The Wholesale Underground course by Marvin Leonard will show you how to sell products sourced directly from suppliers at wholesale prices on the Amazon marketplace. You learn everything you need to run an Amazon FBA business, from finding trustworthy suppliers to winning the Buy Box, and scaling your product listings to other platforms.
It's getting harder to reach a 6-figure income with Amazon FBA in 2024. The problem is that PPC ads are expensive, and the competition is higher than ever. This business model has many moving parts and may not be the best business model for someone looking to make money online full-time.
In this Wholesale Underground review, we'll see if Marvin's strategies adequately combat these difficulties or if his course offers as much knowledge as other courses do. Expensive PPC ads are just one reason I looked for another online business model, which led me to local lead generation. With local lead generation, we rank sites locally without the use of PPC ads. Later in this article, I'll explain why this popular business model is better than Amazon FBA.
Pros
You learn every step of getting started in the Amazon FBA wholesale business model
Marvin shows you what software you can use to get more 5-star reviews for your product listings
If you aren't sure if a product is going to be profitable, Marvin gives his critique if you reach out to him in the Facebook group
Marvin shows you what other platforms, aside from Amazon, you can sell your products on and scale your business
Cons
Not enough examples of how to do product research
Paid traffic is getting more expensive with each passing year, which makes it harder to generate a wholesale order
You only learn basic methods of selling products on Amazon.
Price
The Wholesale Underground costs $997
Refund Policy
35 day action-based refund policy
To qualify for refund, you must have completed the training, setup a professional Amazon seller account, setup a legal business structure, and have opened one wholesale account with a supplier and show proof of one inventory list scanned & researched through the users list analyzing software.
Training
6 training modules in video format along with bonus material
Group
Private Facebook community
Reputation
Marvin Leonard is not a big time Amazon FBA guru. He appears to have a good online reputation, mainly because of all the students who have found success with this course.
5 Pitfalls and Problems with Amazon FBA
1. Up-Front Costs
Getting started with Amazon wholesale isn't cheap. You're going to have to invest between $5K-$15K to get started between buying your initial inventory, setting up an LLC, buying test orders from several suppliers to see which supplier has the best products, Amazon seller fees, advertising, and more. The startup costs for this business model will set you back thousands of dollars before you see any sales. It will also prevent you from seeing any profits for the few months to over a year. Many people avoid Amazon FBA because of the thousands you have to spend at first.
2. Product Research is Time Consuming
You are always in the search for the next profitable product that will make you thousands of dollars each month. Even if you find a product that sells well, you can't stop looking for the next product. Most products only do well for a month or two and some are seasonal only. Either way, ad exhaustion is inevitable and people will eventually tire of seeing your ads. This forces you to jump back into the search for the next product in the hope you find one that makes you thousands of dollars or more. Product research is time-consuming and one reason you won't earn a predictable income each month.
3. High Competition
Every day, on average, over 3700 new Amazon sellers join the platform. This makes it harder for you to sell products and will make the bidding wars for the Buy Box. Competing for the Buy Box isn't worth it because to win it, you've got to have the best price. The problem is that everyone keeps dropping their prices and eventually everyone loses money. This increase in competition makes you spend more money and time on perfecting your Facebook ads. If you do private label, you still have to spend time and money on ads that will outdo what the more established brands are doing. Amazon FBA is an uphill battle that will put you down hundreds and thousands of dollars with no guarantee that you'll get sales.
4. Risk Getting Stuck with Excess Inventory
If you don't get any sales, you're going to get stuck with the excess inventory. If you find yourself in this predicament, you will have to either sell your inventory to break even or sell it off at a loss. This is the risk you take when starting this business.
5. Paid Traffic is Expensive
The cost of advertising on social media platforms is rising with each passing year. According to one study, Meta's CPM rose 61% each year in the past few years. Google's CPM rose 75% each year and TikTok 185% each year. The trend is up for the cost of advertising. This rise in ad cost can also be blamed on the rise in competition.
Who is Marvin Leonard?
Marvin Leonard is an online entrepreneur whose parents immigrated from Mexico. Therefore, things weren't easy for him growing up since his family had little money. After graduating high school, he went to community college only because he did not know what else to do. While in college, he got into the police academy at 21.
Eventually, he was promoted to detective, which he did for a year. Marvin was making $80K per year at the time and had what most people would call "job security". Still, this wasn't the career he wanted to pursue. Working overtime, weekends, and holidays made him feel like he had no life at all. After coming across a video by Graham Stephan where he spoke about passive income, Marvin was determined to make a change.
More and more, Marvin began consuming content about business. On April 30, 2018, he quit his detective job and got into wholesale. He hasn't looked back ever since. Marvin got his motivation from knowing that he needed to provide for his wife and newborn baby.
Today, he's a successful entrepreneur who has earned over 6-figures on Amazon. The Wholesale Underground YouTube channel has over 14.2K subscribers, but Marvin doesn't post content often. On a video he posted selling his course at a discounted price for Black Friday, he said he was going to post more content about making money online.
Marvin seems to be more focused on helping other people become the best version of themselves. He is more consistent posting content about fitness on TikTok than about Amazon Wholesaling. On his TikTok account, he has over 18K followers.
What is included in Wholesale Underground?
In chapter 1, Marvin gives you an introduction to the course and shows you what it is you need to do to start your own business. Marvin shares what documents you'll need to fill out if you're looking to sell products internationally. Also, you'll learn how to navigate in your Wholesale seller account. To finish this chapter, he breaks down the terms you'll come across in this business model.
To start this chapter, Marvin explains what the 'Buy Box' is and how to win it. It's the white box next to the products on Amazon where you can click 'Add to Cart' or 'Buy Now'.
He also teaches you the best strategies for product pricing so that your listings can remain competitive. Then Marvin lays out which tools will help you run your wholesale business. These tools will not only save you money, but they will help you cut down your research time and allow you to make smarter, quicker decisions on what products to sell.
Marvin explains what authorized suppliers are and shows you where to look to find them. He gives you several questions you should ask a supplier while you're vetting them.
He then shares a list of the best suppliers and how you can connect with them. If you don't find the right supplier, it can cost you lots of money. Finally, Marvin provides you a list of the products you should stay away from and why.
Which products sell most on Amazon?
The products that sell most on Amazon are from categories that include video games, electronics, clothing, books, home and kitchen, pet supplies, and more.
Marvin stresses the importance of maintaining contact with the sales representative of the supplier you're working with. He also shows you what to do to not be gated by certain categories on Amazon.
In this chapter, Marvin shows you...
In the final chapter, Marvin dives into how you can get your product listings on more platforms so that you can drive more traffic and generate more sales. Some of the platforms he recommends you scale to are...
- Etsy
- Craigslist
- Bonanza
- eBid
Marvin then touches on reviews. He shows you how to get as many reviews as possible with the help of different online services like FeedbackFive by eCom Engine.
You'll also get training on how to hire virtual assistants to help you scale your business, how much they might cost you and what things you should automating.
How To Do Amazon Arbitrage in 2024 According to Marvin Leonard
Marvin Leonard's Key Strategies in 2024
Issues That Amazon Sellers Might Encounter in 2024 According to Marvin
What's not mentioned in the video: Amazon frequently updates its policies which could directly affect sellers. These changes might include adjustments in fee structures, shipping requirements, or new rules and regulations.
Amazon Wholesale FAQs
Amazon wholesale works by a seller buying products directly from a manufacturer at wholesale, or at discounted prices, and then making a profit by selling those products at higher prices to customers on Amazon.
How much Amazon wholesalers make depends on what products you sell, how much you pay for wholesale items, how much you spend on advertising, and how many people buy your products. The average profit margin for Amazon wholesalers is between 15%-20%.
An LLC is not required for Amazon wholesale.
Sellers leave Amazon for several reasons. They find it to be expensive to get started and may not see a fast ROI. They don't understand the rules, have a hard time finding profitable products, underestimated the workload of Amazon FBA, and aren't patient enough with the business model.
You can't start Amazon FBA with no money because there are several things you need to do before you make a sale that require you to spend some money, such as buying initial inventory, paying Amazon Seller fees, and paying for advertisements.
Tools like Helium 10, AMZScout, ZonGuru, and JungleScout are among the best and most popular that will help you run your Amazon business effectively and efficiently.
Is Wholesale Underground worth it?
The Wholesale Underground is worth it if you want to learn how to start selling on Amazon. Marvin has put together a good course that shows you everything you need to know. There isn't anything missing from his program. His product research could have used some more real life examples, but either way, you learn enough and Marvin is active within his Facebook group even though he providing support for his fitness clients.
Is Amazon Wholesale Profitable in 2024?
Amazon wholesale is profitable in 2024 if you understand it isn't as easy to make money on Amazon as it was 5 years ago even if you're selling brand name products. Startup costs are high (between $5K-$15K). You're looking at around $5K-$10K to get things started, which includes buying initial inventory, paying for Amazon Seller fees, product samples, advertisements, and more.
You need to also look for the next profitable product. It can take months before you find it. If you do, you'll then have to create ads to generate traffic and sales. Keep in mind that your first ad may not convert as well as you might want it to. Therefore, you must try different ad formats and split test several aspects of your ads. If you happen to get sales, your profit margins will also be low. This is an expensive, time-consuming activity, though necessary if you want to succeed with paid ads.
Amazon FBA also requires you to stay up to date with your inventory and pricing your suppliers have. You have to maintain constant communication with them so that you know what you have and how much you're selling it for. If not, you can end up losing out on a lot of money and wasted opportunities. You even have to make sure you send enough products to Amazon's warehouses. If you're running out of inventory, you need to gauge when is the right time to order more.
Another factor that can hold your business back is that Amazon can suspend your account at any time. If you're not paying attention, days can go by without you getting any sales. In essence, you lose money.
Similar to other online business models, Amazon Wholesaling does work and you can make money, but it offers nothing close to a passive income like local lead generation does.
Wholesale Underground Alternatives
Wholesale Academy by Larry Lubarsky is one of the best, if not the best, Amazon FBA wholesale course. Larry teaches you everything you need to know to start and scale your business. There are over 40 hours of video content divided into 50+ training videos. You're learning from an 8-figure Amazon seller in this course, so you will learn the most up-to-date strategies. This course is not always open for enrollment, but if you join, you'll get all the content plus get training on how to bundle your products, and even how to sell products in Europe (Pan-European FBA).
Price: Wholesale Academy costs $1,997
More Info: Wholesale Underground Review
The Wholesale Formula by Dan Meadors and Dylan Frost is another wholesale training course. They teach a process called Reverse Sourcing Wholesale. It's where you bypass wholesalers and buy products directly from manufacturers. This is what companies like Amazon and Walmart do. They provide you with over 90 training videos, spreadsheets, email templates, cheat sheets, and more. You also learn about how to break the ice with brands so you can start selling their products on Amazon. There's a private Facebook community when you join with live coaching calls each week to talk about new strategies and what's working in the industry now.
Price: The Wholesale Formula costs $2,497
More Info: The Wholesale Formula Review
If you want to see what other alternatives exist, read my article on the best Amazon FBA courses.
My Recommended Alternative To Amazon Arbitrage
My recommended alternative to Amazon arbitrage is local lead generation. Instead of creating an online store that sells physical products, local lead generation builds simple websites for local businesses and ranks them on Google.
Ranked sites are like billboards in prime locations in the physical world. They generate leads you can sell to local entrepreneurs at 85% margins. Sites can also be rented out to companies who don't have their own (there are over 10 million of them in the U.S. alone).
Local lead generation provides you with several benefits. For one, you're in control of how you run all aspects of your business. You choose the niche to get into, what local business to send leads to and how much they have to pay you each month.
I rented out this lead gen site to my client for $2000 per month. I have been making passive income from it since I built it over 7 years ago.
With local lead generation, you own the leads generated from your sites. No one can suspend your website and no one can fire you. You can fire your client if they're not paying you well. And, if they're not providing great customer service to the leads you send them, you can start sending the leads to another company who wants more work each month.
Selling on Amazon requires around $5K initial capital, but you only need around $500 to start a local lead generation business. This business is more hands off because leads continuously flow once the sites are up on Google.
To learn how to make money online without paying for traffic and stressing out about what products to sell, check out the local lead generation training program.
