$160 billion was generated last year on Amazon by third party sellers like you
and me.
Stay tuned and let me tell you the seven reasons why you should be selling on
Amazon too.
[inaudible]
What's going on fam. Justin Houser here,
and welcome to my channel where my purpose is to help others unleash their
fullest potential through financial education, investing,
and entrepreneurship. So if you're new to the channel, consider subscribing.
And if you're here again, thank you. So let's just get it over with right now.
Let's go ahead and help that youtube algorithm hit the like button and subscribe
if you haven't. And if you stay till the end,
I will show you my personal Amazon selling central account to where you can see
hands on in real time exactly how much I have made.
So let's get into the top seven benefit on why you should be selling on Amazon
too. So I'm assuming that you already know a little bit about Amazon,
at least on the buying side of things, cause I don't know about you,
but I'll tell you one thing. I'm definitely an Amazon alcoholic and yes,
that is a word.
First thing I need you to understand is that Amazon is not the only company that
is selling on its platform. Benefit number one, revenue king of this graph.
You can see that Amazon only makes up about 42% of its overall sales.
Third Party sellers like you and I have produced over 58% and is growing every
year by about 2% so what does that equate to?
$160 billion in sales in 2018 compared to only a hundred million dollars 20
short years ago.
Currently there are over 5 million marketplace sellers on Amazon,
yet only 20% actually have products on sale via Amazon.
Currently in America,
there are about 1.7 million sellers that are selling on Amazon.com the 20% also
correlates, so again, if you run the numbers,
that's only about 340,000 people that that doesn't even equate to if they're
actually selling their product(s). In 2018 alone,
over 200,000 people have crossed the a hundred thousand dollars in sales per
year mark.
And 25,000 people have crossed a $1 million per year in sales.
Before we go any further,
I really need you to understand when $1 million in sales is not $1 million in
your pocket, people do have small overhead with Amazon.
One thing that separates my youtube channel from other people's that I will be
completely transparent with,
stay to the end and I'll show you the exact numbers. Benefit number two,
small overhead and various small startup costs.
Take a look at the cost of starting a McDonald's, a Panera bread and Applebee's.
Looked down there at the bottom of the estimated total $1.6 million for
McDonald's,
$2.3 million for a Panera bread and $4.5 million dollars to start an Applebee's.
When I started Amazon two short years ago, I started with $500.
That is what did I use as $500 for?
I use this $500 to buy all my inventory, start my professional selling plan,
and also buy the equipment that I needed to actually start my Amazon business.
When I started buying inventory, my tactic was to buy books and yes,
use the books as a huge market on Amazon. Pretty cool fact is,
is that Amazon actually started as a used bookstore? So,
I would pay on average between $0.50 To $1.00 for a used book.
Then I would sell it back on Amazon for 15 to $20. Yes,
there's some fees outside of that, but you cannot beat that return;
50 cents to probably profit about $9 to $10 on each book.
So you're telling me that I can buy a product for $1, sell it for $10 on Amazon.
Never have to deal with customer service, marketing, sales, buying a building,
anything like that.
Yes, yes, yes. Come to papa.
Once I made some money selling used books, I then moved to used textbooks.
Used textbooks is a huge market on Amazon. It actually has two seasons,
one in the fall semester and one in the spring semester. What I would do,
I would actually go buy used textbooks in the off season for 10 to $15 and then
in the peak seasons I would then resell that same textbook for $100 to $150.
Then once I started making money selling use textbooks, I then moved to toys,
electronics, household goods. Benefit number three, customer base.
I'm not going to beat a dead horse here,
but I think we all know how popular Amazon is.
Just take a look at this graph right here.
You can actually see the growth of Amazon just the past six years.
This graph is showing the number of prime members and as you can see,
five and a half short years ago, we had 25 million prime members.
Now there's over 103 million prime members. Why is this important?
I'll tell you why. It's the average that a customer spends per year.
Prime members actually spend $1,300 per year on average versus a non prime
customer that'll spend $700 per year.
CNBC reported that over 60% of American households actually begin their online
searching through Amazon.
This is beating huge giants such as Google and Yahoo and Ebay.
What's even more crazy is that 9 out of every 10 Americans will price match a
purchase with Amazon. Benefit number four, infrastructure The
biggest expense for a company comes down to marketing.
Amazon is already established enough where they don't need your help as well.
There's no website needed,
no funnels that you have to make to drive traffic to Amazon,
and no physical location. Fifth benefit, no customer service.
[inaudible].
What I mean by no customer service,
there's actually two methods of how you can start selling on Amazon.
Number one is merchant fulfilled and number two is FBA, or fulfilled by Amazon.
So what is merchant fulfilled and what is Fulfilled by Amazon.
Merchant fulfilled is where you will handle all the customer service,
you store your products, you send it out to the customers,
you deal with returns, refunds,
etc. I personally use what's called FBA or fulfilled by Amazon.
So why do I use Fulfilled by Amazon and not merchant fulfilled?
Just like the previous benefit said, No Customer Service. What
you do as a seller with FBA is that you buy your products,
you send it to one of the Amazon warehouses and that's it.
You never have to touch the product again.
You don't have to ship it out to customers.
You don't have deal with customer service, no refund, no returns, nothing.
Amazon will actually handle all of that for you. Benefit number six,
great backend support for sellers.
They have dedicated professionals whose knowledge is strictly for sellers
available 24 seven via chat, via email,
and you can also request a phone call which they'll actually call you within
seconds to help you out with an account.
There is also a huge database of Q and A's and forums and benefit.
Number seven, ease of business. Please don't get me wrong.
Amazon is a lot of work, but compared to traditional companies,
there's marketing, there's employees, there's health plans.
All I want to deal with right now is finding the right product and getting it
out to Amazon. Personally,
I do this part time and my full time job is an IT in the United States Navy.
Doing this part time is a huge reason that I started this in the first place and
I'm still doing this two years later.
This business is really unique in that you can live your normal life.
You can go to target, you can go to Walmart,
you can go to a different clothing stores and all you do is bring yourself all
scan something and you can send it into Amazon.
I actually like to bring my family out and they've all learned how to do Amazon
as well, so they also like to scan for products. So just like I promised,
since you stay to the end,
let's jump right into my screen so I can show you exactly how much I've made
these past two years. All right,
so let's jump on in here to Amazon seller central.
I'm going to go to reports, business reports.
Then I'm going to go down to the date. I'm going to custom.
I'm going to go all the way back to when I first started,
which was August 9th,
2017 and we're going to leave this here for August 9th,
2019 which is the day of filming. Click apply
and as you can see right here, 2,665 items ordered. All right,
and as you can see right here,
ordered product sells $87,446.30 With a total of 2,815 units ordered with an
average sale price of $32.81.
One of the things I really want you to understand is that this was done part
time. So what I do, I work on Amazon for only Q4.
So this is usually in between November to January of every year.
You can see these two big spikes. This is when we get the majority of ourselves.
And like I said, the reason is is because I have a full time job.
Out of those three months, how much do I actually work on Amazon?
On average, it's about 10 to 20 hours per week,
which is only about two hours of shopping,
and then the other is going to be research on what I should price the product
for prepping the product, dropping it down at ups, and that's it.
One more thing to keep note is,
is that out of my $87,358 my net profit is right around 40% so what does that
mean? I have taken home in the past two years,
right at $35,000 in my pocket after everything has been paid for.
This is including the inventory, shipping costs,
supply costs total $35,000 now,
what's even cooler is that if you get down to the numbers,
$35,000 divided by six months,
let's to right around $5,800 per month on average.
Now weekly, that is going to be $1,458 per week. Then out of the week,
I said I work on average 10 to 20 hours a week.
Average pay per hour is $97 and 22 cents on an average 15 hours a week working.
So I hope you found this video valuable, and if you did smash that like button,
so now it's time for the question of the day.
What is your goal in cells for the first year?
Please share your answer down in the comments below as I would love to go and
connect with you and be on the lookout for some upcoming videos of how you can
set up your seller central account and start making money on Amazon.
Thank you again for being part of the community and I'll see you on the next
video.
[inaudible].