How to Price Your Amazon FBA Merchandise

Prive vs Value explanined for Amazon FBA

When selling through Amazon FBA, you need to decide how much to sell your products for.  There is a lot to consider when making this decision.  You don’t want your Amazon merchandise to be so expensive that most customers turn to your competition for better prices, but you also need to make money.  Here is what you need to know about pricing when it comes to Amazon merchandising.

Think About ROI

No matter what you are selling, you are going to have to invest some money into that product up front.  Someone has to make the Amazon merchandise.  You obviously need to make at least the cost of your investment back when you sell your product.  If you sell the merch for exactly as much as it cost you, you aren’t making anything.  That would be zero percent ROI, which stands for return on investment.

When it comes to Amazon FBA, you want to price all your products so that you get at least 200 percent ROI.  This means for every dollar you spend, you get three dollars back.  For example, if it cost a merchandise provider five dollars to make you a custom t-shirt, you should sell that shirt for at least $15.  You get your initial investment back, make enough to buy another shirt to sell, and even have money left over to spend on advertising and other business expenses.  Don’t forget about Amazon FBA fees when you are calculating this, either.  If the fee for that shirt is two dollars, it should be priced at at least $21.

Stay with the Competition

You want your Amazon merchandise to be in the general price range of similar products.  If most logo hoodies are selling for $30, very few people are going to spend $50 on your hoodie, even if they really like your brand.  There will be some that will buy merch with your logo on it no matter the price, but those people are few and far between.  You have to consider the customer’s point of view and their mindset.  They need to feel like they are getting their money’s worth.

One of the best ways to do this is to focus on product differentiation rather than price.  Say you have a phone case for sale at the exact same price as dozens of other cases on Amazon, but yours comes with a free screen protector.  People are more likely to choose your product because there is more value for their money.  You don’t always have to add something extra.  Something as simple as offering a product in a different color or size can be enough to convince customers to choo your merchandise.

Reconsider Your Prices as Markets Change

Just because you post a product listing at a certain price doesn’t mean it should stay that way forever.  Check back in often to see how your Amazon merchandise is selling.  You can push prices up or pull them down depending on the reaction from customers and how the market changes.  This does not mean you should sell products for less than 200 percent ROI.  That is your lowest price point.  However, if you started a product off above that mark and aren’t seeing many results, consider lowering the price.  If your Amazon merchandise sold out quickly, you may be able to post the product again at a higher price for the next shipment.

Amazon merchandise from Amazon FBA experts

Kale Abrahamson and Taylor Hiott, founders of Nine University, are expert Amazon FBA sellers.  You can learn more about Amazon merchandising from their online training and even buy merch with their brand at Kt Nine.