When it comes to selling direct to consumers online, no other marketplaces come close to the scope and reach of Amazon or eBay. They are both e-commerce giants, and dominate the online shopping space.
Ready for some amazing numbers?
Amazon sold over $130 billion worth of products to 300 million people in 2016. Not to mention, 80% of US Amazon customers purchased at least once a month. Close to 80% of Amazon sellers use “Fulfilled by Amazon,” that’s something we’ll discuss in more detail below.
Many of Amazon’s third-party sellers (that’s people like you) do well — over a third of them sell over $100,000 of products through Amazon a year, with 15% having revenues of over $1,000,000! It’s time for you to get a slice of that pie.
With Amazon, you can sell around the world. They give you access to the US, Canada, Mexico, the UK, France, Germany, Italy, Spain, Japan, China, and India.
As a third-party seller, there are two main ways you can sell on Amazon. Both ways include listing products on Amazon.
We recommend FBA, because arranging for your own warehousing, distribution, admin, customer service, and logistics can get expensive. Amazon’s FBA fees are reasonable, and give you much greater visibility into your costs.
eBay is another online giant. eBay started as an auction marketplace, it now provides millions of products direct to consumers on a “buy it now” basis with a fixed price. Similar to Amazon, eBay allows third-party sellers to sell through auction listings, buy it now listings, or online shops.
Countries where eBay operates:
US, Canada, Argentina, Brazil, Mexico, Australia, Japan, China, Korea, Hong Kong, Malaysia, India, Singapore, Taiwan, Belgium, Ireland, Russia, Czech Republic, Spain, Denmark, Israel, Sweden, France, Italy, Switzerland, Germany, Luxembourg, Turkey, Netherlands, Norway, Poland and UK.
There are a few requirements for selling on eBay.
First, you must have an active eBay account, in good standing, linked to a verified PayPal account, with at least 10 feedback points. You must also meet the selling requirements for any eBay websites and marketplaces you want your listing to appear on.
Fees for selling on eBay come in three flavors:
An insertion fee cost to list the item of $0.30 — this doesn’t apply to the first 50 items you list in a month.
When the item sells you will pay 10% of the final value (including shipping) to eBay as a fee.
Finally, if you list internationally you will be charged an additional $0.10 – $0.50 per item.
This is the million-dollar question — what exactly should you sell? DHgate gives you access to over 40 million wholesale products to sell on Amazon and eBay, so how do you find the perfect ones for your customers? Fortunately, it’s not as hard as it seems — it’s just going to need some work, and some research.
Before you start selecting, sourcing, and buying products, you must first prove that the product will sell. You don’t want a warehouse full of 15,000 blue widgets, when the current season’s trend is for green ones.
Start by researching the existing market for the niche and products you want to go into.
For Amazon, useful tools include:
On eBay, you can use:
We can’t stress this enough — of all the tasks you’re going to do for your e-commerce business, this is one of the most important, by far.
Getting your market research wrong can be very costly. Make sure you put plenty of time into researching the products that sell.
Make a spreadsheet of how many other sellers are offering these or similar products (they’re your competitors). Record their sales ranking, pricing, and any other information you can gather.
By the end of this phase you should have an idea of the niches you can sell in, and a shortlist of a few products you can research. We recommend coming away from this step with around 2 – 4 niches and around 10 – 25 product ideas.
Next, you’ll want to take a trip to DHgate to start researching the products. Make note of who supplies them, what they will cost, how many you need to order, and how to ship them.
Search through your products one by one and note down all the key data. DHgate provides transparent information on pricing, shipping costs, quantities, and more.
Take all that information and work out what the cost of each item is going to be (more on that below). Then, look at how much your competitors are charging and work out a competitive price point.
Once you know the cost and the price you will charge, you can work out how much profit, and the margin you will make on each item. This will help you to prioritize what items you should invest most heavily in.
Finally, you will want to validate these items in the marketplace.
That means testing if people will commit to spending real money on the products you have chosen. Source one unit of the items you like and have samples shipped so you can check the quality.
After that, list them for sale through eBay or Amazon to see if the item will actually sell in the marketplace. If it doesn’t work, rinse and repeat.
Amazon and eBay customers make decisions based on price and value-for-money. That means you need to set your price points perfectly. You must strike a balance between:
Here’s how to work that out.
The cost per item isn’t just what you pay to buy it and have it shipped. It includes all the costs your business incurs. This includes:
Here are the main areas where you’re going to incur costs as a business owner.
These are the basic costs for each item. But, you will also need to add on costs incurred by your business as a whole. To do that, add up the costs across all your business operations, for a month, then divide that by the number of items you are going to sell that month. That gives you a true cost per item.
Your business operations costs include:
Now you know your costs, it’s time to look at how much other sellers are pricing their items for. Review their pricing strategies, and see if you can work out their profit margins. Although their business costs are not not the same as yours, you can get an idea on how much they make on each product.
Next, look at any unique selling points you have, and your value proposition. This can help you set a fair selling price for the item. Remember, it’s not just about being the least expensive. If there are other compelling reasons to buy from you that can affect the price you charge.
Phew! Now you’ve put all that together, it’s time to work out your overall profit margin. That’s the amount of money you will have left over to reinvest into your business and grow it over time. You want to set this at a reasonable level.
Assuming you’re successful, you will use this extra money for marketing, sourcing new products, and growing your business.
Here at DHgate, we want to see you succeed. That starts by providing you with a safe, secure, and easy way to find, source, and pay for the products you will build your business on. But, it doesn’t end there.
Here are some of the benefits you’ll see through using DHgate to manage all your Chinese product and supply needs.
DHgate is the biggest B2B transactional, international, e-commerce marketplace in China. We provide international logistics, cross-border payments, internet financing, and online marketing.
We give you access to 1.7 million sellers, offering 7.7 million products, and serving 14 million buyers from 222 countries and regions.
What does that mean for you?
In short, we’re here to make buying wholesale a pleasure, and to answer the question “How do I find the perfect wholesale products to sell on Amazon and eBay?” We want to help your business thrive.
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