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KeithR replied to the topic Selling my brand of clothing on Amazon in the forum Tell me straight… 2 years, 4 months ago
Hello Pmok,
I hope this helps your understanding of how Amazon FBA works (Fulfilled By Amazon). We have extensive experience of this, so this will be a longish answer. What you do with the information is of course up to you! I will use numbered points to keep my own mind clear as I write.1. Our experience of getting goods into Amazon in the US from China: Excellent. The logistics system is world class. We also used a specialist agent in the USA to receive goods from China. You do need to stay on top of the full process with the required product labels and customs classification etc and a good agent will help you.
2. Amazon grants refunds to customers with the greatest of ease, so in clothing, you are very susceptible to cheats who order clothes, wear them and send them back. With Amazon the customer comes first every time. How much fraud can you absorb? What does Amazon do with returned clothes that are not damaged? You need to find out.
3. You can only leave your inventory in stock for a specified period without charges applying. So you need stock turnover. Warehouse space is valuable!
4. Amazon FBA sellers use software to detect the prices their competitors charge and undercut them. the downward price pressure is relentless.
5. You need to factor in the costs of advertising on Amazon if your products are to be seen and sold. Amazon is a huge search engine and you will not be visible without paid ads to get into the ‘buy box’.
6. The FBA fees are not inconsiderable – if I recall, ours were around 30% (not for clothes).
7. Amazon does all the shipping, pays you reliably and disposes of returns if you don’t ask them to send the products back.Summarizing, Selling on Amazon is complicated, and can be profitable, but with pressures on your margins and intense competition. Amazon has special categories for products and some require special permission to ship – you do not want your consignment of product turned away and lost. Just guessing, but I would check carefully before shipping anything for children including clothes. Be prepared for a learning curve on logistics management but as I said, the Amazon FBA system is superb. You will need a sellers’ account.
Hope that that helps a little bit.
Keith
Hi Keith,
Thanks so much for response. I have a much better idea now about how it works on Amazon. I do agree with you regarding price pressure and the potential small margin of profits of selling clothes online. However, I suppose if I don’t try I will never begin.
If you don’t mind me asking one more question, may I know where and how I may find the agent you refer to? I am also looking at manufacturing from China. But then again I am not sure where to begin. Do you source from Alibaba? I heard before it is where there are a lot of Chinese manufacturers. May be I am wrong?
Many Thanks,
PMok