Ready to start selling your products on Amazon? This guide will tell eight things you need to start selling wholesale on Amazon.

things you need to start selling wholesale on Amazon

The growth of eCommerce and the boom of the Amazon marketplace have made it easier than ever for businesses to sell products online.

Amazon is a fixture in the shopping world. Over 300 million people shop on Amazon every day, and they purchase more than 280 billion dollars worth of goods annually. 

People are earning millions of dollars a month from Amazon. The same amazing opportunity is available to you.

Amazon provides several ways to make money which are:

  • Private label FBA
  • Wholesale FBA
  • Amazon Dropshipping
  • Amazon Associates

Today we will talk about Amazon FBA Wholesale, one of the best ways to make money from Amazon. In this guide, I’ll tell you the eight things you need to start selling wholesale on Amazon.

But before we tell you about the eight things you need for Amazon FBA Wholesale, I’d like to give you some basic information about selling wholesale on Amazon. If you have a basic understanding of what Amazon FBA Wholesale is, you can go directly to the fourth heading of this article.

What is Amazon FBA Wholesale?

FBA Wholesale is a business model provided by Amazon in which an individual/business purchases goods in large quantities at lower prices from manufacturers or distributors of the product. They store them and resell them on Amazon to buyers by adding their margins.

Benefits of Wholesaling on Amazon

Here are some of the essential benefits you can get when choosing Amazon FBA Wholesale:

Existing Customer Base: One of the best benefits of working on Amazon FBA Wholesale is an existing customer base. In Amazon FBA wholesale, you don’t have to spend time finding customers. Your customer already has been defined to you and all you have to do is find a product with a great customer following.

Better Control Over Prices: In Amazon FBA Wholesale, you have a good sense of price points and trends based on the history of a product on Amazon. Conversely, when you launch your own product, you may find it challenging to choose a price because the price of a product is a crucial factor in determining its long-term success or failure.

Benefits from Big Names: As you all know, there is a big difference between a new brand and an established brand. New brands have to try hard to make customers notice them, but established brands are already known and trusted by people, so you can save your money on expensive marketing by working with established brands.

Lower Risk: Amazon FBA Wholesale is the most low-risk business model compared to other Amazon business models because the FBA Private Label business model has a higher risk of product failure and the Dropshipping business model has the chance of account suspension. At the same time, the Amazon FBA Wholesale is the safest business model without any risks.

8 Things You Need to Start Selling Wholesale on Amazon

These are some essential things you need to start selling wholesale on Amazon:

A Computer with an Internet Connection

As we all know, it is necessary to have a laptop and internet connection to work online.

Amazon Seller Account

If you’re reading this guide on the Micahguru blog, I assume that you already have the above two things. Great! The last eight things on the list are relatively straightforward, but you’ll still need to focus on them. Let’s dive in and make sure they get done.

Register Your Business with Legal Business Entity

To start working on Amazon FBA Wholesale, you should have to register your business with the legal business entity.

The best legal business entity for small business owners like you is a Limited Liability Company (LLC). It offers numerous benefits to small businesses like protection of business’s assets, minimizes business’s taxes, affordable and easy to form, and has some other tax benefits.

If you are thinking of registering your Amazon FBA Wholesale business with a Limited Liability Company, you can do it yourself by reading this inclusive guide, or if you are looking for a professional service to form your company, you can check out Micahguru Formation.

Employer Identification Number (EIN)

This step isn’t “necessary” because you can still do business as a sole proprietor using your Social Security number. But it’s a step I highly recommend to have an Employer Identification Number (EIN).

An Employer Identification Number (EIN) is like a Social Security Number for your business. An EIN stands for Employer Identification Number and, it is the tax identification number of the business.

What are the Purposes of EIN?

  1. An EIN is necessary for your business tax purposes.
  2. It is also required to open a business bank account in the United States.
  3. It is also needed when you want to hire employees legally.

Applying for an EIN is quite simple and free of cost. You can quickly obtain this by visiting the IRS.gov website.

Business Bank Account

If you are non-US planning to work on Amazon FBA Wholesale, you must have a business bank account in the United States.

Unfortunately, most U.S. banks require a branch visit to open a business account. Fortunately, however, there are some online banks like Mercury and Brex that offer almost the same features.

Resale Certificate

The most important thing you need to start selling wholesale on Amazon is the Resale Certificate, also known as the Sales Tax Exemption Certificate.

You may be thinking, Why do I need Resale Certificate for selling wholesale on Amazon?

With a Resale Certificate, Amazon Resellers who buy wholesale products and resell them through Amazon FBA can save money by not having to pay sales tax on the wholesale products they purchase.

Create a Business Website

Having a business website is so important that research has found that six out of every ten customers expect brands to have content online about their business.

There are many reasons why a business website is required for Amazon FBA Wholesale, including

  1. Professional Business Appearance
  2. Quick Brand Approvals
  3. Easy for suppliers to contact you

Find Best Wholesale Products to Sell

Finding winning products that drive sales for your Amazon FBA Wholesale business is the most essential and tricky thing you have to do.

Here are some tips for finding profitable wholesale products to sell on Amazon:

  1. First, make sure the product is not offered by Amazon or a private label vendor.
  2. Find a product with higher demand with Low Competition.
  3. Look for established brands, preferably small to medium-sized ones, as they’re more likely to give you a good deal.
  4. You should read reviews of your selected product to idea of the product’s quality from a consumer’s point of view.
  5. It is highly advised to choose a product which is of less than 1 pound weight and does not have extraordinary dimensions. 

Read this complete guide on finding a profitable product for Amazon FBA Wholesale.

Conclusion

In this guide, you understood eight very important things you need to start selling wholesale on Amazon. If you’re interested in starting an Amazon business, this guide will be a great help.