Sourcing inventory to sell on Amazon is somewhat different than looking for “stuff” to sell on eBay. Your mind needs to take a shift and start thinking more along the lines of selling products that you would see in a retail store… more so than “stuff” at a yard sale.
Of course… we have found an abundance of products to sell on Amazon. It takes a bit of a learning curve, but once you get the hang of it… you will be seeing profitable product opportunities everywhere.
Making “wise” buying decisions means you are going to need to educate yourself a bit. We all stumble across some very profitable products every so often… but for the majority of your product sourcing, it’s going to take good old fashioned grunt work and using your noggin.
Don’t Let Confusion Stop You
You have choices (sooo many choices) to source Great Inventory… it may become confusing and overwhelming. Don’t let frustration stop you… keep going… moving ahead at a pace you feel comfortable with. You may read or hear about others who are selling “huge quantities of inventory for huge amounts of profit”… and this may make you feel defeated. All we can say is this:
” Start with as much cash as you know you can afford,
buy the best products you can find,
sell for the highest profit margins you can…
rinse and repeat”.
Sure… that sounds simple enough. But… WHICH products are the best?
You will find a ton of sellers who will share that a specific category is THE Best. Or… that thrifted products sell for the most profit and that you should stick with that strategy. Maybe… you read that others make a killing selling things they buy at local retail stores (Retail Arbitrage). On the other hand… others will tell you that finding a few good wholesale resources is the best way to go.
So many options!
We can tell you from our own experience – all of the above will work. And… all the above “won’t work” if you don’t approach them with some know-how first.
Jumping in with both feet… spending money on products (no matter where you find them) without education is just the wrong way to start a “Real Business”.
Learn the ropes first… learn them without spending a fortune… learn them with as little stress as possible. Learn while “doing” – will help you learn faster.
You Will Need A Smart Phone And An App (Maybe)
If you don’t have a smart phone… one that you can use to “scan” products… you can learn to use your computer to “test the waters” before you invest in any equipment/tools/services. Grab some items that have barcodes from around your home and look them up on Amazon.com
If you DO have a smart phone… you will need an App to start scouting. You can use Free Apps – but we suggest starting with Profit Bandit (which is only $15) – because it gives you ALL the information you need in one spot. No Guessing. At the very least, grab a copy of Amazon’s free App – Amazon Price Check for iPhone or Android
No matter if you are using Amazon.com or an App, you’ll want to look at the # of sellers, specifically the FBA sellers and their prices for the items. More info about this in the next section below.
Shop Your Home First (Amazing Profitable Products Lurk On Your Shelves)
When you are first starting to learn how to source products… we always suggest shopping your home first. It’s much easier to get past the learning curve of using your smart phone when you can learn in the comfort of your own home. Plus… you will be amazed at the “stuff” you have – right at your fingertips – (stuff that won’t cost you any cash) that you can sell on Amazon!
This is the “cheapest” way to start loading up on inventory. Look for “New Stuff” (things you have never used or received as a gift), Games, CD’s, VHS, Cassette’s, DVD’s, Books and even scan your pantry.
Take a look for how much the item is selling on Amazon. How many sellers are there? Is Amazon also selling the item? Use the free FBA Calculator (google: amazon fba calculator) to see if the item would be profitable for you.
The entire process “from start to finish”, of selling on Amazon FBA can be learned right in your own home. You have a lot to learn… and you want to get going quickly… this is the first step to your first box of inventory.
Thrifting For Inventory (This Does Not Mean Buying Junk or Your “Granddad’s Clothes”)
The next step in finding GREAT (profitable) inventory (without breaking your family budget) can be to shop thrift stores, yard sales, book sales, eBay and Craigslist.
If you have a limited amount of money to put towards inventory, sourcing items from thrift stores can be very good for you. Many people have even added thrift store sourcing to their inventory sourcing mix because of the fabulous return on investment.
I routinely find NEW items at thrift stores to sell for large profits on Amazon like:
- New Leap Pad book and cartridge bought for $3 and sold for $32.99
- New music CD bought for $2, sold for $25
- New Jane Fonda workout VHS tape (YES – V-H-S), bought for $1, sold for $32.97
And I find lots of USED items at thrift stores that sell well on Amazon too, like:
- Holy Bible DVD in Used – Very Good condition, bought for $0.50, sold for $21
- Book about Pineapple Afghans in Used – Very Good condition, bought for $0.50, sold for $25
- Board Game E.T. the Extra Terrestrial – Collectible – Very Good condition, bought for $3, sold for $25
Pros and Cons of Thrift Store Sourcing:
- low cost items with VERY high profits.
- you will usually have minimal competition from other sellers.
- thrift stores put out new inventory daily so you always have opportunities to find GREAT inventory.
- many (but not all) finds at thrift stores can be “long-tail” items which means you are waiting for the “right” buyer to come along.
- it does take time to go through a thrift store looking for items.
- you will have to remove price stickers and clean up items.
You can learn more about sourcing great inventory at Thrift Stores with my Freebies & Guides that you can find HERE.
Retail Arbitrage (Buying Low at Retail Stores – Selling High on Amazon)
Many people source items from retail stores to resell on Amazon FBA. Grocery stores, pharmacies, toy stores, big box stores (WalMart,Target, Tuesday Morning, Toy’s R Us, Home Depot etc.)
You can find items on clearance that can fetch a nice return on investment. Besides that, you can also find regular priced items that sell for much more on Amazon. It’s all supply and demand. Your local big box store may have a large supply of an item that is not selling so they discount it to move it out. Meanwhile, across the country, someone else is searching high and low for that item and can’t find it anywhere, until they find yours listed on Amazon. Likewise, an item that has been discontinued by the manufacturer will become hard to find all over.
We both started FBA by selling items sourced from retail stores. We both continue to purchase a small portion of our inventory from retail stores. We generally avoid going after the “hot” products that every other seller is chasing after. For instance, toys – especially during the Holiday Season. Many sellers love sourcing toys at retail stores to sell on Amazon and are very profitable with doing so. It’s just not our thing.
Pros and Cons of Retail Arbitrage:
- You can often find more than one of an item.
- You can also ‘do retail arbitrage’ at online stores.
- You can often find the same product at multiple stores.
- Many products won’t have discounted price labels to remove.
- Products purchased can be high turn over products… they may sell fast!
- If you go after the same items everyone else is, then you could have increased competition.
- You may noet be able to find the product again… making replenishing impossible.
Wholesale – (Buying In Bulk From Manufacturers or Distributors)
Sourcing products wholesale to sell on Amazon is something that we began doing in early 2013 in addition to thrifting and retail sourcing. We love the idea of buying products in “bulk” and having them shipped right to our doorstep.
We’ve been experiencing some very good luck finding wholesale sources that have products that we can bundle or multi-pack and sell on Amazon without any competition. And to be honest, a lot of hard work has gone into doing research to find these products.
We both chose to get creative with wholesale products and not follow the “crowd”. We haven’t even scratched a tiny bit of the surface in wholesale sourcing… once we learned the basics, a world of opportunity has opened up before us. Our biggest problem now is what to choose to do first.
Pros and Cons of Wholesale Sourcing:
- You CAN often start out with a small minimum order. (We have found many with a $100 min. order)
- No sticker removal!
- You can easily re-order items that sell well.
- You can develop a relationship with wholesale suppliers and have exclusive rights to sell on Amazon
- Wholesale products may not bring the highest profit returns.
- It takes a bit of detective work to find wholesale sources.
- Some wholesale/distributors will not sell to Amazon sellers.
- The competition can become just as prevalent as with retail arbitrage.
Wholesale items can be a very good addition to your inventory sources. Learn more about sourcing items wholesale here:
More Inventory Sourcing Options
- Source items on eBay that you can then re-sell on Amazon FBA for a profit!
- We recorded an awesome podcast all about sourcing items on eBay to sell on Amazon which you can find HERE.
- Source items through Craigslist
- Salvage / Liquidation
- Retail Arbitrage Sourcing Toys
- Creating Bundles
- Buy Without Paying Sales Tax
Pick someplace to start and go gather some inventory to send in to FBA!