Today we have a guest post from my friends Debra Conrad and Beth Sawickie at ThriftingForProfit.com. I’ve been on their podcast in the past to talk about Profit Bandit and SellerEngine and think that they’re two of the most knowledgable and helpful Amazon sellers I know.
One of the most popular phrases we have shared with other Amazon FBA sellers is “Strive For The Magic 25″.
When we share what we have sold for $25 with others… and they can see that a customer could have purchased the same product on Amazon (or elsewhere) for much less, we know what the next question will be. “How could you sell THAT for $25?“.
Often times these items we sell for $25 or more are things we’ve paid $2-$3 for or less! How’s that for a nice ROI? We are going to explain why that “magic 25″ works when you are an FBA seller on Amazon. And we’ll share where we find this low cost, high profit inventory.
Being an Amazon FBA seller definitely has it’s benefits. One major advantage is that your FBA items automatically qualify for Free Super Saver Shipping and also Prime shipping. Items sold by Merchant Fulfilled sellers do not qualify for these perks.
For non-prime buyer to get Free Super Saver shipping they must spend… $25 on qualifying merchandise.
Who Buys “Magic $25 Products” On Amazon?
We’re not targeting the bargain hunter – we are targeting the people who have more money than time. They’d rather find the item they want and get it quickly, paying more than to shop around for a lower price.
Why we feel “OK” with charging $25 or more for items we’ve paid a few dollars for…
- We are providing a service. Often times these are hard to find items. People are willing to pay more for things they can’t locate at their own brick and mortar stores.
- Prime buyers want to be able to get their items quickly. With Prime, they can get your FBA item in 2 days for no shipping cost, or they can spend $3.99 to have it in 1 day.
- Free Super Saver Shipping buyers can receive your item in 2-3 days as long as they buy at least $25 worth of qualifying merchandise of which your FBA item qualifies.
- Plus, Amazon has a wonderful return policy that is attractive to buyers.
We Looked At How We Shop On Amazon
We spent some time thinking about how “we” shop on Amazon. We could go to a store, we could shop for a bargain online OR we can shop when the mood strikes us and have the product tomorrow or the next day. In fact it frustrates us to shop on Amazon for the perfect product we want to buy… and we can’t find it for sale by Amazon or an FBA seller.
Do you think we are unusual in our shopping habits? We don’t think so… In fact we believe that many Amazon shoppers want their purchases NOW!
It’s also frustrating when we find a product for sale by an FBA seller (or Amazon) priced at $23.99 or $24.99… which means we will need to shop around for another low priced product to add to our shopping cart so we qualify for the super fast low cost and/or free shipping. Many times we find ourselves buying the $25 product just to get done with our shopping and move on. We aren’t looking for the cheapest price… we are looking for (as close as possible) instant gratification.
Don’t Sell Junk On Amazon
We’re not saying to buy some junk dime store item and put it up for $25. What we routinely do is buy items (usually brand new) from thrift stores for $2-$3 and then turn around and sell them for $25 or more. Even if Merchant Fulfilled sellers have that same item available for much less.
Some of the types of items we often sell for $25 include: VHS tapes, CDs, DVDs, textbooks, household items, games, puzzles….etc. And remember, all of these items we’ve bought for only a few bucks and most of them will be brand new.
Should “Every” Product Be Priced At $25?
We would love to say that every product we have offered on Amazon will sell for $25 or more. While we have sold a ton of products for “less than $25″ – most of them were purchased with the “Magic $25″ in mind. In fact, when we are processing (pricing and shipping) our products to Amazon – we often price at $25 even if we can see other sellers priced much lower.
You must keep in mind that when you are “buying, processing and shipping” products to Amazon… you have a time lag. What you see in Profit Bandit the day you purchased a product may be different story by the time that product is actually “for sale” on Amazon.
If we buy products that have “wiggle room” in the pricing, we feel confident that we can sell every product we send in to Amazon FBA for a profit. Some products may sell within days and some may take a while. Some products may need to be “re-priced” (later) a bit lower to get the sale.
We are often surprised at the sales we have soon after our shipments arrive at the Amazon warehouses that are priced perfectly for the customers who want “that product – at that Magic 25 price”. It still amazes us at how much “Magic $25″ inventory we have sold over the last year.
Couple the “Magic 25″ with high quality, low cost inventory from thrift stores and you have a winning combination!
You can learn more about Beth Sawickie and Debra Conrad at ThriftingForProfit.com – PLUS learn more with Smart Scouting for Cash Strapped Amazon Sellers just by signing up for the newsletter.