Amazon FBA still worth it in 2022?

Amazon FBA still worth it in 2022?

If you’re a seller on Amazon, you might be thinking to yourself. Is Amazon FBA still worth it in 2022 and beyond? Continue readind to find out more, but there’s a spoiler: yes, it’s definitely worth it.

FBA is an amazing business model that allows anyone, regardless of their ecommerce experience, to open an online store and list products to millions of potential customers. But in anything, the good comes with some downsides. ​​Let’s swiftly go over some of the pros and cons of selling on Amazon.

PROS

Access to Amazon’s loyal customer base: Amazon.com receives nearly 3 billion visits per month and has over 300 million Prime customers worldwide. As a small, single-person business, you can list products on a website that receives millions of visits per day.

If you use FBA, Amazon takes care of logistics: If you use Amazon’s FBA program, you will send your inventory into Amazon’s fulfillment centers, and they will handle the storage, order fulfillment, and even customer service for you.

Prime shipping: When sellers use FBA to fulfill their orders, your products will receive the Prime badge and have access to Amazon’s sizable Prime customer base that orders exclusively from Prime sellers.

CONS

Storage fees: Since you will be storing your items in an Amazon fulfillment center if using FBA, you will need to pay storage fees. There are two types of storage fees: monthly and long-term. Learning to manage your inventory correctly will help you avoid costly storage fees.

FBA fees: For Amazon to store, pick, pack, and ship out your orders, they must charge you a fee. FBA fees depend on the size and weight of your product. Between FBA fees and referral fees, it is typically 30-40% of your product price.

Easy for customers to return items: Because of Amazon’s generous return policy, some sellers may experience high return rates on their products. While it is convenient for customers, it’s a hassle for sellers.

Competition

In any business you decide to pursue, there will always be competition — and competition is good because it means there is a market for your products.

Nearly 600,000 new sellers will have signed up to sell on Amazon this year. Yes, that is a vast number of sellers but remember that Amazon’s market share continues to grow every month, quarter, year — however way you want to look at it.

So while more sellers may make things more challenging for existing sellers, you won’t necessarily be stealing sales from each other but sharing a much larger and growing customer base.

Time investment

To successfully sell on Amazon, you need to put in the time it takes to be successful. If you are consistent, you can quickly launch your first product within 3 months, just like 54% of other Amazon sellers have done. 31% launched in less than 6 weeks!

Don’t feel like you need to get up and running that quickly, though. 14% of sellers took 6 months to a year to launch their Amazon business.

Go at your own pace and what makes you feel most comfortable.

How much time do sellers spend per week on their business?

Once you get your business up and running, you still need to put time into managing it. If you utilize FBA to handle all order logistics, you could reasonably spend less than 10 hours per week on your business, like 39% of sellers do.

However, you can spend even less time on managing your business by using a third-party tool to help you, such as our favourite – Ad-Lister. You can save hours per week by listing your products with Ad-Lister, it’s so much simpler and more intuitive than listing directly through Amazon. But you don’t have to take our word for it, as you can simply give it a free try for 14 days, without any costs.

To sum up – is Amazon FBA worth it?

Yes, and while Amazon is competitive, it takes a decent amount of time and money to start, but contrary to popular belief, it isn’t a set-it-and-forget-it type of venture. Navigating an Amazon FBA business requires learning, perseverance, and hard work. But is it worth it? Ultimately, that answer is up to you, but we say yes.

In our opinion, there are far more upsides to selling on Amazon than downsides.