Is it too late for you to even try Amazon FBA?... ;(

Starting an Amazon FBA Business: Opportunities & Tips

You might be wondering if it is too late for you to jump into the Amazon FBA game.

Well, I've got good news for you – we're about to dive into this question in a super simple and fun way.

I recently had Yoni Mazor on my YouTube channel, and let me tell you guys, he's not just any ordinary guy.

Yoni is an ex-Amazon seller, an e-commerce expert, and the co-founder of Getida, a big reimbursement service for Amazon sellers.

So, you're in for a real treat with our conversation!

We had a fantastic chat, and it's all laid out here in a friendly and easy-to-understand manner.

We're just having a casual talk, like we're your friends.

If reading isn't your thing, don't worry!

You can check out the video below – it's like we're right there with you.

We'll explore whether it's the right time for you to begin your Amazon FBA adventure.

It's going to be insightful, exciting, and, most importantly, super easy to understand.

So, buckle up, and let's dive into my conversation with Yoni Mazor!

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Introduction

Vova: Hey there!

Today, we've got an important topic to dive into – the question of whether it's too late to kickstart your Amazon selling journey.

Joining me is Yoni Mazor, the Chief Growth Officer at Getida.

You might remember him from a previous video where we delved into Amazon FBA reimbursements.

If you don't remember, it's embedded right below. Enjoy! :)

But today, we're focused on helping you grasp the ins and outs of getting started on Amazon with ease.

By the way, I'm Vova Even, and I've been an active Amazon seller in the US and Canada since late 2016.

Is it Too Late to Start Selling on Amazon?

Vova: So, let's get right into it – is it still a viable option to begin selling on Amazon?

But Yoni, how about introducing yourself before we explore this topic?

Yoni: Certainly, Vova.

First and foremost, I want to extend my gratitude to you for having us back on your channel.

It's always a pleasure and a unique privilege to engage in these discussions with you.

Today, we're tackling a question that's been on many minds – is it too late to embark on an Amazon selling journey, particularly through FBA?

That's a fantastic question, and it's a fair one.

To cut right to the chase, my answer would be no, it's not too late to embark on your Amazon selling journey, whether it's through FBA or any other means.

Meet my Guest, Yoni Mazor and His Company Getida

Yoni: I'll provide a bit of background about myself – I'm the Co-Founder and Chief Growth Officer at Getida.

We're a technology company known for our expertise in helping Amazon FBA sellers secure the maximum reimbursements they're entitled to.

Essentially, we have the capability to backtrack 18 months of your transaction data to identify issues for potential reimbursements.

Our dedicated team then handles the entire process, from opening cases to managing all the back-and-forth with Amazon.

Importantly, it's completely free to join Getida; we only charge a fee based on the amount we recover for you.

In a nutshell, we're the largest organization globally focused solely on auditing and obtaining reimbursements for Amazon FBA transactions.

We audit billions of dollars worth of FBA transactions each day.

But, you know, Getida was born from my personal experience as an Amazon seller nearly a decade ago, around ten years to be precise.

My journey into online selling began back in 2013, initially on eBay.

It wasn't long before we ventured into the world of Amazon, and our business experienced rapid growth, soaring from nothing to an impressive $20 million.

Eventually, we became part of a larger group, and collectively, we achieved over $100 million in FBA sales.

Getida was conceived during this period because we constantly faced the challenges of resolving inventory discrepancies.

As Getida grew, we decided to step away from selling on Amazon itself, focusing our efforts solely on assisting other sellers.

However, our passion remains deeply rooted in this industry, as we interact with sellers every day, and that's what keeps us motivated and grateful for the opportunity to help so many people in this field.

So that's a bit about my background, but what would you like to explore next?

Vova: It's great to have you back, Yoni.

Is Amazon FBA So Saturated to Start a New Business?

Vova: Indeed, the question of Amazon's saturation is a common one, and I receive inquiries about it from friends and individuals as well.

It's true, Amazon's marketplace is becoming increasingly competitive, and as a seller myself, I can attest to the challenges.

In fact, just today, we had a discussion with a gentleman named David Miller, an attorney from New York.

He brought up an interesting point that around 3,700 new sellers join Amazon every day – and mind you, these are sellers, not buyers.

Yoni: Absolutely, and this notion applies primarily to third-party Amazon sellers.

Vova: It's quite astonishing, right?

People often get discouraged, thinking the market is saturated.

I've heard this since I started my selling journey in 2016.

People reminisce about the good old days of 2013 when ranking products and getting reviews were seemingly easier.

So, what's your take on this?

Yoni: Well, let me provide some high-level statistics to give everyone an overview of the current landscape.

In the United States, there are approximately two million sellers on Amazon, and globally, that number jumps to around six million sellers.

A decade ago, these numbers were significantly smaller – roughly 90% fewer.

Instead of two million, you might have seen around 200,000 sellers in the US and perhaps half a million or 600,000 globally.

So, over the course of ten years, the seller count has grown substantially, about 10 times more.

This might seem daunting initially, but when you delve deeper into the data, you'll discover that among those two million sellers in the United States…

When we focus on the United States, it's worth noting that due to its sheer size, it may be comparatively easier to navigate.

The US is, after all, one of the largest and most influential markets.

However, it's essential not to overlook the potential in secondary markets on Amazon, like the UK and Germany.

We can dive deeper into those markets later if desired.

In the United States, among the two million sellers, the real revenue and market influence tend to concentrate in the hands of a relatively small group, which could be around 10% to 20% of the total sellers.

This means that, out of those two million, you have perhaps 200,000 to 400,000 sellers who effectively drive more than 90% of the sales volume.

And, let's not forget that the United States, with its population of over 300 million people, or maybe around 150 million using Amazon US, also serves a substantial global customer base.

People from around the world, such as those in Israel, frequently shop on Amazon US.

So, Amazon US serves a global market, possibly reaching into the billions of consumers worldwide, and this market is still growing.

Furthermore, when we look at the bigger picture of e-commerce, not just Amazon, it's essential to remember that e-commerce currently represents only a fraction of overall retail, perhaps around 15% to 17% of the total retail landscape.

If we take a closer look at the retail landscape in the United States, we see that e-commerce represents a relatively small portion of the industry.

To put it in perspective, roughly 17 cents out of every dollar spent in retail goes to e-commerce.

Out of that e-commerce spending, about half of it can be attributed to Amazon.

The remaining portion goes to traditional brick-and-mortar stores.

So, historically speaking, the e-commerce industry is still in its early stages.

The COVID-19 pandemic had a significant impact on e-commerce growth.

Before the pandemic, e-commerce made up about 9% to 10% of retail sales.

Within just a year and a half, the pandemic drove e-commerce to grow by another 5 to 7 percent, effectively achieving in two years what might have taken two decades.

This was a result of people being stuck at home with limited ability to go outside.

Amazon, in particular, became a lifeline for many, offering a vast array of products, including even groceries through Amazon Fresh.

You could order food, milk, eggs, and other essentials without leaving your home, thanks to Amazon's fulfillment and delivery services, which built a strong level of trust among consumers.

To put the scale of Amazon's growth into perspective, in 2019, the company had a revenue of around $300 billion.

In 2020, it added another $100 billion, bringing its total revenue to over $400 billion in just one year.

This was a staggering 25% growth for the company.

Achieving a revenue of $300 billion is indeed remarkable, and it's worth noting that this growth was accelerated by the unique circumstances of the pandemic.

Looking ahead to the next years, Amazon is poised to add several more $100 billions, potentially surpassing the $600 billion mark in revenue.

In the United States, as far as I'm aware, the only other company reaching this revenue level is Walmart, primarily because they have a significant physical store presence.

It's crucial to understand that this growth is not the endpoint; there's still tremendous untapped potential.

As more people embrace e-commerce and become comfortable with Amazon, they tend to increase their shopping activities on the platform.

Over the years, you can observe that customers tend to buy more frequently and more items.

For instance, my own experience reflects this trend.

A decade ago, I would make an occasional purchase on Amazon, maybe once or twice a year.

But today, I can confidently say I've become accustomed to it, almost reliant on it.

The efficiency and convenience are hard to match.

I've reached a point where I have little patience for waiting in line at a physical store.

If I encounter a queue, I often decide to leave the item behind and return home to make the purchase online.

A few clicks, and the product arrives at my doorstep.

Time has become an exceptionally valuable resource for me in my 30s.

I'm married, have children, a career, and a company to manage.

Given these responsibilities, the efficiency of my time is of utmost importance.

The traditional shopping experience entails going to a store, finding a parking spot, navigating through aisles, and potentially discovering that the product I want is not in stock, requiring me to visit another store.

Then there's the process of seeking assistance, waiting for help, and so on.

The whole ordeal becomes inefficient and frankly, I don't find it enjoyable anymore.

Perhaps in my younger years, it was a novel adventure, something to do with friends, spending a day at the mall, getting ice cream, and making the most of your time.

But as you grow, especially when you have more financial stability, the appeal of in-person shopping wanes.

When you're a kid or your parents give you $100 or $200 to spend, you may enjoy going to a physical store, trying things out, and having fun with it.

It becomes a cultural experience.

Now, at my stage of life and financial capability, shopping online is the name of the game.

It's efficient and suits my lifestyle perfectly.

The bottom line is that consumers, particularly Amazon users, are becoming increasingly accustomed to this mode of shopping.

This evolution represents a significant opportunity for sellers.

But let's take it a step further.

Consider individuals who were perhaps 50 or 60 years old and had never really embraced online shopping until the pandemic hit in 2020.

Absolutely, many of these older individuals had to adapt to online shopping due to the pandemic.

As they continue to grow more comfortable with this platform, you'll notice that there's a gap in the market.

Amazon, to some extent, lacks a substantial selection of products suitable for people in their 50s, 60s, 70s, 80s, and even 90s.

Many innovative gadgets and gear designed to make their lives easier aren't as readily available on the platform.

This presents a significant opportunity.

The newer consumer demographics that have entered the Amazon marketplace are essentially untapped territory.

The reason this segment isn't developing as rapidly as it could is due to a lack of awareness and data.

Many sellers often rely on historical data and trends instead of focusing on innovation.

However, as more data becomes available, there's a likelihood that new and useful products will emerge.

For instance, there are devices known for helping seniors who fall and can't get up.

These devices allow them to call for assistance by pressing a button.

Similarly, you can imagine a category of products such as necklaces or rings equipped with distress buttons for senior citizens.

This way, if they fall or encounter an emergency, they can summon help with ease.

In their 70s and 80s, living alone, but financially stable, these individuals are unlikely to splurge on luxury travel but instead focus on a simpler lifestyle.

They may stroll in the park, read a book, and conveniently shop online.

This cultural shift is especially evident in the United States, where older folks visit malls primarily for exercise, not necessarily to make purchases.

Malls are popular walking destinations, especially in regions like New York, where weather extremes often deter outdoor activities.

People spend their time walking up and down the mall corridors, getting some exercise, but not necessarily buying much.

Perhaps they enjoy a cup of coffee at the beginning or end of their mall walks.

Vova: Absolutely.

Yoni: They're indeed mall walkers.

This trend is widespread across the country, especially in places like New York.

But, you see, they don't do much shopping during those walks.

However, now, they're getting accustomed to e-commerce and, particularly, Amazon.

They trust Amazon because it delivered the essentials they needed precisely when they needed them.

Be it toilet paper, paper towels, toothbrushes, or anything else, Amazon came through for them within a day or two.

This trust-building experience marks the initial step.

So, when you consider all these layers of potential – the 70% of e-commerce adoption among new age groups, the efficiency that encourages more adoption, and the untapped market of senior citizens – you can appreciate the immense potential lying ahead in this marketplace.

So, if you're an entrepreneur looking to enter this dynamic game, here's what you should keep in mind.

Assess the vast potential ahead and whether it aligns with your vision.

If it makes sense to you, then absolutely, there's ample room to grow.

I recently had a discussion with Kevin King, and we both concurred that the future holds a tremendous amount of untapped potential.

However, it's essential to bear in mind that this growth is highly data-driven.

You'll need to delve into the data and become familiar with it, but you must also leave some room for innovation.

Recognize that these new-age groups and consumers have needs and preferences that aren't entirely reflected in existing data, simply because the products catering to them are not yet on the market.

This means there's an opportunity for creativity and innovation.

By experimenting, you can create new categories, subcategories, and products that have never been seen before, and that can be highly lucrative.

While competition may arise later, if you've established yourself as a brand and are first to market, you can maintain a strong position in the business.

How Much Does it Cost to Be an Amazon Seller?

Yoni: Now, the financial aspect is a valid concern.

You might wonder how much it would cost to become an Amazon seller.

Vova: Yeah.

Yoni: Right, that's the question we're diving into.

So, the big question remains, can you still make money?

I mean, isn't the initial question whether it's too late to start?

Vova: Right, it was the original question, whether it's too late to get started on Amazon FBA.

But it's all interconnected because people often mention that it requires more money to get started nowadays, especially if you want to dive into private labeling.

I've heard that launching a private label business today is more expensive than it was a few years ago.

Yoni: You're absolutely right.

It's not a matter of it being too late, but it's about the increased cost involved.

So, now that we know it's not too late, the logical next question is, what's the situation like?

How high is the bar, and what has changed?

As I mentioned, I recently had a conversation with Kevin King about this, and he pointed out that indeed the bar has been raised, and it's now more expensive.

Back in the day, you could launch a private label business with just a few hundred dollars.

You'd go to Alibaba, secure a small minimum order quantity, throw it into the market with a modest PPC budget, and things would start rolling.

Those were the good old days, roughly around 2014 to 2018.

However, today, while the basic elements of sourcing overseas and launching with a minimum order quantity are still there, it's undoubtedly more challenging and, probably, more expensive.

It's not just within Amazon; inflation is a global trend affecting many things, making everyday items more expensive.

Vova: Indeed.

Yoni: Indeed, sourcing has become more expensive, and the products themselves may carry a higher price tag.

You might have to commit to more significant quantities, which will impact your expenses.

When it comes to shipping, the costs have gone up, and containers are definitely pricier than before, at least for the foreseeable future.

Kevin King mentioned something interesting to make it easier to grasp the mindset needed to launch a new private label product on Amazon.

He estimates that you'll need anywhere from $5,000 to $20,000.

That's the spectrum he sees as realistic.

So, if you have this financial resource available, between $5,000 and $20,000, you can genuinely kickstart a business on Amazon.

With that budget, you can source enough units, invest in marketing, set things in motion, and begin generating attraction, which is the starting point for building your business.

However, it's crucial to keep in mind that success on Amazon often requires a longer-term perspective and a more professional approach.

A Word About Amazon FBA Aggregators

Yoni: Certainly, it's clear that the influx of substantial institutional money has transformed the Amazon marketplace with Amazon FBA aggregators.

Let me clarify this.

We have numerous aggregators like Thrasio, Perch, Hayden, and several others.

Most, if not all of them, have raised significant amounts of capital, totaling likely over $10 billion or more, to acquire Amazon brands and businesses.

When they purchase these Amazon-based businesses, they essentially elevate the entire industry's level of professionalism.

These aggregators are rapidly expanding their teams, hiring professionals who specialize in various aspects of the business.

They're effectively becoming factories of brands, understanding how to launch, maintain, and grow brands, how to source products overseas, and how to optimize costs, thanks to their immense scale.

These aggregators are making the industry much more professional.

So, for someone fresh out of college looking to enter the e-commerce sector, these companies are now incredibly appealing.

Some of them have already achieved valuations exceeding $10 billion.

Imagine finishing college or university and having the opportunity to join a company of that stature.

If you're a recent graduate, you're now in a position where you can aspire to work for a billion-dollar or even a ten-billion-dollar e-commerce company.

These companies offer a unique opportunity to attract the very best talent in the industry.

You'll have access to experts in PPC, sourcing, marketing, logistics, and various other fields.

So, you're competing with these juggernauts, and over time, you can refine your skills.

Being small has its advantages compared to being big, and vice versa.

Both small and large businesses have their place in this industry.

One thing to understand is that everything is becoming more challenging and more professional.

This is a critical insight.

As e-commerce continues to grow and captures an increasing share of the retail market – perhaps 40%, 50%, or more – it might seem like the space is maturing and getting crowded.

However, it's crucial to remember that until that point, you've got a significant time frame – perhaps 10, 20, or even 30 years.

That's a substantial window of opportunity for building careers and businesses in this industry.

It all comes down to dedication, hard work, and, above all, a relentless focus on data.

The beauty of selling on Amazon and online, in general, is that it's data-rich.

Whether you're in private label, wholesale, or arbitrage, data is your lifeline.

It guides your decisions, showing you what can or can't be bought and sold.

Absolutely, you've hit the nail on the head.

Data is the cornerstone of successful e-commerce.

Whether you're scanning items in a Walmart, checking a product selling for $2 and realizing it can go for $20 on Amazon, or sourcing a Nike product for $50 to sell for $80, it's all about data.

Data informs your decisions, helping you identify profitable opportunities.

This applies across the board, from arbitrage to private label sales.

If the data suggests you can do it, and you're laser-focused on data, and you have the necessary resources, then go for it.

Vova: It's pretty interesting, and I must say, something about aggregators caught my attention.

When you mentioned them, it might make some new or prospective sellers wonder, How can I compete?

These aggregators are building teams of professionals, including PPC experts and sourcing agents, while you might be just starting out, perhaps even while holding down a day job.

It's a daunting thought, but I had some folks from Accel Club, which is an aggregator, on the channel, and one of them was Nick. Let them know Vova referred you, if you ever decide to work together.

He's one of the co-owners. And he brought up something quite interesting.

He explained that their focus, and maybe it's specific to them as an aggregator, is on buying and growing businesses that generate over a million dollars in yearly revenue.

Now, for new sellers, especially those just starting out, it's worth noting that these aggregators generally tend to avoid smaller niches.

If you're working in a niche where your product generates, say, $5,000 a month in revenue, you can reasonably expect a profit of around $1,000 or maybe even more – it varies, of course.

But for a beginner, diving into these smaller niches could be a smart move because aggregators typically aren't interested in them.

They have a lot of capital, and they need to scale quickly.

So, while I believe they operate differently, if you're just starting out and you niche down, launching, let's say, four products that each generate $5,000 in monthly revenue with $4,000 in profit, in a place like Israel, you can potentially quit your day job.

That's a winning strategy because you have a portfolio of products in niches that aren't attractive to larger players.

Yoni: That's a fantastic advantage – having a portfolio of highly specialized products that nobody else wants to get into.

Vova: Absolutely.

Yoni: So, when you have a portfolio of products, each making you a few hundred or even a few thousand dollars every month, you can accumulate a good income – $50,000 a year, $100,000 a year, or even $200,000 a year.

You'll have a comfortable life, and nobody will bother you.

You become your own boss, and there's plenty of room for this approach.

It's essential to understand that this is your advantage because larger players won't bother with it.

They won't invest millions in buying products that won't yield them millions.

So, that's the difference, and that's why there's room for everyone.

Vova: Absolutely. 

Yoni's Tip for Product Differentiation

Vova: And before we wrap up, Yoni, maybe a final tip from you.

What advice can you give to those who are entering the market now, given the influx of new sellers?

How can they differentiate themselves and stand out? 

What should they look for?

Yoni: As I mentioned earlier, focus on the data, as it provides recommendations.

But also, leave some room for common sense and a touch of creativity.

For example, if the data suggests that everyone needs toilet paper, that's fine.

But how about adding a creative twist to it?

Rather than just going to the factory and asking them to make it in red or blue, think outside the box.

Leave some room for creativity, like giving the product a unique spin.

You want to create something that stands out and makes people think, Why would I buy this particular product?

That's where your soul comes into play.

While there's a lot of math, data, and calculations involved, you still have space for your creativity.

When you inject some creativity into your business, you'll be more passionate and committed, which can lead to greater success in the long term.

Vova: Thank you for sharing your valuable insights today.

I appreciate your time, and it was incredibly insightful.

Yoni, thank you so much.

Yoni: You got it.

Thank you, everybody.

Good luck!

Vova: Bye.

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Conclusion

So, that's a wrap up of my conversation with Yoni Mazor about starting a successful business on Amazon.

If you're anyone thinking about entering the world of online selling, here's what you need to know:

First and foremost, it's not too late to start selling on Amazon.

The e-commerce industry is still booming, and there's plenty of room for new sellers.

In fact, it's growing fast, and there are countless opportunities waiting for you.

Now, you might have heard that it's become more expensive to start an Amazon business.

That's true to some extent.

While it used to be relatively inexpensive to get started, costs have gone up a bit.

But don't let that discourage you.

If you're well-prepared with a budget of around $5,000 to $20,000, you can start your Amazon journey and see it thrive.

One of the secrets to success in this field is to focus on data.

Yes, data is your best friend.

Use it to understand what products are in demand, what people are looking for, and where the gaps in the market are.

But here's the cool part: you can add your own touch of creativity.

Think about how you can make a product unique, whether it's through the packaging, a special feature, or a creative twist.

This makes your business stand out from the crowd.

And guess what?

When you put your creativity to work, you'll be more passionate about your business, and that passion can lead to greater success.

So, don't be afraid to let your imagination run wild.

Now, remember that Amazon isn't only for big players and aggregators.

You can succeed by targeting smaller niches that aren't attractive to larger companies.

By launching products that make a few thousand dollars every month, you can build a portfolio that provides you with a comfortable income.

You don't need to worry about competing with the giants.

So, if you're thinking of starting out, you've got a world of possibilities waiting for you.

Just like we mentioned, there's room for everyone in this growing e-commerce world.

And here's the best part – you can be your own boss.

As you explore this exciting journey, keep in mind that while data and calculations are essential, there's also room for your soul.

Inject some creativity into your business, and watch it flourish.

Success is within your reach.

In the end, the e-commerce industry is thriving, and there's a bright future for those who are willing to take the leap.

So, go ahead, follow your passion, and start your journey on Amazon.

Who knows, you might just create the next big thing and become a successful online entrepreneur.

It's a world full of opportunities, and it's yours for the taking.

Good luck!

Best,

Vova :)