Amazon, like any retailers, breaks it product offerings down into categories. New sellers are only allowed to sell products in certain categories. You can apply to be “ungated” in the restricted categories. Some are easier than others (e.g. Shoes, Handbags & Sunglasses). A few are virtually impossible (e.g. Video, DVD & Blu-Ray).
Gated categories freak a lot of new sellers out. It feels like a devastating limitation but it isn’t. Each category has anywhere from a million to eleven million products that have been sold at least once in the previous 12 months. There is plenty you can sell from day one.
That being said, it is worth while to pursue getting ungated in a few categories. I’ve found Beauty, Health & Personal Care, and Grocery & Gourmet Food to be the most immediately profitable categories. More on that later.
Baby Products (Excluding Apparel)
Camera & Photo
Home & Garden
Software & Computer Games
Tools & Home Improvement
Toys & Games
Video Games & Video Game Consoles
Automotive & Powersports
Clothing & Accessories
Grocery & Gourmet Food
Health & Personal Care
Historical & Advertising Collectibles
Industrial & Scientific
Luggage & Travel Accessories
Shoes, Handbags & Sunglasses
Video, DVD & Blu-Ray
2. Ranking, Categories & Sales Velocity
It is important to remember that sales velocity (the quantity of a product sold in a month) not only varies by ranking but also by category. For example, a book with a ranking of 10,000 will sell roughly 200 copies in a month but a baby product with the same ranking will only be sold 89 times in a month. Consequently, you’ll need to factor in category before you buy a product. This is especially important if you are contemplating buying multiples of the same product.
So how do you determine sales velocity? One helpful tool is Jungle Scout’s estimator (junglescout.com/estimator). You simply pick your category, type in the ranking, and they supply you with an estimated sales velocity. Personally, I’ve found it to be very conservative in its estimates.
Another useful tool is CamelCamelCamel.com. This website simply tracks the price fluctuations of products on Amazon. This is helpful because it allows you to determine if a product has ever sold on Amazon and when that product has a high demand.
Lastly, you can also get an idea of a product’s value and demand by looking at sold listings on eBay. You simply go to eBay, put in the keywords/upc/isbn, and then filter by sold listings (left side bar under “show only.”
All these things are tools that help you make an informed decision when it comes to purchasing and pricing. There is no ironclad method. It is a mixture of “gut” and science.
3. Types of Sourcing
1. Garage, Yard, and Moving Sales (I mainly use gsalr.com to find the sales)
- Early Bird Gets the worm, Last in the “room” gets the deal
2. Estate Sales
Know what “key words” to search for: sealed, new in box,
You can set up Google Alerts for certain keywords (http://www.wikihow.com/Set-up-a-Google-Alert-for-Craigslist) or use a paid service like craigslistnotifier
4. OfferUp - iOS & Android App
5. Varagesale iOS & Android App
6. Mericari iOS & Android App
7. Thrift Store
8. Flea Markets
9. Pawn Shops ( Steve Raiken’s Periscope, YouTube & book are helpful)
10. Liquidators/Pallet Sales
What are some good products to look for while thrifting?
Books (Rare, Technical, Textbook, Teaching)
Board Games (the weirder the better)
Printers (keep an eye out for large format photo printers)
Calculators (Texas Instruments)
Micro Cassette Recorders
VHS Movies (e.g. WWF videos)
Video Games (retro is super in: Mario Bros, Zelda, etc)
Hand Held Electronic Games
LCD Universal Remotes
Electric Pencil Sharpeners
Anything New in a Box
Benefits of Thrifting
You can source very profitable products for next to nothing through thrifting. I often spend $25 on products that will produce $200-$400 in revenue. If you are on a tight budget, this is the route for you.
Drawbacks of Thrifting
1. It is easy to buy incomplete or non-functioning products.
-Double-check editions of books
-Make sure board games are complete
-Plug in electronics and bring along a bag of batteries
2. Also, some people might not enjoy the haggling.
Tips: Be sure to write good “condition notes” when selling used/collectible products.