This guide will cover how to choose private label products to sell in your new ecommerce business.
We’ll break down the process on how to get Amazon private label product ideas, discuss the Amazon FBA product checklist that will help you choose the best products to sell on Amazon FBA and the best product research tool you can use.
You will also read about complementary products, how to find a profitable product to sell on Amazon and how to avoid patented products and the Amazon gated categories.
Chapter Quick Links:
- Understand how to choose products for ecommerce
- The ultimate Amazon FBA product checklist
- Best Amazon product research tool
- How to offer a better product than your competition
- Find complementary products for your private label brand
- How to find a profitable product to sell on Amazon
- Learn about Amazon gated categories
- Identify and avoid patented products
- Actionable steps: use Amazon product research to find your first private label product
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Understand how to choose products for ecommerce
The first step in finding your initial private label product is simple and straightforward: study the Amazon product categories and sub-categories.
This will give you a feel for what people are searching for, how Amazon builds their categories and what the competition is offering.
By doing this, you can find a niche you are interested in, if you don’t already have something in mind, and narrow your research in that area. You can expand this by searching the “Best Sellers” and “Hot New Releases” areas for extra inspiration.
Ideally, you should start with something that interests you or you have some knowledge on the topic. This will motivate you more in the beginning, and it can be easier to research something that you are already familiar with.
Ultimately though, you will want to follow the numbers and what the market is telling you, even if that might not be something that you’re passionate about.
Overall, try to get familiar with how Amazon builds its product pages and what is selling well in the first pages of each search.
Don’t be tempted to “innovate” too much or bring a lot of extra features on your first product. Don’t offer the same recycled item either but just try to bring in a little something extra or a new small feature that sets you apart. Don’t go overboard with re-thinking the entire product.
The ultimate Amazon FBA product checklist
Below are some guidelines and tips on what to look for in a good product, as well as the things you should definitely stay away from when doing your research for private label products to sell.
Product attributes to avoid in the Amazon product research:
- Easily breakable products: This will be a shipping nightmare from China to the Fulfilment Center. From there it can go to other fulfillment centers depending on the demand Amazon is seeing in different states. Finally, from there it gets shipped to the customer.
- Easily swallowable products & skin care products: You will need FDA approval to sell these products. If you settle on such a product, at least try not to source it from China, but look for US suppliers instead. Be very careful with anything that comes in contact with the buyers’ skin. If a product is bad, and you don’t catch it in time, your brand might fail before you even have a chance to start.
- Other FDA products: FDA approval can be obtained, but it requires extra costs and paperwork. Try to double check if it’s needed before committing. Even if your supplier is FDA approved, you will still have to get your own FDA approval for Amazon.
- Patented products: You will be exposing your brand to potential legal action against it if you are sourcing a patented product. Toughest cases are utility patents. One of the easiest and quickest ways to check for a patent is using Google Patents.
- Hazmat products: These are flammable products or dangerous for transit. Examples: lighters, candles, stove burners etc.
- More than 8 competitors with BSR (Best Seller Rank) under 3000: You can determine the BSR with a free Chrome Extension called DS Amazon Quick View. The BSR will show how well the competition is selling in that category or subcategory. If most of them are already ranking high, it’s going to be difficult to enter the niche.
- More than 16 competitors with BSR (Best Seller Rank) under 12000: The same idea as above, but expanded to a bigger number of sellers. The more sellers ranking very high, the tougher the competition.
- Products that have batteries or LEDs: You need extra documentation and approvals for customs when it comes to these products.
- Technically complicated products: Both from a production standpoint, and a “technology” point of view. Examples: smart wristbands, music players etc.
Product attributes of a profitable product:
- Lightweight (below 1 pound) and small volumetric size (under 18” x 14” x 8”): This will have a huge impact on your transport costs. The lighter and smaller the product, the more you save on shipping. Consult the official Amazon FBA sizing chart for more details.
- Minimum selling price of $20: A lower price means you will most likely lose money. If you want to see a quick breakdown on a products’ estimated revenue and costs you can use the Amazon Revenue Calculator Tool, but keep in mind there are more things to consider.
- Minimum 3 competitors with BSR (Best Seller Rank) under 3000: With this metric you’re making sure that there are already some sellers doing well in this niche.
- Maximum 10 competitors with BSR (Best Seller Rank) under 12000: Too much competition will make things tougher at the start, so you want to keep an eye on how many top sellers are on this product.
- Less than 500 Product Reviews: Niches with more reviews can also work, but they are much more competitive in terms of ranking.
- Review score of 3 stars or lower: The more sellers offering low quality products, the easier it’s going to be for you to step in with something better.
- Minimum of 300 monthly units sold: This also depends a lot on the value of the product, but generally you want to look for something that is in high demand.
- Top 3 related Keywords have over 50,000 monthly searches on Amazon: Using a few specialized tools you can determine how many people search for keywords related to your product. The more searches, the higher the chance people land on your product listing if you’ve done your product page optimization.
- There are 2 or 3 products with less than 50 reviews on the first page: Getting on the first page of an Amazon search is extremely important. Whenever you spot a few competitors that aren’t well-established yet it means that you can still jump in that niche and have a high chance of success.
- Year-round selling product (not seasonal): Seasonal products (e.g. Christmas decorations) aren’t recommended as a first private label product. You need to start with something that has constant high demand, regardless of the time of year.
- No famous brand names within product category or niche: Trying to compete with a big name brand at the start is nearly impossible. You need to find niches and cover them better than the big brands, which usually try to serve general needs.
- The product can be made for 25% or less than the sale price: This is meant to be a quick viability check on the product, since you will need to crunch precise numbers when you settle on the final one. However, quickly eliminating a product off your list if you see it’s not going to be feasible cost-wise will save you a lot of time in your research.
- Multiple keyword opportunities related to the product: Again, you will have to rely on tools that breakdown keywords. The more keywords, especially long-tail keywords, your product can target, the easier it’s going to be for your to reach potential customers.
- Current top sellers have room for improvement and optimization in the product pages: Quickly scan competitors’ main pages to see if they are optimized and built correctly. If the pages don’t look good, and yet they are still on page 1, then you have a good chance to take their place. Look for bad product pictures, poorly written descriptions, lack of keywords etc.
- Easy China sourcing: China is still the best place to source your products, despite the current economic situation brought by the Trade War, as they have the largest private label manufacturers. More and more alternatives will be popping-up in the near future, but for now, this is still the safe bet.
- Can expand your brand with related products: Make sure that your first private label product can be easily expanded with a second one. This second product can either enhance or complement the first one.
- Can source a superior product over similar products in the market: Higher quality will always trump lower quality. Keep in mind though that quality costs, so you will have to find a good balance between the two.
- Social media marketable: Ensure that you can easily leverage social media to send paid or organic traffic to your Amazon product page.
- Product encourages recurring purchases: The best products are the ones that are constantly in high demand and people need to make a new purchase regularly. However, this doesn’t mean selling a bad product that constantly breaks! Always keep quality high on the priority list.
All in all, keep in mind that these are tips and best practice guidelines that would lead you to a truly “perfect” product.
In reality, you will almost never find a product which combines all of the above criteria at the same time.
The trick is figuring out which positive traits matter to you most, and how many negatives can you avoid or mitigate easily.
Also, keep in mind that every single course, expert, guru etc. recommends these types of products and as such everybody and their grandma’ are looking for the exact same thing.
You will need to be creative and very thorough in your research if you want to find private label wholesale products that fit as many positive attributes as possible and are not currently being sold by thousands of private label brands already.
Best Amazon product research tool
There are a few main options when talking about tools that help you analyze the marketplace on Amazon and your potential competitors.
I will list them below and say a few words about them, but they have so many options and features that it would take too much space to go through them in detail here.
It’s best if you have a look over each yourself, consider what they offer, as well as their pricing, and choose one as your main tool.
Jungle Scout is probably the most well-known Amazon tool out there. They have expanded their offer with some services, but for right now all that you would need are the research tools.
They also offer a free trial so you can test things out before making a final decision. Their pricing is a bit cheaper to start off with, but one of the drawbacks is that you need to pay separately for the Chrome extension.
I mention this because the Chrome addon can be very helpful and reduce research time, as it gives real-time metrics about products directly in the Amazon search pages.
AMZScout offers a set of tools similar to the ones mentioned above, but as far as I can tell at least, no extra services in their portfolio yet.
That shouldn’t be a deal breaker at this point, since you should focus on finding a good product first and foremost.
They also offer free trials if you want to get familiar with their tools, and they have the cheapest prices compared to the others.
A great overall solution that offers multiple tools and services. There is an option for a free trial, so you can get a feel for the tools, and you can upgrade if you are satisfied.
You don’t need to start with the most expensive plan right off the bat. You can start with one month of the basic plan for the initial research and then extend and expand as you need.
The advantage of Viral Launch is that all the tools are integrated and you get everything bundled into the same price, both in terms of their web interface and the Chrome addon.
A special mention needs to be made for Helium10. I haven’t used their services too much, but they are also a well-known and established brand in the Amazon product search tools domain.
They have a selection of tools for product and keyword research, as well as services to help you manage your Amazon listing. There’s a free plan available to get you started, so you have absolutely no reason not to give them a look and see if you like their offer.
Ultimately, the best advice I can share is to give all of them a quick try, think about your budget constraints, and pick one of them as your preferred Amazon research tool going forward.
You can’t really go wrong with any of them.
Regardless of the tool you end up using, some of the main things you will be looking for in your product research are these:
- Product Size: Standard – this doesn’t mean you shouldn’t look for bigger products, but keep in mind that every cost will increase proportionally with the weight and volumetric dimensions
- Seller Type: FBA – this denotes the type of seller and fulfillment. The different types are FBA – Fulfilment by Amazon, FBM – Fulfilment by Merchant; Amazon – products that are sold under the Amazon Brand
- Price: the product sell price – this should be a minimum of $20 to $25
- Rank or BSR (Best Seller Rank) – shows how well that product sells within the category; we should be aiming under 12000 across the main sellers
- Monthly estimated sales – how many units get sold on average during a month
- Maximum reviews – how many reviews the product has. Aim for something with a maximum of a few hundred. Take this with a grain of salt, as “buying” reviews is still a common practice on the platform so many products are overinflated with reviews.
- Minimum rating – how well the customers rated the product. We’re looking for low rated products that still do well so we can improve them and make a better offer
There are plenty of other research tools out there tailored to the Amazon ecosystem, but we really can’t get into all of them as this guide would become even larger than it already is.
There is only one other special mention I wanted to make about a simple, free Chrome Extension to help with your research: DS Amazon Quick View. This will show you the seller rank, ASIN and the type of sellers for any product on Amazon pages, at a quick glance, without going into each product page.
How to offer a better product than your competition
One of the best ways to find product improvement ideas is to study your competitors product reviews.
These will show you potential problems and issues customers have in the low rated reviews, as well as the main selling points and benefits of the product in the high rated reviews.
However, take reviews with a grain of salt and study them carefully. Buying positive reviews is still something happening, so these might not necessarily reflect the true nature of the product.
Likewise, the competition can sometimes be cutthroat, so don’t be surprised if bad reviews are actually posted by the competition trying to tank the product credibility, without actually representing the product’s true nature.
Overall, when it comes to ideas around innovating Amazon products, some of your best options are:
- Make sure that you solve customer problems and pain points that your competitors missed and that you bring real value with your private label product
- Try to get a feel for what “real” users of that product need. Use Facebook groups, forums and niche websites to try to learn your future customers and market. This will also help you in developing the customer profile which you will need for marketing campaigns
- Use the power of Google. Try searching for “product X reviews”, “best product X” etc. This will not only give you ideas for the product, but will also help you learn about your competitors. In the long run, this exercise allows you to find potential influencers that you will be able to reach out to for product promotions
Find complementary products for your private label brand
Finding an extra product to pair with your first one from the start is extremely important as we’ve highlighted in the first chapter about starting an ecommerce business.
Below you can find some tips to guide you in the search for an additional product:
- Leverage the power of the Amazon “frequently bought together” and “customers who viewed this item also viewed” sections
- Take advantage of the search bar suggestions in Amazon pages. This will tell you what are the most frequent searches people make.
- Find the main competitors in the niche and study their store pages to see their full product offering
- Try to explore potential suppliers also based on the extra products they make. This can also net you some small discounts if you show them you will have future business.
How to find a profitable product to sell on Amazon
Probably the biggest success factor in picking a good private label product is related to how well you take into account numbers, and ignore what you “think” would be a good choice.
With so many tools available that track user activity on the web and in marketplaces, it’s easier than ever to gauge user interest in various products and niches by looking at keyword searches, buying patterns on Amazon, social media groups etc.
The tools mentioned in the subchapter above, related to Amazon product search, will give you tons of data to work with so you can make a solid decision and pick a product that will sell and be profitable.
The easiest way to keep track of everything is to build a spreadsheet and crunch all the possible numbers related to the product.
I usually pick the top 10 to 15 sellers for a product, basically the 1st Amazon search page, and average out all of their data to get a feel for the viability of the product.
This gives a rough idea of whether you should dig deeper into this particular product or quickly move on.
If things make sense at this high level, that’s when you start looking into more details about the product and see if it’s really worth it to pursue this niche.
Below we’ll talk about some important factors to keep in mind when choosing your first product. These should form the blueprint for your spreadsheet and research process:
1. Product Metrics
- Main Keyword – the keyword or keywords that get the most searches related to the product
- Average Best Seller Rank – the lower the average BSR, the higher the competition, the harder it’s going to be to get on the main page
- Number of Reviews – if the current sellers already have thousands of reviews it’s going to be nearly impossible to compete
- Weight, Height, Width, Length – these dimensions will be crucial in determining your transport costs. You can actually find a nice calculator on Freightos.
- Sales – how many units are sold during a month on average
- Selling Price – obviously this is one of the most important things to look out for. Too low and you won’t be able to compete. Too high and you might need a large initial investment
- Production Cost – this should be a quick check right now on AliBaba for similar products. Keep in mind that the prices there don’t always reflect reality and you should consider at least a 20% extra on anything you see there.
2. Logistic costs and Amazon FBA fees
- Transport Cost – this should be based on the volume, weight and number of products. You will want to make your first shipments by air. The costs are a bit higher compared to sea shipping (roughly $4.5 / kg vs. $1.5 / kg) but you will get you products in the fulfilment centers a lot faster. Air shipping takes a few weeks compared to 3 months by sea. Don’t forget about adding duty fees in this cost, since these will add up to a few hundred dollars.
- Tariffs – a hot topic right now for the USA, and at the highest levels they’ve been. To know what fees you’ll have to pay you must search by country, depending on where you want to ship and sell your goods. If you plan on selling in the USA, you can use the official tariff guidance posted on the U.S. International Trade Commission website.
- Quality Check Fee – you always want to check each batch of products before they leave the supplier, even if it’s someone you’ve worked with before. Take into account about 5% of the value of the goods bought.
- Sourcing Agent Fee – it’s not uncommon to find a local sourcing company that can help with finding suppliers, arranging transport etc. If you find a trustworthy agent expect to pay a fee of around 5% of the purchase value.
- FBA Fees – this is cost of Amazon fulfilling your orders to customers. This is also influenced by weight and volume.
- Amazon Fee – 15% fee on each product sold on Amazon. This is applied to the sale price.
- Warehousing Fees – not a huge cost initially, as you won’t be storing large quantities, but definitely something to keep in mind as you expand. In the holiday period these fees increase, so you might feel a higher impact then, even if you don’t have big quantities in storage.
3. Promotions, advertising and other costs
- Discounts and promotions – take into account a margin for discounts and promotions you will give out to boost your sales. These should be inevitable when you start, as you need to boost your rankings fast after the product launch.
- Returns – inevitably some products will get damaged while being shipped or customers are just not happy with the product. Take into account a margin of at least 5% of your units for these losses.
- Various tools and software – you’ll be using a few tools to help you along the way, like the product research tools. The costs might not seem too big individually, but they can add up fast.
- Amazon Seller Subscription – a fixed $39 monthly cost
- Accountant – I stress again the importance of having an accountant on board. This cost will obviously vary by region and conditions.
- Advertising – this one is very hard to estimate and budget at the beginning. We will cover paid advertising in detail in later chapters, but for now take into account as high a percentage as possible. This will be an important aspect in increasing your sales velocity when you launch.
Learn about Amazon gated categories
When looking for your first private label product, there are some very specific categories that you should avoid.
First of all you should check out the Amazon restricted products page which contains all categories that need extra approvals, guarantees, certificates, etc.
All of these items need good customer support and require 100% original products.
On top of that, some of these categories are just extremely competitive.
Along with the products in the restricted section, some other categories to avoid are:
- Collectibles: coins, playing cards etc. These generally need an official authentication and authorization to sell.
- Fine Art, Jewelry, Wine – you will need extra approvals and Amazon has high enrollment fees to become certified (around $5000 for Jewelry for example). You will also need a physical store in which you sold goods in the previous year of at least $25.000.
- Grocery – these are perishable goods, that need to have documents attesting their origin in the USA.
- Kindle and Kindle Accessories – all of these products need to adhere to certain quality standards and Amazon takes a cut of about 45% from the sales.
- Clothing – you can list your product in this category by filling in a request and answering a series of questions. The niche is highly competitive however.
- Toys & Games – you need to get approval for this category before September if you want to sell in Q4 (Holiday Season). You will need special approvals for anything in arts & crafts, toys with batteries, chemistry sets, painting sets, building kits and anything that contains sprays and fireworks.
Another special mention is needed for Hazmat Products.
These are products that can be dangerous for the customers’ health, for the environment or can cause damage during transport. You need to avoid these products completely.
The sure way to check if a product is considered hazmat is to use an Amazon Hazmat check tool. With this you can check an ASIN number of a product similar to yours and you should find out if this is categorized as Hazmat or not.
Examples of products that might be regulated as dangerous goods or hazmat goods can be found at this official Amazon Hazmat guidance.
Identify and avoid patented products
There are multiple types of intellectual property that you need to take into account when setting up your private label business.
Brands are protected by Trademark, books have Copyrights, secret recipes fall under Trade Secrets, and finally, product ideas are protected by Patents.
The easiest way to find out if a product is protected by a patent is to use the dedicated Google Search Engine called Google Patents. Use the keywords for the chosen product and try to look for something similar to what you are looking to sell.
Another reliable option to search for patents is on the World Intellectual Property Organization website which has multiple search filters available to narrow your patent research.
Due note that for a more reliable and accurate search you should seek legal counsel. That is the only way you will know for certain if you are safe from potential legal action.
As a general rule though, if there are a lot of sellers providing the same type of product, then most likely that isn’t covered by a patent.
Actionable steps: use Amazon product research to find your first private label product
- Browse Amazon pages and categories to find product niches and ideas
- Use the Amazon FBA product checklist to find a profitable product to sell on Amazon
- Choose a tool like Jungle Scout or AMZScout for Amazon product research
- Look for products that need improvement so you can beat the competition
- Find complementary products to expand your private label brand in the future
- Choose profitable product to sell on Amazon by taking into account estimate costs and revenue
- Avoid Amazon gated products and patented products