How to Find Profitable Products to Sell on Amazon

Finding a profitable product opportunity is the first step to selling on Amazon. The opportunities shared by usual sources tend to be unprofitable, as sellers jump on the bandwagon.
FindingFind Products to sell Amazon

Finding a profitable product opportunity is the first step to selling on Amazon. The opportunities shared by usual sources (seller gurus, coaches, online tools, and blogs) run the risk of becoming unprofitable, as many sellers tend to jump on the bandwagon. The Amazon Marketplace has more than 1.9 million active sellers. If you find and source the products in the same manner as other sellers, you will never turn a profit on the Amazon marketplace. You need to differentiate your process; otherwise, you will find many other sellers selling the same product by the time you list your products!

The key is to stay ahead of the competition by going deeper in your product research than other sellers. This post lays out the foundational principles of researching and finding the products to sell on Amazon.

Before diving into the intricacies of product research, Let’s first understand what makes a product profitable.

What makes a product profitable to sell on Amazon?

A product has a better chance of becoming profitable to sell on Amazon if many customers are searching for it while only a few sellers are offering it on the marketplace. The bottom line is to find products with high demand and low competition.

Some products just don’t sell well! Nothing is worse than choosing a product you think will do well, only to find yourself paying long-term storage fees for unsold stock a year down the road. To avoid this fate, Here are some things you should be looking for:

  • High Demand: Look for products that are in high demand. There is no hard and fast rule, but a rough rule is to have at least more than 1000 sales per day in a particular niche.

  • Low Competition: A large number of sellers selling in a particular niche will result in race-to-bottom price competition. On the one hand, it makes it difficult for new sellers to enter the product niche, while on the other, it also cuts into the profit margin of all existing sellers.

  • Few Reviews: Products and sellers on the Amazon Marketplace are partially ranked based on relative customer feedback (i.e., comparing the reviews of sellers within a niche). If top sellers have thousands of reviews, your 100-review product isn’t going to get much attention. To hold your own, we recommend looking for niches where the top sellers have less than 200.

  • Markup-able: Markup-able technically isn’t a word, but it does capture a vital trait of a successful Amazon FBA product. You need to be able to sell products for more than it costs to buy them. To make the endeavor worthwhile, we recommend looking for products that can sell for more than 4X the sourcing cost.

  • Low Weight: Heavy items are more expensive to transport and store. Find lightweight objects to lower your expenses and increase your profit margins. We recommend starting with products that weigh less than 5 lbs.

  • Small Size: Bigger products also cost more to ship, and since they take up more room on the shelf, you’ll get charged more for storage. If you want to keep your costs low, look for smaller items. We recommend starting with products that are smaller than 18” X 14” X 8”.

How To Find Products to Sell on Amazon?

Find products to sell on Amazon by looking at product opportunities within the Amazon Marketplace. Best Seller Lists, Most Gifted, Most Reviewed, and New Release lists are good starting points.

Gather data from the lists and then compare it across data points to find profitable products to sell. Let’s dive a little deeper into product research:

1) Check Out Amazon Best Seller Lists

Start from Amazon’s Best Seller List; these lists are based on sales volume, so you can see what people buy most. Amazon Best Sellers List is a great way to identify customer demand and get ideas for selling products on Amazon. You can use Amazon’s Best Sellers Rank (BSR) ranking system to go deeper with your onsite research. Each item is assigned a value based on the customer orders within a specific category to show where it ranks in sales volume. While BSR is not a direct predictor of sales success, it does indicate a product’s popularity. That means you can use it as a rough indication of potential daily sales for a product.

Do not refer to the Best Seller List in isolation.  While it indicates what customers are buying, you still need information about the number of sellers and niche history before deciding if that particular product niche is a profitable opportunity.

Note: Targeting items that rank in the top 10% of a category with a vast number of items is far more helpful than comparing ranks across categories (which all have their supply and demand ecosystems).

2) Identify Market Supply by looking at the Competition

If you want to develop a product-hunting strategy that’s sustainable, flexible, and profitable, you’ll probably need to go deeper than other sellers. In-depth research will help you determine the best product opportunities that are profitable. You need to have a very clear idea of other sellers in a niche. You can find this data by looking at search result page data or tools that provide a rough estimate of this data. At Seller Adventures, we use a mix of manual analysis and automated tools to ensure data accuracy and relevance. Through our managed services for Amazon Sellers, we provide complete demand and supply data for your review to make an informed decision.

3) Use Amazon’s “Frequently Bought Together” Feature

Amazon’s “Frequently Bought Together” feature makes recommendations based on customer behavior, search, and purchase history. If you’re unfamiliar with this feature, it recommends additional products that customers might want to add to their orders.

Here’s an example:

As you can see, the recommended items stick within a single niche and are more-or-less complimentary to one another. This is a great way to discover products that may have earning potential. The algorithm is essentially telling you:
a) That people are interested in the recommended products
b) That the algorithm is predisposed to recommend the products in question.
Both are good things if you want to find products to sell on Amazon!

4) Use Product Reviews To Identify Market Gaps

Once you’ve decided on a potential product or niche, look at the reviews sections for high-ranking results—there’s a lot you can learn! Consider the number of reviews first. If a product niche has tons of reviews, you can learn a few things:

  • Demand is high.
  • Earning potential is high.
  • Competition is high.

Likewise, if there aren’t many reviews, it might indicate that the opposite is true. Amazon reviews are a goldmine for market insights. Many consumers will go into great detail about the benefits and drawbacks of a product, as well as where specific sellers fall short. Take advantage of this free data on your customer’s pain points and learn from other merchants’ mistakes to produce something better than the competition.

A word of warning: not every Amazon FBA product is a winner.

In this first part of the “how to find products to sell on Amazon series,” we learned about a few basic techniques of product hunting. You don’t need any experience to identify the product opportunity. Still, you will have to gather data and compare the data points to identify the gaps where customer demand is high but seller competition is low.  Once you have found an item, the next step is to create a well-optimized Amazon product listing.  I’ve given you a few simple tips for finding profitable products to sell on Amazon; Now, with hard work and little luck, you can find your first product to start selling on Amazon.

Lastly, have you checked out our product research service for finding an online arbitrage product for reselling on Amazon?

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