Increasing your Average selling price to increase your overall profits
March 22, 2020
Step 1: Buying higher priced products to sell with Amazon FBA and/or ebay
When I first started with Amazon I bought tons of low priced items to sell on Amazon because I could buy tons of them due to being on a limited budget. So I would buy $5 items that would sell for $12 to $15 making my profits very small usually in the $2-$5 range. Now with over the years as I have grown my Amazon business I definitely gravitate towards higher priced items when I am look for inventory because I know I will make more profit when I find good items. I now look for items that make at least $10 profit and the cost of the item can be anywhere from $20 to $50.
With this strategy you will not have to sell near as many items in a month to make the same kind of returns. It also takes less time to pack in ship if your not buying a ton of small items.
Step 2: Make sure you check for any and every discount possible when shopping.
A few examples would be Kohls sends me coupons on a regular basis so I can almost always get an extra 20 to 30% off when I shop or I can shop on days that they offer a higher percent off for card holders. By waiting for the sales I can easily increase my profit margins.
Stores such as bed bath beyond have coupons online that can be used over and over. You can check retail me not and usually pull up a coupon that can be used online or in store.
Another great way to find online coupons is to use a program called Rakuten. It will tell you all of a stores/websites current discounts and will also offer different amounts of cash back for each store. Follow this link to sign up and earn $25 when you make your first qualifying purchase on Rakuten.
Just remember any % you can get off your order or get in cash back is more profit in your pocket.
3. Control operating expenses :
1. Only buy the programs you really need to run your business. I know some online sellers that spend hundreds of dollars on multiple programs to run their inventory, reprice their items on Amazon, buying lists, scanners, computers etc.
When I first started my business I did not pay for anything extra and I was able to run my Amazon business just through the tools that Amazon offers. I did eventually start using a program called Inventory lab . Inventory lab does a great job for what I need it to do which is list everything on Amazon, keep up with inventory and also give me my end of the year tax reporting information that I need to give to my accountant, but I would suggest you start off listing and keeping up with everything just through Amazon until your sales justify investing in Inventory lab.
2. Buy supplies in bulk. I found out early on that I was going to use a lot of tape, mailing labels, printer ink and other packing materials.
So the best way I found to save money was to order packing tape 12 to 24 or more at the time on Amazon and it was cheaper per roll thank buying 4,8,12.
I Also purchase poly bags on Amazon in bundles of 1,000 this way you get 4 different sizes which you will need to ship certain items or anytime there is 2 or more of something that you need to package together.
You can also save money by getting different size boxes from stores that are throwing them out anyways. I use free boxes when possible but if I need a larger sturdy box I will purchase packing boxes from Lowe’s or Home Depot.
3. Shipping to Amazon fba is another way you can cut cost. You get Amazons rates for shipping via UPS and it is much cheaper than if you tried to ship through UPS yourself.
Once you get use to shipping to Amazon you will see that the more you can ship in a box the more you can save. For example if you can for 30 items in a box versus 20 your shipping cost per item would likely be lower so instead of paying .40 cents an item you may only pay .30 cents an item. Doesn’t seem like much in the short run but if your making multiple shipments a week you will learn to get as much as possible into a shipment so squeeze that extra little bit of profit out whenever possible.
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