How to Sell on Amazon in 2025: A Beginner’s Guide
How to Choose the Right Amazon Business Model from Online Arbitrage, Retail Arbitrage, Private Label, Wholesale, Drop-shipping, and Handmade.
Choosing the Right Amazon Business Model
When starting an e-commerce business, you must first pick out a business model that works for you. Below are a few factors to consider when choosing your ideal business model:
- Accessibility: How easy or difficult it is to start using this business model.
- Profitability: How quickly and easily this business model can generate profit.
- Viability: The chances of maintaining long-term success while handling risks.
- Competitiveness: The level of competition you’ll encounter in the market.
Below we introduce the most popular Amazon businesses, namely: Private label, wholesale, retail arbitrage, online arbitrage, drop shipping, and handmade.
The Six Types of Amazon Business Models
Let’s explore each business model in detail, examining not just what they are, but how they work and who they’re best suited for.
Amazon Private Label
Private label selling involves sourcing unbranded products from manufacturers and rebranding them under your own label. Essentially, you create your own brand identity and apply it to products that are often already being made by manufacturers. Think of it as creating your own restaurant rather than franchising an existing one—you have complete control over your menu (products), pricing, and brand identity.
A few benefits of owning a private label business on Amazon include:
- Brand ownership gives you control over pricing and product development
- Higher profit margins (typically 25-40%)
- Potential for brand recognition and customer loyalty
- Opportunity to expand beyond Amazon
📖 Read this blog on the 9 Causes for Private Label Seller Failure on Amazon
Amazon Wholesale
In wholesale, you purchase products in bulk from distributors or manufacturers at a discounted price, then resell them on Amazon at a markup. Unlike retail or online arbitrage, where you’re hunting for deals on individual products, wholesale selling focuses on buying from established suppliers with large catalogs and offering those products to a massive audience on Amazon. The key is to buy in large quantities, which helps secure better pricing and increases profit margins.
Key aspects of wholesale success:
- Established product demand reduces marketing needs
- Predictable inventory management
- Built-in brand recognition
- Opportunity for consistent reorders
🎥 Watch this video for tips and tricks on Amazon Wholesale & Private Label
Retail Arbitrage
Retail Arbitrage refers to reselling goods that you find at bargain prices from retail stores, then selling them at a higher price point on Amazon to make profits. Amazon sellers prefer this business model due to its ease of access, simplicity, and fast process. You don’t need any investments, and only purchase items that are readily available!
As a retail arbitrage seller you may find yourself going through the steps below:
- Morning: Check clearance sales at local stores
- Afternoon: Scan items using Amazon Seller App to check profitability
- Evening: List new finds and process shipments
🎥 Watch this video and find out How Alex made $380K a year with Retail Arbitrage in less than a year.
Online Arbitrage
Online arbitrage is similar to retail arbitrage but happens entirely online. You scour e-commerce websites like Walmart.com or Target.com for discounted items, purchase them, and resell on Amazon at a markup.
A few common tools that you would use to assist you as an Amazon online arbitrage seller include:
- Price comparison software
- Deal finding extensions
- Virtual assistants for sourcing
- Automated repricing tools
🎥Watch this video to discover John’s journey with Online Arbitrage as he shares the pros and cons and answers our questions about his experience.
Amazon Dropshipping
In this business model, sellers set up their storefronts, decide on pricing, branding, and marketing—all without ever touching the products. As a seller, you act as the middleman between the supplier and the customer. When someone places an order, you collect the payment, pay the supplier, and they handle the fulfillment.
Understanding the drop-ship workflow:
- A customer places order on your Amazon listing
- You forward order to supplier
- Supplier ships directly to customer
- You pocket the difference between your selling price and supplier cost
📖 Read this blog for a Basic Guide to Dropshipping on Amazon
🎥Watch this video on Tips for Retail Arbitrage, Online Arbitrage and Dropshipping on Amazon
Amazon Handmade
Amazon Handmade is a curated community for artisans, similar to Etsy but with Amazon’s massive customer base. This model is perfect for creators who want to scale their craft business.
What sets Handmade apart:
- Direct connection with customers
- Lower competition due to entry barriers
- Higher perceived value for unique items
- Strong brand storytelling opportunities
📖 Interested in Amazon handmade? Read this blog on Exploring the Handmade Amazon Program: Is it Worth Your Time (or your Money)
How do I choose the right Amazon business model?
Choosing the right Amazon business model is a critical decision that depends on your financial readiness, time availability, market conditions, and risk tolerance. The infographic below breaks down the process into three key steps: self-assessment to evaluate your resources and commitment, market analysis to understand competition and trends, and risk assessment to weigh potential challenges.
Questions to ask yourself when selecting an Amazon Business Model include: Self Assessment Questions, Market Analysis Questions, and Risk Assessment Questions.
Now that you understand the basics of Amazon’s business models and its policies, it’s time to explore the practical steps to get started. In this section, you’ll find step-by-step guides for each business model- Private Label, Wholesale, Retail Arbitrage, Online Arbitrage, Dropshipping, and Handmade. From finding suppliers to listing products that stand out, these practical tips will help you hit the ground running and set your Amazon journey up for success.
How to Sell Private Label on Amazon
Creating a private label business on Amazon involves sourcing unbranded products and rebranding them under your label. This model allows you to control your product design, branding, and pricing strategy, offering significant opportunities for growth. Below we define the steps on how to get started selling Private Label on Amazon.
4 Steps to Selling Private Label on Amazon include, defining your product strategy, developing go-to-market plans, listing products on amazon and finding a reliable supplier.
STEP 1: Define Your Product Strategy
Start by identifying a niche where you can offer something unique. Consider customer pain points, market trends, and gaps in existing offerings. Your product should address a specific need or provide added value to stand out.
STEP 2: Develop Your Go-to-Market Plan
Once you have your product, define your target audience, pricing, and marketing strategy. Remember that private label buyers often expect lower prices than national brands. Ensure your pricing aligns with consumer expectations while maintaining healthy margins.
STEP 3: Find a Reliable Supplier
Look for manufacturers on platforms like Alibaba or ThomasNet. Focus on suppliers who offer competitive pricing, consistent quality, and ethical production practices. Test samples to confirm the product meets your specifications.
STEP 4: List Your Product on Amazon
Create a professional, optimized Amazon listing with high-quality images, keyword-rich titles, and engaging descriptions. This ensures your product stands out in search results and appeals to potential buyers.
How to Sell Wholesale on Amazon
Wholesale involves purchasing products in bulk from distributors or manufacturers and reselling them at a markup. It’s a straightforward model that leverages established brands and products.
The four steps to selling Wholesale on Amazon include researching wholesale suppliers, conducting due diligence, purchasing products in bulk, and listing products on Amazon.
STEP 1: Research Wholesale Suppliers
Start by identifying reputable wholesalers. Use directories or contact brands directly to find authorized distributors. Focus on suppliers offering popular products with stable demand but avoid overly saturated categories.
STEP 2: Conduct Due Diligence
Vet potential suppliers thoroughly. Check for authorization to sell the products, review their pricing structures, and ensure they meet your shipping and quality standards.
STEP 3: Purchase Products in Bulk
Once you’ve selected a supplier, buy products in bulk to secure better pricing. Be mindful of minimum order requirements and focus on maintaining a balanced inventory to avoid overstocking.
STEP 4: List Products on Amazon
Use existing ASINs for products already listed on Amazon or create new listings for unique items. For optimal results, leverage FBA to manage storage, packing, and shipping, ensuring faster delivery and higher customer satisfaction.
How to Sell Retail Arbitrage on Amazon
Retail arbitrage is one of the simplest ways to start selling on Amazon. You buy discounted products from local stores and resell them at higher prices. Below are detailed steps on how to begin selling retail arbitrage.
The four steps to selling retail arbitrage on amazon include finding local stores and deals, using the Amazon Seller App, calculating your ROI, and listing your product on Amazon.
STEP 1: Find Local Stores and Deals
Visit department stores, supermarkets, or clearance outlets to scout for discounted items. Focus on well-known brands that customers already trust.
STEP 2: Use the Amazon Seller App
Scan product barcodes using the Amazon Seller App to check the current selling price and potential profit margins. Look for items with a Best Seller Rank (BSR) below 50,000 to ensure steady demand.
👉 Read our blog post on “5 Repricing Strategies”
STEP 3: Calculate Your ROI
Before buying, calculate your return on investment (ROI) using the app. Ensure the product’s profit margin justifies your time and effort.
STEP 4: List and Sell on Amazon
Add the items to your Amazon account under existing ASINs or create new listings. For faster sales, consider using a repricer to stay competitive.
How to Sell Online Arbitrage on Amazon
Online arbitrage mirrors retail arbitrage but involves sourcing discounted products from e-commerce websites instead of physical stores.
The four steps on selling online arbitrage on Amazon include identifying reliable websites, using product research tools, purchase and manage inventory, listing and optimize products.
STEP 1: Identify Reliable e-Commerce Websites
Search for deals on sites like Walmart, Target, or Overstock. Look for clearance sections or seasonal sales.
STEP 2: Use Product Research Tools
Leverage tools like SellerAmp or Keepa to track product pricing trends and ensure consistent profitability. Analyze sales data and competition before making purchases.
STEP 3: Purchase and Manage Inventory
Order the products and have them shipped to your home or directly to Amazon’s fulfillment centers if using FBA. Check shipping fees and delivery times to manage costs effectively.
STEP 4: List and Optimize Your Products
Create attractive listings on Amazon. Use compelling images and descriptions to drive conversions and regularly monitor performance to adjust pricing if needed.
How to Dropship on Amazon
Dropshipping allows you to sell products without holding inventory. You act as the middleman between customers and suppliers. The steps involved in dropshipping are listed below.
The 4 steps to dropshipping on Amazon include: identifying reliable websites, setting up your amazon store, handling orders and fulfillment and monitoring performance metrics.
STEP 1: Find Reliable Suppliers
Research suppliers on platforms like Oberlo or Spocket. Ensure they can deliver high-quality products promptly and offer competitive prices.
STEP 2: Set Up Your Amazon Store
Set up your store and list products from your chosen supplier. Use engaging product descriptions and high-quality images to attract buyers.
STEP 3: Handle Orders and Fulfillment
When a customer places an order, your supplier ships the product directly to them. Focus on managing customer expectations and addressing issues quickly.
STEP 4: Monitor Performance Metrics
Keep an eye on fulfillment times and customer reviews. Promptly address any issues to maintain strong seller metrics.
How To Sell Handmade on Amazon
Amazon Handmade is ideal for artisans and crafters looking to sell unique, handcrafted items.
The four steps to selling handmade on Amazon include: applying to Amazon handmade, designing and producing products, listing products on Amazon, and engaging with your audience.
STEP 1: Apply to Amazon Handmade
Register for the Handmade program and provide information about your craft. Approval may take time, so prepare your portfolio in advance.
STEP 2: Design and Produce Your Products
Focus on creating high-quality, unique items that cater to a specific niche. Highlight your craftsmanship and any custom options available.
STEP 3: List Your Products on Amazon
Showcase your items with professional photos and detailed descriptions. Include information about the materials, production process, and customization options.
STEP 4: Engage with Your Audience
Build a loyal customer base by offering exceptional service and engaging with buyers through feedback and reviews.
📖 Read this blog to find out whether Amazon Handmade program is worth your time!
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