What to Know About Selling Electronics on Amazon
Access to the market is one of the most pertinent concerns for a trader. This is even more complicated because you don’t necessarily have a guarantee that those buying from you today will not go to your competition tomorrow.
These are the market dynamics that make the system work. America alone has millions of households.
This is a ready market, and the only thing standing between them and the sellers is access. This is where Amazon comes in.
Amazon is the largest eCommerce platform based on the coverage area worldwide and its turnover.
Considering this, Amazon is your best bet for making millions selling electronic products online.
This guide takes you through details on how you can set up an electronic shop on Amazon.
Such details include the requirements for selling electronics on Amazon, how to sell restricted products, the benefits of listing your products on amazon, and general practices by sellers and Amazon to ensure a seamless flow of business and increased customer satisfaction.
Why Sell Electronic Products on Amazon?
A poll survey carried out by NPR and Marist revealed that 44% of prospective buyers online start their search on Amazon.
This was 11% higher than the number of people who begin their product searches on Google.
Additionally, it was proved that at least 40% of Americans love to do their shopping on Amazon. These numbers are ridiculously high for one country.
Understandably, some countries may register low numbers, but cumulatively, you are looking at billions of people buying products online, a big chunk of this being Amazon customers.
Selling on Amazon is, therefore, a gold mine! If you play your cards right, plenty of success will come your way given that Amazon helps you by expanding your reach which has a net positive effect on your income.
Besides, what is the essence of a business if not to make profits, grow, and return to the community?
Selling electronics online is one way of making a business. However, listing on Amazon is regulated by specific requirements for every item.
Ungating Electronic Products on Amazon
Ungating simply means obtaining approval to list under a specific restricted category. A while back, it was fairly easy to start and run your business on Amazon without any fuss. However, when counterfeits started flooding the site, and people were being scammed on the platform, Amazon quickly closed these channels. Now for sellers to be allowed to list certain items on Amazon, they need approval. Electronic products are examples of merchandise open for everybody to tread in. However, to be able to deal with certain brands and specific items requires one to apply to be ungated.
General Requirements for Electronic Product Sellers on Amazon
First, electronic sellers need to ensure that they comply with the local, state, and federal government regulations and guidelines for selling electronics.
This is followed by keying in relevant information such as; seller or vendor ID, company name, contact information, a list of product ASINs, etc.
For approval to sell some specific items, sellers may also need to show user manuals, test reports, images showing compliance and safety markings, and other relevant information.
They may also need to show certificates and other documentation showing brand approval.
Brand approvals is a permission from the brand owner to sell their products on Amazon.
Some products are limited to being sold only by the brand owners.
Such items are marked as premium and you will never be permitted to sell them.
How To Start Selling Electronic Products on Amazon
Setting up a shop on Amazon does not require a government license (although to be allowed to sell certain items like jewelry, you will need a license). Once you observe some basic marketplace principles and regulations, you are free to sell and find your customers online.
Here is your Five Step Plan to follow if you are a newbie:
1. Choose Your Product Niche
This sounds like a cliché, but believe it becomes hectic especially when sellers need to research which products can give them a maximum return over short periods. Amazon has a metric it uses to measure performances, which includes shipping rate, selling volume, stock turnover, and customer satisfaction. Those who perform well on these metrics enjoy certain benefits that are not open to everyone. Some of these benefits include Fulfillment By Amazon, Amazon Small and Light FBA, fulfillment centers space quota, allocation during high-demand seasons, etc. To be on the safer side and ensure they reap maximum benefits, sellers need to choose a product that is performing well. Otherwise, with low sales, and high fees by Amazon, they are likely to struggle to keep their business afloat.
2. Find Out The Category Under Which the Product Is Listed
Now that you have chosen to sell electronic products, research where these products are listed and how Amazon categorizes them. Knowing product categories is especially important since you will then know which products require to apply for approval and the ones you are free to sell. The former requires you to apply to have an Amazon Seller Professional Account. So, research to find out if the item you intend to list has some prerequisite obligations that need addressing. This improves your chances of being approved.
3. Open An Amazon Seller Central Account
Sign up for the Amazon seller account by clicking the Start Selling button from the website. You will be prompted to choose your preferred selling plan. Amazon offers two selling plans; individual and professional selling plans. Individual plan subscribers are required to pay $0.99 for every item sold on Amazon plus referrals and variable closing fees. Whereas, a professional account holder will have to pay a monthly one-off fee of $39.99. Those who sell less than 40 units of a product in a month are advised to pick the individual plan while those who sell more should subscribe to the professional plan.
4. List Your Products And Start Selling
Directions for listing for different seller accounts differ as well. However, you need to ensure that you list products by their SKUs and UPCs together with descriptions. You will find directions on your seller account portal.
5. Set Up Your Shipping And Carry Out Product Promotion
You can decide to sign up for Amazon FBA to enjoy the company’s shipping services at a fee. However, you still have options to set up your shipping arrangements or hire third-party companies to take care of your shipping needs.
Carry out advertisement gigs and product promotion strategies to attract more customers to your online store.
Examples of Electronic Brand Names
Kindle | Echo | BlueTooth Speaker | Roomba Robot Vacuum | Acer
What Are Amazon Restricted or Gated Categories
Amazon gated or restricted categories are those with strict selling rules that no seller is allowed to sell freely.
These categories, brands, and ASINs have specific approval guidelines, and any seller who meets the standards can enjoy a vast market with less competition.
That means Amazon only has the power to draw the rules and open gates for more sellers to access the categories.
The good news, however, is that Amazon does not always restrict the entire category, like in the previous gating practices. Instead, it gates subcategories, leaving some products open, even though they might be under gated categories.
This explains why there is a short list of gated categories and a long list of restricted products or subcategories.
Generally, any seller who wants to sell within a gated category such as electronics must apply for electronics brand approval for Amazon to let them in.
Why Does Amazon Gate the Electronic Category?
Most multi-million investments are built on trust, customer satisfaction, and a healthy working environment, and Amazon is no exception.
Being a huge marketplace with millions of users globally, Amazon strives to maintain a good relationship with both buyers and sellers by ensuring only high-quality clothing products are in circulation.
It achieves this by gating some categories, brands, and ASINs.
Therefore, among others, here are the main reasons why Amazon gates the electronics category:
1. To Monitor Product Standards
One of the first missions of the company is to ensure buyers are offered both high-quality and safe products. It does this by allowing only sellers whose products have undergone stringent quality assessment steps to access highly-demanded categories.
Since the platform is home to millions of brands and buyers, there are high chances of buyers getting counterfeit products.
Hence, it is Amazon’s responsibility to block such products and demand sellers who want to sell electronic brands to request electronic brand approval ungating.
2. To Protect A Brand’s Reputation
Amazon also works jointly with big brands to ensure only authorized resellers can list products. Therefore, to protect the brand’s reputation, Amazon asks sellers to provide legit documentation from these brands to show they are allowed to list their products. Resellers who do not provide proof of authorization are locked out of certain categories. In fact, many large and well-known brands require pre-approval with them directly, before even applying to Amazon. This is true for both seasoned sellers, and individuals new to the platform.
3. To Enhance Customer Satisfaction
Besides ensuring buyers can get high-quality products, Amazon also restricts some categories to prevent sellers from exploiting buyers. That means only sellers with a positive track record can access the categories and reach buyers. This enhances customer satisfaction and a positive rating. The company may also limit or dictate maximum pricing to ensure buyers are not being fleeced.
4. Adherence to FDA Regulations
Many items require the approval of the Food and Drug Administration to sell in the US marketplace. No retail platform, website, or other selling venue is permitted to offer any product that is not previously rubber-stamped by the FDA. The obvious reason for this is safety because specific laws exist to ensure that end users are not harmed. Further, items from foreign countries may not be permitted, as they do not meet standard codes from other regulatory bodies.
Categories And Products That Require Amazon Approval
As stated earlier, Amazon has a long list of gated products and a short list of restricted categories. That is because one category can have more subcategories, which can add up to tens of products. Therefore, when applying for electronics brand approval, sellers need to consider three ungating levels; category, brand, and product ungating. They should also differentiate between category and product unlocking.
General Guidelines on How to Sell Electronics on Amazon
Whether you are a new reseller or an established FBA seller, utilizing the vast market space offered by Amazon should never be a challenge again. Amazon’s mission is to see its users grow, and thus, increase sales and profitability.
And this does not matter if you are listing your products in a locked or unrestricted category.
As a result, if you want to expand your selling portfolio by accessing restricted categories, you need to fulfill the following Amazon electronics requirements:
Sign Up for A Professional Amazon Seller Account
Professional Amazon Seller Account is the backbone of any seller as it records all the activities conducted by the seller on the platform. It is through this account that Amazon can tell your business position and determine whether you are eligible for selling electronics on Amazon FBA. Therefore, if you don’t have one, you can create a professional Seller Account which goes for around $39.99 per month.
Analyze And Verify Your Account Health
Creating a professional Seller Account is not enough.
You still need to maintain its health to maximize your chances of getting approved. Maintaining a healthy account includes meeting your customers’ expectations and adhering to Amazon’s business code.
That means you should have a timely shipping record, good customer relations, competitive pricing, and avoid violating Amazon’s policies.
To check your account health, go to the Account Health section on the Seller Central Account and click on the Performance menu.
Check Specific Electronics Brand Ungating Guidelines
Each category has specific ungating instructions, and you need to check them before requesting approval.
Some categories are complicated, while others have simple instructions that even new sellers can unlock easily.
For example, some categories require sellers to have at least three years of selling experience and running websites.
Choose A Reputable Supplier
Getting a reliable supplier is also a vital step, especially as your demand curve grows. Amazon will also ask you to provide legitimate invoices from trusted suppliers whose products fall under gated categories. After choosing a supplier, you need to place at least three orders, with each order having at least ten pieces of the restricted product.
Retailers are not considered suppliers. That is because you cannot go down to your local store and purchase a bunch of items or take shortcuts like buying used electronics on Amazon for resale. The products need to come from verified wholesalers and distributors. Be sure to do your research before sourcing and paying for any potential sales items.
Prepare Your Documents
Before submitting your approval request, you need to prepare your documents, which include recent purchase invoices from reputable wholesalers. These scanned copies of individual invoices should have all the ASINs written next to the product name. Price and other confidential information should be locked for wholesaler privacy. As a general note, it is usually best to send the documents in PDF format, so it can be easily seen that they have not been revised. You may also be required to send information about your status or business trading information. Some sellers also choose to hire ungating services that show them how to sell electronics on Amazon.
With all the documents and other requirements ready, you can proceed with electronics brand approval ungating using the following steps:
- Getting a Pro-Merchant Status. You can get the status at only $39 per month. It becomes easier if you already have a Professional Seller Account.
- Search for the item you want to list
- Go to the Listing Limitations Apply
- From the new menu, click on the Apply to Sale button
- Lastly, click on the Request Approval button
Guidelines To Ungate Specific Categories on Amazon
Selling electronics on Amazon FBA goes a long way in understanding what the category entails and how to ungate it on Amazon.
For instance, some categories require sellers to have authorization from regulatory bodies like Food and Drug Administration. Others require sellers to have more years of selling experience and a good online presence.
Therefore, if you intend to sell in any gated category, you need to consider the following best tips to maximize your chances of getting ungated:
- Getting a Pro-Merchant Status. You can get the status at only $39 per month. It becomes easier if you already have a Professional Seller Account.
- Maintaining your order defect rate below 1%. Since it is challenging to tell how fast some products can go bad, it is crucial to ensure your orders move as fast as possible to minimize cases of selling defective products.
- Maintaining your pre-fulfillment cancel rate below 2.5%. A higher pre-fulfillment cancel rate can impact your account health negatively. Thus, you need to lower your order cancelation to maximize your approval chances.
- Lowering your late shipment rate to below 4%. Timely delivery is one way to get customer trust; hence, you should try as much as possible to avoid late shipment.
- Acquiring child product certificate. A Child Product Certificate is a must-have requirement if you want to sell in children’s categories such as Toys and Games. It also proves that you adhere to both local and federal product safety laws.
Final Thoughts on Selling Electronics On Amazon and Electronics Brand Approval
If you have a goal of establishing a business on Amazon, then no obstacle, legal, systemic, or otherwise can prevent you from making money online. Thousands of people have started businesses and they are booming.
With electronics, you simply need to follow regulations and you are on the green. Though, before reaching that level of making millions selling electronics on Amazon, you need to understand certain selling hacks.
These hacks include direct customer interaction, updating their products’ SEO, understanding product safety rules, and taking the risks to invest in more than a thousand units from a single manufacturer.