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How to Start an Amazon Private Label Business

Looking to start private label selling on Amazon? Ensure you’re prepared for anything with your Amazon Private Label business. By Rachel Van Clepper August 16, 2022

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Investing in a private label brand takes time and research, from conceptualization to hands-on execution. Ensure you’re up for the challenge and learn the steps you need to get started as an Amazon Private Label seller.

Continue reading, and we will explain how to start a private label business on Amazon and provide practical advice on how to ensure success.

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Private label products are manufactured by a third-party and then sold to another company to brand, market, and sell under their own brand name or label.

What are Amazon Private Label Products?

Private label products are manufactured by a third-party manufacturer or company and then sold to another company to brand, market, and sell under their own brand name or label. The manufacturer has no rights over the label or brand, and you get to decide on the product design, your brand logo, labeling, packaging, and all other creative elements.

Private label products could be a generic Alibaba product with their brand label added, a product with custom additions or changes, or a unique product sold exclusively by that brand.

Although it can take time and work to build your brand recognition, selling private label products on Amazon allows your business to grow long-term.

White label products are generally less expensive, allowing you to achieve higher margins.

Advantages of Selling Amazon Private Label Products

Private label products have many benefits on Amazon, including:

Increase in Credibility. By selling products under a private label, you can capitalize on in-demand products while contributing to your own brand’s credibility.
Higher Profit Margins. White label products are generally less expensive, allowing you to achieve higher margins.
More Exposure. Amazon values private label products and will give more exposure to private label sellers on the platform.
Option for Customization. You can stand out by customizing your products depending on customers’ needs and demands.

Getting Started With Private Label on Amazon

Many e-commerce businesses prefer to buy popular products already in high demand and brand them under their own private label. But to be done successfully, there is a process you must follow when starting, and that begins with adequate research.

Popular private label products to start with include household items, groceries, and electronics.

1. Pick Your Products

It’s necessary to do your research to identify the right product to add to your catalog. When figuring out which products would make sense for you to white label, find a product that you stand behind and can realistically become a best seller.

Brainstorm activities, services, or product categories that interest you, then list the associated products.

Start with a broader list that you can gradually narrow down to help ensure you cover your bases. Popular private label products to start with include household items, groceries, and electronics.

Picking your first Amazon private label products should take time, so be sure to consider the following:

Small and lightweight items like supplements and cosmetics (saving your fulfillment and shipping costs)
Easy to sell, and uncomplicated products (no paperwork, no customer service issues, and no batteries)
Avoid seasonal products when you are just starting out

Be sure to take the existing or potential demand into consideration, including any sales fluctuations or seasonality. Moreover, ask yourself if you will be able to create recurring demand.

Want more tips? Read our Amazon Private Label Checklist for choosing and sourcing your products.

Your supplier plays a significant role in the success of your private label products.

2. Partner With an Experienced Supplier or Manufacturer

There are two methods you can use when sourcing your products. You can go directly to a manufacturer to secure a private label product, or you can order one-offs of products on sites like AliExpress to avoid dealing directly with a manufacturer.

We suggest dealing directly with a manufacturer, but be sure to take the time to compare supplies and negotiate prices. The best way to ensure you invest in quality products is by asking for a sample. Although not free, this may save you a lot of time and help you avoid bad reviews if the product is not up to snuff.

Your supplier plays a significant role in the success of your private label products. While cost will be critical in determining the right supplier, it cannot be the sole factor. You should consider labor and material costs, as well as currency appreciation, if sourcing from overseas when weighing your options.

Isolate your search to only the experienced suppliers with products similar to the ones you want to produce to ensure they are credible and reliable. Establish a rapport over the phone, and do a site visit to their manufacturing facility to gain a clear understanding of how and where your products will be created.

Be sure to balance product quality and cost to ensure that you do not end up paying an extremely low price to receive a product of poor quality. Inquire about minimum order quantities and find out about their quality assurance (QA) process to mitigate the risk of any defects or quality issues.

Want more tips? Learn how to find a manufacturer for your Amazon private label products.

Infuse unique and bold colors, fonts, and design elements into your logo and packaging

3. Select Your Brand’s Logo, Product Design, and Packaging

A key benefit of selling private label products on Amazon is the lack of direct competition, meaning that you automatically win the Buy Box on the ASIN.

While you can face indirect competition, no one is selling your identical product — with your exact brand, packaging, value-added benefits, features, or competitive differentiators.

Aside from the physical components of a product, such as the product itself and the packaging, you can also set your brand apart from the competition with a compelling value proposition and engaging brand story. Both of these more intangible elements of your brand can help promote brand awareness, consumer engagement, and social proof.

To entice prospective buyers, infuse unique and bold colors, fonts, and design elements into your logo and packaging and remain consistent across any additional products you add to your private label line to demonstrate brand consistency.

When creating the brand concept and physical design, keep your target customer in mind and make sure your decision appeals to them.

4. Request Product Samples for Quality Control

After you have developed your product, be sure to ask your supplier for samples so you can make sure the quality and other specs are precisely what you are looking for before you go to market.

Share the prototypes and packaging with various groups of people, including prospective buyers, to garner any feedback that should be addressed before placing your initial bulk order.

5. Decide on Your Amazon Fulfillment Strategy

Before you make your first sale, you need to find a way to fulfill your orders. You have a few options, including fulfilling your own product, finding an outside source to package and ship your product, or becoming an Amazon FBA seller.

To decide if you will fulfill your Amazon orders via a merchant-fulfilled operation (Fulfillment by Merchant or Seller Fulfilled Prime) or through Fulfillment by Amazon, you need to understand which products have proven success with each fulfillment method.

Ask yourself these questions:

Do your products require special handling?
Are they easily prone to damage with extreme temperature fluctuations?
Do you want the Amazon Prime badge on every product you sell?
Do you have the bandwidth to take care of customer service and returns, or would you prefer that Amazon handles those logistics?

Discover which products are best suited for each fulfillment method, by reading our fulfillment playbook to help inform your decision. Whichever route you ultimately choose, consider the size of your operation, your product categories, and your business objectives for the year.

6. Create Your Listing on Amazon

Once you have sourced and decided upon your products, it is time to begin to research keywords for your product title and description and collect high-quality images of your product(s) to create a listing on Amazon.

Take time to find the perfect listing title. If you aren’t sure where to start, look at your competition and decide what you want to replicate and how you want to stand out.

3 Tips for Selling Private Label Products on Amazon

1. Fulfill Your Orders with Amazon FBA

Many sellers use Amazon FBA to sell private label products. You can fulfill orders yourself, but by using Amazon FBA, you can reduce your risk and pass the responsibility on to Amazon to handle your customer service.

This shipping method allows you to send your inventory to one of Amazon’s warehouses, which will store, pack, and ship your orders to customers and take care of returns and refunds. If you want to save time, this is the best way to do it. You can consider a different fulfillment method if you want more control over your products.

Further Reading: FBA or FBM on Amazon

2. Optimize Your Amazon Pricing

As we discussed at the beginning of this article, it takes a bit more work to sell on Amazon than it used to. There is more competition, changes in demand, and low stock availability due to ongoing supply chain issues.

Optimizing your price by understanding the competition and demand will help you increase your profit and stand out from the crowd.

3. Don’t Just Resell, Brand Your Private Label Products

Creating branded products gives you a much greater chance of success than brandless items or listings. One way to do so is by creating a logo and color scheme for your private label brand.

Use your core product decisions to get a clear idea of your brand identity and invest in a graphic designer to help you make a logo and a brand vision that you are proud of. Incorporate the brand logo as a label on your products, packaging, and listing. Taking the time to do this will help you create brand recognition and foster trust with your customers.

About the Author

Rachel Van Clepper is a content marketing writer for Feedvisor, where she contributes to the company’s content marketing initiatives. Before joining Feedvisor, she was a senior content marketing writer for a nonprofit software company.

Final Thoughts

There is now much greater importance on your Amazon selling and optimization strategy as a private label seller.

Private label products require time, research, effort, vetting, and cash flow. Still, if you maintain control and involvement throughout the entire process, you can increase your margins and generate incremental revenue on Amazon.

Get a deeper look into Feedvisor’s ProductSphere and understand how you can use Feedvisor’s technology to get a competitive edge for your private label products on Amazon, including inventory and forecasting with machine-learning optimization algorithms.

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