How to Make Money from Amazon in 2020 for Beginners

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How to Make Money from Amazon

Why You Should Not Start An Amazon Store

hey, what’s up Rohan gavai here and in this article, I’m gonna show you why you should not start an amazon store , i’m glad that you stopped to read this article.

I want to talk to you today about why you should not start an amazon store now I already know what you’re thinking you’re like oh my gosh okay Rohan,

listen everybody’s talking about Amazon Amazon is huge why would I not want to take part in this why would I not want to make money from this,

I get it I understand it I’m gonna show you why in just a second the fact of the matter is is that Amazon is huge right Amazon is massive but what if there was a way that you could actually profit from Amazon without starting an Amazon store.

you see one of the things that I find very difficult for beginners is that when you’re starting a new store and when you’re starting this whole new thing online like you’re sitting there thinking to yourself like.

I gotta go get a tax ID number and then I’ve got to go over here and I’ve got to put together a product list I gotta find products then once I find the products that I can sell.

I’ve then got to go see what everybody else is selling those products for and I’ve got to try to beat their prices then I’ve got to ship all this stuff to Amazon and I’ve got a hope that it all makes it there and,

I don’t lose any products and you can seem like it’s a lot of organization it’s a big thing so like all these people would say oh just start an Amazon store well,

I mean look the big money isn’t made in dropshipping from Amazon right that’s not where like the big money is made when you’re buying in bulk you’re shipping that stuff to Amazon and,

Amazon is shipping it out for you we’ve done this with in the past with our books so I’ve written a lot of books of my very first one the hidden millionaire,

we put it on Amazon you can find it on Amazon right now and I’ll tell you it’s the least profitable channel that we’ve ever used right we’ve put it on television the internet web pages of all these things and Amazon is the least profitable, one

so what I want to do in this video is talk to you about why and how you can still benefit from Amazon but not actually have to start on the store so let’s go to my computer alright so the reasons

why you should not have an Amazon store alright reason number one alright is simply just the logistics ok the logistics of it these this is a nightmare like I just said it’s a massive massive logistical nightmare to be able to find products get products ship products to refund customers

do customer support have shipping policies return policies merch all these things right like there’s a lot of stuff involved in shipping and do and doing business with a quote Amazon store

the second one which I think is very important is just simply the competition ok the competition I want you to think about this how many people are buying and selling on Amazon right now hello

when you go and you fish in a pond ok with a million other fishermen even if there’s a lot of fish in the pond it’s still sometimes hard to catch a fish because so many other people are competing with you and so in my mind

I’m thinking man you got to put all this money into this and then you’ve got to risk the fact that you’ve got other people that can sell at better rates than you sell for cheaper prices in you and that can be very very difficult

and it can be just like catastrophic for your business right so that’s reason number two back to my whiteboard let’s talk about reason number three and it’s the real simple reason it’s called money ok money

you have to spend a lot of money on Amazon in order to be able to make money with Amazon and here’s how that works and here’s why ok so let’s just look at a breakdown like

let’s say month 1 okay so you’ve got month 1 month 2 month 3 month four month five and we’ll just break it down into month six okay so a month these months all right so here’s the thing

if your average profit okay if your average profit margin on the products that you’re selling is let’s just say it’s 10% for the lack of better numbers and having to go through a bunch of things because some products have a little bit higher profit margins and then others but let’s just say it’s 10%

so if in month one you want to sell thousand dollars worth of products okay and then in month two you want to sell hopefully you grow a little bit you want to sell twelve thousand dollars worth of products and

let’s say month three you want to get to fifteen thousand we’ll stop right there okay so if we add that up that’s thirty-seven thousand dollars worth of products that you want to sell in the first three months

so really really simple math numbers here okay in order for you to be able to fully see what that looks like thirty-seven thousand with the profit margin of ten percent would mean that you would spend okay thirty-three thousand three hundred dollars on your products and you would generate thirty-seven thousand okay

which would give you a profit obviously because hey look the end of the day that’s what we’re looking for is a profit but it’s only like thirty-seven hundred dollars right so think about this

if you’re spending like say month one you got to spend $9,000 on a product just to generate a one thousand dollar profit okay so guess what that means even though you made a thousand dollars your first month

guess what in order to have twelve thousand dollars worth of inventory for month two now what do you have to spin the money to make sure that Amazon has that product well that’s now ten thousand eight hundred dollars right so

even if you sell all this and you make a $1,200 profit you can see that as you go along it’s gonna take you at this rate okay selling it you know somewhere between 10,000 and 15,000 dollars a month worth of product okay

it’s still gonna take you months okay months and months and months maybe ten-plus months ten-plus months, okay to have basically a ten thousand dollar profit okay which you can then roll back into your product cost

so think about that means that you could legitimately be running an Amazon store for 10 11 12 months be making a profit right so actually be making money but never have any of that money because why

well because that money is being reinvested into the growth being reinvested into the product being reinvested into having the stuff to sell for the next couple of months and that’s what makes this so hard

people always tell you oh it’s so easy you just do an Amazon store make a fortune that’s true but you have to have cash flow right you have to have enough money to be able to sink into it and leave it there for six seven eight nine months until you flip the script right

until you’ve now generated enough profit that you’re spending your profit on now your inventory right with Amazon and now it’s bringing back in an actual cash profit that you can use cash flow right this is something that a lot of beginners

don’t understand is the cash flow of business when I started my first infomercial which was you know a few years ago and we were selling a book and we were selling it on television

we had to spend upwards of six to seven hundred thousand dollars, okay and that money stayed out for six to seven-eight months before it flipped before we actually started making more money okay then

we were spending and started bringing back in some of it and so it’s very important as a beginner as somebody who’s just looking for okay I want to start my own business online I’m gonna make money on the internet how do I do this you see everybody’s telling you Amazon stores this is the reason why people will do those done for you Amazon stores why

I mean people always say well why would they do a done-for-you Amazon store that’s gonna make all this money why not just do it themselves right

I had the same question and this is the answer it’s because of cash flow it’s because instead of when somebody knows how to automate and handle an Amazon store and scale it right what ends up happening is they run out of credit they run out of ability okay to front-load all this money

so it’s easier to go get fifty people right that all have maybe 50,000 or $100,000 worth of credit that they can use to build up a store than it is for them to go get five million dollars right and that’s the reason

why you see a lot of people that are selling done-for-you Amazon packages so is that a good business absolutely it’s not like it’s a terrible business but you have to understand that these are the things that could happen right and these are the little pitfalls that people don’t know about so why do I think there’s a better way well it’s because in the past

I’ve experienced more success as an affiliate then I have as an actual store owner let’s go back to my whiteboard and I’ll show you really fast what I’m talking about okay so the affiliate model all right so the affiliate model for me makes more sense and the reason is is that you have the big companies okay

so you have a big company and this might be like Amazon okay alright and they go out and they reach what we call affiliates right so these would be people just like you

so you can become an affiliate all right and then what the affiliate does is the affiliate sins traffic ok so traffic and customers all right listen to traffic and customers to existing stores and what Amazon does is they go back and

they pay a commission ok so they pay a commission on those sales so it makes it very easy you basically become an affiliate ok and an affiliate is somebody who is able to promote Amazon stores

you’re able to market an Amazon store just like you would your own the difference is is that you’re earning a commission from doing it instead of having to go and buy all of these products and have a very small profit margin you’re not having to front-load any of the cost of the product

you can still earn 7 10 12 percent I’ll show you right now let’s go to my computer so this is Amazon’s website right here and if you scroll all the way down on Amazon’s website

you’re gonna find a button ok that a lot of people miss so you look at all these buttons you’ll see you want to here that says become an affiliate

when you click on this button you’ll see you can earn up to 10% in commissions by just simply sending Amazon customers right so 7% on Echo and Fire TV devices you can see right here this is the profit like this is the margin that

they will give you right and so what you can do is you can become an affiliate okay and in becoming an affiliate you can earn money on anything that’s on Amazon and this is something else that’s very important

I’ve seen a lot of people get caught with this they’ll buy all these products right and then all of a sudden the trend will change the fault will change something changes and then they’re stuck with all this inventory

and they can’t sell it the great thing about being an affiliate is is it somebody else’s inventory that you’re selling you’re not having to front-load it you’re not having to put any money into it you’re not having to go spend money on a product

you don’t have to do all that logistical stuff you don’t even have to worry about the competition because you’re not really even competing you’re able to just send customers to Amazon and get a commission and that is something that I feel like

if you’re a beginner and you want to get your you want to you know to put your foot in the water dip your toes in the water as they say on building an online business being able to generate income being able to actually make money like

this is how you do it because this is the way that makes the most sense to me, in fact, this is how I got started I got started online as an affiliate and that was an affiliate of big banks

so what I was doing was promoting chase and Amazon are not Amazon chase and American Express and in Bank of America and all these big credit-card companies right and

I was earning an insane amount of money from it in fact what I’m gonna do is I’m gonna play a clip that I had a lot of success with this it’s what started my success online and my someone came and they interviewed my dad about what I had done and I’m gonna let him kind of tell you a little bit about

what I did and then also show you some of the checks that I earn because this was back in like 2006 or so so as many many years ago but you’re gonna be shocked when you see six-figure checks literally what is that like fifteen years ago or so fourteen years ago I was earning six figures imagine

what you can do now I mean things have completely changed so check this out it would take you four out the way it still takes my breath away he created the internet business that produced these checks one hundred

and one thousand a hundred and three thousand ninety-four thousand ninety thousand we went from devastation to a Cinderella lifestyle in just a few short months was it was primarily developed to help this family there’s

so many others have benefited from it pretty cool stuff, huh I mean look at the end of the day there’s a lot of money to be made as an affiliate there’s a lot of people that are making money as an affiliate

and ultimately it’s just affiliate marketing is it’s like a staple it’s something that’s time-tested it’s been around for forever right over well over a decade and a half and my first book was teaching people

about go be an affiliate go do this cuz it’s a simple path like I’m all about like the simplest path to having success the path of least resistance right like yes I could go create this huge eCommerce store but it’s a nightmare sometimes and

I know this from experience you know you might be saying okay Anthony well what do you know about e-commerce well I also started an e-commerce business when I back in 2006 when I first started my online business

I was already commerce business affiliate marketing business I grew my e-commerce business to 300,000 or so dollars a month in sales the problem was I was only making 10% in making 10% guess what

I wasn’t really making a lot of money but I was spending a ton of time on it I would much rather have the hundred and two hundred thousand dollar checks that

you just saw and be spending a small fraction of that like my profit margin was in sometimes some months ninety percent right.

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