27/05/2022
How to Start FBA Wholesale Business in USA from Pakistan? Breakdown of Investment:
We need investment around 5,000$ to 8,000$ in USA market.
Step # 1: Creation of Amazon Individual Account:
First of all, we have to create Amazon Individual Account of US with Pakistani Details.
Requirements to Create an Amazon Individual Account:
Passport
Meezan Bank Statement
Credit Card of Meezan Bank (Remember to make a Credit Card because a Debit Card makes issue Sometimes)
Utility Bill
Make sure that home address on Bank Statement and Utility bill are same.
Step # 2: Creation of USA Based Company (LLC):
LLC (Limited Liability Company) is a business structure that allowed us to registered/create our own company in United States.
Criteria of USA LLC:
When Individual account will verify, hire an agent to Create LLC (Limited Liability Company), when LLC get registered then we will get EIN (Employer Identification Number, After EIN we have to register ITIN (Individual Tax Identification Number), Also get Reseller Certificate, Sales Tax ID. It takes 50-60 Days to complete all process. Required Budget for this step is $800-$1000.
Remember that we will never make an order of LLC Registration until our Individual Account is verified.
Step #3: Convert Individual Account to Professional Account.
Once Company Registration process is completed, we have to convert Individual Account to Professional Account. It takes some time to verify our account. When it will be verified, Amazon will deduct $40 monthly subscription fee from our bank account.
Step #4: Create Website & Company Email Address & Number.
We have to need website with Uploaded Products dummy listing to take an approval from Brands and open a trade account with Distributors. It takes $150-200.
Step #5: Product Hunting.
Now we will find a profitable product and take an approval from their brands or its distributors. It takes some time like 15 days. (Depend on Efforts)
Step #6: Order to Test Products.
Initially we will shortlist minimum 3 products of some brands or distributors, order their Inventory. There is no need to put all eggs in one basket, because brands have a lot of products so we donโt spend all the money on a single product even we do not spend the whole budget on a single brand hence the risk is diversified and our money is spent on different products of different brands.
ยท So initially, we will order 20-30 units for each product for testing purpose. Letโs suppose average cost of per product is $5 so for 30 units of each product and total 90 units of 3 products. Budget for this is $450-$500. We will ship our inventory directly to Prep Centre.
Note: We took $5 price as an example, according to our latest product hunting criteria price must be between $12 to 50$.
Step #7: Generate Amazon Label & Send to Prep Centre.
We will make Shipment Plan and generate Amazon Labels and will send it to prep centre. They will paste Labels on our inventory for FBA warehouse. Suppose for each unit prep centre are charging $0.6, so for 90 units it would be $54-$60.
After prep, they will ship our inventory to Amazon Warehouse. Once amazon confirm & verify our inventory, our listing will be ACTIVE.
Step #8: Choose Profitable product to Order Large Amount of Inventory.
Once Products are live, you have to select 1 or 2 profitable products whose sales are good and which is generating excellent profit. Order large amount of inventory like 200 units because inventory also matter in Buy Box rotation. It will require 200*5= $1000 and for 2 Products $2000.
Note: We took $5 price as an example, according to our product hunting criteria price must be between $12 to 50$.
Step #9: Again, Generate Amazon Label & Send to Prep Centre.
After Ordering ship to prep. After prep, ship to Warehouse. It cost will be 400*0.6 = $240
CONCLUSION:
LLC = $1,000
Website with domain & hosting = $200
Monthly Subscription fee = $40
Testing Units = $500
Prep of testing Units = $60
Large Inventory of 2 Products = $2000
Prep = $240
Total: 900+200+40+500+60+2000+240 = $3940 (But if we are following our Product Hunting Criteria, we need 5,000$ to 8,000$ on initial stage).
USA Product Hunting Criteria:
1) BSR (Best Selling Rank): 1 to 60,000 (Itโs good as less as possible)
2) Reviews: 100+ (Should be more than 100)
3) Rating: 4.2+ (Rating should be between 4.2 to 5)
4) Revenue: 4,000$+ (Monthly Revenue should be more than 4,000$)
5) Price: 12$ to 50$ (Price should be between 12$ to 50$)
6) New Offers: 5 to 22 (Sellers should be between 5 to 22)
7) Package Weight: 2kg Maximum = 5 Lbs. = 2,000 grams.
8) Variation: Not more than 4.
9) Amazon as a seller: Not Selling OR Out of Stock.
10) Sales Equity: At least 25 sales per seller.
Note: Same Criteria can be used for UK โ BSR Should be under 35,000
The second question is how much time will it take to start generating profit?
FBA Wholesale is not much time taking business like FBA Private label. FBA private label takes 8 to 12 months until you start to get stable profits. But FBA Wholesale business takes almost 3 to 4 months to start earning profit. (It can vary that LLC is ready or not?).
As LLC registration & processes also takes (30-40 days). So, this is what we can expect like after 3 to 4 months when our account will be mature, we can start earning the profit in FBA Wholesale business.
Thank you.
Regards,
Talha Murshad
FBA Wholesale
