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Is Amazon FBA dead in 2022 for starting a business?

ZCP

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For those coming behind years from now reading this, if you must have validation from others before you try / start / do, then entrepreneurship may not be for you.

Get started. Learn while doing. Answers appear as you put in the work.
Be ready to pivot. You may not end on the path you begin. That's the journey.
 

Walter Hay

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I'm not quite sure what you mean by that. Can you elaborate on that a little more?
Thanks.
I expect that the course referred to in the helpful post by @david1024 would be the PROVEN AMAZON COURSE that has been functioning for about 17 or 18 years and is constantly updated.

Full Disclosure: That is an affiliate link which gives me a small compensation because if you buy via that link you get a free copy of my $117 book ProvenGlobalSourcing.

MJ asked: Has Amazon jumped the shark? Yes, to a large extent Amazon has been a victim of its own success, but more so it is a victim of its own greed in offering favors to Chinese suppliers to join up. Also, increasing their fees downgrades their attraction for sellers.

So to answer your thread title question: NO- Amazon FBA is not dead in 2022 for starting a business.
If I wanted to enter the world of eCommerce, I would use Amazon FBA as a starting point, BUT......
Here are a few things I would take into account:
  • Competition. I would not be scared of that. I would beat it, not by price cutting but by a) better product presentation in my listing, b) offering a product that is actually different - not offered by other sellers, and not even a modified version of one. They can be found. c) Side step Amazon's TOS by setting up my own site and incorporating my URL in the product or in the label. This would provide me with direct contact with customers. d) I would never ship direct from supplier to FBA, I would use a private fulfilment service.
  • I would sell B2B on FBA, not join every man and his dog selling B2C. More and more business sellers are using Amazon for the simple reason that an increasing number of businesses are aware that commercial products can be found there.
  • I would avoid hot selling products, and in order to do that I would avoid buying from China.
  • My own site would display offers that customers buying my Amazon product cannot resist. To do so I would think about the motivating factors that led the customer to buy on Amazon.
  • I would follow up with emails to those customers as I build an email list.
Now here is a Caveat: I am not an eCommerce marketer, and not experienced in eCommerce marketing, but I do know something about Amazon and I can sell because I understand marketing psychology, whether B2B or B2C.

If you want truly expert help for your eCommerce project, see the posts by @Black_Dragon43

Walter
 

ZCP

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@Ywan get started. Decide you are going to work a business in that area. Start / buy / partner / grow one. Fully commit to it. Learn / study / do.

Whether it works or not, whether it gets you to your END goal or not ..... you will learn a massive amount about business AND yourself.

What are the first 3 things you need to do to work an FBA business? List them here. Then go do them and report back.
Your answers will appear as you put in the work. You got this!
 
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Amazon is FAR from dead, for 2022 or for any year in the near future. It is by far one of the biggest markeplaces in the world, especially in the USA.

Not to say that it will be easy, or as easy to start as lets say a decade ago, but it is beyond possible.

The execution, value add, pricing, and product itself will need to be ironed out - and even with all that nothing is 'guaranteed' - and as other posters mentioned you will need to go through several products before one takes off.

Make sure to also not base the entirety of your business on Amazon FBA, and if the product can't stand its own outside of Amazon, I would think hard and long on whether you can break into your chosen field on there.

But it's way more then possible!

For some more encouragement - here is the current LIST of businesses for sale (MANY AMAZON FBA) on empire flippers, in various categories. If you browse through the listings you will see that many of them are not that old at all, and bring in SIGNIFICANT revenue! It's out there, and possible. Good luck!

Empire Flippers AMAZON FBA For Sale Businesses
 
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Experienced Amazon seller here. 7 years and over 8 figures in sales on Amazon.

In response to the original question - you seem to overcomplicate things for yourself by trying to test a product on Amazon with the ultimate goal to launch on your own e-commerce site.

If your goal is a successful Shopify store, you don't need a successful Amazon store l first as a prerequisite. Using Amazon for product research is easy by using one of the many software tools for product research. That is unless your product is a new invention that doesn't exist yet, ok m which case Amazon would be a good testing ground. But for any other established product, it's not necessary to launch it in order to do product research. Product research is a pre-launch phase.

Success with Amazon FBA in 2022 is significantly more challenging than it was in 2015, but it still possible and a good opportunity IMO. Some of the increased barriers to entry and challenges now:

- over 90% of Amazon sellers in the US in 2022 are Chinese sellers. This is both a challenge and an opportunity. Chinese sellers tend to compete more on price than diversification and marketing. You need creativity and deep pockets to win in the game in 2022.
- Deep pockets - you need a lot more starting capital in 2022 to succeed at FBA. In the last few years Amazon has shifted more and more resources to their Ads as a revenue source as it became their #1 revenue source in 2017. This means less and less organic real estate on the search page, and for sellers, it means you must invest in a good agency or learn ads yourself and set an advertising budget to succeed. In 2015, all you needed was good product research and an understanding of the platform to succeed. Now you can't succeed without capital to invest in advertising and product launches.
- in 2022 to succeed on Amazon FBA is no different than succeeding in any business. You need to run your Amazon storefront like a real business - you need an understanding of IP, operations, teams, supply chain, etc... It's no longer the simple thing many courses will tell you, as in launch a product and kill it with 1 product. While 1 product may succeed temporarily, to have sustained success in 2022 on Amazon, you need to approach it like running a real business, with all it's challenges.
 

ZCP

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what research and information have you found to support or deny the theory?

in other words, clarify your question. it sounds like you want a step by step or verification to not do anything?
 

Ywan

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@Ywan get started. Decide you are going to work a business in that area. Start / buy / partner / grow one. Fully commit to it. Learn / study / do.

Whether it works or not, whether it gets you to your END goal or not ..... you will learn a massive amount about business AND yourself.

What are the first 3 things you need to do to work an FBA business? List them here. Then go do them and report back.
Your answers will appear as you put in the work. You got this!
Thanks for the answer. I need to keep working on my mindset. Until now, I always discarded a business idea if I couldn't be sure it would work. Because you can never be sure until you try, I've discarded practically everything. But the bottom line is that you always learn, both when you succeed and (or especially) when you fail. So I will just start and focus on the process, not the outcomes. Easier said than done, but I am willing to try.

Here are 3 things I will do:
1. I will create an Amazon Account in Sellercentral.
2. I will decide on a method that I will use to do product research.
3. I will do product research.
 

fastlane_dad

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  • My own site would display offers that customers buying my Amazon product cannot resist. To do so I would think about the motivating factors that led the customer to buy on Amazon.
  • I would follow up with emails to those customers as I build an email list.

This was also a constant battle as we were building up our amazon / shopify business before we sold.

It is ideal to control your customer, own their address, email etc and be able to funnel into that.

But the catch-22 is steering sales and customers away from amazon is worsening the amazon sales rank, and therefore placement and procurement of your product(s) across their site.

It's a double edged sword. It also depends on what your ultimate end goal and values are, and revenue / profit might not always have to be #1.

In the end, we rolled the dice, and ultimately decided to steer the customers to stay on Amazon. We (think) it paid off. But in many ways it could of also been strategic playing it the other way.
 

david1024

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Hello,

I'm thinking of starting a company via Amazon FBA, that is, using Amazon for product research and for testing the products by launching them there. If a product does well via FBA, I would then offer it via other sales channels (that have nothing to do with Amazon), thus gaining more control.

But now I'm wondering if that's even a viable strategy in 2022. Is there too much competition on Amazon to successfully bring products to market and test them?

I appreciate any thoughts on this topic.

Thanks.
It still works. However, no business or business model will be easy to be successful. I have launched 2 products in the last year. One that sells really well, and one that doesn't. Both very well researched before launching. So you will never hit a home run every time.

Here are a few things to consider:

-Funding
-Increase shipping costs and making sure you are profitable
-A course to make sure you understand the whole process
-Being prepared to have a few failed products that will make you lose your money

Selling on Amazon is like selling at a retail store, but with much less headache. As long as you understand things can start off slowly as you learn the process, you can do very good. The main thing is finding profitable products. Remember, you are competing with everyone in the US not just your town. So your competition may be higher, but your sales will be too.
 
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ZCP

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@Ywan put a note in your calendar to tag me here in a week and let's see how you are doing!
 
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I recently sold an Amazon business for 7 figures and I know a lot of Amazon sellers.

It is absolutely possible to succeed at Amazon, but it is way harder than it was, as has been pointed out, competition is high, especially the influx of Chinese sellers.

To put the odds in your favour you need an edge, e.g. you have great marketing skills, you have a great source of products, etc.

In terms of should you start an Amazon business, I think you need to look at your strengths and find the business that is right for you, not the latest fad, or where you think is the most money.

By the way selling on a Shopify store is a completely different set of skills than selling on Amazon.
 
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Greg Black

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Plus, if you are serious about starting don't jump straight into private label, start by sourcing and selling whatever you can get your hands on, learn the process, see if you enjoy it, plus its a good way to get a feel for the market and products ideas.

Someone mentioned getting a course. I would second that, but not some flashy high ticket course, I would recommend starting with the Proven Amazon Course led by Jim Cockrum, the investment in the course is tiny and packed with info to get you started. If then you find you want to go balls deep with private label, then think about investing money in a program with a proven expert.
 

Walter Hay

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Using Amazon for product research is easy by using one of the many software tools for product research.

with good research, you can find products on Amazon that are already selling well.
Both of these quotes suggest getting into a highly competitive market with products that are ordinary, and this requires exceptionally good marketing skills. If someone really wants to sell on Amazon it is far better to source products that have never before been imported to the US.

It can be done if you search away from China.

If you can offer something that is unique, and by that I don't mean a variation on a theme by having an "improvement" made to an existing hot seller, you will have a better chance of being noticed.

Walter
 
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Ing

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I m sure, you can do that. Perfect execution will bring the wanted result.
But its not an easy me too think to success.

Well, I failed at the first steps 2 years ago. Maybe you ll be better.
 

Ywan

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@Ywan
really proud of you!!
nice progress!

so what will be your 3 big outcomes for the coming week?

AND what specifically will you do differently to make SURE you achieve them?

Thank you.

My three big outcomes for this week:
1. I have to review the strategy that I am most drawn to at the moment, because there are a couple of things that I will try in a different way. So I am going to make a step by step plan in order to don't lose the big picture.
2. After doing that, I will start with product research on Amazon.
3. I have to work on my mindset. This is not going to benefit my progress directly, but I already see doubts creeping up again and I have to keep them in check in order to move on. Otherwise there will be a point, where I change ideas and start from scratch - which already happened more times than I like to admit.

What I will do differently: I have to focus more on the business side of things and set them as the priority. Only after finishing, what I wanted to do for the day in terms of business, I will do something else.
This will be a challenge, because the last couple of years I always did the easy things first. They were easy to do and this gave me a quick feeling of accomplishment.
Easy in this context does not mean not important or a wast of time - but often times I just didn't have enough time or, which was more often the case, energy left at the end of the day, to then do the hard things. So by reversing that, it should work out a lot better, because after all, I can do the easy things in the evening, even when I am tired.
I also will try out a system in order to keep track of my priorities and my daily goals. I already had a system once, that worked kind of, so to speak - I will make some adjustments to this system and then check how things work out.

Now let's see how it goes.
 
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ZCP

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@Ywan love it! Amazing update!

Now, what will you accomplish in the next week to start / get going your Amazon FBA business.
I see a lot of talk / discussion / about to get started above. Is there something actionable THIS WEEK that has a tangible OUTCOME to getting the Amazon FBA business producing revenue THIS WEEK?????

Focus on the outcome.
Get it done.
You got this!
 

Redwork

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For those coming behind years from now reading this, if you must have validation from others before you try / start / do, then entrepreneurship may not be for you.

Get started. Learn while doing. Answers appear as you put in the work.
Be ready to pivot. You may not end on the path you begin. That's the journey.
Thanks for saying this. Fear of failure is big but we never think hey we might just succeed. I am paralysed by it. The only way to move forward is to do and try.
 
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This is interesting.

Can you elaborate on that a little bit please? What skills do you need if you have a Shopify store and what skills do you need for Amazon?
Thanks.
To be successful with a shopify store, you have ALOT of different places you can derive traffic. You need a decent product, a decent website and from there on in you just have to figure out a way to drive traffic. This can be in basically unlimited ways.

To be successful on Amazon, your skillset is alot more focused on Amazon itself. You can technically bring traffic to your listing from outside of Amazon, but generally that is a rarer route. Generally, your traffic is from Amazon itself. So your insight about Amazon's advertising platform doesn't translate to Shopify. Your insight on getting good rankings on Amazon's search, doesn't translate to Search engines. etc..
 
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Ywan

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Hello,

I'm thinking of starting a company via Amazon FBA, that is, using Amazon for product research and for testing the products by launching them there. If a product does well via FBA, I would then offer it via other sales channels (that have nothing to do with Amazon), thus gaining more control.

But now I'm wondering if that's even a viable strategy in 2022. Is there too much competition on Amazon to successfully bring products to market and test them?

I appreciate any thoughts on this topic.

Thanks.
 
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Ywan

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what research and information have you found to support or deny the theory?

in other words, clarify your question. it sounds like you want a step by step or verification to not do anything?

Actually, I'm looking for a reason to do it (so to speak).

The thing is, in the last five years I've always jumped from one idea to the next, whenever things got serious.

So I've done a lot of self-reflection in the last few weeks and realized that I've been subconsciously looking for the perfect solution - which, of course, doesn't exist. I've only ever focused on the positive aspects of individual business ideas and as soon as the negative ones came up, I switched to another thing.

I have now understood that only individual aspects of many ideas appealed to me, but that the vast majority of these ideas will not take me where I actually want to go. I have determined that there are currently only two or three realistic paths I can take to get close to my goals. All the other options take me somewhere else.

So now it's a matter of accepting the unpleasant things and enjoying the journey - something I haven't done so far. I've only ever had the destination in mind, which meant I never really got started. After all, the destination was so far away, it seemed impossible to reach.

One of the ways that can get me to where I want to go is e-commerce. Years ago I looked into Amazon as an idea generator and product testing machine, so I asked in order to quickly determine if it's still possible to do that via FBA or if it's too late by now. If so, I would have to try something else in order to get started. (So I haven't done much research yet that supports or denies my theory.)

I hope this gives a little more context to my question.
 
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theguy22

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It's hard to get an objective opinion on this, if someone has a course to sell you or a YouTube channel in the Amazon niche to promote, then they'll say it's not dead.

I personally wouldn't say it's dead, but you definitely won't have the same advantage that you would have had 10-12 years ago at it's early adaption phase. So if you're trying to compare, then yes it's relatively harder now than it was a while back. Does that mean you can't succeed? No, of course not. A lot of people that are trying to get into Amazon FBA are the low-skilled worker types, didn't get good enough grades in school to land a decent paying job, so they're now trying to do Amazon. You're probably a lot better than them so don't worry about the competition. Compete on quality and value.
 

ZCP

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@Ywan
really proud of you!!
nice progress!

so what will be your 3 big outcomes for the coming week?

AND what specifically will you do differently to make SURE you achieve them?
 
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NeoDialectic

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Hello,

I'm thinking of starting a company via Amazon FBA, that is, using Amazon for product research and for testing the products by launching them there. If a product does well via FBA, I would then offer it via other sales channels (that have nothing to do with Amazon), thus gaining more control.

But now I'm wondering if that's even a viable strategy in 2022. Is there too much competition on Amazon to successfully bring products to market and test them?

I appreciate any thoughts on this topic.

Thanks.

Check out my thread here

Amazon FBA is definitely NOT dead
 
D

Deleted2BB3x9

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Amazon FBA isn't dead. Online shopping is growing every year. I started selling on amazon in 2014, then stopped, and now I am starting again in 2022. It's never too late.
 

Two Dog

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Unfortunately, my notes are not in English and there are dozens of pages - so translating would be a lot of work.

But I can tell you some basic strategies underlying the different models. In the end, it just depends on the implementation and there are different implementation options for each strategy, so you can think about it yourself and then test it.
-Sell products from existing brands that are not yet on Amazon but where there is demand.
-Review mining -> what can be improved in products?
-Improve a product that sells regularly but is not a best seller and sell it at the same price or cheaper than everyone else - then repeat this process a hundred times.
-Try to collect data on Amazon (there are different ways to do that) and then use it to find niche products that no one is selling but there is a need for.
Thanks! Even that bit is helpful when you know pretty much zero. It gives me some directions to consider.
 
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Two Dog

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I've been thinking about posting the strategy on the forum to get feedback, because doubts have come up again.
“Everyone has a plan until they get punched in the mouth." ~ Mike Tyson

You'd probably benefit immensely from a different perspective on failing. Failing is mandatory to making progress. It's impossible for anyone - no matter what their previous experience or successes - to lay out a course of action that will always work. Here's the original version with some background: Strategic Planning: Moltke the Elder, Dwight Eisenhower, Winston Churchill, and Just a Little Mike Tyson

In your situation, think about posting something like "Tried AAA this week. It failed. Tried BBB this week. It failed. Tried CCC this week. It failed." A dozen of those posts will get you much further along than doubts or getting feedback on strategy. One of the dumbest things imaginable that school teaches is the idea that perfection is needed for advancement and that failing is reserved solely for dumb losers. That's completely a$$ backwards.

Failing *teaches* you how to be successful. My kids probably hear that in their sleep by now.
 

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Yes i have found this path & just started on it in the last month… I am doing more Online Arbitrage, but when at store I look as well… definitely money to be made out there, just have to put in the time & work to learn… I sent my first FBA shipment in, honestly I don’t think I will make much, will be happy to get most of my initial investment back.. but I wanted to see the whole process through… I sent in June 14 & it looks like it will take until July 12, for things to get to & receiving & processing items… again I did a small shipment but wanted to get going.. just START that is the biggest thing… no right or wrong, just learn from whatever you do. GOD Luck to you ALL! :cool:

Glad to hear you decided to go for it and it's working out so far! I like the idea of Online Arbitrage a lot more than Retail since I live in a really congested area. For me its hardly worth the time traveling to the stores to hunt down deals, but occasionally you can find some strong items.

With so many different extensions and tools to use for RA/OA its surprisingly "easy" to get up and running. It's all about casting that wide net and actively researching potential winners. (But I dislike that this model doesn't give us any control and we're 100% at the mercy of Amazon. The earlier you set yourself up to withstand any sudden changes, the better)

I hope you find continued success with your store!
 

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Hello, I'm thinking of starting a company via Amazon FBA, that is, using Amazon for product research and for testing the products by launching them there. If a product does well via FBA, I would then offer it via other sales channels (that have nothing to do with Amazon), thus gaining more control. But now I'm wondering if that's even a viable strategy in 2022. Is there too much competition on Amazon to successfully bring products to market and test them? I appreciate any thoughts on this topic. Thanks.
 

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