As Amazon FBA sellers, we have all made this sourcing mistake at one point or another. Especially as we’re just getting started in the business, without much experience to give us confidence.
Typically, we start out selling items that are familiar to us. Many sellers come to Amazon as book lovers, looking to get profits for the extra books around the house. Others get their start in FBA when they have growing kids with an abundance of toys around the house and a familiarity with the popular characters for certain age groups.
We start off selling what we know. And what we know is the perfect place to start.
But the biggest mistake I can make the further I go in my FBA business is this: to source as if the Amazon customer thinks just like me.
Here are a few examples of thoughts we can entertain that will shut us down as we’re sourcing:
- “Why would anyone ever buy this item?”
- “Why would anyone ever pay this price for this item?”
- “There is no way this item would ever sell on Amazon.”
- “Why would someone buy this on Amazon would they could just go down the street to get it at the grocery store?”
Your sourcing progress will come to a halt if you continue to source as if the Amazon customer thinks just like you.
You have to change your perspective, think like an Amazon customer. Now, Amazon has millions of customers, so you can’t think like every single one of them. But you can get out of your own brain and do a few things to start thinking less like an Amazon seller and more like an Amazon customer.
1. Expand your categories.
If you have been selling for a while (by “a while” I mean a few months) and feel like you’ve got a good foundation in toys or books, try branching out into some new categories. People come to Amazon to buy just about anything, so as you’re out in the retail world, thrift stores, or garage sales, expand your thinking to include different types of items as potential inventory.
There’s no need to get hung up trying to get ungated in a bunch of new categories before you start expanding your inventory. Arts and crafts, home and kitchen, sports and outdoors are all categories that don’t require Amazon approval for new sellers, and you can find inventory for these categories in a ton of places.
We hear sellers say all the time, “I went to [fill in the blank with store name] and looked at the clearance, and there was nothing there for me to buy.” Granted, sometimes this may actually be the case, but often the problem isn’t that there is nothing to buy — the problem may very well be that the seller is overlooking items that don’t fit in the categories he or she normally sells.
Selling items in the categories we are unfamiliar with can be uncomfortable for some people, but don’t let the fear of branching out to new categories hold you back. Get out of your regular pattern, out of the regular aisle where you shop, and scan something completely new and different.
2. Don’t make assumptions.
Last spring we found a $3 item on clearance. It’s oversized. It’s basically a piece of molded plastic with a sticker on it. No moving parts. No fancy decorations. It’s just the kind of thing you would naturally skip over as you’re scanning. But we scanned it just in case and found that it had a low rank in the toys category. Not only that, but it was selling for over $40 at the time. Buy for $3, sell for $40 — that’s awesome ROI! Over the next several months we bought dozens of this item in various colors for $3 to $7, and we sold them all for $40 to $60 each.
We’re certain that one reason we’ve sold this item so well for so long is that most other resellers skip over it thinking, “It’s just a piece of plastic. No one’s going to pay $50 for that thing.” But customers know that the item is hard to find in stores and Amazon is the easiest place to get it. It’s worth it to those customers to pay that amount for it.
3. Scan everything.
If you have time, scan everything. Just do it. Scan to see what’s in the Amazon catalog, what prices things are selling at, what items have a low rank. If you don’t have time to do that, maybe you have the money to hire someone to do it for you, to just scan an entire aisle in a store and see what’s out there.
Scanning everything in a “regular price” retail store aisle is a great way to find inventory that has less competition (because most sellers are focusing on the clearance aisle) and is possibly replenishable (where you can continue to go back to that store over and over again as that store restocks its inventory). Yes, scanning everything takes time and requires patience, but the rewards can be massive… especially if you find something great at one retail store, and your town has many other locations of that same store where you can go across town and stock up even more.
4. Don’t only focus on hot items.
Star Wars, Nintendo, and Hatchimals are not the only toys out there. People are making big profits on items that are off the beaten path. Don’t get stuck always chasing the next big trend, looking for the toys that everyone else says are the hot items of the day. These popular items may go up in price quickly, but unless you’re the first one in as a seller and can sell out quickly, you’re likely to be stuck with inventory that has a growing number of competitors and a sharply dropping price.
Not every Amazon customer is looking for the most popular toy out there. You can be the seller who brings unique, hard-to-find, quality inventory to the Amazon market, and customers will flock to you.
5. Check the Keepa data.
When you’re out scanning all these new items in new categories that you’re not used to, be sure to check the price history and sales rank history on Keepa. You may look at the Amazon product page for an item and doubt that a customer will pay that amount of money. But the history on Keepa doesn’t lie. If the lowest price for an item is steadily high and the sales rank stays consistent (or has consistent peaks), then that item really does sell for that price. Even if you doubt it. Even if you personally wouldn’t buy it. Even if you personally wouldn’t pay that much for it. Learn more about Keepa here.
Do your best to get out of your own brain when you’re making sourcing decisions. Do your best to think like Amazon customers. If you do, you’ll increase your inventory level, lower your competition, and make strides in growing your FBA business.
Do you struggle with your mindset when it comes to sourcing inventory? Do you have any strategies you would add to this list? We would love to hear from you in the comments below!
JumpStart Amazon is our intensive course focused on teaching you, step-by-step, how to build up a successful Amazon FBA business from scratch. From setting up your seller account to finding profitable inventory to knowing how to best use your profits, I’ll show you the proven strategies for how to start your Amazon FBA business so that it’s set up for long-term success. JumpStart Amazon is both an ebook (200+ pages) and video course (10+ hours) focusing on everything you need to start a successful Amazon FBA business.