Two Essential Tools for Amazon FBA Sellers

Part 3

This is the third post in my Amazon FBA series. If you missed them, here are the first two  posts:

1. Follow Along as I Become an Amazon FBA Seller
2. Getting Started With Amazon FBA

To sell on Amazon, you need products. More importantly, you need to source products that you can purchase for much less than the product is selling for on Amazon because you have additional costs such as inbound shipping and Amazon fees that add to your Cost of Goods Sold (COGS).

Let's say you're doing Retail Arbitrage (RA), and you find a toy in the Walmart clearance aisle that is marked 50% off. You check the Amazon app and see the same product sold there, along with its price. Should you buy a bunch of them and send them in to Amazon for resale? You can't simply guess, or go on intuition. You need data, and that's where FBA tools come in.

There are many FBA-related tools available, and I spent much of my first week researching them. In this article, I introduce two tools that I feel are indispensable for Amazon FBA sellers: 

• Keepa
• SellerAmp SAS¹

These two tools give you the data you need to make informed decisions quickly and efficiently, and fortunately, they are both reasonably priced which makes them ideal for those of us who are just starting out.

I introduce the two tools below, and explain, at a high level, how to use each of them. This article is not meant to be a tutorial or course on the tools (search YouTube for those), so we'll focus on their purpose, their key features, and how you can use them as you source your products.

Effective sourcing is key to your success as an Amazon FBA seller and I'll have at least one future article about how to find products to resell.

Keepa

Keepa collects detailed price history for over 300 million Amazon products. You can use the Keepa charts to see at a glance how the product's price has varied (or not) over a given time frame, from one month all the way to the product's lifetime on Amazon.

You can go to keepa.com and search for the product in which you are interested, but a much more efficient method is to use Keepa's browser extension. Once you install the extension, the Keepa charts are displayed right in the product page on Amazon's website. There are Keepa extensions for many common browsers, including Safari, Chrome and Firefox.

Here is an example set of Keepa charts from a product I picked at random (baby wipes):

As you can see, there is a lot of information crammed into those three charts. The three charts, from top to bottom are the following:

1. Historical pricing (Amazon, FBA, FBM, the Buy Box, and so on), plus sales rank.
2. Detailed sales rank including rank in Amazon sub-categories
3. Offer count, which is how many sellers there are at any given time.

The charts are crowded, but you can turn off information that is not useful to you. Simply click on an item in the key to the right of the chart to turn that data off (or back on).

Learning to interpret Keepa charts is one of the most challenging, but also most effective ways for you to quickly see at a glance if a product is worth sourcing. There are numerous YouTube videos in which people talk about reading Keepa charts. I am very much still learning, and at some point, I will write in more detail about how to use them. For now, I want to point out one other very useful bit of Keepa data. 

When you select the Data tab located above the charts, and then select the Buy Box Statistics tab, Keepa shows you an estimate of the Buy Box distribution, as seen here for our baby wipe example:

The Amazon Buy Box is displayed at the top right on almost every Amazon product page. An estimated 83% of Amazon purchases are made through the Buy Box's Add to Cart or Buy Now buttons so it is critical for you as an Amazon seller to get a share of the Buy Box. Amazon typically rotates the Buy Box among the available sellers, as well as Amazon itself, if Amazon is also selling the product directly. 

The Keepa table above shows that there are only two sellers on the Buy Box: Eleeo Brands, and Amazon, and that the former has won the Buy Box 95% of the time! Amazon rarely wins it themselves because they almost never sell this product directly. You will see orange shaded areas on the Historical Price chart when Amazon is on the listing.

The immediate takeaway from this Keepa data is that you should skip this product and move on. Eleeo Brands is likely the manufacturer and you probably can't compete with them on price. You can see how a quick glance at this data tells you what you need to know and you can simply move on to your next product idea.

There is a free version of Keepa but you need the Pro version for access to the sales rank, offer count, and Buy Box historical data which is mandatory for a successful FBA seller. At the time of this article, Keepa is 19 €/month (approximately $18.50 US/month). You can save about 18% if you pay 189 € / $185 annually.

SellerAmp SAS

The second indispensable tool that I recommend you get is called SellerAmp SAS, where SAS is an acronym for Sourcing Analysis Simplified. Most people seem to refer to it simply as SellerAmp or SA. 

While Keepa shows you pricing and offer charts, SellerAmp helps you analyze the data. It also integrates with both Keepa and your Amazon Seller account. You set your required profit and Return on Investment (ROI), as well as your costs, including your inbound shipping costs (for example, $.40/lb). SA calculates the Amazon fees automatically and then shows you at a glance if a potential product meets your profit criteria after taking into account how much you are getting the product for, along with all the other costs. 

There are three ways to use SellerAmp:

1. You can look up products on the SellerAmp website.
2. You can use the Chrome extension.
3. You can use the iPhone or Android mobile app.

The mobile app is particularly useful for retail arbitrage when you are walking the clearance aisles and scanning hundreds of products.

I start with the Quick Info panel. The red Eligible field indicates that I am not eligible to sell this product. In the Alerts panel, you can see that I am restricted by Amazon from selling this product. I either need the brand's approval, or I might need to be ungated in a category or sub-category. I'll talk more about ungating in a  future post, but this restriction alone is enough for me to move on to another product.

In sourcing, efficiency is everything. Don't waste time on products that you can't sell, whether you are restricted or because they don't meet your profit criteria. Just move on.

There is additional useful data in the Quick Info panel. The Alerts box shows you any concerns, which are listed further down in the Alerts panel. The BSR is the Best Seller Rank (aim for top 1%, otherwise move on). You can see an estimate of the number of sales/month, which along with the Keepa Buy Box distribution data lets you estimate how many units you might sell if you get a share of the Buy Box.

If this is a viable product for you, then you enter the cost in the Quick Info panel. I haven't done that in my example, because I already know this is a dud for me. Notice the Max Cost field, which shows you the most you should pay just for the product itself. If I can't get this product for under $3.84, then that's another dealbreaker. Move on. 

For the sake of the example, let's say you found these baby wipes for $4. When you put your purchase price into the Cost field, you can see your potential profit (1.84) as well as your ROI (46%). I have SellerAmp set to a minimum of $3/unit profit and an ROI of 30% or higher. Because I require at least $3 profit, that field is red, while the ROI meets my requirements and is displayed in green.

You can get a two-week free trial of SellerAmp. After that it costs $16.95/month or $169.50 annually (which works out to $14.13/month).

Final Thoughts

Keepa is 100% required for you to successfully source products. There are alternatives to SellerAmp, but honestly they are generally more complicated and they cost more. For a total of about $75/month you can be in business right away:

• 18.50 – Keepa
• 16.95 – SellerAmp
• 39.99 – Amazon Seller account

I want to mention one other useful Chrome extension called DS Amazon Quick View. The extension shows you at a glance if Amazon is on the listing and how many FBA and FBM sellers there are (see the examples). I don't want to compete with Amazon so if they're on the listing, I will probably just move on and not even click through to the individual listing. 

My plan for next week is to find a test product to buy and send in so that I can figure out the shipping process.

¹ The affiliate links in this article support my writing and I thank you in advance for using them.