Starting your private label business can seem overwhelming, especially at first. If you’ve been promised that you’ll make tons of money in less than 30 days, you may want to pump the brakes a little and read this blog.
Now, first it’s important to know that it is actually possible—if you’ve been private labeling for years and have supply lines and online storefronts already in place. Your first instinct will be to research the easiest ways to get started, during which time you’ll find out about retail arbitrage and other potential options. Before you do that, keep reading this blog. We’ll give you all the possibilities available to you so you can get started the right way and make all the money you deserve for your hard work.
How Private Labeling Works
If you’re planning to sell on Amazon, you can work out a deal with Amazon to source and ship your products to an Amazon warehouse. From there, they will take care of keeping inventory and shipping to your customers after an order is placed. This is known as FBA, or “fulfilment by Amazon.” For their trouble, they take a percentage of what you make.
Now, you do have other options, such as keeping inventory on hand for yourself, which involves finding your own warehouse and dealing with shipping on your own. For the amount of money you’d save doing this, the work is absolutely not worth it. It’s up to you, however.
Finding Your Products
How can you choose what to sell? With so many options, narrowing down to one product or a cohesive line of products can be difficult. Then there’s the possibility that what you choose isn’t what the buying public is interested in paying for. If only there were a way to determine what consumers want to buy!
Your best bet is to decide what you want to sell and then begin researching. We recommend scouring Amazon to discover which products have a low Sales Rank. This is the ranking algorithm that Amazon uses to identify which products people are buying. With a Sales Rank below 12,000, you can be sure you’ve selected a popular item.
Now, if you’re planning to sell products as a side feature to a business that’s already in place—such as a business or life coaching endeavor—then you want to find products that support your current brand. This may take more time to uncover, but the results are definitely worth your trouble.
Sourcing the Products
We mentioned retail arbitrage earlier, which is how many people get started in the product entrepreneur business. This involves buying brand-name products from a retailer and reselling on Amazon at a profit. It does work, but it’s very time consuming and offers such a small margin that you could end up losing money in the long run.
You can also work with wholesalers, but this option is also hard to do and profit margins aren’t great. If you do pursue this possibility, you don’t necessarily need a website or even a warehouse (if using FBA). It does however, involve a large cash investment and, in some cases, high minimum order quantity (MOQ). In those cases, a warehouse will be needed.
The problem with both of these options, aside from the already stated drawbacks, is that you will work extra hard just to build someone else’s brand. What you really need is to find a supplier who provides products you can put your own brand on before selling. We recommend trade shows to connect with suppliers, at least to start getting a feel for what’s available.
If you really want to private label your products, make a ton of money, and enjoy your new career, then you’ll want to go to the Canton Fair in China. Sure, Alibaba may seem more convenient, but you’ll definitely pay for that convenience. Why not go right to the source? In just three days, you can gain access to over 60,000 suppliers and find your perfect products!
With your perfect product, you’re ready to go.
Of course, there’s more to the story than that. First of all, you’ll probably want to wait to visit the Canton Fair until April, because the holiday season is already in full swing right now. Then there’s the packaging and shipping details you’ll need to take care of. Finally, you’ll also need to work hard to set up an Amazon storefront that does a lot of your work for you, whether through compelling descriptions or powerful search terms so you can get found.
So, back to the original question: Can you private label in 30 days? As you can see, it’s not very likely. Those who promise that you can are either trying to get something from you, or they simply don’t remember how hard it is to get started in this business.
If you’ve worked with private labeling products before, then you can definitely make it work in 30 days. We’ve done it, and we’ve seen countless others do it. However, we want to help new private labelers enter the business with realistic expectations. This blog is a good way to get started, and we’ve also written a book on the process to help you get it right the first time. For the whole story, you can get Private Label Secrets on Amazon for Kindle. Or you can give us a call and join one of our training sessions. Hope to hear from you soon!