Anyone with a product to sell could put it on Amazon and make a buck in the early days. There weren’t as many rules, and the costs were affordable for many people. FBA is an entirely different experience, especially for new sellers in 2022; the market is overcrowded with private labels or scammers looking to make a quick buck. The expectations of Prime customers have only grown, as have shipping charges, fulfillment fees, and other costs associated with running an Amazon FBA business.

After reading all that, you may be ready to walk away, but don’t be too hasty: if you know what to expect and make the smart choices, you could run a profitable Amazon business despite the competition.

Is Amazon FBA Still Going To Be Profitable in 2022?

Although the competition is fierce and you’ll have to put in extra effort, the window of opportunity is still open. The rules of creating a successful Amazon business haven’t changed much; to be a good seller, you still need strategy and a plan.

Years ago, you could sell anything on Amazon quickly and profitably. Now, you must choose less competitive products and use marketing methods like strong product photography to get them to page one of the search results.

Types of Amazon FBA Businesses

You can sell on Amazon FBA in three major ways:

• Private label: Private label sellers develop their own brand on Amazon. They design a shop, product listings, social media profiles, etc. After researching the market, private labelers pick the items they want to sell and contact domestic or overseas manufacturers to provide their items in bulk.
• Wholesale: Wholesale sellers buy branded items without building a private label. Instead, they acquire products from producers in bulk and offer them for sale at a higher cost than the per-item fee they paid the producer.
• Retail arbitrage: You don’t need to build a unique private label because you’re reselling other brands’ products in retail arbitrage. It involves buying inexpensive items at retail outlets and then reselling them for a healthy profit margin.

Starting With Amazon FBA in 2022

After weighing the oversaturation and your online competition, if you still decide to pursue the Amazon FBA dream in 2022, here are four strategic tips to get you started.

Validate Your Product Listing

Some badges give an instant visibility increase, and you’ll want to earn one of these to receive more traffic, and ultimately, conversions. The two most prominent badges are “Amazon’s Choice” and “Best Seller.”

Utilize Amazon Marketing Services (AMS)

From Attribution, Demand Side Platform (DSP), and Posts to Sponsored Brands, Products and Display, AMS’s choices for marketing are highly diversified. If you’re fresh to promoting on Amazon, get started with Sponsored Products.

Save on Shipping Costs

Take advantage of Amazon FBA’s shipping programs and save on monthly storage fees. Here are some examples:

• Small and Light
• Subscribe and Save
• FBA Pan-EU
• FBA Export
• Frustration-Free Packaging
• Multichannel Fulfillment

Acquire the Buy Box

Become a top-notch seller and obtain the Buy Box. This is the most significant advantage of Amazon FBA.

The Difference Between Amazon FBA and FBM

Several sellers with Professional seller accounts employ the different fulfillment options simultaneously. Fulfillment by Merchant (FBM) and FBA provide unique benefits. Here’s a breakdown of both.

FBM

• Sellers are entirely in control of the customer experience.
• Amazon’s fees depend on size and weight, so FBM costs less for bigger items.
• FBM sellers can access lower shipping cost providers if they do enough market research.

FBA

• Customer service and shipping are Amazon’s responsibilities.
• Better fit when items are small, low-cost, and shipping might reduce margins.
• You get more time to grow your brand as Amazon takes care of shipping for you.