April 9, 2020
Selling Private Label On Amazon (Pro’s and Con’s) – Tips for Selling on Amazon FBA

Selling Private Label On Amazon (Pro’s and Con’s) – Tips for Selling on Amazon FBA

what’s up everybody I’m Justin and I’m
Kristen and we are Flipping Profits and this is our two-minute tip of the day so
yes it actually Justin I get a lot of questions about launching a private
label company and honestly we both think it’s a great idea and it’s very
profitable but with profit there’s a lot of risk and reward so we want to give
you a couple tips if you guys are interested in launching your own private
label so stay tuned all right welcome back like Kristin said a little bit
earlier we’re gonna be going through private label what are the do’s what are
the don’ts how does it work what does it mean like that type of stuff but Before
we jump into that make sure you go down below hit that subscribe button if this
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and good and the most value yeah we create a video about it so let’s drop
that timer are you gonna do it okay so let’s jump in to the pros and cons of
private label so you I’m gonna go over like what private label is first for
people that are branded so for people that are brand new private label means
that you can come up with your own product to sell on Amazon you can go and
get it and manufactured in China well we use China but you can go to different
places like India yeah you can really go and get anything
match or manufactured anywhere I mean in France the US like for example like
sourcing products in the US is really good for like supplements and protein
shakes and stuff like that because we have higher guidelines and standards
like going over to like India is really good for like clothing like blankets I
really wanted actually we got really close I don’t know if you guys have
heard of Aidan and Aniyah but swaddle blankets I actually loved
those and I was paying top dollar for them so I decided to go and recreate
Aidan and Anaya’s swaddle blankets and that I would not do in China that I
would do in India so depending on what you’re looking to do you can go overseas
to do it so I think we should talk about the pros to it it’s great because you
can private label like we just said put your logo on it I mean it’s really just
developing a product from the ground up like every little aspect of it anything
you you know you could take a concept that is already existing that’s good and
I’m built upon it and make it better which is something that’s you know for
those that are like into that type of stuff it’s really fun and exciting I
mean for us when we were doing it the very first time it was almost like
exhilarating because we’re like somewhat newer to Amazon we knew the potential
like let’s give an example so for one of the examples that we use is my daughter
or my daughter I mean our daughter when finally sorry ok my daughters our
daughter didn’t want to wear headbands so we actually came up with a kid’s head
band that had wire in it and you could like you wouldn’t feel the wire so kids
really like them and we would sell them in a 3-pack and it was really fun
because we could get pictures done with kids and we named it our own brand I’m
like I had its own brand and it was ours so we love that the downside of it
though is that it what we paid for I think we paid as like a bucket was it I
want to say was like 2 dollars and 85 cents to have it
manufactured in China with all the product packaging with everything and to
have it shipped to the US a total from manufacturer everything to have it land
in amazon fulfillment centers it was just under $3 per unit which is I mean
and by the way when you’re working with China like we were we actually had
inspectors over there in China inspecting our products and making sure
that it was up to our standard which is super important to do that’s like we
almost lost like five thousand dollars because they do they because of a
language barrier sometimes they do mess up on your logo or the stitching won’t
be as good so we would actually have our product sent back and forth to Amazon
quite frequently or not to Amazon from China to the US quite frequently to make
sure that I was up to like not rinky-dinky cheap material also product
photography is very important we actually have a great person who is
actually not even there in Ukraine no oh you’re talking about the one in New
Zealand oh yeah we do have a product photographer that’s based out of New
Zealand that’s really good but it is also very expensive and and family
expensive I think like for one product we ended up spending almost like $2,000
just on seven or eight photos just on product yeah product pictures and also
you’re creating your own listing and doing your you know having your search
engine optimization you’re also paying to you do a lot of giveaways to get your
ranking up it’s just a lot of advertising that goes into it so if you
guys have a lot of capital to drop into private label we do suggest doing it and
trying it because with big risk there is a big reward so what’s the one of the
pros like what it to you was like the biggest Pro well the money obviously the
you know the biggest upside was the money of it and it was ours so it felt
like wow this is like something that we created together and launched on our own
so we kind of treated it more as like a baby and like I was very attached to our
items so anyways and then let’s talk faster because the two minutes is
already going up it’s already gone alright so the cons I would say the
number one con is competition so Amazon you know is the largest selling platform
in the world China knows this too and you know quite frankly there was one of
our products that we ended up launching that didn’t saintly well we were doing
almost a thousand dollars in profit every single day and at one point we had
probably like 40 or 50 brand new sellers just show up on Amazon and we’re like
whoa like what the hell just happened it’s the same exact product and they
were competing with us neck-and-neck and there was nothing we could do and they
were priced at like half of our price and what we ended up finding out was the
reality was as Chinese manufacturers realize how much money was being made
and they would jump on the list they just you know and because their product
is priced so much lower and they have the capital to invest in pay-per-click
advertising and like all these different things and factors just to get higher
ranked they just you know there’s nothing you can do to beat them and I
caught another con would be one of the products that we did launch was a beauty
product that had a lot of FDA problems and regulations that we would have to
follow so it as well as it was doing it came with a lot of work so your account
would get shut down like every six weeks and then we’d have to deal with proving
that we were in proper guidelines of the FDA and then then the account would get
reestablished so it is a lot a lot of work especially if you’re going into
like a niche market yeah so I mean another problem given another Pro one of
the best things about running a private label business really is the ability and
the flexibility of like where you live you never have to worry about touching
the product you know you have the staff or the people to help you that are
overseas and it literally goes directly from the manufacturer to Amazon
Fulfillment Center so you have absolutely no contact with the product
which is really cool and it easy because literally you can be
traveling around the world I mean we’ve known people that have been traveling
just you know one day they’re in Dubai the next day they’re in Singapore and it
they don’t skip a beat yeah they are still working because the reality is is
you know there’s a lot of gurus out there saying Oh privately well private
label private label you can make so much money and set it and forget it and they
kind of advertise it like that that’s complete malarkey so Justin and I are
actually going to launch another private label and when we do that we will
actually be traveling international to like actually make sure we go and check
out the manufacturers and go visit their and actually build our relationships
that way because one of the cons to it is that you are working with them and
you don’t really personally build a relationship with them and then they’re
like the language barrier you have not really care about you as like a customer
to some extent like they care about you obviously but like you’re just like
every other person that’s trying to do the same thing we got really lucky but
I’ve heard a lot of horror stories on it and then another thing is like
transferring the money over there to pay them like a large amount of money was a
pain in the butt like going to the bank and getting well not on that but like
there’s a couple times where we like wired money and then they didn’t do it
no no no they remember that one manufacturer that we wired money to them
and then we ended up they weren’t giving us the samples like we were we were
trying to finish by a deadline and they kept on coming back and this was like
three four weeks went by and they hadn’t provided any samples and we’re like well
your guys’s lead time is generally ten days from when we hand you the money to
when you actually have a finalized product like what’s taking so long and
we ended up having to cancel that relationship they wouldn’t give us our
money back yeah so we actually learned along the way to actually use some
credit cards so to pay for this tobacco and PayPal so that if something does go
wrong you have protection over your account so if you guys are interested in
private-label and want to ask us questions make sure that you guys ask us
because we are like I said we do want to launch another product and we’ve been
through it we went for a couple years and we did really
well yeah but it does take a lot of capital but what’s happen offski I’m
super risky but with risk there is a reward and it’s just the challenge of
getting in ten yeah so anyway about that two minute tip of the day make sure it’s
like 12 minutes oh sorry no don’t worry about it so everybody welcome christen
to the 2-minute tip so we hope you enjoy this
we hope you you know learned a little bit about what private label is what are
the pros what are the cons make sure to smash that like button
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16 thoughts on “Selling Private Label On Amazon (Pro’s and Con’s) – Tips for Selling on Amazon FBA

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  2. Welcome back Kristen, it's good to see you again! Interesting video. I manufactured a medical device that was manufactured in China and as you say, there are many challenges. Can you possibly make a video about SEO and PPC? Thanks so much. Looking forward to your coaching program.

  3. I think the more you talked about the cons, it seems like private label is more of a hassle than it's worth.

  4. Hello again guys, you talk about a private label like it is a thing in your past, are you not doing it anymore or is it still a viable way that you make money?

  5. You should mention trademarking and Brand Registry. Trademarking your name brand can take a year or more and you need to know what class your product falls into and you have to show you are making that product within a certain amount of timem TM and Brand Registry are so important. Having Brand Registry is also required to have control of your listings on Amazon and keeping unauthorized sellers off your listing. Amazon doesnt want to see the same Alibaba products simply listed with a new logo scattered throughout their catalog. They are cracking down on this. People interested in private label should be doing their research and seeing how they can make a product better and capitalizing on that. Amazon reviews gives you plenty of insight into what customers want.

  6. Private label is something that I have been curious about for a few years now. I am curious (if you don't mind answering) how much did it cost from development to product landing in Amazon?

  7. Whats minimum amount to max just give an educated guess on probably small amount of units like maybe 2 or 3 Hundred For total investment with everything you discussed,

  8. Do you have your private label items shipped directly to Amazon or to your house to be inspected by you first?

  9. Very informative thank you! I thought private labeI would be a good fit for me, after watching this video…..I think not. I'm not a gambler and it sounds like there are more risk involved than I had thought, and it sounds like a lot of money and little control. Thanks for being realistic and transparent!

  10. Could your next pro vs con video be about wholesaling? Thanks (and I don't mind if it is over 2 minutes lol)

  11. I'm about to contact Chinese manufacturers about my own PL, how do you find an inspector? and at what stage do you bring him/her into the project?

  12. I really like that you said, “With profit, there is a lot of risk and reward.” This is so accurate, especially when you’re an entrepreneur!

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