How to choose the best (and most profitable products) to sell on Amazon

So you’ve decided you want to start selling on Amazon but what products should you sell?

Choosing the right product niche is the most important part in your Amazon business.

A lot of other aspects of an Amazon business, such as listing writing, advertising and account management can be outsourced to freelancers or virtual assistants as your business grows but I think coming up with product ideas and new product niches is something that you should always do yourself.

There are lots of ways to get inspiration for new products or product lines (I talk about one of my favourite ways in this video). But there are a few core principles that you should keep in mind when you assess whether you go ahead and pull the trigger with a new product.

Here is my checklist covering how to choose profitable products to sell on Amazon.

If this is your first product, what you want to be looking for is:

• Sale price – Products that can be sold for between (£,$,€)20 and (£,$,€)100
• Dimensions – Products that aren’t too big. ≤ 45 x 34 x 26 cm in the UK /  ≤ 18″ x 14″ x 8″ in the US.
• Weight – Products that aren’t too heavy. ≤ 5kg 
• Competition – Products without too much competition. It’s going to be tough trying to sell yoga mats for example.
• Demand – Products that are already selling well on Amazon which you could adapt or improve in some way. Amazon isn’t the place to sell something totally unique. 
• Complexity – Products that are simple with few moving parts and are hard to break. For example, I wouldn’t sell electronics as my first product as there are a lot of things that could go wrong.

Of course, there are exceptions to every rule and there are plenty of products that do well on Amazon which don’t meet these criteria. 

But if this is your first foray into selling on Amazon, it’s a good idea to stick to these basic rules. 

Sale price

When you sell on Amazon there are a number of fees and costs that you need to take into consideration. 

👉 Product cost – This is an obvious one, but the cost of the product the manufacturer charges or if you’re making it yourself then the cost of your materials and time to make the product. 

👉 Shipping – The cost of shipping the product from the manufacturer to the Amazon warehouse if you’re selling via Amazon FBA or your own fulfilment costs if you’re selling via FBM.

👉 Tax and import duties (if relevant)

👉 FBA fee – this is the fee Amazon charges for picking and packing, storing and delivering your products if you’re selling via FBA.

👉 Amazon referral fee – This is the fee Amazon charges for a sale. For most products this is 15%. 

Tip: Helium10 has a handy fee calculator which allows you to see what competitor products are paying in fees. 

You want to be selling products for at least £20/$20 otherwise you could be left with little to no profit.

One way to get your product above £20 is to add value to the product or bundle multiple products together in multipacks.

If you sell products with a sale price of over £100/$100 then the customer is likely to have pretty high expectations so if the product doesn’t match up you could end up with a lot of returns which could ruin your profit margin.

So for your first product I wouldn’t recommend going above £100 unless you are really confident in your product. 

Dimensions and weight

As a general rule, large, heavy items cost more to ship and store in the Amazon warehouse as they charge oversize fees.

For your first product, look at something smallish, unless you’re fulfilling orders yourself in which case you might have more flexibility here. 

However, large products can be a good thing to sell when you’re a more experienced seller, as the weight is a barrier to entry. This means there might be less competition.

Competition and demand

Amazon ranks the products being sold with a best seller rank. The product at the top of a best seller rank is selling the most. 

If you get your product to number 1 – congratulations, you are probably making a lot of sales!

Ideally you want to find a product that is already selling quite well, but which doesn’t have too much competition.

Amazon isn’t the place to launch a totally new invention. People generally go to Amazon looking to buy a specific product rather than to get ideas.

By using the best seller ranking, you can make an estimate of how many sales a particular product is making. Jungle scout has a free tool called the Sales Estimator which can help with this.

Let’s look at an example. Here is a screenshot from a listing for a “viking horn”:

The best seller rank is 28,569 in Toys and Games. If we go to the Jungle Scout Sales Estimator and enter in the best seller’s rank number we see that this helmet sells roughly 21 per month, which isn’t that great, so probably not worth competing with.

You also need to check how much competition your potential product would have. 

Look at the number of competitors and what their reviews are like. If there are ten sellers selling a similar product, all with 4.5 stars, you are going to find it hard to find a point of difference. 

However, if you see lots of sellers with 3 stars, then have a look at the reviews, find what issues people are having, and see whether it’s something you can improve on.

For example, if there is a shoe that has good sales but only 3 stars because many people find it uncomfortable, you could improve it by adding an insole.

Complexity

You really don’t want to be selling complex or electrical products for your first product. The main reason for this is you want to limit the amount of returns you get as returns can really hit your profit margin.

You are going to get far fewer returns selling rubber spatulas than you are selling remote control toy cars as there are only a few things that can go wrong with rubber spatulas. Rubber spatulas are probably extremely competitive though!

So in summary…

There are lots of other things to think about when coming up with new products but if you keep these core principles in mind when you’re starting out, you’ll give yourself the best chance of launching a successful product. 

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