My First Year Selling On Amazon FBA – The Honest Results

Step by step every single cost he had to starting this Amazon business including his product cost his design cost his shipping cost as well as all his other costs and his final profit in his first year going to share the three biggest mistakes he made including one mistake that cost him over $20,000 and this is a very easy mistake to make a lot of beginners make this mistake and you’re going to want make sure you pay attention so that you don’t make the same mistake Gary tell us what do you sell and how did you start your

Gary’s Product

business my dad was in the pharmaceutical business and he was always messing around with chemicals and trying to improve and make different products and then one day I saw my dad and I was looking at him and his skins amazingly clear and I was like what have you done and he told me he’s been working on this product and he thinks he’s figured it out so I decided to
start a company called clear and we started selling on Amazon because Amazon is the easiest place to sell products and last year there was over $600 billion in sales on amazon.com and this year it’s projected to be over $700 billion and 2third of all the sales that happen on Amazon are people like you me and Gary selling our products on Amazon
so it is the easiest place to sell a product online and I know this because I had a corporate 9 to-5 job that I quit over 10 years ago I’ve been selling on Amazon for over8 years and it’s the easiest way I found to make money online so smash we’re going to share with you step by step how Gary started his Amazon business this is pretty much the same formula that so tell us how did you start this business uh well the

How Gary Started His Business

First step  actually to improve the product uh because uh initially the product was a great product but I don’t think it was uh viable for the public use because of some problems that that it actually had and how did you go about finding a person that could help you do that well the funny thing is you got to believe that it’s possible I know that sounds kind of crazy but um I literally went on Google started Googling ways around the problem and eventually I found um manufacture that was able to create uh an ingredient the way that I
wanted it to be created and for you at home most products that people sell on
Amazon are a lot easier to develop Gary picked a product that was a little bit more complicated and that gives him an edge over the competition but at the same time it did require a lot more work up front so now that you had your product the next step for anyone starting an Amazon business is design creating the logo creating The Branding How To Setup Amazon PPC (Sponsored Products) In 4 Minutes

Product Design

How did you go about creating your name your branding and your logo I wanted to have something that was simple and easy to use online uh so I’d always try to look for five-digit words uh if possible or something that’s easy to remember because that’s always your first impression that you’re going to make we also wanted to sell not only in America but internationally so we felt it’s important to have the trademark up front then we went to a designer worked with a designer to come up with a brand that fit kind of what the product was supposed to do okay how do you find that Designer basically through family contacts who do a lot of manufacturing they had a designer that we used originally and she helped us how much did that cost that about $2,000 the next step when starting an Amazon business is to set up a legal entity and this could be a DBA or LLC are the two most common things that people use how did you set up your business from a legal

Setting Up Business Legally

 I originally actually set it up as a Corp which I know is unusual and maybe I have delusions of grandeur but I was hoping that I could build a big company and eventually people could become stockholders in the company so I thought that’s the easiest way rather than changing it over later and for you at home most big companies are C Corp
But most Amazon businesses start out as an LLC which still allows you to have some ability to do stock holders but if you’re planning on going public a C Corp is a better option and DBA is another even cheaper option and DBA stands for doing business as it allows you to open up a business bank account and a
Business credit card but it doesn’t give you any legal protection and LLC stands for limited liability company and it will give you legal protection as well as allow you to start a business bank
Account and do all the other things but an LLC is often a little bit more expensive than a DBA the next step in starting your Amazon business is to do a production run to actually get your product produced how much did that cost you to get your first production run so The Harsh Truth About Amazon FBA

Production Run

I about 6,000 we found a manufacturer because of some contacts I had in South Africa actually have some family members in the manufacturing business and for you at home if you’re looking to find a manufacturer for your product you can go to websites like alibaba.com if you’re looking to get a product manufactured over seas or thomasnet.com if you’re looking to get a product manufactured here in the United States but the third option is to just go to Google and search for manufacturers now this sometimes works really well and
sometimes it’s a little bit harder at this point the costs are starting to add up but they’re are still some other costs when starting an Amazon business but keep in mind that different businesses cost different amount of money in order to start I’ve had students that started with literally
zero dollars and they were able to raise all the money they needed by crowdfunding by doing an Indiegogo or a Kickstarter once you had your production run done it was time to get your product shipped from South Africa into the

Shipping

United States yeah originally we went uh air shipping most of the time I’ve only recently started doing sea shipping and it’s quite expensive to be honest to ship internationally like that sometimes cost in almost as much as the product itself wow so something to be aware of and when you’re shipping a product from
Overseas in the United States you have two options you have air shipping which is what Gary used to do but I think you’ve since switched to Sea shipping right yeah for a lot of our products it’s a lot cheaper so yeah and exactly C- shipping is going to be slower but it is going to be cheaper so if you can do C- shipping at the beginning often times it will save you money but sometimes
it’s worth it to pay a little extra to get the product to you faster The Next Step before you launch on Amazon is you need photos of your products because when you’re selling on Amazon you need to create an Amazon listing which includes the photos of your product the The Best Ecommerce Platform in 2024

Amazon Listing

Title the bullet points and the description how did you go about getting the photos for your product and how much did that cost you to be honest I did the photos myself but I did decide to get a decent camera so I spent like I think 500 bucks terms of the wording mainly
Myself we did try use some social media people to come up with some wording and the good thing about investing in that camera is now you can use that for
Marketing you can use it over and over again so even though it is an upfront cost you were able to use that over time oh yeah I use it all the time every time we have a new product and there’s just a couple other fees that you need to think about before selling on Amazon the next one is a UPC code and UPC stands for

UPC

Universal product code every product in the world has this anytime you see a product being scanned at Walmart or at a checkout they’re scanning the UPC code and in order to sell an Amazon you need to buy a UPC code for your product how much did you spend on UPC codes yeah I
started with gs1.org and we pay $50 a year yeah that’s not bad and the way it works is if you want one barcode it’s going to be about 30 bucks if you want 10 barcodes it’s going to be 250 bucks but there is a like a yearly renewal fee and that’s probably the $50 a year that you’re paying exactly and now we’re going to share exactly how much Gary made in his first year selling on Amazon
we’re going to go month by month and share the revenue and the profit numbers but before we do that you spent a lot of money getting this business ready to launch on Amazon

Amazon let’s break down some of those costs in your first month selling on Amazon how much money did you have to spend on the products that you sold in that first month yeah in my first month
I spent around $600 and when you sell something on Amazon there is a fee you have to pay the 15% Amazon seller fee for anything you sell on Amazon and how much money do
you spend on that 15% Amazon selling fee in your first month yeah we spent around $725 and the next fee is the Amazon FBA Picking pack fee and what makes selling on Amazon so special is you can take advantage of their FBA program FBA stands for fulfilled by Amazon this is where you send in the products that you want to sell on Amazon’s website into
The Amazon warehouse and anytime you get an order Amazon will pick pack and ship out the product to the customer but they do charge you for this and how much did you spend in your first month with the Amazon FBA Pick and Pack fee about $1,000 and it sounds like a lot of money but keep in mind if you’re selling products online on your own website

1st Month

selling on Amazon you ended up doing a profit of around $1,500 how did you feel about that was that good for you was that bad were you nervous still no it’s a good feeling obviously when you see
start seeing profits yeah and let’s talk about this first month did anything interesting happen in this first month yeah I would say a lot of interesting things happened in the first month I mean the first Focus was obviously to get awareness of the product and

Amazon so that they could buy the product and hopefully give us good reviews to create the awareness out there we also learned a lot from some of the reviews because
initially actually to be transparent our packaging was considered not professional by some people that we
actually got that feedback through the reviews so that’s a very important thing to to learn I think and we’ll talk about this in depth when we go over the
mistakes because this mistake cost around $10,000 and we’ll talk about how you can avoid that in Gary’s second month selling on Amazon he ended up doing over $5,000 in revenue and once

2nd Month

it was around $2,000 in profit and in the second month did you see anything interesting happening yeah we noticed people like the product more and more people are buying the product and the important thing to remember when selling on Amazon is that Amazon is a search engine people go to Amazon to search for products that they want to buy and your goal when selling on Amazon is to get to the top of the search results and as you
Start to get more sales as you start to get those five star reviews Amazon’s going to put you higher and higher up on the search results and this creates a Snowball Effect where as you have more sales and more reviews you’re going to get even more sales and more reviews and over time you get higher and higher up on the search results and in total in your first year selling on Amazon you ended up doing over $100,000 in sales.

1st Year Result

Over $35,000 in profit and for you at home it’s important to know that around 43% of Amazon sellers end up making $100,000 or more so even though this is very impressive that Gary’s done it you can do it as well how did it feel for you to do over $100,000 your first year selling on Amazon yeah it’s a great
feeling having money coming in every month and for you is it relatively passive and automatic Amazon side of things or does it take a lot of work I’m but it definitely cuts out a lot of work because they’re taking care of all the distribution you can prioritize your time much better because when things actually get sold especially with
FBA Amazon’s taking care of the warehousing and the selling for you which is a big part of the business 
it’s I don’t have to do as much marketing because people are already going to Amazon and buying do you find the same thing to be true or does depend yeah no I like this it’s kind of a unique system because it’s
Actually based on how good the product is based on reviews so uh it’s the one landscape where you can actually get the benefit of your product without having to do excessive marketing.

3 Biggest Mistakes

 So that you don’t make these same mistakes and I’ve worked with a lot of students I’ve taught over 2,000 people how to start their own Amazon business and I’ve seen a lot of the same mistakes again and again and if you are looking for help to starting your own
Amazon business course so stay tuned for that but let’s go over the first mistake that you made Gary and that was with your product design what happened I know this mistake cost you around $110,000 yeah I mean a couple of problems happened with the design of our product first of all is that it initially didn’t look professional 

Amazon so fortunately I was checking the reviews almost every day and as soon as I saw one that was bad I I could take care of the problem and make sure that our next batch of products didn’t have those design floors other problem we had in terms of design is that we originally had a product that was doing well for
some reason we decided to change the design of the product and noticed that
The sales actually dropped off and then a lot of people were requesting the old design uh so that was another Learning lesson for us as well were you able to do anything about those negative reviews were you able to get them removed .
Actually would report them on Amazon especially if they were not accurate but mainly it was taking care of the problem to make sure that that kind of review couldn’t happen again the second mistake that Gary made cost him over $115,000 what was that mistake and let’s talk about how people at home can avoid it yeah I mean that’s kind of interesting .

what actually happened is during the holiday season uh we actually got a huge number of sales tried to rejuvenate the stores of our product but uh it actually took too long and we ended up running out of product and this is one of the most common mistakes I see is people either ordering way too much inventory

or not enough inventory it’s hard to get that number exactly right and I do have tools in my Amazon FBA program showing you how to figure out how much you should order but this is a very common thing that people run into because they end up having more success than they thought they were going to so you’re not alone in this and now I want to share

The biggest mistake that Gary made and this mistake cost him over $100,000 most people end up making this mistake you’re probably making this mistake and you don’t even know it what was that mistake yeah I think the Best Ecommerce Platform For Wholesale For 2024.
Mistake was waiting because the opportunity cost where’re on the fence for a while and could have sold some of our products at least a year earlier which a lot more Revenue obviously yeah and you made a $100,000 in your first year selling on Amazon if you would have
Started a year earlier that would have been an extra $100,000 and for you at home every minute that you’re waiting to
Start your online business you’re losing out on money you don’t think about it like that but if you were to start your business today that would mean an extra 100,000 $200 $300,000 in your pocket instead what most people fall victim to don’t be one of those people I have a free eight hour step-by-step Amazon FBA course for you you can get just by clicking right here it’s a free The Best Amazon FBA Course for Beginners