Amazon and Apple recently announced about their new partnership, and now Amazon will ship Apple products directly from Apple and authorized Apple retailers.
The only Apple products sold on the platform were sold by the third-party sellers. And these sellers now deal with the consequences of this new partnership.
For newbies, it’s important to mention that this agreement is impacting only the sellers engaged in retail arbitrage and doesn’t affect private label products.
Most Amazon FBA sellers get their start in retail arbitrage, trying deeply to find discounted products for profit. They shop online and in brick and mortar stores, buying products at a low cost and then reselling the same products at a higher price.
For retail arbitrage and name brands like Apple, fake products flooding the market become a problem.
With a brand like Apple, there’s a much greater risk of getting into knock-offs. In 2016, as much as 90% of all “Apple” devices, i.e. accessories like iPhone chargers being sold on Amazon, weren’t genuine
This new partnership will surely shut down the entry point for fake products, ensuring that any Apple product we buy on Amazon is an Apple product. It also guarantees fair pricing, quality control, sufficient inventory, and helps the Apple brand to integrate.
This agreement started during the busiest shopping week of the year. Later more and more Apple products were added to global Amazon marketplaces, and sellers had until January 4th to become authorized Apple retailers.
So, whether you’re a new seller or rethinking your selling strategies based on this news, we see two positive takeaways from this announcement:
- Starting Selling Private Label Products
You should not get caught up with reselling major brands. Not all the sellers are equipped to play with brands like Apple; very often, private label selling is the best business opportunity.
You can also find a product with high demand and low competition, and start sourcing it yourself
- Wholesale Selling
If you don’t want to jump through hoops to become an authorized Apple retailer or you’re not quite ready to dive into private label selling either you could try selling wholesale, as there are several advantages in choosing this selling method.
First, wholesale refers to purchasing a branded product right from a manufacturer and reselling it to consumers. Wholesale selling varies from arbitrage in the following:
- Requirement to have a wholesale license.
- Requirement to build relationships with brand owners and manufacturers.
- Has pricing that is more controlled; here you’ll have to negotiate the price with each manufacturer.
Second, when selling wholesale, price wars with your competitors are unlikely because retail prices are mainly standard across the board.
Finally, selling wholesale doesn’t mean you’re launching a new brand. Unlike private label sellers, you won’t create a new Amazon listing or add value to a product within a profitable niche. You can just capitalize on a ready-made, success-proven product.
Is this business model worth it?
There are pros and cons for every Amazon selling option. Here are some roadblocks you should encounter:
- Finding manufacturers or the brand owners who don’t sell directly on Amazon.
- Finding brand owners who won’t require high order quantities.
- Starting from square one as a newbie and establishing your business as trustworthy and professional.
The same product research tips for finding a private label products that can be sourced and sold also applies to finding a product for selling wholesale.
Here you can still apply the Fulfilled by Amazon benefits the same as you’re selling a private label product.
The key to success is to know how to research effectively, to get really good at negotiating with manufacturers, and build up a strong profile on Amazon.
No matter which avenue you’ll take giant partnerships like Amazon and Apple do not take over the third-party seller space. Otherwise, it points toward these alternative selling options as your best bet to become a successful Amazon seller.