What is Amazon Private Label | How to start


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Amazon features different business model options for sellers to choose from. If you want to increase your online profits and grow your business, you should consider selling private label products on Amazon. The idea of private labeling products is gaining immense momentum nowadays. 

The concept is quite straightforward. You sell your inventory and use your packaging, but the products you’re selling are made by a third party. Private labeling isn’t a new phenomenon. Since the mid-19th-century, sellers have been creating private label items. The interesting thing about private labeling is that you get a great product to sell and you don’t have to deal with all the problems related to production, etc.  

In this article, we’ll tell you about Amazon Private Label, the pros and cons of Amazon Private Label, and how to set up a private label to make it work in your favor.

Why Amazon?

Amazon is the world’s leading E-commerce website where the number of customers is greater than eBay. If you want customers to buy your products, Amazon is where you should sell them. A key benefit of the platform is that Amazon offers very affordable warehousing, distribution, and delivery, which means you can focus more on growing your brand instead of handling day-to-day logistics.


What is Amazon Private Label?

Private labeling means researching and sourcing a product that is in demand and already being manufactured in its unbranded state. 

In simple words, Amazon Private Label is to sell the products of your choosing, under your own private label on Amazon. After choosing a product, you contact the product manufacturers and they produce the product for you in a bulk quantity under your brand name and ship the product. Once this is done, you can sell it on Amazon. 

What is the concept behind Amazon Private Label Products?

Private label products are simple products that are created by the company and then sold by another company. One of the most profitable ways to do this is to sell your private label products using Amazon FBA. From electronics to cosmetics, clothing to food, you can benefit from creating and selling your own private label products via Amazon FBA.

How to Set Up Private Label

Now that we have discussed what Amazon private label is, let us provide you with a quick breakdown of how to start your own Private Label Product with a small initial investment.

Research to Identify the Right Product

Find a product that you think will benefit you if you private label it. Research and brainstorm numerous product types that seem interesting to you. Start with a broader list that you can slowly narrow down to cover all points.

Be sure to take the existing or potential demand into consideration, including any sales fluctuations or seasonality. Also, ask yourself if you will be able to create frequent demand. You can perform research on social media to discover market trends. 

Partner with an Experienced Supplier or Manufacturer

Your manufacturers play an important role in the success of your private-labeled items. While cost is a key consideration while finding the right manufacturer, it cannot be the only factor. If sourcing from overseas, you should take labor and material costs, as well as currency variation into consideration when weighing your options. 

Build a Solid Brand Logo, Product Packaging & Overall Identity

Investing sufficiently in product quality design, packaging and branding will allow you to have a seamless brand presence in the digital marketplace. These fundamentals can help boost brand awareness, customer engagement, and social proof. You can set your brand apart from the competition with a persuasive value proposition. 

Request Product Samples for Quality Control

After you have created your product, be sure to ask your supplier for samples so you can make sure the quality and other characteristics are exactly what you are looking for, before you go to market. Share the prototypes and packaging with various groups of people, including prospective buyers, to garner any feedback that should be addressed before placing your initial bulk order.

Decide on your Amazon Fulfilment Strategy

Before you decide if you will fulfill your Amazon orders via a merchant-fulfilled operation or through fulfillment by Amazon, you need to understand which products have proven success with each method. 

Fulfilled by Merchant:

Amazon “Fulfilled by Merchant” is a fulfillment method in which an Amazon seller is responsible for fulfilling their products purchased on Amazon. FBM can be managed by the seller or by partnering with a third-party logistics service provider.

Fulfillment by Amazon:

With Fulfillment by Amazon (FBA), you store your products in Amazon fulfillment centers, and then it is Amazon that takes care of picking, packing, shipping, and providing customer service for these products. FBA can help you scale your business and reach more customers.

Create your Amazon listing:

Manufacturers require almost 3-4 weeks to make a product, and another 1-2 weeks to ship it to the retailer or the nearest Amazon fulfillment center. When creating an Amazon listing, there are a few points that one needs to be aware of:

  1. Firstly, when you are creating an Amazon listing, make sure you have everything ready to publish and launch in advance.
  2. Secondly, great product photos are necessary. And unless you have some serious photography skills, you need to hire a professional, because it is one of the most important elements of your Amazon Private Label product listing.
  3. Lastly, integrate your products’ strongest features and benefits in the description field of products as bullet points. This content helps customers in making a purchase decision when they click through to your page.
Optimize Your Listing to Boost Sales.

Amazon product listing optimization is the process of optimizing your lists to increase traffic and conversions. Optimizing this listing also ensures consistency across branding, reviews, messages, and ratings. Moreover, this act boosts your visibility on Amazon’s search engine results page.

With Amazon PPC, you can run sponsored ads, which help your products appear on the first page of search results, and in your competitors’ product pages. When you completely understand the Amazon PPC and the Amazon sales process, you can use other tools to run tests on the productivity of various elements of your Amazon FBA private label product listing. When split testing, you run two parallel tests featuring small changes to your product listing (e.g., main image, price, etc.). Automated software allows you to see what works and what doesn’t.

Pros of Amazon Private Label:

  • Brand Restrictions are less severe – The Amazon Brand Registry is a requirement for creating a private label. Sellers are given the ability to monitor their inventory via the service, while controlling their brand. 
  • Visibility – You’ll have the opportunity to create a distinct persona and brand that buyers will associate with your company. Users will return for more if you provide them with quality offerings.
  • Competition is less intense – Your business will stand out from the crowd more easily. Sellers won’t try to undercut your listings.
  • Amazon listings for Private Label businesses may include A+ Content. This implies that you may add multimedia material to your listings. Consequently, A+ Content provides you a chance to improve your search engine rankings and enhance consumer satisfaction.

Tips and Tricks

We’ve discussed all the basic steps you need to take in order to start selling private label products on Amazon, as well as the perks of Amazon private label. Here are a few tips and tricks that will help you get started with your private label journey on Amazon very swiftly.

  • Designing a Logo and Packaging: 

You’ll need to come up with your own branding and packaging if you want to sell your own private label product. But if you don’t know how to do this yourself, you can hire a designer from different sites like Upwork, Fiverr, etc. 

  • Your product should be easy to transport: 

Make sure your product fits into a small, flat-rate box. This will help you save on shipping from the manufacturer and during the fulfillment process.

  • Patents: 

If your product is exclusively unique, it may be appropriate for a patent. By filing a patent, you can prevent other sellers or another company from copying your design.

  • Avoid seasonal products. 

Seasonal products are not the best choice for Amazon Private Label if you want to have year-round sales. Some examples are Christmas products, any holiday products, winter clothing, etc.

Conclusion

Private labels are not a short-term money-making venture. You’ve got to be in it for the long haul. If you’re doing it right, you have the potential to become your own boss and create an e-commerce empire. Private label products need research, effort, time, screening, but if you maintain control throughout the process, you will be able to generate incremental revenue on Amazon. 

You need to build your Amazon private label business in such a way that customers remain loyal to your brand. There’s no special training required other than being extremely patient, conducting thorough research, and making sure your product combines the best of what’s proven to have worked in the market historically.

If you have any comments, queries, or suggestions regarding this article, please state them in the comments section below. 

Thanks for reading.

author

Steve Smith is a entrepreneur and Experienced in making money online with a demonstrated history of working in freelancing field.

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