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December 3, 2016

120 How to Increase Your Amazon Profit – without more sales

The final 5th part of this miniseries of 5 episodes, this completes this overview of Profit Maximizing Strategies. Remember the basics: you can only increase profit 2 ways:

  1. Increase income
  2. decrease costs

We looked last time at decreasing your overheads. Here we address the other profit killer: your Direct Costs.

Otherwise known as COGS=Cost of Goods Sold.

look at your Total Landed Cost (TLC): Here are some ideas for reducing these:

-Manufacturing cost – can you negotiate with your supplier for lower costs? If you order more units, can you get a lower per unit price?

-Freight cost – get multiple freight quotes. Order more in bulk so you can sea freight rather than air freight etc. Choose lighter products!

Also consider your Amazon costs when choosing a product:

-Weight handling costs: Consider product weight & calculate costs very carefully if considering a heavy product. Will it make a profit?

-Oversize product costs: same things to consider as heavy products.

-Amazon Warehousing/storage – generally these are low but again very bulky products may increase these – do your P&L calculations carefully as well.

-Receiving warehouse/Prep: compare costs between eg FBA Inspection, Earth Class Mail, EZPrep in the USA.

Other supply chain cost reductions:

  • remove a link in the chain! Eg get products sent directly from China to Amazon warehouse(s) rather than via a warehouse. I advise against it for a new supplier but if you plan it carefully for a proven supplier/product, that will save you money – and of course time as well.

Watch How to Increase Your Amazon Profits without Selling More!

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Michael Veazey


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