• Craig Gedey

Making a success from Private Label Selling on Amazon

Private Label Selling can be a lucrative way to turn a profit for businesses on Amazon. There are many success stories on forums about Amazon Sellers and their Private Label adventures.


Making a success from Private Label Selling on Amazon

What Is Amazon Private Label Product?


Amazon Private labeling is the term used when a seller sells their inventory and utilizes their own packaging but with products being manufactured by someone else.


The Amazon Seller buys generic products from a manufacturer and then adds their own logo and brand name. The best thing about this is that you get an awesome product to sell on Amazon without having the fuss of manufacturing the product yourself.

That can apply to any number of products - a highly popular recent one has been labelled water bottles, a line that saw a significant surge following the success of TV show Love Island. In a recent interview with the Mirror newspaper, Signature Prints founder Ed Snelson explained how it helped launch his business into one making seven figure profits.


He said: “Things like Love Island definitely have an effect on what consumers want. A couple of years ago the demand to have your name in a certain font on a plastic water bottle was super high and we got loads of orders to do them.”


Water bottles are just one example - others include phone cases or accessorises, stationary and socks.


The main benefits include not having to invest in the research and manufacturing of products, which can incur time associated and staffing costs. That can make profit margins greater. And in fact you can establish business where you wouldn’t even have to touch the Private Label product you’re selling, if you choose to use Fulfilment by Amazon.


So what do you need to get started? Thompson and Holt’s managing partner Craig Gedey has put together a five-step guide to Private Label Selling.


1. Do your research

This is crucial for any online business but particular those looking to sell Private Labels on Amazon. Ultimately, you can’t sell a product that isn’t in high demand, so spend time looking in detail at Best Sellers lists. That provides a perfect insight into which products are currently selling well on Amazon.


Then look into the cost of sourcing the products that have caught your attention. High demand aligned with profitability makes the perfect Private Label product. But there’s little point in selling something in demand if the profit margins are minimal. Target those with a profit margin of around 50 percent.


2. Size up the competition

This is where your research should head next. When you’ve identified items that you believe can turn a profit through Private Label Selling, have a look at the companies already selling them. How much are they charging? What are their reviews like? Is there a small or large amount of competition in that field? The answers to those questions will give you a solid starting point for your planned product. Ideally, you’re looking for a product that is in demand, but with limited competition. It’s also worth noting that Amazon themselves may actually be your competition having had success with products such as the Amazon Echo, Kindle and Basics range.


3. Design your own brand

Now you know what you want to sell, you need to add you own personal touch. This is a key factor in the process that will make your product stand out from the crowd, and as such you need to carefully consider which brand brand name, logo, font and colours to use. Ideally you also want a unique selling point to make it stand out from the crowd. If this is a process that daunts you, consider outsourcing it to a design specialist, although obviously this will affect your profit margins.


4. Find suppliers

Once you have settled on a product that you want to sell, you need to find a wholesaler or supplier to provide it at the best price possible. A good way of doing this is by searching Alibaba, which allows you to look a list of global wholesalers. Key factors that you need to consider when searching are the size of orders you’re likely to need, what the manufacturer’s response rate is like if you have any issues, and how many of your chosen products are being private labelled elsewhere.


You also need to find a manufacturer to add your branding to the product. China hosts thousands of these kind of companies, and Alibaba can again help find the best ones, along with Global Sources.


5. Create an Amazon listing

Now you’re ready to go, but creating the correct Amazon listing is a crucial final step in the process. It isn’t just a case of uploading some pictures with a brief explanation. Instead, you need to make your product stand out from the field. Take time to research Amazon SEO tips to help boost your sales, it’s certainly worth it. Be sure not to infringe upon anyone's IP rights otherwise this could lead to an Amazon IP suspension. Don't use other brands in your descriptions.


6. Try to increase the number of reviews

As you know the number and quality of reviews can really help snowball your product and increase sales. Make sure you don't breach Amazons policies on review manipulation. Here are some additional tips on how to increase reviews on Amazon.


If you already Private Label Selling on Amazon and have encountered any problems that have led to suspensions, contact Thompson and Holt immediately to get your business back online in the quickest possible time.


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