There’s no such thing as money for nothing – but this one comes close!

There’s no such thing as money for nothing – but this one comes close!

If like me you’re interested in creating a rewarding website-based business, then this particular pathway can generate a lucrative income for relatively little investment of money or time, with the potential for eventual sale at a substantial profit.

Why this opportunity is so different

In a traditional commission arrangement, you sell something which isn’t yours and receive a commission from the owner of the goods or service. We all understand that. It goes without saying that you are actually working at some kind of job which provides the platform for this incentive-based remuneration.

But imagine if you had a set-up which produced automated online referrals to a seller, who then paid you a commission on anything that was sold as a result of your referral. You have no real costs entailed. You don’t own the inventory or pay the cost of the storage and delivery systems and you don’t have any accounting to manage. You just get paid for doing almost nothing.

The basic requirement is that you need to set up, or buy, an effectively functioning website that draws regular traffic. Once that’s been achieved, you’re well on your way to owning a potentially highly profitable ‘Affiliate Business’.

What is an Affiliate Business?

So what is an Affiliate (Advertising/Marketing) Business and how does it work? Well, Amazon Affiliate is only one of the many enterprises now operating in this space, but as it was one of the first and remains the largest let’s look at Amazon primarily.

Becoming an Amazon Affiliate business is as simple as registering with Amazon at no cost and then you begin promoting literally any of the products Amazon handles and you get paid a commission on all sales which emanate from your promotion.

How does it work?

The infrastructure for this is amazingly simple. You have a website which features products relevant to your audience. When a website visitor clicks on a product profile, created by Amazon with no work involved for you, this creates a 24-hour duration cookie. Now here’s the exciting part. You get a commission on anything at all that the visitor buys from Amazon in the next 24 hours, not only the items you were actually featuring.

Simply to illustrate, let’s say you have created or acquired a website that features boating and fishing tips, news and stories. On a current post, you have an engaging and informative article on how to choose the best fishing reel, having regard to the fact that these vary in price from around $40 to well over $1000.

Using an extremely simple process you embed Amazon’s own seller descriptions for some of these items, enabling your visitors to click through the links. That’s all there is to it. Tracked by the 24-hour cookie if they then buy anything at all on Amazon over the next 24 hours, including download services, you get the commission. This includes expensive high-end items totally unrelated to the direct content of your website.

Think of it as being paid by a business for your online version of a ‘word of mouth’ recommendation. The actual commission structure is quite complex and strongly rewards higher volume sales, with a peak commission of 8.5%. But even a single sale will earn you 4%.

Is Amazon Affiliate the only option?

No, not at all. There are numerous providers of Affiliate Marketing programs. It’s important to do the research and decide which will work best for you and your website niche. Whether you decide to hook up as an Amazon Affiliate or commit yourself to an alternative targeted ads partner like Google’s AdSense, it is obviously important to understand the commission structures and to do the due diligence so you don’t get caught not understanding the Terms of Service (ToS) arrangements.

For a beginner in this space, Amazon is a very safe place to start because it has massive inventory in virtually every market niche and has a very high level of customer trust when it comes to making an online purchase. You can always migrate to an alternative program later.

Some things to consider

Always carefully check and observe the Terms of Service provisions. While Amazon, for example, makes the setting up of the Affiliate Business arrangement pretty simple, they don’t hesitate to embargo you if you breach a condition, such as making sure to never state a product price or specification within your own website content. And once embargoed, it is close to impossible to be reinstated!

Setting up the relationship and commission payment arrangements is fairly straightforward, but because of stringent identity checking requirements, it takes a bit of effort – more than setting up an Airbnb host account, for example.

The real challenge is to have a website which will attract traffic of the right kind and in sufficient volumes. Amazon will require the details of your website/s as part of the initial registration, but there is no stringent website quality checking on their part. At the end of the day if your website doesn’t attract sufficient traffic to re-direct to Amazon products or services in any great numbers, then all that means for them is that they won’t be paying out much commission.

Naturally, you want your website to be of the highest possible quality anyway and to feature regular posts of interest to engage your target audience. The more clearly you can define this niche and then concentrate on developing quality content for that audience, the better.

Personally, I like this Affiliate Business model because it genuinely rewards the creation of high-quality websites, including blog/vlog sites, and provides monetisation rewarding the level of audience traction gained. All of this at no additional cost to you and with the potential for very substantial commission payments.

Initially, you may be covering only your website hosting costs, but once you create and sustain good quality content with precisely targeted affiliate ‘advertising’ you may be earning enough to pay freelance writers for a great range of engaging content. Eventually, there’s a real potential to earn more than a good salary and start paying off the mortgage at a stellar rate!

Producing high traffic to make your affiliate advertising take off

It’s essential to have a website in an area of genuine interest for you. Authenticity of interest will enable you to work effectively with commitment and enthusiasm and will provide sustainable motivation for the long-term, or until you sell your website at a good profit!

High traffic can be produced if your website is in an area of interest to a large number of people, for example, a site on pet welfare and nutrition. Think of the enormous range of relevant products you could be ‘advertising’ in this context. While more narrow interest areas may produce lower traffic, there may still be a very high level of potential buyer interest in higher-cost products that you have sourced and can promote.

If you have your website up and running already, then linking it in as an Affiliate Business with Amazon or another partner is a prospect really worth considering. Alternatively, you can plan and create a website in an area of authentic interest for you but intended from the outset to be pitched as an Affiliate Business.

Would I consider buying an existing website and turning it into an Affiliate Business?

Yes, this is an intriguing and genuinely exciting opportunity which I’m currently exploring for myself right now. It’s also worth considering the acquisition of an already existing Affiliate Business which is up for sale, if it’s currently operating profitably or better still if you can see it’s got high potential yet to be realised.

It’s true, there’s never money to be made without any effort at all. The trickiest part of the Affiliate Business model is choosing a website niche that genuinely suits your interests and developing it as an affiliate advertising platform. Generating high-quality content and managing your SEO is the key to high visitor traffic and conversion to the click-based commission revenue. Ultimately the yield will make the website profitable and self-sufficient enough to support paid content writing. That will free you up to start your next website in a different niche, working towards your ultimate goal of building an Affiliate Businesses portfolio.

Case Study: EZTool

Case Study: EZTool

Platform: Amazon FBA
Business Model: eCommerce
Business Age: 3 Years
Sell Price: $160,000

EZTool sells watch repair kits via Amazon FBA. They’ve tapped into a niche and the growing direct-to-consumer FBA space. The search power and logistics capability of Amazon has helped them to find a sweet spot. The product is simple and suits the home watch enthusiast! This month EZ Tool Founder Angus Hess successfully found a buyer and has recently completed the sale on Flippa.


What is the product?

EZTool sells two different watch repair kits. Kit one is more conclusive with a wrench and illustrated manual and kit two – the QuickFixxer – is a 16 piece tool kit.


What makes EZTool such a good business?

There’s really two things. Firstly, it’s found a path to popularity in a niche. The product is well supported by a 41 page illustrated guidebook and comes with a 100-day replacement guarantee (nothing like a guarantee to woo customers). Secondly, they’ve successfully leverage Amazon FBA and benefit from cost-effective shipping, storage and world class customer service.


Who is the EZTool customer?

There best selling kit is perfect for watch enthusiasts and connoisseurs alike. Aimed at those who enjoy DIY as well as those looking to save money on pricey jewellers fees the EZTool products sell steadily all year round. And, they’ve found their kits have become very popular gifts.


Why was it so appealing?

Easy to understand this product had significant interest among the Flippa buyer community. Couple that widespread appeal with the FBA model, the strong consumer feedback scores and strong financial results – EZTool was generating between $5-14k profit monthly, which is in part due to low time commitment – and you have a winner.


How did Flippa assist?

The Flippa model has evolved and it’s beginning to suit higher value buyers. That alone is a big win. Flippa now has over 150,000 registered buyers representing a combined purse of over $9bn wanting to be placed. There are not enough sellers. Once they pop up, sellers like EZTool are benefited from the self-service platform, lower success fees than other channels and dedicated account management.

Is it time your business jumped onto Amazon FBA?

Is it time your business jumped onto Amazon FBA?

If you already have, or you’re contemplating, a start-up with an actual physical product to sell, then you have probably heard of Amazon FBA – but what is it exactly and what are its advantages and any potential drawbacks you need to know about?

Well, as a budding mature-age entrepreneur myself I’ve been very interested to follow the progress of one of my friends, Georgina, who has been steadily building a very successful business in high quality skin care products, emulating the well-known and pricey Aesop’s range, but with some extremely creative additions as well.

Like so many other successful start-up businesses, Georgina’s was initiated in her garage, where she worked hard to experiment with bases and herbal ingredients (some of them very expensive) and the mixing, matching and blending processes to create not just practical but alluring fragranced skin products – from hand-wash, to body wash, to nourishing body oils, and later on perfumed candles and aroma diffusers.

The design of packaging (again very expensive) was a major challenge. Logos and branding took time and creativity. The initial sales (obviously on a loss basis for quite a while given the development costs) were to family and a network of friends. But there was a vision. The vision held firm and the viability grew. Finally there was proof of concept as the sales took hold online and some great exposure was achieved when a major Melbourne homewares brand with several suburban stores agreed to stock some of the range.

By now the garage was completely outgrown. It was time to lease a bigger space just for the production itself, and the rental was a significant expense. Georgina took on a couple of university student casuals to help her – but by now the real problem was storage, managing inventory and delivery. Packaging and posting individual orders and hand delivering the store orders had become unmanageable and Georgina was completely out of storage and handling room.

Amazon FBA (Fulfilled by Amazon) entered the Australian market space just 12 months ago – at exactly the right time for Georgina. As a great example if IaaS (Infrastructure as a Service), Amazon FBA manages every aspect of the pick-up, storage, inventory management, order shipping and even customer returns.

It’s useful to clarify that your product does not need to be sold on Amazon itself (although of course it can be). The winning point of differentiation for Amazon FBA is that it’s an end-of-the-line system which saves your business time and money because Amazon stores your products and manages their delivery in your direction. The fulfilment fees are extremely competitive, given Amazon’s vast network of storage, delivery and inventory management systems. Their advanced data management systems allow you to monitor and track all inventory, orders and deliveries as they are happening.

The fulfilment fees include all packing of orders, inner packaging and delivery, even including the management and accounting for any returns. Separately there is a monthly storage fee, based essentially on your cubic metres of stored product. It would be impossible for a small start-up company to access its own rented storage facility in an equally cost-effective way.

All of Georgina’s products are classified by Amazon FBA as ‘standard-size’, but companies with large physical products such as craftsman-made tables and furniture are also accommodated on a different storage fee schedule. One potential financial hiccup to be aware of, is that Amazon FBA storage fees have a price hike (literally tripled) in October-December because of the premium on space in the lead-up to Christmas, but this applies to the storage fee only, not to processing and delivery fees.

Obviously, costs will depend on the kinds of products being handled, but as an indication in Georgina’s case, her typical $30-$40 product has a per-item cost of under $3 for picking up, packing and shipping, plus around $30 each month per cubic metre of stored products. In the case of her business, that’s a lot of product she doesn’t need to store, package and handle for shipping, allowing her and her couple of part-time assistants to concentrate on what they find more interesting and enjoyable – developing and actually making their product range.

For a small business, there are really very few drawbacks in using Amazon FBA. Initial account set-up, including business and individual identity verification, and learning the system for preparing product for FBA collection is a bit complex initially, but once managed it’s plain sailing. It’s also sensible to check out the very large number of order fulfilment alternatives to FBA offered by many companies now for Australian-based businesses. Few can rival the economies of scale of Amazon, but the best deal for your business may depend on exactly what it is you’re selling and your own production or sourcing processes.

In this article, I’ve concentrated on Amazon FBA for Australian-based businesses creating physical products for sale. However, it’s important to remember that there is a massive growing global enterprise in third-party selling. This is where the trader sources products from an original supplier literally anywhere in the world, and then markets it with a price markup, often at a huge margin. Using Amazon FBA the third-party seller can create a highly profitable business without ever actually handling the physical merchandise at any point at all.

A variation on this, and one that is often highly successful is the ‘Private Label’ approach. This is where an already existing product is sourced, usually from a low-cost producer overseas, and branded with the third-party seller’s own logo and brand name.

Now that’s a completely different scenario from Georgina’s business, but a very interesting one to explore in a separate discussion another time along our journey.

 

Flippa Partners with Industry Leader for Amazon FBA Training

Flippa Partners with Industry Leader for Amazon FBA Training

Photo credit: https://www.businessinsider.com.au/its-still-day-one-first-photos-of-amazon-australias-melbourne-fulfilment-centre-2017-1

 

Guest blog by Jim Cockrum, founder of the Amazon FBA training course – Proven Amazon Course

 

Let’s start with an obvious observation.

 

Amazon FBA is hot!

Currently, Amazon FBA is one of the most wide open and most talked about business opportunities in the e-commerce universe! As a business model FBA benefits include:
    • Ease of launching from scratch
    • A short learning curve
    • A truly global opportunity
    • Very low capital risk required to get started
    • Very predictable growth if proper strategy is deployed
    • Favorable market conditions for future growth
    • Automation & hands free operation are possible
    • Creative resources are readily available to assist you
    • From day one you have a built in ravenous customer base

These factors and others make the Amazon FBA opportunity nearly impossible to ignore as a premier online business option.
 

What is FBA?

FBA stands for Fulfillment By Amazon. Most simply stated, you can ship your goods to Amazon warehouses and Amazon will sell and ship the product to the end customer for you.  You never even have to see or touch your inventory if it comes straight form a supplier or manufacturer! It’s one thing to understand what FBA is by reading Amazon’s own description of the program,  but it’s another matter entirely to build a successful, scalable, sellable business on the platform.

 

How much bigger will FBA grow?

FBA is in its infancy.  Amazon is building warehouses globally and is set to open soon in Australia as its latest conquest.

Consider these facts as well: According to U.S. government data, retail shopping online is still less than 10% of all retail spending in the U.S., but that number is projected to grow rapidly in the coming decade and could easily reach 25% in that short time.

In other words, most of the growth in e-commerce and Amazon FBA is yet to come – and it’s coming rapidly! Unless there is a major disruption of current trends, Amazon is clearly set to see incredible annual growth for years to come. That serves to substantially benefit those who are building FBA businesses on the Amazon platform. The opportunity is truly global as well because as an FBA business owner you can use our extensive network of partner services that accommodate every possible challenge in moving your inventory to where it needs to go.

 

Which FBA strategies are hot?

There are numerous ways to succeed with an Amazon selling business.
  • Selling your own private label product
  • Establishing relationships with wholesale sources
  • Sourcing unique products from small businesses that aren’t selling online yet, or are marketing themselves poorly
  • Bundling already popular products to make new listings
  • and many, many more…
Opportunity is abundant because customer spending continues to escalate on Amazon!

 

Why partner with Flippa?

Our FBA training team is delighted to have been contacted by Flippa in order to form a partnership that benefits those who wish to start or grow with the FBA model.  The Filppa leadership indicated to us that numerous Flippa.com users were making inquiries in recent months on the topics of buying, starting or growing an FBA business. As a result, Flippa began to research extensively and eventually came to the conclusion that we were the perfect FBA educational partner for their community. We are of course honored to form this partnership in order to better serve those seeking success with FBA.

 

About our Proven Amazon Course

No one in the world has served Amazon selling professionals (aka FBA sellers) for as long or as successfully as has the creative team behind the Proven Amazon Course.  We have our own publicly disclosed 8-figure online selling accounts that demonstrate our depth of knowledge of the platform. We’ve received over 1,000 documented success stories as well which all credit our coaching and course for having helped establish and grow incredible Amazon FBA businesses.

 

We have successfully assisted thousands of students with:
  • Launching an FBA business from anywhere in the world
  • Building private label brands on Amazon
  • Building a team for scalable growth
  • Finding creative sources of profitable inventory
  • Creatively marketing Amazon products through advanced Facebook strategies

 

We are delighted to partner with Flippa, and we’d love to hear from you if you are interested in learning more about launching or growing an Amazon FBA business.

 

 Proven amazon course_Flippa_Jim Cockrum

 

About the author:  Jim Cockrum is a best selling web marketing author and a seasoned Amazon FBA expert. His courses, books and coaching are the foundation behind thousands of Amazon seller success stories.  His industry leading course located at ProvenAmazonCourse.com contains numerous comprehensive modules for both beginner and advanced online sellers who are either launching or growing an Amazon FBA or Amazon merchant fulfillment business.  The latest update of his book, “Silent Sales Machine – 10th edition” is a consistent top 10 seller on Amazon in numerous e-commerce categories.
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