There are many people who are jumping on board the Amazon bandwagon in the hopes of striking gold. After all, this opportunity has impressive upsides.
But there are certain things that you need backing you, long before getting started.
Not only will you need a strong and compelling reason to start this journey,
Then there is the biggest hurdle. The one that stops many people finding success.
That is money. Cold hard cash.
Touchy subject. You need money to start any business. Launching an online business is no different.
Today I’ll explain why selling on Amazon can’t be your gig (for now) but I’ll also highlight what you can do about it.
The hidden expenses
You’ll be coming across a range of expenses in the journey. Most Amazon gurus will hide this information, in order to sell their course. Only for you to find out later.
But I’m upfront. This post is public. Feel free to share it around. After all, some people are caught in the euphoria of Amazon courses, without seeing the reality.
Your expenses include:
- The initial investment into your inventory (your biggest capital outlay)
- Freight for getting your goods to Amazon’s front door, via air or sea
- Tools such as JungleScout to find the right niche and product to sell online
- Custom packaging if you intend to sell a more expensive/unique product
- Samples to assess quality before you place that first inventory order
- Amazons fees which include pro seller account, PPC, FBA and processing
- US Customs will charge you fees too, and guess what? They just raised it!
- Accountants will charge for advice plus setup of a new business structure
- Trademarks and patents are highly advised, and also very expensive too
- Finally, some of your products will be returned by customers. Ouch!
Suddenly selling on Amazon doesn’t sound that whizzbang fantastic, does it?
But wait, there’s more!
We haven’t even started our first Canton Fair experience yet. Here’s what you’ll have to expense for:
- There is the cost of flying to China ($700 economy to $4k on business class)
- Then the accommodation charges (Hotels jack up prices for the Canton Fair)
- Plus taxis and food for the few days (Watch for the dodgy and fake taxis!)
- …and the Visa itself is around $100! (Plus takes a lot of frustration to get….)
Amazon businesses are a bit like boats. You’ll constantly be pouring money in, long before seeing those rewards you were promised in webinars.
But those rewards do eventually come.
See – I sell on Amazon everyday. I went through the hard yards. There are some seriously impressive rewards here. But only for those who work + have some money.
Now, I had both qualities when starting. In fact, I started Amazon in the deepest and darkest period of my life. I made this work for me.
Finding the money for Amazon
If you’re starting, and you’ve got very limited money, then it’s not advisable that you even consider Amazon or a course. At least, not for now.
As you can see from the expense list I provided, you just won’t make progress with limited funds.
But what can you do in the interim? Well, by no means is this financial advice. But what I can say is: Hustle.
I live in Australia, and we don’t like being told that we need to work harder. This is, however, what it’s likely going to take.
Some ideas include:
- Getting an additional job to save up some extra starting money
- Selling your unwanted things online or via Gumtree (I did this)
- Seek to move into a higher paying job if possible (also did this)
- Reduce your expenses and income reducers (Foxtel, anyone?)
- Use Uber, Airbnb or Airtasker to build up that capital base
- Consider working for an existing Amazon seller
part time
Expect 6 to 12 months of solid savings in order to attain some working capital. If you have credit card debt, then I would recommend paying this off first with said capital, as opposed to investing this into an Amazon business.
The truth about Amazon
What to know what it really takes? Ignore those who are saying you can get started with hundreds. Couldn’t be more further from the truth.
You’ll need $5,000 MINIMUM. $10,000 is ideal. This is above the course of your education.
Remember – there are plenty of expenses. It’s not just your inventory but many more as I’ve outlined here.
As I said, a bit like a boat. Keep pouring that money in… 😔
In summary
Amazon isn’t for the person who’s broke. Neither is it for the person who’s cheap. Certainly, it isn’t for the person who thinks they will make a million dollars by next year.
Please have realistic expectations. This business opportunity isn’t perfect either.
In fact, many beginners make mistakes. I know I certainly did in my early days. It’s all apart of the process.
An online empire takes years to come to fruition. So many courses are selling quick riches and success; simply capitalizing on people’s dreams.
Amazon is the #1 opportunity right now. Yet it takes money. If you don’t have it, then go work for it. Then really consider if this is right for you because 80% of people just don’t have the qualities to get them through the tough times.
I know – I’ve seen it. But if you’ve got what it takes, there is some serious potential here.
