A Simple Guide for Picking Your First FBA Private Label Product

You don’t have to hit a homerun. You just have to take a swing.

How’s that for sports metaphors? I could go on, but I’ll stop while I’m ahead. The point is: Don’t worry about trying to find the golden goose for your first private label product. Just pick something that looks profitable and won’t break the bank while you test it out.

So how do you do that? All I can do is tell you what I did. Maybe it will work for you, too. Or maybe you have another method that you prefer (if so, let me know in the comments!).

Focus on Products You’re Familiar With

Before you pull the trigger on a huge order, you’re going to have to get product samples from the manufacturers. I don’t think anyone would recommend selling something that you haven’t tested for yourself. You need to be able to vouch for it.

I can honestly say I know absolutely nothing about knitting. So as shocking as this may sound, I don’t think I would start out by trying to sell knitting needles. I couldn’t tell you the difference between knitting needles and chopsticks. And furthermore, I’m not even interested in knitting. You’re going to have to write engaging sales copy for a listing at some point, so pick a product that you know a little something about.

So when you start your product research, focus on areas and products that you use or are familiar with. When you get your samples in from the manufacturer, you’ll actually be able to inspect and test them. You’ll be able to tell if the quality is good and if it functions like it’s supposed to.

Plus it just makes everything a little more entertaining. You’ll probably be more interested in selling something you actually use.

Pick a Product that is Small and Light

Why? Small and light = cheaper and easier to ship.

The lighter your product is, the cheaper the shipping charges will be. And the smaller it is, the less shelf space it takes up in the warehouse. These things all equate to lower FBA fees from Amazon. If you start getting into large, heavy objects, then you’re going to get dinged on the weight handling and warehouse storage fees.

Personally, I went with items that could fit in a USPS mailbox. My items weighed less than 1 lb. and could fit in a box the size of a CD (that’s a compact disc for you young people).

Pick a Product that has Profit Potential

This goes along with the previous section. While you’re looking at “small and light,” make sure you’re looking at products that look profitable.

Sometimes small and light can also mean “too cheap.” No matter how you look at it, you’re looking at a minimum of almost $4 in FBA fees (regardless of the product). For instance, if you were selling dog tags for $7.99, you’re total fees to Amazon would be $3.76. That’s nearly 50%.

My advice is not to start with something with margins that are too tight. The lower FBA fees are good, but aim for something that also sells for at least $15 or so. That way you have a lot more room for error.

Low Minimum Order Requirements

So now you’ve looked into private label products that you know something about. The price point is good and the FBA fees are low. At this point, you can do all the analysis in the world. And you can try to project how everything is going to work out. But the truth is, you aren’t going to know for sure until you start selling!

And for that reason, you want to make sure you don’t have to order 1,000,000 widgets to start with. There’s no sense in ordering anything but a minimum quantity of product. Because you don’t know for sure how well it will sell. The market may look good on Amazon. There may be a few other sellers with a good number of reviews. And they may look like they’re selling a few hundred (or thousand) per month.

But this is the point where the analysis ends and the “doing” begins.

So to answer your immediate questions: Yes, you’re unit pricing is going to be higher. Yes, that’s going to eat into your profit margin. But so what? All you want to do is make sure that there is a real market for what you’re trying to sell. I don’t know about you, but I’d much rather risk $500 on an order of 100 widgets versus $5,000 on an order of 2,000. That lower risk is a little more manageable. If the product doesn’t sell or the market turns out to be different than you thought, then you aren’t completely out of the game. (Shoot. Another sports metaphor.).

When you get into the details and start trying to scale up your business, there’s a lot more involved. This is just a very basic method that I used to decide on my first two private label products. You may be a little more risk-averse, and that’s fine. But at some point you just have to do it. You have to get out there and see what works. You’ll have time to fine-tune things as your product starts selling. And just like anything else, you’ll get better at analyzing products with time.

I’m still completely new to this myself, so I can sympathize. I’m still in the process of testing and tweaking – for both my products and my methods. But it definitely makes it easier when I follow these simple steps I’ve laid out.

Pick a product you know something about. Keep it small and light, but make sure there’s some margin in the numbers. And finally, start small! Test everything and make adjustments along the way.

Most importantly: Just do something!

Brandon