You’re probably wondering if selling wholesale on Amazon really works…well, we’re here to tell you that it can and does work!
It’s no mystery as to how Amazon successfully sells an incredible variety of products. Wholesale is the key to much of Amazon’s success because it allows Amazon sellers to buy bulk products from other retailers and then sell to consumers.
As former Amazonians, we know that wholesale is an opportunity for Amazon sellers to make money on Amazon.
Selling wholesale as a reseller is achievable, but it’s crucial to understand what wholesale on Amazon looks like.
What is wholesale on Amazon?
There are pros and cons to selling Wholesale on Amazon, and there are steps you can take to understand the wholesale process while successfully executing business.
For wholesale sellers, Amazon may require a license in order to sell wholesale goods. This might also be called a business license or a tax exempt form depending on your location.
It is important to research the required licenses determined by your state or county.
Initially, wholesale appears similar to the other business models on Amazon, but wholesale is different in some major ways.
How does wholesale differ from other selling models on Amazon?
Take, for instance, arbitrage business models on Amazon.
Arbitrage is the process of purchasing products from retail sites at discounted prices and in turn, reselling them on Amazon to customers. Similarly to wholesalers, arbitrage businesses buy branded products. However, unlike the arbitrage business model, wholesale involves a bulk product purchase rather than an individual purchase.
Wholesale also involves some kind of negotiation over the price of bulk items, whereas arbitrage reselling involves purchasing already discounted products to resell to customers.
Selling wholesale on Amazon is unlike what sellers typically need to do because when participating in wholesale on Amazon, wholesalers do not need to create entirely new product listings. Instead, wholesalers are required to add their offer to an existing product listing unlike private sellers, for example, who must create their own product listings.
Wholesale on Amazon also requires sellers to control their supply chain and fulfill orders themselves.
How can you become an Amazon reseller?
Becoming an Amazon reseller to sell wholesale on Amazon involves the following steps:
- Establish an Amazon seller account. See our blog post on how to sign up for an Amazon Seller Account in 2020 here.
- Research the best selling products on Amazon with a high demand to resell. See our blog post on choosing the right product to launch with here.
- Source the product you want to resell from a manufacturer. Discover Cascadia’s course with a free preview to learn more about sourcing the product you want to resell here.
- Create an optimized listing to optimize search results compared to competitors. Find our blog post on writing content for Amazon here and Cascadia’s Jumpstart: Amazon Content course here.
- Launch the product! Further promoting your product to ensure sales is also an important step. Find our course Jumpstart: Amazon Advertising here.
- Focus on managing and growing your business.
At first, becoming an Amazon reseller and selling wholesale may take some patience and hard work compared to other methods of selling on Amazon. However, buying wholesale products can help support a Fulfillment by Amazon business.
Check out all of our blog posts here.
Best selling products on Amazon
In order to successfully resell on Amazon, it’s essential to find a product to resell that is in high demand on Amazon.
If you’ve been through all of the steps to become a reseller on Amazon, but you’re struggling to achieve success, it might be because you’re not reselling the best selling products on Amazon.
Find Amazon’s best selling products here. Take some time to research the products that are easy to buy in bulk to resell to customers.
The best selling products on Amazon are broken down by various categories such as clothing, electronics, and food products.
If you are interested in reselling best selling products like food products, check out our blog post about the Food and Drug Administration marketing guidelines on Amazon.
Once you decide on a type of product or brand you want to sell, you then need to find a source for it, and sign up to be a wholesale customer.
How to sign up for wholesale accounts
It’s pretty straightforward to sign up for wholesale accounts – but that doesn’t mean you’ll get approved!
For example, here’s a link to the application to sell for UNFI – https://getstarted.unfi.com/form/new-customer-request#no-back – United Natural Foods, Inc., which is a large wholesale distributor of dozens of brands that are sold to grocery stores, convenience stores, and ecommerce stores, both online and in brick & mortar stores.
After you sign up with a distributor or manufacturer, and you’re ready to order, you need to meet their MOQ, or minimum order quantity. For some companies, that’s as little as half a dozen items; for others, you’re looking at MOQs of 1k+. The risk you take with buying more is that you may find that there is more competition for the buy box (“Add to Cart” button) on Amazon, which is awarded in a round Robin style approach by Amazon’s automated tools, then you realized, and you’re not able to move products fast enough.
Or, you may face other risks working with distributors or manufacturers who aren’t ecommerce focused – for example, you may sell quickly, but the packaging may not be e-commerce ready and you get a lot of returns due to smashed or damaged products.
So when you’re signing up for a wholesale account, you’ll want to take to them about how they package and label, just as much as what their pricing is, or whether it’s alright for you to sell products on Amazon (often as not, it’s not alright for you to resell on Amazon).
Challenges with selling products on Amazon
Selling products on Amazon can be quite the journey for sellers. Business as usual can change with a single misunderstanding or a simple grammatical error on a product listing. As noted, sometimes your wholesale accounts aren’t as aware of selling on Amazon, and don’t package or label appropriately.
At Cascadia Seller Solutions, our goal is to help sellers like you make the most out of your Amazon Seller account.
Our team of former Amazonians can help your business thrive by selling products on Amazon, so you can focus on growing your brand.
If something like damage issues are prevalent on your account, Amazon may choose to suspend your listing, or put it under investigation status while they look into customer concerns.
If you need help because your Amazon listing needs to be reinstated, we can support you in that process. It may feel like you’ve hit a roadblock when trying to figure out why your listing has been suspended and how you can get back to selling your products on Amazon – such as the client whose items kept being suspended for being expired, and when we checked, the brand he was selling used only manufactured on dates – and of course these were in the past and customers got confused and complained to Amazon… or the client whose brand was selling supplements packaged in glass bottles that were breaking on their way to the customer, and Amazon told him he was selling “used sold as new” – which he obviously wasn’t – but they don’t have a designation for selling items that break on their way to the customer!
At the account level, we’ve encountered many resellers who were reported by the brands they were reselling for selling counterfeit products because the brand didn’t recognize who they were or believe they were authorized to resell on Amazon, and then their account was shut down for selling potentially counterfeit products.
This can be incredibly frustrating and frightening, especially after all of the effort to open an account, research product ideas, apply for a wholesale account, meet the MOQ and buy a lot of product, start selling and seeing your side hustle/new business growing… then BAM… Amazon shuts you down.
It can be tempting to freak out and blame Amazon for being stupid, or competitors for trying to shut you down and you may try to contact Amazon over and over to fix the situation, but this is not helpful!
What you can do is remain calm in knowing that our team is equipped to handle situations like this and has been helping Amazon sellers with listing and account reinstatement for years.
Whether or not listing or account suspension is a problem you have faced, it is a good idea to familiarize yourself with the reinstatement process in the event that it does happen to your account.
Find out how we can help you with our tried and true reinstatement process designed by our team of former Amazon workers so you can get back to selling your products on Amazon. Visit our reinstatement resource page for more information about how we navigate the “s” word (suspension).