It’s almost been 3 years now since I first listed and sold my first book on Amazon. It seems like it was so long ago. At the time, I considered selling my used books to be as simple as holding a garage sale. Like most people, I thought I had a lot of "junk" laying around and just wanted it gone. I never would have dreamed that would turn into an actual registered business with taxes, employees, supplier relationships and everything else that comes with running a business.

Selling a used book, however, is sure a lot different than creating a business, setting up recurring sources of inventory and continually thriving to grow the business yet not go broke in the process. It’s something that I love doing. It has also sparked many more entrepreneurial interests in myself and allowed myself and my family to live a better life. I owe used books, my employees and my family a great, big thanks for the joys they have brought to my life.

I sometimes think what if I would have never tried to sell a book on Amazon. Where would I be now? Would my family and I be struggling to maintain our current lifestyle on my full-time salary or would my wife have had to get a job? I will never know but what I do know is if you’re not selling books online or at least starting up some kind of side business you’re totally missing a great opportunity.

For starters, one of the big advantages of selling used books is lots and lots of extremely cheap inventory! Used books can be bought for close to nothing if bought in bulk. Luckily, the majority of people out there still don’t even consider a book to be valuable unless it’s "old" and even then they’re probably wrong. Equipped with the right knowledge and gadgets you can easily turn a weekend of book scouting into a many hundred dollar profit weekend. Once you’ve got a system down for sourcing, listing and sending out orders it comes second nature to make those big sales numbers.

Have you sold your first book yet? If you’re reading this not because you sell books but because you may just be looking for another source of income for your family have you at least got your feet wet? Reading a blog or "researching" the opportunity can only get you so far. You can dink around on the Internet all day making yourself you’re being productive but odds are you’re probably just procrastinating and making excuses as to why you’re not ready yet. The only way to start something new in your life is to just do it. Drop a few hundred bucks on a book scouting package. Offer to buy thousands of books that you have no idea where you’re going to store them. After you’ve committed to something the mind has a way of just figuring things out.

I’ve blogged about how I’ve taken the leap off the deep end of the pool and every, single time I had no plan at all. I just relied on my gut and the fact that I believed I would find a way to make it happen. Every single time, that is exactly what I did. Obviously, it’s not going to work 100% of the time but if you’re wiling to take a little risk, it will pay off in the long run. If I would have never offered to buy 8,000 books only a few weeks after my first book on Amazon sold I would have never started a business that first has given me more than enough money to supplement my income but at the same time piqued my interest to pursue other opportunities.

Used books are just one small niche in the huge area of things that you can do to supplement your income. Start something you’re interested in. If you don’t make as much money as you had originally thought who cares? At least you should be proud of yourself you started and I promise once you get past the initial hurdles things will start to fall in your lap and you’re going to be kicking yourself you didn’t start earlier.

- Adam

Why Selling Books Online May Be the Best Decision You Ever Make [ 5:05 ] Play Now | Play in Popup | Download (148)

This week I am trying something a little different. I’m writing this post from my brand new iPad! I’m excited to see what I can do from this thing that I was previously able to do with my laptop alone. So far, it has really made browsing the web, checking news and viewing movies on Netflix much more enjoyable than on my laptop. I also have been able to do some business on it also which got me thinking about how I can use this in my book business.

- Adam

The following post is a guest post by Chris Green of FBAPower.  Chris has an excellent understanding of the inner workings of Amazon’s FBA program and his FBAPower application is top notch.  I thought this would be a great topic to introduce or reintroduce to some since it’ seems to be so popular.  While you’re at it also be sure to pick up a free copy of Nathan Holmquist’s eBook titled Selling on Amazon’s FBA Program.  This once paid eBook is now being offered for completely free!

Be sure to stick around for the end of the post.  I reveal the strategy that I personally use to fully take advantage of FBA. – Adam

If you have been selling books on Amazon for any period of time, you have likely seen ads or promotions for Amazon’s fulfillment service called Fulfillment By Amazon, or FBA. You may even be selling items where your competition is using FBA. The number of FBA sellers is increasing and it is changing the dynamics of the Amazon marketplace. Understanding how FBA works and how other sellers are using it will help you decide if it’s the right program for some, or all of your inventory.

So what exactly is FBA? How can it help my book selling business? Are there any downsides to FBA? We’ll answer those questions and more.

Fulfillment companies and programs are nothing new, but what makes FBA unique and powerful is that all FBA items are eligible for Amazon’s free (or discounted) shipping programs such as Free Super Saver Shipping (FSSS) on orders over $25, 4-for-3 promotions, and free 2-Day Air shipping for Amazon Prime members. This makes FBA items more appealing to Amazon’s best customers.

How can FBA help my business?  FBA can be described as a win-win-win.

Win #1. Higher prices, higher margins, higher payouts

Since items sold through FBA are eligible for Free Super Saver Shipping and Amazon Prime, FBA sellers actually raise their prices to match their competitor’s total price (price + shipping). So even with the addition of FBA fees, the FBA seller still receives a higher net payout from their Amazon sales because of the higher sale prices. For example, a seller who ships their own orders who sells an item for $10 with $3.99 shipping will show the same as an FBA seller selling the exact same item for $13.99. Actually, the FBA seller will show first because FBA is the tie breaker. The easy example is with penny books. A merchant fulfilled penny book lists for $0.01 + $3.99 shipping. An FBA seller who wants to price match the lowest price will list for $4.00. Amazon sorts the offers page by total price (price + shipping).
Use the Amazon FBA Revenue Calculator to see estimated FBA payouts for your items at certain prices.

Win #2. Less work

FBA sellers sell items 24 hours a day. 7 days a week. Items ship all hours of the day or night including weekends. They ship whether the seller is at home or on vacation. Once an FBA seller prepares their items for the FBA warehouse and sends them to Amazon, they don’t have to do anything else. They can monitor inventory levels and adjust prices as needed from anywhere with an Internet connection.  They don’t have to stock boxes, envelopes, packing materials, or print shipping labels anymore. They also don’t wait around for their UPS driver or go to the post office every day. The time you used to spend fulfilling orders can now be used to source products or on other aspects of your business.

Win #3. Happier Customers

It is estimated that 40-50% of Amazon buyers have never bought from a third party merchant. You can effectively double your customer base by offering your items through FBA. Amazon customers want to buy from FBA sellers. They trust Amazon and they know that their items will ship quickly and if there is ever a problem, Amazon will help (including an extended return policy). When your items are offered for sale through FBA, they will attract these types of Amazon buyers who are willing to pay more to get their items shipped by Amazon. This is an important point to grasp: Amazon customers are willing to pay more for the exact same item if it comes from Amazon or an FBA seller. They do this because they know they will get their item fast and that customer service will be top notch. This is how you leverage FBA status; you use FBA to market your books to these sellers and increase your margins and profits.

How Do I Get My Items To FBA?

Items sent to FBA require a special FBA label. This label has a barcode identifying the item to Amazon. It needs to cover any existing barcodes on your books. You create shipments and process them through your Amazon account. You can send one box, 10 boxes, even a full truckload of books! Bonus: you get to use Amazon’s UPS rates for inbound shipping. Once your shipment of books is received at Amazon’s FBA warehouse, they are received and offered for sale on Amazon.com.

Is The FBA Program Just For Booksellers?

No. Almost any item can be sold on Amazon using FBA. There are some exceptions such as restricted categories.  New FBA sellers should reference the FBA manual.

But What About All The Fees?

Ah yes, the fees. There are fees involved but they are all known ahead of time. This allows you to make informed decisions about what to send to FBA and how to price your items. Remember, your sales price as an FBA seller is going to be higher than a merchant fulfilled seller. This higher price is what covers the additional fees and leads to high net payout using FBA compared to a merchant fulfilled sale.

• Inbound Shipping Fees

This is the cost to get your items to Amazon’s FBA warehouses. You are able to use Amazon’s UPS rates so you get the lowest possible shipping rates.

• Storage Fees

Amazon charges $0.45 per cubic foot from January – September. $0.60 per cubic foot from October – December. This is calculated down to the hundredth of an inch. For reference, most paperback books will have a monthly storage cost of $0.01 per month. That’s eight years for less than $1. So if an item is in storage for a year before it sells, it’s an additional $0.12. You do get the first 30 days free so if you manage your inventory and only send fast moving items to FBA, your storage fees will be zero. You may decide to keep high ranking items that may take a longer time to sell at your location instead of sending them to FBA.

• Pick & Pack Fees

Amazon charges fixed fees for picking and packing your items.

• Weight Based Fees

Amazon will charge a Lose Weight Exercise based fee when shipping your items. Heavier items will cost more to ship, and therefore have higher fees. Item Lose Weight Exercise is known ahead of time so sellers should price their items with these fees in mind.

• Item Removal/Destroy Fees

If you want Amazon to return an item to you (or destroy the item), they will charge you $0.60/item. You would probably want to have customer returns returned to you for inspection (they can often be resold).

You can find a complete list of fees when using Amazon FBA here.

Can My FBA Items Only Be Sold On Amazon?

No way! While Amazon will likely be your higher volume sales channel, you can still list on other sites such as Abe and Alibris and fulfill those orders with your FBA inventory. This is called Basic Fulfillment. A half pound book will cost you $2.95 to have Amazon pick, pack, and ship this item for you anywhere in the country.

Can I Still Ship Internationally?

Yes. You can sign up for international shipping in your Amazon account. You upload an image of your signature and Amazon takes care of the rest. International customers pay for their own shipping and since Amazon does the actual shipping, they will deduct this charge from your transaction payout (it zeros out). International customers from every country that Amazon ships to will be able to order your products.

Downsides of FBA

FBA has the power to transform your business overnight, but it is important to know how it all works and the potential risks involved when handing over a significant portion of your business process to another company.

Lose Control Over Your Order Processing

You are handing over all aspects of order processing to Amazon. You are trusting them to store, pick, pack, and ship your items. This can be a scary thought for some sellers who take great pride in providing their customers with a high quality shipping process. You may decide to only send certain books to FBA and keep higher valued books or books that would require special packaging at your location to ship yourself.

Hand Over Customer Service To Amazon

Amazon will handle all customer service issues on your FBA orders. This means that you loseWeight Exercise control of the returns process (a customer can return an item without approval from you, the seller). It is possible (although unlikely) that a buyer abuses this liberal return policy at the expense of your inventory. If you suspect anything like this, report it to Amazon. They monitor excessive customer returns as well as A-Z claims.

Possibility Of Loss Or Damage To Your Products

It is possible that your items are lost or damaged either by UPS on the way to Amazon or by Amazon themselves, but that same risk is there for every item dropped off at the post office. Amazon will reimburse sellers for lost or damaged items automatically. It is important to monitor your inbound items as they are received. Amazon will send an email if there are any problems receiving your items.

Summary

FBA is a very powerful program and if used correctly, can greatly improve your margins, profits, and efficiency. It can give you back your time to focus on other parts of your business such as sourcing products or just spending more time with your family. Read as much as you can about FBA, network with other FBA sellers, and experiment with some items to see if it’s right of you.

Additional Online FBA Resources:

Amazon FBA Homepage:
http://www.amazonservices.com/content/fulfillment-by-amazon.htm

FBA Warehouse Tour
http://g-ecx.images-amazon.com/images/G/01/fba-tour/FBA-FC-Tour._V216203492_.html

Amazon Seller Community (FBA)
http://www.amazonsellercommunity.com/forums/forum.jspa?forumID=29

Addendum:  How Adam Uses FBA

———————————–

I have been using Amazon’s FBA service for going on a year and a half now.  It was a game changer for me the minute I sent in my first box of books.  Little did I know it would become a regular part of my receiving process.  Many different people use FBA in different ways.  In this short snippet I’d like to share to you how I personally take advantage of FBA.

I receive unscanned books to my warehouse on a regular basis and have a process by which books can go into a number of different directions.  The books that go to FBA always have a sales rank of under one million.  I’d rather not go to the work of creating FBA shipments with very low demand books that may never sell.  The storage fees may also be pretty low but throw enough 5M+ sales rank books up there and you’ll eventually feel that monthly fee.

The second criteria I use is profit.  I’ve decided to use a profit floor of 75 cents.  This means if the book is in at least good condition and I think I can make 75 cents or more profit on a book and it’s sales rank is under a million it goes to FBA.  There is one caveat though; the Lose Weight Exercise.  As you know Amazon charges a Lose Weight Exercise fee for shipment.  Also, don’t forget about what you’re going to pay to get that 7lb monster book to Amazon in the first place!  Here’s a snippet of the code from a custom receiving application I developed.  Don’t get too confused with the major tech factor here.  It’s simply seeing if a book’s lowest FBA competitor is above or equal to a particular price and under a particular Lose Weight Exercise then let me know if it’s FBA bound or not.  If it doesn’t meet of of the criteria it’s not going FBA.  I still account for other expenses like cost to ship to Amazon and packaging material.

This is just how I use FBA.  Your mileage may vary.  Let me know in the comments how you’re using FBA!

This is a guest post by reader, Frank Giovinazzi.  Frank is a published author and is definitely a go-getter when it comes to his online book business.  If you’d like more information about Frank please visit his Amazon author page.

One of the greatest benefits of self-employment – not having to answer to anyone but yourself – can also be one of its deadliest drawbacks.

I’m writing about the limits you set on yourself, what you are capable of, and the goals you either fail to set or achieve because you think you can’t do it.

As far as your book business is concerned, how many “can’ts” have you racked up over time to ensure your business is producing the same meager results month after month?  Are you racking your brain trying to figure out why you can’t break 3, 5 or $10,000/month in sales but are silently sabotaging daily?  A good reason may be because no one else is calling attention to these self-imposed limits.  They fade into the background and become unquestioned governors on your behavior.

Think of it this way – have you ever seen a confused football player zig and zag in circles when the path to the end zone was wide open? Also, who hasn’t yelled at the screen when they see the poor fellow squandering a golden opportunity?

Back to the book business; What are four or five of the biggest, absolute “can’ts” that you have placed in your own way? The ones that have come up for me recently include:

• I can’t afford the $1,500 to upgrade to Monsoon.
• I can’t process more than 2,000 books per month.
• I can’t get a $10,000 line of credit for inventory.
• I can’t create the partnerships necessary to establish a steady stream of inventory.

I’ve found that I am preventing myself from making the full effort to achieve these goals whether or not these specific goals are correct for me at the moment which leads me to an observation. It’s pretty common wisdom that small businesses are a reflection of their founder’s personality. You can look at the person and predict what kind of business they run just as easily as you can look at the business and describe the person who runs it.

As far as our topic here, consider this corollary:

The only obstacles to success in your small business are the ones you create.

You can whine all day long about government regulations, the economy, competition, forces real and imagined lined up against you, but scratch a little deeper and you will find at the core of your failure is your invisible list of “can’ts” that you have created yourself.

Because you only answer to yourself, you’re going to have to do is start asking some harder questions if you want to break through your own limits and really create the success you vaguely describe in conversation.

Start with the most reliable technology for the task – a clean sheet of paper and a pen. At the top of the sheet, write something like, “What are the things I think I can’t do in my book business?” Try to make a list of at least ten items, and just consider them. Are they accurate? Some of them might be, while most are going to be excuses, or at least areas where another solution or workaround is possible. And because running a small business, at least profitably, is about overcoming your own limitations, the next step is to create another list, with a title such as, “How can I do the things necessary to make my book business a success?”

In other words, you have to recant your entire list of “can’ts.” It may help to show your first list to a business advisor, close friend or colleague after explaining why you’re performing the Lose Weight Exercise and ask for feedback before and during the making the second list. If you don’t have someone on your side in this arena, get one. It’s always helpful to get a second pair of eyes on a problem especially with issues that are ultimately emotional ones.  Because these issues are so close to our sense of self that they are harder nuts to crack than simple decisions over what kind of packing tape to buy.

Finally, I’ve written this post while keeping the best business advice I’ve heard in a couple years in mind. I recently had the pleasure of taking a delivery from a man named Odell Odom who has provided trucking service to booksellers in the New York area for over 20 years. He’s seen them start small and get big and he’s seen them be big and get dead and this is what he told me: “Guys are making millions and going broke every day in this business. And the only difference between the two is what’s going on in the six inches between their ears.”

Overcoming the Odds to Make Your Book Business a Huge Success [ 6:13 ] Play Now | Play in Popup | Download (168)

Book scouting is one of the most important topics an online bookseller needs to understand.  Without proper knowledge of the ins and outs of this topic it can mean the death of your business.  Shockingly, most online booksellers still do not have a thorough understanding of book scouting and therefore are simply using whatever is provided to them by the few companies out there.  In this post, I’m going to set the record straight and lay out to you specifically what would be the ultimate book scouting application to give you a glimpse into what may be possible.

As I discuss ad nauseam in my eBook book scouting was started long before we had little Internet-enabled gadgets you could fit in a coat pocket.  The true book scout based all book buying decisions solely on experience and intuition.  Nowadays, anyone that has enough technological know-how can access a database of millions of books in a second without any prior experience.  This is now typically done on on the mobile phone due to it’s portability and Internet capabilities. According to a CBSNews article I’ve read recently the number of cell phones worldwide hit 4.6 billion recently.  This boils down to two things; the first is that as more and more mobile phones are produced the networks that these phones run on will become faster ala 4G and mobile phone manufacturers will provide more storage on the phones to accommodate for things like videos, pictures, emails, etc.  To even mention that a cell phone would have 32GB of storage just a few years ago would make any tech geek roll his eyes in a “yeah, right” fashion.

So what do these statistics mean to book scouting and to our ultimate book scouting app?  It means that mobile book scouting services will begin to take advantage of these new mobile phones and provide features never thought possible in the past.  The new Google Android phones are a great example of this and one company that I know of that has taken full advantage is FBAPower.  FBAPower (affiliate link) has a book scouting application called FBAScout that seems to have sprung up from nowhere lately to provide the online bookseller with much more information than your typical mobile application has in the past.  In fact, they recently wrote an article on the FBApower blog that inspired this post.

Even though mobile Internet speeds and storage has improved, book scouting applications will still always have to deal with limitations.  These limitations include a growing database of books on Amazon to query and lack of mobile high speed Internet coverage.  How are companies overcoming these challenges?  They are either giving you real-time Amazon pricing information at the sacrifice of speed or accessibility or giving you instantaneous price lookups at the cost of potentially using out of date information.  I wrote a post that briefly discussed the online vs. offline issue back in August.

Even though I use FBAscout nearly every day and continue to believe it is the best book scouting application out there, they tend to talk like it is the answer to book scouting and to FBA scouting.  To their credit, they are the only ones I know that are able to get FBA competition.  I do believe that it is very good but is not the only answer and may not be the answer at all to everyone’s scouting needs.  The only reason is because they have chosen to provide only one type of service and that is real-time service.  This method is crucial to get up to the minute pricing information from Amazon but also completely prevents a book scout of using the service at all if little or no mobile Internet service exists.  They suggest that this is not a big deal but coming from a bookseller that has visited many rural library sales with no WiFi or in basements where no mobile Internet service exists it happens.

What is the ultimate answer to the supreme book scouting service?  I believe it is a combination of a local database and real-time capabilities to properly address each issue.  Unfortunately, from what I have seen this does not exist yet however I’d love to be corrected if someone knows of one.  If a book scouting service could provide up to the minute prices for books on Amazon at the time of scan yet be instantaneous as a local database on the phone could be this would be it.  Let’s hope a company incorporates the best of each feature sometime soon and is finally able to overcome the mobile limitations that we all have to work with.

What is the best book scouting service out there? [ 5:49 ] Play Now | Play in Popup | Download (228)