Amazon FBA Success Story: I Sold $40,639 Worth of Physical Products in 30 Days
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I want to share with you my experience as an Amazon seller – just one of my Amazon FBA success stories and one of many out there.
Sharing income from my business kind of eats me up inside. Part of me hates doing it, because I have a lot of family and friends that read my blog. Talking about income openly with people you know personally is always a taboo subject.
On the other hand, I know how much reading income reports on other blogs inspires me to grow my business. For this reason, I know all of you reading (that I don't know as personally) can gain some motivation from these types of blog posts so I don't mind sharing.
But, if you have met me in “real life”…please stop reading this blog post! 🙂
Sharing income always works as a way to really get people's attention. For example, I could write the most elegant post about my Amazon FBA strategies; however, its not until I say something like, “and these strategies net me $10,000 a month”…that people's ears really perk up.
So, as I share this income report today, one of the main purposes is to concretely demonstrate that Amazon FBA sellers are the real deal and it can be a great opportunity for financial freedom. Running an Amazon business is a VERY real business, and I am seeing very real income from the business model.
I'm not saying that everyone should jump on the FBA band wagon, open a business account, and start selling; I'm simply saying that it's not some sort of scam (but please do read this to avoid any Amazon automation scam).
Amazon sellers are making very real money on Amazon, and there are plenty of worse businesses that you could start! So with that caveat…let's look into some numbers.
Amazon FBA Success Story
Amazon FBA Revenue and Profit Numbers
Let's jump right into it, shall we? My revenue number from my physical products on Amazon are below, then we can discuss what's been going on with the business.
Here's a screenshot from the Amazon FBA seller app showing the earnings over the past 30 days
I am as floored as you might be when seeing this revenue screenshot from the Amazon seller app, but it's true. My Amazon FBA business sold $40,639.60 worth of product in 30 days!
What about profits?
Having revenues of over $40,000 does not mean I put that much into my business account though. When you factor in manufacturing costs, shipping costs, returns, amazon fees, and more…the actual net profit Amazon sellers take home is much less.
Without getting overly detailed or exact, the net profit from my private label Amazon sales is right around 35 to 40%. This means the net profit from my Amazon FBA business in the past 30 days was around $14,223 to $16,225. Again, this isn't exact…but it's going to be fairly close to that. (I haven't had a chance to do full accounting, so that's why these numbers are rough). Still, not bad for 1 month.
Calculating the net profit is actually quite difficult for Amazon sellers to do on an ongoing basis though due to returns, promotions, and constantly reinvesting in new inventory. Oh, and like other new sellers I also change the pricing on my products throughout the month to test different price points.
Despite the difficulty of getting an exact profit number each month, I have sat down and calculated the profit margins on each of my products ( so I know how how much money I make on each sale).
I now have 5 products up and selling on Amazon. Each help me grow my successful Amazon business. And below is the rough profit margin I earn on each product.
1st Product: 46%
2nd Product: 23%
3rd Product: 38%
4th Product: 43%
5th Product: 29%
Overall, I'm really happy with revenue and profits generated with this business! Can you believe that I've only been doing this for 6 months?
I listed my very first product for sale in March 2015, and just six months later I was pulling in $40k per month. I'm living proof that this is a viable business model. And this is by far the fastest growing business I've ever started (although still not the biggest).
I'm already very impressed with how quickly this business has grown; however, the potential for growth is still significant.
I can do 2 things to grow this business even more:
- Increase the sales of my existing products
- Manufacture and start selling new products
In terms of selling more of my own products, I really haven't done any Amazon PPC yet. I've only done paid marketing for one of my products so far because it wasn't selling well initially. The other 4 products I have not spent any money on PPC ads and yet I still made a very profitable Amazon business.
If I did more advertising like other sellers, I could easily grow my successful Amazon business even more. However, the primary reason I haven't been doing paid advertising is because I'm struggling to keep my product in stock as is. Paid ads would just increase my expenses…until I can order a large enough batch of inventory to make it worth it.
That day is coming soon…(see below).
The holiday buying season is coming, and I fully expect this will significantly increase my sales volume of my existing products for November and December. I ordered huge batches of inventory for all products of my own brand over a month ago. And they are either being shipped now, or are still in the process of being manufactured.
To give you an idea, for most of my products I had an initial order of about 500 units. I sold out of these 500 units after 45 to 60 days approximately. I've now ordered close to 2,000 units of each product in preparation for the Holiday season where Amazon sales explode.
So, I would have to nearly quadruple my sales to run out of stock during the holiday season. I don't think that will happen; however, double is probably not out of the question ($40k x 2 = ????).
November and December should be really good months. 🙂
I've received samples of 4 or 5 products over the past couple of weeks from China. I'm ready to expand my line of products even further. I mean, why not? How many products you'll want to carry is up to you though.
So far, I have 5 private label products and every single one of them is now selling well and turning a profit. Initially, I thought I had a couple of dud products…but I was able to turn them around.
The 2 new products I'm adding both have the potential to be my top selling products. Or, they could also totally flop.
I will be working on finalizing a couple of things (branding, additional samples) with my manufacturer over the next week or two. Once I receive some finalized samples with my branding and small changes, I will give the green light to manufacture a batch for both products.
I should be able to get these listed on Amazon just in time for the big buying season (December).
Then towards the end of the year if my existing products are still selling well, I'll look to add a few more products early in 2016.
It's hard to call it a “problem” when people are buying your products so quickly. However, I've been unable to keep a stock of inventory of my products (it's just the way it goes sometimes with online arbitrage).
In all cases, I have simply underestimated demand. I will say that it's not really my “fault”, because you really don't know until you actually start selling a product. This is still a brand new business, and I'll have better data going forward.
For example, when I ran my initial batch for 4 of my products (out of 5), I ordered 500 units EACH.
I had no way of knowing if this was too much or too little. At first, they might only sell 1 unit a day…so it seems like I can wait 500 days!
However, after a couple of weeks, the sales started escalating quickly for most of the products. They started selling 10 to 15 units a day. Suddenly, I was faced with knowing that in about 2 to 3 weeks I was going to be out of inventory.
You must react fast
It's a really good problem to have, but there was NO way to predict how well these would sell.
So, I immediately ordered nearly 2000 units each for the products. However, it takes easily 30 to 45 days to manufacture, 2 to 3 weeks to ship the products to the US, then another week getting the product shipped and unpacked by Amazon.
So, even though I reordered new inventory as soon as I saw things started selling…it takes 2 to 2.5 months from order date to actually getting the new stuck up and selling on Amazon. Unfortunately, knowing that you are going to run out of stock in 3 weeks, means you are going to be out of stock for at least a month and a half.
As a result, I'm basically out of stock at the moment for my products. I'll have one of my products in stock later this week (its about one day away via UPS from Amazon as I write this). My other 4 products will be in stock in 2 to 4 weeks.
Because of this, my earnings for October will not be as much as the screenshot above…but November and December should be huge!
Lessons Learned with Amazon FBA [To Help You Join The Many Amazon FBA Success Stories]
Obviously, I've learned a little bit about inventory issues. They aren't fun!
Inventory – Order Small at First
However, I actually think I would give the advice that you should do what I've done with your initial orders. I would order as small a batch as your manufacturer will let you get away with on your FIRST order.
By ordering small, you can make a much smaller investment and limit your downside. This allows you to test a market and see if your product will really sell.
Amazon is HUGE
Another lesson, I'm continuing to learn is just how massive the Amazon marketplace is. I'm constantly shocked at how many people want to buy my products!
And the thing is, I'm still not even one of the best selling products in my category. The potential of the marketplace just on Amazon is SO big…it's a bit mind blowing. And although there are many factors to consider – basically anyone could create an Amazon success story.
Keywords Make a Difference [The Foundation for all Amazon FBA Success Stories]
I've also learned the importance of keywords in Amazon listings, but that really deserves an entire post on it's own. Basically, I made some keyword changes for the titles and descriptions of my “dud” products, and they quickly turned around and started selling well.
Our Separate Website is Helping Increase Value of Business
I should also make a quick note that we are actively building a separate affiliate website in the same niche as our Amazon products. Which is a game changer, and one of the many factors owing to our success. The purpose of this website is 2 fold:
- Generate traffic outside of Amazon (primarily from Google)
- Sell more of our own products and to sell affiliate products.
We are taking a very long tail keyword approach (as outlined in my last post), and we are seeing encouraging results already. The natural search engine traffic from Google is on a nice growth curve, and we've made about $135 in extra income from affiliate commissions from our site in September so far.
We also sold 4 units of our own products, which equates to a little more than $200 in additional revenue. The potential for this site is tremendous and living proof that this is a great option for Amazon sellers.
We will be changing to a more professional WordPress theme with the help of a web designer and putting a lot of effort into it this year.
Once you're able to and have a system in place you should outsource ‘busy work'
Like most people, my goal in every venture and side hustle is to not just make extra income but to enjoy being my own boss and ideally grow them into a life changing business exit.
And once you see in your Amazon seller app that you're making enough to quit your current job, the best advice I can give to new sellers hoping to grow is to prioritize your time. This means hiring virtual assistants from other countries to do the busy work that will eat up time best served strategizing your next move.
For instance my supporting niche sites. If you'd like to do the same but aren't familiar with building sites you can consider hiring a web designer to get it off the ground.
Sure there is free training from some YouTube video out there but you need to consider how much time you have in a day and how to spend it the best way.
Plans Going Forward [To Grow My Amazon FBA Success Story]
Here's a brief list of my plans going forward:
- Get inventory re-stocked and ready for big holiday season
- Source inventory to add 2 new products before the year end
- Optimize/tweak listings for additional long tail keywords that I can potentially rank for
- Possibly add a couple of additional products early next year (based on how well my existing products are selling).
- Consider hiring some virtual assistants to help grow the business with sourcing efforts and assessing other categories (get ideas with our list of virtual assistant websites)
- Start using Amazon PPC if I can schedule my inventory better.
- Continue building a website based on my product category. The website is already seeing strong results. I see TONS of potential for selling my own product, and also making some serious affiliate commissions in the market.
- Start creating truly unique products/inventions next year with the funds I'm building up through private labeling products currently. I already have a list of ideas.
Is Amazon FBA Worth It?
When I first wrote this post, I had about 6 months worth of experience with Amazon FBA. Now that I'm older, wiser, and sold out of the Amazon FBA business, I'm able to reflect a bit.
In short, I had a lot of good things come about from my Amazon FBA business. I made a pretty decent chunk of change, I learned a lot, and I feel like I grew as a person.
That being said, I don't think that Amazon FBA is for everyone (but there are Amazon FBA coaches to help). There are so many factors that lead to success or failure in this game.
There were hard days, the income was anything but consistent, and Amazon can be a pain to deal with for most people.
Here are some of the things I think:
Benefits of Selling On Amazon FBA
No doubt that selling on Amazon has some strengths that niche sites can't match. Niche sites often take months to get off the ground. My Niche Site Project 4 didn't earn much of anything before month 6. And since I've had a little experience with niche sites, I think my results aren't very typical.
Amazon isn't like that and there are plenty of Amazon FBA success stories to prove it.
It does take a little while to find a profitable product, source it, and get it to Amazon. But once you've got it listed, you can start making a profit that very same day.
A viable business model that can be as simple as you want it to be
I also think the simplicity of selling on Amazon FBA has been a bit of a game changer for me. With niche sites, you have to select a great hosting company, find your niche, write a lot of articles, do your SEO, build backlinks, manage social media, and more.
Amazon FBA involves picking a product, finding a manufacturer, and getting your “SEO” right on Amazon. Write your product's headline and description, you're pretty well off to the races.
Of course, Amazon FBA can be more complex. And to become a Amazon success story, you can do giveaways, add follow ups to turn buyers into reviewers, and more. But the basic premise is a lot more simple (and faster, and easier) than niche sites. There's just a lot less learning curve with FBA.
Another thing that adds to the simplicity of FBA is that Amazon takes care of a lot of the hassle of the business model for you. As an Amazon seller, you never have to worry about shipping to customers, collecting customer information, or building trust.
Amazon handles all of that. They even take care of some of the return process for you. Compared to something like dropshipping, Amazon makes a lot of things pretty easy.
But that's not to say that FBA is perfect. It has one major drawback:
Disadvantages of Amazon FBA [What most Amazon FBA Success Stories Won't Tell You]
The greatest strength and weakness of Amazon FBA is the same mighty force: Amazon itself.
They make it easier than ever to sell on a platform that your users already trust. But they can be an enormous pain to deal with.
I never had any significant problems, but there are horror stories of other sellers getting their accounts banned. Amazon has a reputation for being about as clear as mud when it comes to communication. If your product gets too many returns, if someone leaves a super nasty review, you could end up banned from Amazon. Just make sure to read and follow the Amazon FBA guidelines.
Many people will never have significant problems with Amazon though, so this shouldn't keep you away. At the end of the day, Amazon wants you selling on their platform and they're willing to work with you on some stuff. And if you do get banned, you can always contact them and resolve the issue.
Another downside of Amazon is that there is a lot of competition. I never had a ton of luck with “generic” products. All of my most successful products had a unique twist to them. For example, if I was selling a showerhead, I might add a unique way to pattern when the water comes out. If I was selling a computer mouse, I'd make it more comfortable.
The Best Combination Of All
I talk a lot about niche sites here and I've talked a lot about FBA as well. But if I were to start from scratch, I would do both at the same time. This is what I did with my FBA business before I sold it: I had a website in the same niche as my Amazon FBA business.
This website drew in organic traffic to buyer guide type articles ( best X for Y) and when I had a good opportunity, I promoted my own product. This allowed me to make more sales of my products and earn commission from my competitors.
Yep, when visitors bought other things on Amazon, I earned from that too!
This is the profitable business strategy I would pursue if I were starting all over. I would start with either FBA or a niche site, then expand to have both at the same time.
This strategy helped me sell both the site and the FBA for $425,000.
One of Many Amazon FBA Success Stories
As always, I would love to hear your thoughts or questions on the subject. Obviously, there is SO much more depth I could write about in regards to strategy and other details that are helping this become a profitable Amazon business.
However, I wanted to simply share about how my profitable business is growing and some of the lessons learned so far. I'd love to hear what's working for you or any other comments that you might have. Thanks!
Want to see one of my favorite tools for building an Amazon Business? See my Jungle Scout review here.
Want to learn step-by-step how I built my Niche Site Empire up to a full-time income?
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Learn How I Built My Niche Site Empire to a Full-time Income
- How to Pick the Right Keywords at the START, and avoid the losers
- How to Scale and Outsource 90% of the Work, Allowing Your Empire to GROW Without You
- How to Build a Site That Gets REAL TRAFFIC FROM GOOGLE (every. single. day.)
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