How Amazon Experts Source Their Products?

This is an expert panel Q&A with Amazon experts Kevin King, Kian Golzari, Shane Oglow and Steve Simonson, recorded during the 1st annual European Seller Conference in Prague.

Most Amazon sellers are sourcing from China, especially those who are just starting out. Finding the best product to source and a reliable supplier to work with can be quite overwhelming. There is no better way than to learn from Amazon experts who are willing to share their best tips and practices you can implement in your own situation. Listen to how Kevin King, Kian Golzari, Steve Simonson and Shane Oglow do their product sourcing for Amazon FBA. 

This panel discussion was held during the European Seller Conference 2019 in Prague on March 28-29, 2019.

List of topics covered in the video:

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Biggest sourcing mistakes when starting to sell on Amazon

When starting off, most sellers keep on doing the same mistake - they're looking at the products that are selling well. Just because it's selling well, doesn't mean it's a product you should source because those sales might not be coming from within Amazon. It could be something that got featured on a TV show or it could be someone that's driving a lot of traffic from social media or from their own website. Kevin King advice to focus on keyword demand instead - that's actually what he does himself: "The first thing I do if I'm selling on Amazon is I look for keyword demand and opportunities within those keywords where I can compete and so that dictates number one what I'm going to source. In my opinion, if you have to drive traffic from outside of Amazon to drive your Amazon sales, you're making a mistake. The only time you should ever drive traffic off Amazon is for launch purposes or positioning purposes. So that's the number one thing that I look for is keyword demand and opportunity."

And then as far as the second biggest mistake people make when they're sourcing products is their budget. The worst thing you can do on Amazon is run out of stock. Usually, people will launch a product on Amazon, they'll find something on Alibaba or go to sourcing trip that and eventually they run out of stock. The thing is - if you run out of stock on Amazon, you might as well just start over. So in order to avoid such scenario, you have to look at your budget. Let's say you have say $10,000 USD to go into this business. You should not be sourcing anything that cost you more than $4,000 USD landed cost. And landed cost means the cost to get in and China, the cost to actually pay to have it shipped over, all the other costs to get it actually into an Amazon warehouse. As you can see, you need two and a half times minimum, your initial landed costs as an investment otherwise your chances of success are pretty low.

Don't have too high expectations at the beginning

Steve Simonson sees the tendency among sellers who want to conquer Amazon at the very beginning. If you have such mindset, you might want to shape it a bit - don't try to be the king of the hill on the most competitive products, you need to learn some skills, you need to get a process, the systems, just kind of understanding it. Steve says it's like an education, it's a degree at Oxford, or Yale or Harvard, or whatever your first product you bring in, and then the next one is another degree and another one. Just by time you are getting good at it.

Another thing you might not want to do is to look at too competitive products. There are probably 30 or 40 types of products that Steve himself wouldn't look at just because they're so competitive. Make sure you have reasonable expectations and find a product with which you can differentiate and where you're not competing against the whole world. The more competitive it is, the more likely you are to get blackhat kind of tactics used against you. And that's definitely not the way you'd like to start off. 

Do you really know what product you are selling?

You should not only know what the quality of your product is but also what experience it creates. Kian, who sourced plenty of products from China, can't stress enough how important is to try your product first. He says that if he's sourcing a backpack, he's going climb a hill with that backpack on his shoulders and if it's a a sleeping bag, he's definitely sleep in that sleeping bag. According to him, far too many people do this mistake - just sourcing products from China, not trying them themselves and putting them online. Obviously, then they learn about the failures from the comments and reviews. Even if it's a coffee mug, fill it up with hot water and drink from it - you have to use your own products because you are your own toughest critic. That way you can improve your products a lot.

Also, always ask your manufacturer for tips as well because remember, your manufacturer is not only producing for you but they're producing for some of the top global brands. Ask them what's working for their customers, what's working in different markets, what's the latest testings that they've done. You can get so much knowledge from your manufacturer. And a lot of people try and figure that out for themselves. But it's all available if you just ask.

About the speakers:

The event was moderated by Alex Chernenko: