Educated Sourcing: 5 Things to Consider When Making Buying Decisions [Series] #4

Not everything you scan will be worth sending into Amazon for resale. How do you know which items are?
 In this series, I'll discuss the top FIVE factors that I use to decide whether or not I purchase an item for resale. Making educated sourcing decisions is important for the growth and survival of your business. Incorrect decisions can lead to holding onto inventory for too long which can lead to limited capital to reinvest. This can start a snowball effect. So let's start off making smart buying decisions from the start using the information available at our fingertips.

In this series so far, I've shared the ins and outs of sales ranks and how competition and reviews affect my buying decisions.  Today, I'll be discussing “hidden” fees that can quickly take a product from profitable to dud. 

Why SIZE Matters.

It's simple. The fees for oversized items, which are usually bulkier than standard sized items, can add up because they take up more space in the warehouse and sometimes require more than one person to handle. Let's take a look.

Pick & Pack Fees for standard vs oversized items are shown below.

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As you can see in the charts above, an oversize item can change pick and pack fees by more than $3 per item. The hidden fee shows up in the form of monthly storage fees. While Amazon's storage fees are inexpensive they can quickly add up with oversized items.  More on monthly storage fees can be found here. You can determine what product tier your item falls into here.

How heavy is TOO HEAVY?

Weight also needs to be factored into your buying decision, for two reasons.

  • Higher Amazon Fees:  Amazon fees are higher for heavier items because it will cost more to ship. For more information about weight-based fees go here.
  • Increase Inbound Shipping:  Inbound shipping when sending heavier items to the warehouse can cost more. Even when using Amazon partnered shipping heavier items can drive the cost up.

These fees can usually be calculated using the Amazon Seller App or by using the Amazon Profitablity Calculator. The hidden fee shows up when the item has an incorrect weight listed on the product page. A small 4oz item should not show up with a shipping weight of 4lbs! Check that the weight and size on a listing is correct. MF sellers attempt to adjust the listing size/weight so they can get more money for shipping allowances (which never fully cover the cost of shipping). This can quickly eat into your profit margin with pick & pack/weight-based fees.

Make sure you are factoring ALL of the fees associated with a product you are considering sending into Amazon.

Check back next week! I will be wrapping up this series with more educated sourcing tips to help you make smart buying decisions in Q4 and all year round. If you aren't already signed up to get notifications when new content is posted make sure you sign up in the right sidebar.

MORE FREE CONTENT Remember to catch me later today on Periscope. If you haven't downloaded Periscope [ iOS | Android ] to your smartphone or other mobile device (iPad, tablet, etc), make sure you do it before 2:30pm EDT so you're ready to ask your questions. You can follow me @amy_feierman. See you there!

What are you doing TODAY to move your business forward?



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