little product in for sale. I have bought lots of stuff from Amazon, but not reversed the process to be a seller!

    I have sold on EBay and am currently selling a couple of items there. I have also done online garage sales and craigslist for my local area. I want to start first with Arbitrage and Wholesale for now and build into other areas. Adrienne, please show me HOW! I would love to send a shipment in the next 14 days!

    • Hi Cynthia

      Thank you joining the challenge. Congratulations on your new Amazon account. You have a lot of experience with online selling which will help with Amazon.

  2. Torrence Taylor Chicago IL
    Selling on Amazon since 2009
    Platforms: Amazon, Ebay, Craigslist
    I only do Merchant Fulfilled but ready to do FBA

    • Torrence

      Thanks for joining the challenge. You are a seasoned Amazon seller. I am glad you are going to try Amazon FBA.

  3. Adrienne is a great motivator and she is the only reseller I seek advice from I’ve talked to others but they seem unreliable. I’m hoping that I can learn a great deal from Adrienne to jump start my full time biz

    • Torrence

      Thanks for the compliments. I really appreciate them. I am glad that I have been a help to you.

  4. Adrienne I want to start retail arbitrage I like the thrill of the hunt to and I will start to put a shipment together so by next week I can ship my first FBA box. Thanks

    • Torrence, I am glad that you want to do Retail Arbitrage. It is so much easier than Merchant Fulfilled. Send in your box and let Amazon send the products to your customer.

  5. Hi, I’m Dee. From Maryland. I sell on eBay, Amazon FBA, bonanza, Mercari & Poshmark. I am busy as one can see, but I want to advance my fba business. I am trying to get ungated in grocery at this time. I do sell mainly clothes, books and luggage.

    • Hi Dee,

      Welcome to the challenge. I also live in Maryland. You have a lot of online selling experience. Which platform is the best for you? Have you submitted your application for grocery ungating?

      • Great, I am in Annapolis. I like them all Poshmark has been busy for me the last couple of weeks. But I like all if the sites Mercari has the cheapest fees, just 10%. Not yet, I have had a busy week. It’s in the works for Early next week submission.

  6. I have my box of shipping materials from Amazon. They arrived today. I am ready to start my compilation of goods for my first shipment. I want to start with retail arbitrage

  7. Adrienne, thanks for letting us know to do the two step authorization. I thought I had completed the process and I had not! I am now authorized and approved to sell. I plan to work this weekend to process my first shipment.
    I have the app on my phone (finally something that is FREE!) You are my ROCKSTAR! Thanks for your explanations that I can actually understand.
    Cynthia Charleen recently posted…Organize Your Life – Get More DoneMy Profile

  8. Hi Adriene, I’ve been reading through your 14 Day Amazon FBA Challenge. You have included some great tips and techniques…lots of practical suggestions. Thanks so much for sharing your experience with us!

  9. Hi Adrienne,
    I am Alexandra from NYC, and I am about to start this business, however I came across a lot of difficulties when I was watching videos and reading articles about this. A lot of people seem to advice to buy a bulk of a certain item and then sell it on amazon, while others buy items 1 by 1 online and then resell those. I absolutely cannot decide which one I should do!

    • Alexandra,

      Starting out, I do not advise that you buy in bulk. I started with Retail Arbitrage. I went
      to the store, scanned items and found profitable products. You can also do this online.

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