You will usually receive a premium by selling just about any hot selling product on Amazon FBA compared to selling Merchant Fulfilled (MF) but sometimes the best move is to quickly sell your product before other sellers can get their product into the Amazon warehouses.
In my example, I will show how I was able to do this on the hot selling Olaf Hallmark Keepsake ornament the I sourced on “date night” at Kolh’s.
I found 8 of the Olafs on the Hallmark ornament display as I was walking toward the toy section. I snatched them up and meet up with my wife.
Maybe I got lucky finding these, but my wife had checked there before and they were out of stock, so I was thinking that they got more stock in. If they got more in, I would guess that the other Kolhs may have gotten more in.
If supply goes up, price goes down.
When I scanned them, they were selling for about $45 FBA with Kolh’s price being $14.99.
When I got home, I checked Amazon again and they were out of FBA Olafs, and the low price MF was $34 with free shipping.
I did a quick check on eBay and they were selling for about $24 and up. I also checked eBay UK and the price was around 24 pounds (take times about 1.6) with free shipping ( probably $11-$13 for shipping).
At this point, I was not too confident that the price will hold up long enough for me to get them into the Amazon warehouses.
I mentioned that Kolh’s price was $14.99. A point to remember is that not every seller has the same acquisition cost. This is part of the reason some sellers seem to be selling for less that you even purchased your inventory for. Just like in real estate, you make your money when you buy.
In my case, I had downloaded a coupon for $10 off of $25. My wife also had a 15% discount when using her Kolh’s card.
We actually had 2 copies of the $10 of coupon, so we split up the Olafs.
My wife bought 6 of them and used her 15% discount and the $10 off. This cost $82.28 with the tax.
I bought 2 and used the $10 off coupon. My total came to $21.29 with tax.
In total all 8 cost $103.57, which works out to $12.95 each.
I listed the Olafs MF for $34.00 with free shipping. I took the buy box from the other seller that was selling $34.00 with free shipping and I sold 2 in the first 15 minutes. In total I sold all 8 in less than 10 hours.
I paid $5.10 in Amazon fee for each one I sold and received $28.90 for each one.
I still needed to purchase shipping which cost $2.66, so I made $13.29 on each one ($28.90-$2.66-$12.95 = $13.29 ), which if I take times 8 equals $106.32 profit !
Had I sent them into FBA, I am guessing I might have made an additional $60 profit if the price held. The price also may have gone up, so I did leave money on the table but I was happy to return just over 100% profit in less than 10 hours.