How to Decide What to Sell on Amazon

Figuring out what to sell on Amazon is one of the biggest challenges sellers face. What if you buy 100 copies of a product for too high a price, and can’t sell them at a profit? Or worse, what if nobody wants to buy them at all and you lose your entire investment?

We recently covered the process of figuring out what to sell on eBay, and decided it would only be fair if we did the same thing for Amazon. Here’s how to avoid getting burned when selecting your inventory.

As we did in that article, we’ll start out with . . .

What to Avoid Selling on Amazon

I could spend a lot of time going into specifics, but there’s really just one thing you need to know to avoid: anything with a low profit margin.

As we discussed in our beginner’s guide to selling on Amazon, Amazon generally takes one-third of the final value of your product in fees. That means you can’t go buying something for $20 when you’re only going to sell it for $30—Amazon’s going to end up charging you about $10, which means you just made a whopping nothing. Your time would have been better spent playing video games.

Never buy anything for more than half of what you plan to sell it for on Amazon. Whenever possible, aim to buy for a third of the price you’ll sell for or less.

This instantly rules out a lot of products. You generally can’t sell new, big-brand stuff. You need to look low and buy used or unwanted goods, or look far, to large-scale exporters overseas.

This doesn’t mean sell crap. It means you need to find quality goods for low prices. For a detailed guide on how to do that, see the “Find a Great Supplier” section in “How to Make Money Selling on Amazon.”

Go read that first. In fact, read the whole article—the other parts are important too! When you're done, come back to find out . . .

How to Figure Out What to Sell

There’s a common misconception that certain items are always good choices for new Amazon sellers. That isn’t true—just about any specific item worth selling now will eventually get discovered, and competition will move in. In the end, it will be left in the hands of the sellers who noticed it early and worked out good deals with suppliers.

So, how does one find the things that are worth selling right now?

Finding Profitable Products for Free

With a little know-how, you can manually search Amazon for profitable products. We provide step-by-step instructions for doing this here. (Hopefully you read that already!) It’s a time-consuming process, but you will find something worth selling if you stick to it.

One thing I’d like to add to the guidelines in that article: look for things that are already selling. You want to avoid competition that’s so fierce that you can’t compete on price, but you also want to make sure that somebody’s actually buying this product. A couple of other sellers won’t stop you from making money if you price competitively.

How can you tell if something’s selling? The fastest and easiest way is by looking at the number of reviews. Only a tiny portion of customers bother to rate a product that they’ve used, so if you see that a product has 20 reviews, then it’s probably had several hundred buyers.

Items that have no reviews might not sell at all. On the other hand, if a single seller’s listing has thousands, then they’re probably impossible to compete with. Look for moderate numbers of reviews to find profitable products without overwhelming competition.

Finding Stuff to Sell the Fast Way

If the free way of finding products takes too long, you can try out Terapeak. This respected research tool can help you find profitable products much faster.

Selling What You Know and Knowing What You Sell

Before ChannelReply took off, we had a successful business selling car parts on Amazon. Why? Because we knew the market.

When you know a lot about a specific kind of product like car parts—a “niche”—you can see opportunities where other people can’t. You learn what the going rates are and how to recognize a good deal immediately.

Even better, you start building connections in your industry. When you buy massive quantities of similar products from the same wholesaler, you can often negotiate a rock-bottom price. You may even start purchasing in such high volumes that you can buy directly from the manufacturer for even less.

Finally, you can get repeat buyers after a while. This ensures ongoing profits and could set you up for success selling on your own website.

We cover more great reasons to start selling in a niche in “How to Figure Out What to Sell on eBay.” Trust us, those reasons all apply equally to Amazon.

In Summary

Figuring out what you want to sell on Amazon can be tricky, but if you follow the guidelines in this article and in the ones we linked to, you should be able to avoid the duds and go straight to the moneymakers. Now get out there, pick something, and start selling!