How risky is an FBA business

It depends on the product. If it is a "forever" product like bowling balls, they'll eventually all sell, provided your prices are in line with the competition.

If it is something like a phone case for an iPhone 7, you could be stuck with a bunch of them when the iPhone 8 is released in about 5 months.

No matter what you decide to sell, you better have a very competitive price!

Hold on!

There's much, much more information you will need, in order to take a decent commercial decision.

Of course, you want a good sense of whether or not there is volume to be had.
What about competition levels? Are they high or low?
What about the quality of the product?
What about market positioning of the product?
What about advertising channel appropriateness for the specific product?
What about amazon ads position on the page, and cost per click?

What about?.. What about?... What about?

There's a hundred and one questions and issues to be investigated before you can come to any decent commercial decision. It's the case for offline businesses and it's the case for online businesses. No different (just a different set of questions).

Asking the right set of questions will go some way to mitigating your risks and increase the probabilities of success.

My advice would be to look at the opportunity strategically and not tactically. This is where most of the big money is made in ecommerce generally and amazon specifically.

When I started selling on amazon, years ago, I did 'okay' for the first period of time, but it was only after fully addressing strategic commercial issues that i then moved into 6+ figures a month.

Hope this helps, at least, a little.

Good luck with your ventures

My advice is to start with a ressler shop (like a test), with super hot products! and after you have made a good point of your shop buying rates and traffic you can go forward and buy a stock package!

You can buy a WSO or contact freelancer to set you up with ecommerce platform and some affiliate modules, and save the 4500$ until you're sure!

Also be aware of what you buy and who you are working with
Take SEO and SEM in consideration and have good good patience for results.



Regards!

In my opionio I would say it's a risky business. A lot f people do go into it and have success but it will cause a lot more stress because of the fact that you also have to do all the shipping and everything like that. It's a lot of investments that you could do for even just $1000 and still have a faster return and not that huge hassle of shipping out orders and everything.

I like how people seems to think the price is all that matters....Especially on Amazon, because it is not true at all.

On Amazon, is it all ABOUT RANKING ON THE FIRST PAGE FOR YOUR KEYWORD.

You sell Wallets? You better rank high in the Amazon search engine or you WONT MAKE ANY SALES.

How to rank on amazon? BY SELLING STUFF MAINLY, by having an optimized title, a good description, good pictures, but mainly by having a lot of sales in a short period of time. Just think about it....would that make sense for Amazon to rank your product on the first page if they noticed that in a short period of time you sold a lot of units?...The answer is yes, and this is exactly what they do.

This is the Amazon game. You want to quickly have as many sales as possible, so a good strategy is give a huge discount for your product when starting out, hopefully you already have a list of buyers, then BOOM in a short period of time you end up on the first page for your keyword. Then you raise your price and you WILL STAY ON THE FIRST PAGE, because people only look at the first page most of the time. If you are #1 in your category, you will sell a lot and you will STAY #1.

Even if you have a new product and you put the price super low, it won't put you on the first page...understand? Price alone will not help you, at all. You need a strategy that will bring you to the first page, and yes, you WILL lower your price (or give a discount) at first, but it is only to game the algorithm in amazon.

Does that make sense? Don't think that by looking at the #1 product in your category, then selling your product $2 less, you will outrank them, IT DOESN'T WORK LIKE THIS.

Just look at the price of the top 5 products, and look at the price of the products on page, 3-4-5 and you will notice that products on page 3-4-5 are often CHEAPER, yet they don't rank better.

Understood?

It is NOT about the price. It is about RANKING HIGH IN THE SEARCH ENGINE.

The bottom line is if you know how to do all of this, it is not risky at all, but if you don't, then it is super risky.

IMO it is not very risky at all if you follow a low risk system. I use camelcamelcamel to learn of a products past sales and price history. This can be used to forecast how frequently the item will sell and for how much. There will be adjustments in price you may have to make but that should be considered. Also you should only send in small portions of inventory until the sales demand and you need to send in more.

As for the poster above who suggests you start with your own ecommerce store vs. FBA that makes zero sense IMO and I expect anyone who understands how good a sales site Amazon is would completely agree.

Meh,

I've tried FBA and Dropshipping and I would highly recommend any new person to start with dropshiping using Shopify.

The risk factor is there. With dropshipping you can get started with less than $100, whereas with FBA good luck doing this with less than $500, or even $800.