Last week, I wrote a post about one of the items on my #40Before40 list that I’m most excited about. You can check the post out here: Starting an Online Business: Amazon FBA. 

Lots of people have already created successful part time and full time income streams with Amazon FBA. There are 2 business models that we will explore that you can use to make money with Amazon FBA:

• Retail Arbitrage
• Private Labeling

Let’s take a deeper look at each of these options.

Retail Arbitrage

Retail Arbitrage is when you purchase products at a discounted rate and then list them on Amazon for a profit.

Discounted products found at Walmart, old textbooks from used book sales or even sourcing products from Ebay can all be used as sourcing strategies for a Retail Arbitrage business.

Once you source your products, you package them up, send them to one of Amazon’s warehouses and list the product on Amazon’s website. After that, you wait for the product to sell and Amazon sends you your cut.

The important thing to remember with Retail Arbitrage is to source products that have enough of a profit margin for it to make sense to sell. Also, it’s important to check that comparable product listings have a best seller ranking of 100,000 or less. I’ll expand more on Best Seller Ranking in a later post.

Private Labeling

Instead of sourcing existing products or brands, you research products that are currently selling on Amazon, then find a manufacturer to produce a similar product and build a brand to sell on Amazon.

Product selection is extremely important here. You do NOT want to select a product that doesn’t have enough demand, or a product that has too much competition. You will also need to make sure that whatever product you select has enough of a profit margin that it isn’t wiped out by the fees you will pay to Amazon.

My Choice: Private Labeling

For my Amazon business, I’ve selected private labeling. I don’t want to have to worry about inventory levels disappearing or price undercutting to remain competitive with other sellers who might be selling the same product.

Private labeling also allows you to grow a brand that you can expand with new products and expand into other channels such as Ebay and other ecommerce opportunities.

Next up, I’ll show you the strategy that I will be using when looking at potential products to use in my Amazon Private Label business. It’s called “The 10x10x1 Strategy.”

Is there anything in this post that you’d like me to expand on or explain in greater detail? Let me know by sending me a quick message by clicking here!

The idea of starting an online business scares the crap out of me. What if I fail? Or even scarier, what if I’m successful?

Either way, I decided it would be a good idea to write down My Top 5 Reasons to Start an Online Business to help keep things in perspective. These 5 reasons (and 1 BONUS reason) help support a blog post I wrote a while back called “My Ideal Day.”

It might also be interesting to look back every 6 months and see if these reasons remain the same or change.

1. Low Startup Costs

Starting an online business can be done with a low budget, especially when compared against traditional brick and mortar businesses.

Depending on the business model you choose, you can get started with an investment of less than $100. That should remove at least one major excuses.

2. Freedom of Schedule

I wake up pretty early most days. I don’t like the feeling of a wasted day. That being said, I’m not a huge fan of having to be at a certain location during a specific time period from Monday to Friday.

I’d much prefer to make my own schedule and decide when I work, when I decide to play and when I decide to sleep. With an online business, you have the freedom to make those decisions for yourself.

3. Freedom of Location

I love the idea of being able to pack up my laptop, fly to Chicago for a weekend set at Wrigley Field and have my business never miss a beat.

I can be sitting amongst the ivy in left field and still be making sales and providing value for my customers. Crazy thought isn’t it?

4. Incredible Earning Potential

So far in my career, I have always been compensated based on the hours I work. What that means is, I can only make so much. Even if I was paid $1000/hour, if I worked an entire week straight, with no breaks, I could only ever earn $168,000 per week.

Although that is a huge sum of money, you could never earn more than that. Even if you provided twice as much value.

Alternatively, when you open an online business, it never closes. It’s open 24/7/365! You don’t need anyone to stand behind a cash register and your business can reach people halfway across the globe.

So, if you create a $10 product and get it in front of a global market, your earning potential is much greater. You can even make sales while you sleep!

I can’t wait until I make my first sale while I sleep!

5. Create Something You’re Passionate About 

Instead of putting all your effort and energy into something that someone else decides for you, you can decide how you spend that same effort and energy. You can create a product or service that serves people for a greater good.

Get paid and feel passionate about what you do – sounds pretty good, right?

6. BONUS – Just Look at the Picture

I know I only said 5 reasons but this picture did a better job at explaining my reasons why, than all the words in this post.

You might be wondering, “what is your online business going to be?” Well, why don’t you click this link to find out more: Starting an Online Business – Amazon FBA.