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Amazon - Is an individual seller account even worth it?

Discussion in 'Making Money' started by carking, Oct 23, 2013.

  1. carking

    carking Newbie

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    Ok. Being a realist, I have come to the conclusion that I will never make dime one screwing around with blogs, youtube, pinterest etc etc. Idk, I just don't say the right things. I'm sure their is one guy in a glass jar in Beijing somewhere with a masters in computer programing who actually makes 10k/month or 100/day...that's not me. After reading for years, most of these so called guides are absolutely worthless or totally full of isht.

    Now waking up and realizing this, my thoughts returned to Amazon. Something that is REAL, has and ACTUAL plan and path of success & isn't loaded down with people who retell having invested YEARS of their lives to make $10-20 from their endless hard work and worthless blog.

    So now the question is this. Last time I looked at Amazon, I was driven away by the $4 shipping. Now that USPS has media shipping it looked like you could not only break even but profit just from shipping alone. The new downside is that they are racked with fees now. The .99/per has always been there for individual sellers. But now their is a % referral fee and a second "variable closing fee" that I do not remember the last time I set up an account with them. In short, unless the order is expidited the shipping credit is pretty much evaporated by Amazon fees.

    So in reality, you are paying shipping fees directly out of your selling price. For media up to 1 pound this will be $2.53 approximately. So on a $10 book or cd 25% of your sell price is direct shipping cost. Most business models hover around a 33% profit margin so am I looking at 8% profit or $0.80/ per unit in this example? This is before any minor overhead expenses. Time to pack, ink to print shipping labels, at least SOME valuement for my time invested etc etc

    Does Amazon have the individual seller priced out of the market? It's almost looking like I need to buy $5 cds and dvds at the Walmart "nobody wants these" bins and then try to market them for $12-15 in hopes that a) I'm not priced out of the market b)my prospective customer doesn't live anywhere NEAR a Walmart. I thought Walmart used to do wholesale accounts but apparently this is either never been true or no longer exists unless you bid on liquidation pallets something I'm not set up to handle.

    I already understand that I can get the money before I ship (I believe), and I have some money of my own obviously. But I was hoping to sell smalls as space is an issue for me. Only rich men have space in New Orleans, or at least space that won't get robbed so this is simply a luxury in this region that most cant afford.

    Most of the dropshippers I've seen either have subscription services (cause they know they won't make money off their overpriced undesired wares) or are some foreign guy who may or may not be legit and will take forever to ship.

    I know people make money with this site. I know that in some way shape or form the individual seller option must be legit and lawful as it's been around forever and congress hasn't shut them down yet haha.....

    But, hypothetically, if my mission was to put together a business plan using Amazon and present it as a consultant, my recommendation would be to make no long term commitments on behalf of that site or it's customer base as it is no longer viable thus not a fund-able project.

    But the initial question stands, is it even worth it? If I've drastically missed something here, by all means I love being proved wrong. It happens so rarely that I actually enjoy the experience.

    The limitations your response faces are these: The example product model must net a pre-tax profit of at least $2.50/unit, can not be ridiculous in size like a 60in TV as I fear getting killed by shipping costs, no earnings screenshots - I have photoshop,screen print and OCR as well (or better yet copy the HTML into dream, edit source code & POOF you make millions of dollars a month yeah right). Obviously, stability of supply goes without saying as it can prove costly to sell products you can not longer acquire reasonably if at all.

    This is one of those few times in life where I really DON'T wish to be proven right cause that means the game is over. :(
    This isn't a question for pretend "ballers" & smarta**s with their 2% personality issues , this is a question that requires quantitative analysis of the Amazon program and the missing piece(s) of the puzzle. I should be able to put this into test phase (the only earnings proof I need is my own after mathematical satisfaction says initiate immediately) requiring small to no investment. Based on that success, I can scale up on my own testing different bigger products later on for desirability and ROI and slowly build a catalog.

    Thank you, Oh and no offense to the guy in the glass jar.
     
  2. Fats0420

    Fats0420 Newbie

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    The individual seller is pretty much out of the game because of the "prime" and free shipping amazon offers. Most of everything that's sold on amazon is sold to people who have subscribed for the "prime" program. And only the sellers who have and FBA account are eligible to offer free shipping (which the prime program is known for) . . Individual sellers will have less visibility than the FBA sellers. There is NO WAY around this, unless you find some product no one else is selling and milk it.
     
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  3. carking

    carking Newbie

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    That's kinda what I feared as it also means just paying their $40/month fee isn't enough either. With that FBA you're sending the products to them which means you have the cash outlay for products that might not sell sitting in a warehouse that you paid to ship to. Don't like that. The downside of "some product no one else is selling" is that this will almost guarantee the necessity to pay the $40/month from the gate even if you never sell a damn thing successfully. No wonder they can afford free shipping haha
     
  4. MadStacks

    MadStacks BANNED BANNED

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    Honestly eBay although competitive is more small business friendly than Amazon so you might want to look in that direction.