Reselling on Amazon: How to Make Money Reselling Products

Reselling 101

By RC Staff

13 March 2023

Amazon. What started as a eBook seller in the 90s has since morphed into an absolute behemoth. It’s hard to remember a day before Amazon Prime, and having packages shipped right to your door in just a few days.

Part of why Amazon is able to have such a massive inventory of products is its array of third party sellers. According to Amazon itself, 7,400 purchases are made per minute from its US sellers alone. Maybe it’s time that you broke into that market.

Why you should resell on Amazon

Well, for the profit of course. If you’re wondering if it’s profitable to sell on Amazon, you should know that tens of millions are made in revenue every day through third party sales alone.

In recent years, third party sellers have begun to make up the majority of revenue through Amazon, and it doesn’t look like that will slow down any time soon.

With billions in revenue every quarter, it’s clear that there’s money to be made. Selling items through amazon has two critical advantages compared to other online marketplaces:

First, it’s an established global platform with tons of users. By selling your products through Amazon, you’re guaranteeing eyes on your listings everyday.

Second, Amazon offers Fulfillment By Amazon (Amazon FBA). This is an incredibly powerful way to sell your products, and is ideal for small businesses.

How much does it cost to sell on Amazon?

Amazon offers two tiers for seller’s accounts. The individual plan is free, with a 99 cent fee charged per item sold.

The professional plan costs a flat $39.99 monthly fee. The professional plan also includes numerous benefits to help put your products in front of customers. Amazon recommends its professional plan to sellers who move more than 40 items per month.

There are additional fees associated with Amazon FBA we’ll get into later.

The best items to flip on Amazon

Well, obviously something profitable. While Amazon allows you to list and sell a wide variety of products through their platform, your primary concern should be maximizing products.

There are no silver bullets. Many of the most profitable items to resell are restricted by Amazon, as they do not allow unauthorized resellers to list them. For example, Nike is a restricted brand. Getting permission to sell these items is not impossible, but you need to be careful to follow Amazon’s rules to avoid any trouble.

Of course, Amazon’s seller’s policy also precludes counterfeit items, and has restrictions about selling new or used items. Give the policy a good read before listing any items to make sure you’re in the green.

The best items to resell on Amazon are constantly changing, and there are various strategies to employ. We recommend retail arbitrage.

What is retail arbitrage on Amazon?

It’s a fancy way of saying purchasing retail goods and reselling them through Amazon. If you are able to find a good deal for them, or they hard to find, this can be very profitable. Additionally, you have a wide range of products to source.

There are a couple different ways to get into retail arbitrage. A key aspect is to be aware of trends. When a product suddenly begins to pick up steam at retailers, it may become of the best items to flip on Amazon.

Additionally, you can also tap into your own hobbies and interests to find items to resell that other online resellers may not be aware of.

Take advantage of trends to flip items on Amazon

There are tons of reasons an item may become popular. One of the most common is social media attention. We’ve seen this before in items like the Dyson Airwrap, a hairstyling tool that became extremely popular before the holidays. Check out our article for a deep dive into why this item resells.

If you’re able to find a way to buy these items at a discount, you can simply list them on Amazon and collect profit. Typically though, you’ll be looking for an item that is so popular it completely resells out of stores, and consumers are forced to buy from a reseller. In these cases, you can charge over the retail price and still make sales from the increased demand.

Develop a niche to resell items through Amazon

Your hobbies and interests can be a springboard in finding the best items to resell. While most resellers will be competing with each other for other items, you may already have a line on serious profits.

Like skateboarding? Maybe you’ve heard a thing or two about Bear Walker. If you were there for his early collaborations with the Pokémon Company, you could have picked up a few boards to resell for hundreds in profit

Or maybe you prefer Magic: The Gathering. If you scored one of the limited edition 30th Anniversary Boxes, you could have made more than a thousand dollars reselling it.

The point is that opportunities like these are everywhere. Pay attention to news within your circles for upcoming drops, collaborations, and limited edition products. When other hobbyists are excited about a product, it can be a great opportunity to resell it for profit. If you can get out ahead of other resellers, you’ll be able to score more product for yourself.

How to become an authorized reseller on Amazon

As we mentioned, some products are restricted for reselling on Amazon. When you list one of these items, Amazon will notify you that you need authorization to resell it. Depending on the product, this may be easy, or it may not.

For all restricted products, you will need to show you have at least 10 of the item in question, and an account with positive seller rating on Amazon.

Certain brands have particular restrictions. Nike requires either a letter of authorization from the manufacturer, or a purchase invoice in your name directly from the manufacturer.

On the other hand, it’s nearly impossible to resell Apple products on Amazon. They are very restrictive with who they authorize to resell their items. You’ll need to check the restrictions for individual brands through Amazon.

Is Amazon FBA worth it?

Once you’ve sourced some items to flip on Amazon, you might be wondering if its worth it to use Fulfillment By Amazon, or Amazon FBA. This mainly comes down to 1) what are you reselling, 2) how much are you reselling, and 3) how much time and space do you have to spare.

For a deeper dive into Amazon FBA, check out our article “Is Amazon FBA Worth It?” here.

What is Amazon FBA?

Essentially, Amazon FBA outsources your warehousing directly to Amazon. Instead of shipping directly to your customers, you send your items to Amazon before making any sales. Amazon will store your products, pack orders, ship them, and even handle returns.

Additionally, when you use FBA to flip items on Amazon, your products will usually qualify for Prime shipping. This is a huge advantage if other sellers are not offering Prime.

How much does Amazon FBA cost?

So, there’s two things to consider here. First, the cost per item is highly variable. Bigger items will cost more. Second, Amazon FBA costs are always rising. Amazon does NOT want your items to linger in their warehouses, so anything you send for FBA should be an item that will sell fast.

As you can see, there are a lot of possible fees. The exact costs vary, but Amazon FBA costs $1-5 for small packages, $5-15 for larger ones, and potentially $50 or even $100+ for very large or heavy packages. Remember, you are outsourcing all your shipping and handling to Amazon.

Additionally, improperly shipped packages will incur additional fees, as well as returns.

Use Amazon’s FBA cost calculator for a more detailed breakdown.

Is Amazon FBA profitable?

If you are flipping items on Amazon frequently, especially smaller items, then Amazon FBA can be highly profitable. Amazon FBA is very beneficial for small businesses and sole proprietorships. If you are working a full-time job and are unable to keep up with the demands of regularly shipping a high volume of goods, FBA can be a lifesaver.

Conversely, if you are only selling a small volume of items, or have spare time and space, you may not need to pay for FBA. Keep in mind that by shipping items yourself, they will not qualify for Prime shipping. Amazon is currently not taking new registrations for its Seller Fulfilled Prime program.

Best practices for flipping items on Amazon

Keep in mind that that if you are not using Amazon FBA, you will be taking on more responsibility for your shipments. Here’s a quick rundown on the requirements for shipping to FBA:

How to ship items to Amazon FBA

Previously, Amazon had a bit more intensive process for shipping your products to their warehouses. Starting in 2022, they have rolled out a new method: “Send to Amazon”, which we recommend using.

To pack items for Amazon FBA, follow the guide Amazon provides, which differs between items. Pack your items carefully and keep track of the relevant SKUs. Once you have loaded up all your products, you will upload the manifest to Amazon. If you do not upload this manifest, Amazon will charge you a fee to sort your products.

Reselling on Amazon using FBM

Amazon FBM (Fulfillment By Merchant) simply means that you are responsible for packing and shipping orders, as well as handling returns and refunds.

If you are on Amazon individual seller plan, you will receive “shipping credits” after shipping an item. These are a predetermined amount depending on the category of the item, and will generally not cover the entire shipping cost. Professional sellers can set their own shipping costs.

You should try to ship your orders as fast as possible, and be up front on your listings when buyers can expect their packages. You will be competing with Prime shipments, so try to be speedy.

Dealing with refunds and returns as an Amazon seller

Sooner or later, a customer will want their money back. In the event of a return or refund request, always answer immediately, and get to the bottom of the issue. Your goal should be to receive positive feedback at the end of the interaction, even if you need to issue a refund.

When you resell your products on Amazon, you are required to match Amazon’s refund policy. This means you must honor refund requests made within 30 days of the receipt of the item, and have a return address listed on your seller page. Keep this in mind when flipping items on Amazon.

Do you need an LLC to sell on Amazon?

No, you do not need an LLC to resell products on Amazon. There is no requirement on Amazon’s Seller Central to file an LLC, and you are free to operate as a sole proprietorship.

Still, opening up an LLC down the road can be a good idea, especially if you are moving a significant amount of products.

So, is reselling on Amazon worth it?

With all that said, we hope you have a solid idea of what it takes to flip items on Amazon. You’ll come to find that sourcing products will likely be the hardest part of operating your reselling business.

We recommend staying up to date on reselling by subscribing to our newsletter and joining the RC Elite waitlist if you haven’t already. New items are posted everyday, and there is a wealth of resources for both new and experienced resellers. Staying in the loop on the most profitable items to resell on Amazon will help you grow your business and move towards financial independence. Additionally, check out our other articles and item pages for in-depth looks into past and present cooks, and learn about what makes an item resell.

The most important aspect of reselling products on Amazon is whether you will utilize Amazon FBA. It’s a uniquely powerful tool for a individual reseller, and allows you to have an entire warehouse team at the fraction of the cost.

If you don’t intend to take advantage of Amazon FBA, whether because of cost or you don’t feel you need it, ask if you are certain reselling on Amazon is the right fit for you. If you are only interested in reselling a few items at a time, other platforms like eBay or StockX may be a better fit, considering the numerous restrictions Amazon has on its sellers.