What is Amazon FBA?<\/strong> We have already compiled a detailed explanation of the shipping service for you here: Amazon FBA for Beginners and Advanced Users<\/a>.<\/span><\/p><\/blockquote> You are currently viewing a placeholder content from Youtube<\/strong>. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.<\/p> More Information<\/a> <\/div> There are a number of points that sellers need to consider when they want to start their business on Amazon. While participating in Fulfillment by Amazon simplifies the start and especially reduces the financial expenses that need to be incurred, an Amazon FBA business is still subject to conditions, both from the e-commerce giant and from a legal perspective.<\/p> Therefore, the following list does not claim to be exhaustive. Depending on personal circumstances, additional steps may be required or others may be omitted. For example, those selling cosmetics from Spain have different requirements to meet than sellers who want to import toys from China. In case of doubt, a professional such as a specialized lawyer should always be consulted.<\/p> At the forefront should be a concrete product idea. However, before creating an Amazon FBA account and placing the first order, there are primarily some legal and organizational questions to address.<\/p> The first point of our Amazon FBA guide involves the establishment of a business. Only in this way is it possible to open a professional seller account on Amazon, as the business license or commercial register is requested during registration. Many successful sellers started as sole proprietors and eventually grew into a GmbH. This has the advantage that, in the beginning, when revenues are still low, entrepreneurs can rely on significant tax benefits.<\/p> However, there are at least two other business models that new entrepreneurs can choose from. Which legal form or business model is suitable can be found here: The right business structure for your FBA business<\/a>.<\/span><\/p><\/blockquote> Sounds trivial, but it is by no means. While a separate account is not mandatory for sole proprietors, it can quickly become uncomfortable when a personal checking account is used as a business account.<\/p> For these reasons, the recommendation to open a business account can be found in most guides and also in this Amazon FBA guide.<\/p> Even if the small business regulation may apply at the beginning of the “Amazon” adventure, this will not last forever, which is why it is still important to have a VAT identification number already. Otherwise, sellers may end up paying taxes twice. Normally, sellers receive gross invoices with specified VAT. However, since Amazon is based in Luxembourg, sellers receive net invoices, on the basis of which the seller pays their VAT.<\/p> However, if no tax ID is registered in Seller Central, the trading company plays it safe and pays the VAT itself. This does not exempt the seller from their obligation to ensure the payment of the tax, as long as the small business regulation does not apply (anymore). To avoid the suspicion of tax evasion, the seller would also pay the VAT \u2013 thus paying twice. Ideally, sole proprietors should also seek a tax advisor for tax matters.<\/p> Point number 4 of this Amazon FBA guide applies only to imports, but it still affects a large portion of marketplace sellers. The Economic Operators\u2019 Registration and Identification is an identification number without which commercial import into the European Union for commercial entities is not possible.<\/p> Thus, the EORI number serves as a unique identifier for the responsible importer and can, for example, be applied for at the German customs<\/a>.<\/p> Now we come to the actual core: the Amazon FBA business. For example, how many products should sellers have in their assortment, and what does a good listing actually look like? It is also true here that this Amazon FBA guide does not claim to be exhaustive, and depending on the product category or Amazon marketplace, there may be additional steps to consider. The creation of the account on Amazon can also take place later.<\/p> Without a seller account, it is not possible to sell on Amazon. Registration is relatively simple through this page<\/a>. Newcomers should especially note to uncheck the option to sell on all marketplaces simultaneously. Especially at the beginning, it makes sense to sell exclusively on Amazon DE first. When selling across Europe, several additional points would need to be added to this Amazon FBA guide. For example, a VAT ID is required in each country where goods are stored. However, those focusing on Germany can first get to know Amazon and gain initial experience as sellers.<\/p> Additionally, Amazon asks during registration whether it should be a basic account or a professional account. The professional version costs 39 euros per month and is worthwhile from about 40 sold items per month. Normally, this value is reached quickly, and sellers can confidently start directly with a professional seller account. However, since the switch is relatively easy, it is also possible to register first for the basic account if it is foreseeable that the launch of the first product will still take a few months.<\/p> It is one of the most important tasks: product research. Whether a business thrives or is history within a few months can depend on it. Sellers should pay particular attention to the market analysis<\/a>. Even with a very good product, sales can be hopeless if too many competitors are already active on Amazon or if the company itself offers the same or a very similar product.<\/p> Because on the online marketplace, much more depends on it than just a good product idea. Those selling commercial goods compete for the Buy Box, without which it is hardly possible to achieve sufficient sales. Those offering private label must achieve the highest possible ranking within the search results. Excessive and especially already established, experienced competitors make both endeavors extremely difficult.<\/p> Anyone who wants to dive deeper into the topic of product research<\/strong> than this Amazon FBA guide can offer, click here: Researching new products for Amazon<\/a>.<\/span><\/p><\/blockquote> The newcomer now knows the product \u2013 it is time to find a suitable manufacturer. And it is not the case that the lowest price wins. A trustworthy business relationship between the seller and the manufacturer is extremely important to build the FBA business on Amazon step by step together. Finding a manufacturer means reaching out to many different producers, comparing prices, and creating a list of all favorites. A product sample from these favorites then helps with the final decision.<\/p> A central question is often whether to source in Germany, in the EU, or in a third country. While many Asian manufacturers are cheaper and many products offered on relevant portals like alibaba.com<\/a> are not necessarily of lower quality, those importing goods from a non-EU country into the European Union are also considered importers \u2013 and thus bear the full liability risk. It can therefore make sense to look for producers on wlw.de<\/a> or zentrada.de<\/a>.<\/p> For anyone who is unsure while reading this Amazon FBA guide about how and where to approach sourcing, you can find more expert tips for crisis-proof sourcing<\/a> in our blog and what advantages sourcing in China vs. the EU<\/a> has.<\/span><\/p><\/blockquote> This point is very important to achieve legal certainty and should definitely be clarified before the first purchase. Having a patent on a product is quite unfavorable, as sellers then need the permission of the patent holder to sell a product at all. One initial indication of this is, for example, the exclusive sale of the product by only one (large) manufacturer. Despite the high costs, we clearly recommend in this Amazon FBA guide to work with a patent attorney.<\/p> FBA sellers also need to take care of certificates in many product categories \u2013 for example, in children’s toys, cosmetics, or food. As a rule of thumb: if it touches the body, the product probably needs a certificate. Not only the manufacturer can provide specific information, but customs or T\u00dcV are also good points of contact.<\/p> For private label sellers, the creative part begins now: a brand name needs to be found, a logo must be created, and based on this, the design of the product packaging can be addressed. Of course, the recognizability should be high, but various brands have established themselves in the market. There is no secret formula for this point in our Amazon FBA guide.<\/p> However, it is important that the name, logo, and design do not infringe on other trademark rights; otherwise, a warning with a cease-and-desist declaration may follow. Therefore, aspiring sellers should always research whether they can find search results under the intended brand name on Google and Amazon or if there is a registration in the DPMA register<\/a>.<\/p> While marketplace sellers do not necessarily need an EAN number, they are mentioned in this Amazon FBA guide because, without an EAN number, a product is limited to sales through Amazon. Therefore, those who may want to enter other channels need these numbers to unequivocally identify their products and avoid issues with inventory management. EAN codes can be purchased from both GS1 Germany<\/a> (in larger packages) and GS1 Netherlands<\/a> (also in smaller packages).<\/p> Now it is time to clarify the logo and packaging with the manufacturer and to order the first product batch. All details should be discussed to avoid any unpleasant surprises at the end because not everything was produced as the seller envisioned.<\/p> Payment is also a topic in itself. Those sourcing through Alibaba can use Alibaba Trade Assurance, for example. In this case, the buyer transfers the money to Alibaba, which in turn verifies the receipt of funds with the manufacturer. Only when the goods have arrived at the seller’s location and the seller has confirmed that everything is okay will the money be released to the manufacturer. This creates security for large sums. As the business relationship continues and trust grows, traditional bank transfers are, of course, also possible.<\/p> As mentioned earlier in this Amazon FBA guide, importers in the EU are also considered manufacturers and thus bear the liability risk. This becomes important if, for example, there was an accident involving one of the products and the injured party demands compensation or even damages. Therefore, private label sellers who source outside the European Union should definitely take out insurance for these cases.<\/p> In addition, sellers of their own products must ensure that the waste generated from the packaging they put into circulation is disposed of or recycled correctly in accordance with the Packaging Ordinance. There are various providers for this, such as the Green Dot.<\/p> As banal as this point may sound among all the important to-dos in this Amazon FBA guide, it is not at all. On the contrary, the listing, consisting of the product title, bullet points, product description, etc., will ultimately determine whether a customer buys the product or switches back to the search results to view another offer.<\/p> Describing how private label sellers should optimize their listing would be too extensive for this Amazon FBA guide. You can read more about it in our blog post on Amazon SEO<\/a>. It is also important to note the correct addressing of different customer types<\/a>.<\/p> For the first product batches, it is certainly advisable to first check the products randomly yourself and only then send them to Amazon. Once a trustworthy business relationship has been established with the manufacturer, they may also be able to deliver directly to Amazon.<\/p> In any case, a shipping order is required, which sellers can create in Seller Central under “Inventory” \u2192 “Manage Inventory.” Behind each product listing, there is then the option “Send Items to Amazon.” After clicking on “Create New Shipment Plan” and going through a few more steps with the shipment details and selecting the carrier, the shipping labels can then be downloaded. Normally, Amazon informs the seller via email after a few days to weeks that the shipment has arrived.<\/p> The sales of a product and the number of reviews are extremely important for ranking on Amazon. This FBA guide can hardly cover all the points to consider for a good product launch<\/a>. Suitable product photos, for example, are an important aspect and should be created professionally. In any case, newcomers should also take care of running ads<\/a> and generating initial reviews<\/a>.<\/p> Those competing for Buy Box face similarly challenging problems and must first sell on Amazon for at least 90 days to be considered. It is important to elevate and maintain one’s seller performance at a very high level. All important metrics can be found here: Criteria for Buy Box<\/a>.<\/p> And now? First of all, new sellers will have enough to do improving the existing listing, running ads, optimizing them, and generating reviews. Because even though the product is now theoretically orderable, it can still be quite a struggle to increase sales enough to improve the ranking or achieve Buy Box qualification.<\/p> Once the product is doing well, the product range should be expanded. Some points of this Amazon FBA guide will no longer apply, but others will remain. Gradually, Amazon sellers will establish their own workflow and continue to professionalize. However, two points still need to be addressed.<\/p> With Fulfillment by Amazon, the e-commerce giant has created an extremely helpful service for many sellers. But even though Amazon has already automated many processes, there are still people working in the logistics centers. And people make mistakes. For example, items may be damaged or incorrectly logged, or a customer may not return a return. In such cases, Amazon must compensate the FBA seller. However, the online giant does not provide guidance or assistance to track down such errors.<\/p> To do this, sellers would need to analyze up to 12 FBA reports \u2013 an extremely time-consuming task! It is easier with appropriate tools like Lost & Found<\/a>. This tool analyzes all processes in the background and reports discrepancies directly to the seller. All the seller has to do now is copy the pre-formulated text into Seller Central and open a ticket with Amazon. If there are issues with the refund, the experienced SELLERLOGIC staff are also available to assist with communication at any time.<\/p> Every Amazon seller will eventually reach the point where they want to automate some processes. This could be invoicing with a tool like Amainvoice or Easybill. There are also corresponding tools for inventory management and keyword research. Many Amazon analysis tools<\/a> also offer various functions in one.<\/p> For sellers of commercial goods, it is also very important to eventually invest in a Repricer. This automatically adjusts the price of a product according to market conditions. Manual adjustments are very time-consuming and hardly manageable even with a medium-sized product range. Here you can learn how a Repricer works and why it is so crucial<\/a>.<\/p>\t\tStarting with Amazon FBA: A guide for everyone<\/h2>
Even before starting Amazon FBA: Preparing the business<\/h3>
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<\/figure><\/div>1. To-do: Business registration<\/h4>
2. To-do: Opening a business account<\/h4>
3. To-do: Application for tax numbers<\/h4>
4. To-do: Application for the EORI number<\/h4>
The actual Amazon FBA business: Step-by-step guide<\/h3>
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<\/figure><\/div>5. To-do: Registration with Amazon<\/h4>
6. To-do: Research the first product<\/h4>
7. To-do: Search for a manufacturer<\/h4>
8. To-do: Acquisition of patents and certificates<\/h4>
9. To-do: Brand name, logo, and design<\/h4>
10. To-do: Purchase of EAN numbers<\/h4>
11. To-do: Purchase of products<\/h4>
12. To-do: Conclusion of business liability insurance and licensing of packaging<\/h4>
13. To-do: Creating the listing on Amazon<\/h4>
14. To-do: Shipping to Amazon<\/h4>
15. To-do: Product launch<\/h4>
Congratulations! Now the first orders can start coming in!<\/h3>
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<\/figure><\/div>16. To-do: Checking for FBA errors<\/h4>
17. To-do: Implementation of helpful tools<\/h4>
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