At 25-years-old, Kale Abrahamson, who dedicated most of his life to basketball, ended his career as a Division 1 college basketball player to start his Fulfillment by Amazon FBA venture.
Despite his lack of business acumen, Kale was able to achieve tremendous success through the FBA program. After teaming up with former computer salesman and fellow entrepreneur Taylor Hiott, the two were able to utilize the power of Amazon FBA to build a seven-figure business.
Now, Kale and Taylor help other aspiring entrepreneurs grow their businesses through Amazon through a coaching program called Nine University. “Every type of business — from small ventures to massive corporations — can benefit immensely from Amazon’s resources and reach when they sell through the FBA program” says Kale.
Why sell through Amazon FBA?
Amazon has overtime evolved into one of the largest, admired, and feared companies in the world. The tech giant is expected to be the most important company of the 2020s — “and probably the 2030s as well,” predicts Kale.
Most businesses compete against Amazon. Today’s consumers don’t just compare products and services, they compare shopping experiences –including personalization, customer service, shipping, delivery service, and returns.
You can to take advantage of Amazon’s unparalleled distribution network, renowned customer service, and huge customer base to help your business by using an Amazon FBA program. As an entrepreneur in the FBA program, you get access to the extensive resources of a powerful corporation without actually being one.
With Amazon taking care of inventory, shipping, returns, and customer service, you are able to dedicate more time to developing your product, marketing, and reaching new customers.
How does Amazon FBA work?
The majority of products on Amazon are not actually sold by Amazon itself — an estimated 70 percent of products are sold by third-party businesses. No matter the size of your company, you can sell your products on Amazon through the Amazon FBA program.
With Amazon FBA, you supply products and sell them for a profit while Amazon handles the picking, packing, shipping, and customer support. Here is a step-by-step breakdown of how that process works:
Step 1: Set up your Selling on Amazon account. Start by setting up a Selling on Amazon account and be sure to opt-in for FBA services. Once your account is created, you can list your products on Amazon.com
Step 2: Ship your products to Amazon. After informing Amazon of what you are shipping, you can send your products to Amazon’s fulfillment centers in the U.S. At these warehouses, the team will carefully sort and store your items. Should any of your products be damaged during this process, Amazon will reimburse you for their full retail price.
Step 3: Advertise. Once your products have been received by Amazon, your listing will activate and you can begin promoting your product through platforms like Amazon Sponsored products or Facebook Ads This step is key to boosting your visibility.
Step 4: The purchase. Whenever a customer purchases your product, Amazon handles every step of the transaction — including processing payment and updating your inventory.
Step 4: Picking, packing, and shipping. After a purchase is made, Amazon picks, packs, and ships orders through their web-to-warehouse system. Amazon offers free, fast shipping on your products to Prime members, and free shipping on most orders.
Step 5: Customer support takes over. Once your customer receives your product, Amazon’s customer support team takes over. Amazon’s customer service staff fully manages returns, refunds, customer queries, and follows up with customers to ensure satisfaction.
The benefits and drawbacks of using Amazon FBA
Still not sure whether FBA by Amazon is right for your business? We spoke with Kale Abrahamson of Nine University to learn some of the benefits and drawbacks of working with Amazon:
Pro: Free, fast shipping. Your product can be delivered to Prime Members in as little as one day. Non-Prime shoppers, too, are typically eligible for free shipping.
Con: Cost. You have to pay a monthly fee and a percentage of profit for each product sold to participate in the Amazon FBA program.
Pro: Multi-channel fulfillment. As an FBA member, you can take advantage of Amazon’s fulfillment services items sold on your proprietary website and platforms like Etsy and Shopify.
Con: Limited remarketing opportunities. The FBA program doesn’t provide you with the emails of the customers who purchase your products.
Pro: Customer trust. When your product is sold on Amazon, customers trust that their items will be delivered on time and their customer service experience will be satisfactory due to Amazon’s reputation.
Con: Constantly changing market. “Amazon is totally different that it was five years ago”, says Kale, “It is going to continue to change over the next five years.” To remain competitive, businesses need to constantly be evolving with a changing market. Kale warns aspiring entrepreneurs that there is a lot of clutter on the internet promising get-rich-quick solutions through FBA. “Serious FBA businesses are dynamic and always learning,” Kale says. “If you come in prepared, you can crush all the competitors trying to make a quick buck.”
Kale Abrahamson and Taylor Hiott are the founders of Nine University, an online course that helps you develop your Amazon FBA business. Started in 2016, Nine University now has over 130 employees and mentors over thousands of students globally on how to properly start their Amazon FBA business. Kale and Taylor are very skilled in the business world and specifically, the ecommerce world. Kale started his own Amazon FBA store Business on the side while also working full time as a business consultant at Duquesne University, and Taylor made 130k per year prior as a computer salesman. YouTube channel
Amazon stock photo by Sundry Photography/Shutterstock