Here’s how to start an Amazon FBA store on a tight budget:
How Much Money Do You Need to Start Selling on Amazon?
Amazon FBA startup costs range from $3,500 to $13,000. There are ways to start a store even lower, but spending less than $3500 affects your chance of Amazon FBA success.
JungleScout says existing sellers spend @ $3836 to start. Here’s their breakdown:
Stats courtesy of: JungleScout
Note: You could use a credit card. Many Amazon automation agencies suggest this while waiting for Amazon’s 2 week payout. But this can build debt fast and destroy your credit score, especially if Amazon suspends your account.
Does the Amount of Capital You Have Directly Impact Your Level of Success as an Amazon Seller?
Yes. The more you invest in your new Amazon FBA business, the greater your chance of success. But also, the more you invest also heightens your risk.
There is a free Individual Amazon Seller Central account. You’ll pay $0.99/ listing with a limit of 40. Then, you could sell things you don’t need, paying only shipping costs (which is Amazon FBM, not FBA.) Eventually, you’ll run out of profitable items to sell. You won’t be able to scale much higher, even if you reinvest what you made.
So, while you could start with very little, you won’t make millions off of a strategy like this.
How to Start Your Amazon FBA Store on a Tight Budget
1. Choose the Amazon Business Model that Fits with Your Budget
There are many Amazon FBA business models, and some may allow you to at least start on a smaller budget.
2. Getting Set Up with the Best Amazon Seller Account for Your Pocket
A Professional account costs $39.99/month for unlimited listings. Normally, this is the best choice at the start of your Amazon business.
But, if you have a tight budget, an individual Amazon FBA seller account might work best. After all, you shouldn’t have a large inventory of listings if you can’t pay for it. You can save some cash by listing fewer than 40 products on the Amazon platform. And you’ll save on both inventory costs and Amazon FBA fees.
3. How to Find a Profitable Product to Sell on Amazon
For a more in-depth breakdown, look at our full Amazon FBA product research tutorial.
4. Source Your Products and Make Deals with Suppliers
With retail and online arbitrage, search the clearance sections of your retailer, or their website. Selling clearance items at maximum price will make your profit margins much heftier.
If you’re selling on Amazon using wholesale or private label, order inventory with a low minimum order quantity, or MOQ.
Some suppliers will allow you to order just a few hundred items. If not, you might cut a deal. However, this can be difficult because suppliers won’t make a lot of money from fulfilling such a small order. Plus, they may not take you seriously or consider you a good investment for the future.
To combat this, get a sourcing agent from UpWork for $10-$20/hr. They’ll complete about 5-10 hours of work, making your investment significantly cheaper than purchasing an unnecessarily large quantity of product. If you’re sourcing from China, an agent that lives there will understand the language and customs. Also, a sourcing agent will have other clients that they can bring to the manufacturer, making a more lucrative deal.
5. Set Up Your Amazon Product Listing
If you are selling someone else’s product, you won’t have to worry about Amazon product listing optimization. But, if you created a private label product, you will need to make a listing that sells. (Click that link to see an in-depth guide to this strategy)
Here are a few cost-effective strategies to optimize your listing:
Do You Need a Business License to Sell on Amazon?
No, but some suppliers will only work with wholesalers that have a business license and/or resale certificate. To keep costs low, search for suppliers that do not have these requirements. Aliexpress, Tradegala, and others do not require a seller’s permit. Some states require this regardless, so research your location.
6. Test Your Product’s Popularity and Boost Traffic
Do not start your product launch with an auto Amazon PPC campaign. This can drive your ad spend into the thousands while pushing Amazon visitors from keywords that make no sense with your product.
Instead, start with your own keyword research. Choose keywords based on search volume and buyer intent (much like when you optimized your listing). Then, pick 5 high-relevance keywords to focus on, and at least 60 long tail keywords. Finally, 2-4 weeks into your product launch generate an auto campaign. That way, Amazon’s auto campaign will take in the sales data you have already collected.
On a budget, you can’t throw thousands of dollars into PPC. But, that doesn’t mean you can’t use this feature at all. Set a budget of $5 to test your ad campaigns. You won’t see much growth, but you will see which ads work the best.
Other cheap ways to boost traffic to your Amazon product listing include:
The Course: How to Start an Amazon Store on a Tight Budget
“How to Start an Amazon Store on a Tight Budget” is a very popular Udemy course. This bestseller has over 95,678 students. Total, Theo McArthur teaches 156,073 students.
Theo McArthur's Presentation
The course is a complete guide to every step of setting up an Amazon wholesale or private label business. From finding Amazon account support, to understanding the BSR, to figuring out new requirements for product approval, it’s in this complete Amazon selling blueprint.
Price:
$109.99 or lower, if you have a Udemy coupon
Course Started:
2015, most recently updated in March 2022. She adds new content often.
Coach:
Theo McArthur started selling on Amazon in 2013, but began her online career in 1995. She has marketed e-learning products, still works as an affiliate, and scaled her Amazon business onto an independent eCommerce store. She created this course to help newbies avoid common Amazon FBA mistakes.
Group:
Yes, there is an active Q&A board within the course.
Training:
Aimed at complete beginners or those who need to revamp their store from the ground up. If you are a veteran seller, you will still find value in this online course. But there will definitely be some surface level parts you can skip.
Lives:
No.
Some other things we liked:
This course covers over 11 hours of content in bite-sized pieces. You can easily return to content you wish to review.
Course content includes multiple handouts.
Some things we didn't like:
At times, there seemed to be a little too much fluff.
There’s no real video of the presenter.
She could include the use of more tools that automate some processes.
What are Some Potential Alternatives to How to Start an Amazon FBA Store on a Tight Budget?
How to Start an Amazon Store on a Tight Budget is a great course. But, when you’re ready to invest a little more, consider Private Label Masters. It’s taught by Tim Sanders, who is an 8-figure Amazon seller. This is just one reason it made it on our list of Best Amazon FBA course. The course is $5K, so plan to take this course when you have a larger budget. It’s a much better choice than the Amazing Selling Machine (which lacks real-world examples).
Conclusion: My Recommendation for Starting an Amazon Store on a Tight Budget
If you have a tight budget, it’s not probable that you will make a lot of money with Amazon FBA at first. But it is possible to stick to your budget while gaining experience, seasoning your account, and bringing in your first dollars from making money online. Follow the steps above and invest your earnings back into your business so that you can scale as you learn more.
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