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By: Steven Pope

Think you’ve mastered Amazon selling profitability core building? Think again — most sellers miss key pieces, and it’s costing them big time.

Selling on Amazon looks easy—until sellerboard shows your real numbers. Margins are disappearing, ad spend is bleeding cash, and your competitors are eating your lunch.

You did everything right—sourced a great product, optimized your product listing, and ran PPC ads—but your profits are still razor-thin or even negative. Amazon profitability isn’t just about making sales; without the right strategy, you’ll keep wasting money, battling frustration, and struggling to break even.

In this guide, we’ll break down the biggest pain points sellers face when dealing with the Amazon selling profitability challenges. Real-time profit tracking can help identify losses, and a full service Amazon agency for sellers can provide the expertise to optimize your profitability.

1. Amazon Selling Profitability Core Building: Product Selection

Pick the Right Product for Long-Term Profitability

Choosing the wrong product can make or break your Amazon FBA business. Many Amazon FBA sellers jump into trending categories without checking competition, profit margins, or marketplace saturation. They end up in a price war, drowning in ad costs, and struggling to make a profit.

Here’s how to avoid the biggest product selection mistakes:

Overlooking Amazon Fees and Profit Margins

Mistake: Forgetting to account for Amazon FBA fees, storage, and refunds.
Fix: Use Sellerboard to calculate total costs and ensure sustainable profits.

Picking a Product Without Keyword Demand

Mistake: Selling low-search or unclear demand products.
Fix: Use Search Query Performance to find high-demand keywords.

Competing in Overcrowded Niches

Mistake: Entering a market with big brands and tons of customer reviews.
Fix: Target long-tail keywords and niche subcategories with less competition.

Selecting a Product Without Competitive Pricing

Mistake: Choosing a product that forces you to undercut prices.
Fix: Check competitor prices and ensure your margins work with PPC.

Selling Low-Quality or Easily Copied Products

Mistake: Selling generic products prone to imitation.
Fix: Differentiate with unique features, better materials, or custom packaging.

Best Practices for Selecting Products to Sell on Amazon

Focus on What You Know

Choose products in categories you’re familiar with. Your knowledge will help you understand customer needs and stand out.

Avoid Following the Crowd

Don’t rely only on data tools. Many sellers on Amazon use the same filters, leading to oversaturation. Find ways to differentiate your product.

Understand Customer Needs

Go beyond low competition—identify real problems customers want solved. This will help you offer better solutions and build loyal customers.

Listen to Customer Feedback

Ask your customers what they need or want more of. Use their input to guide product expansion and increase your chances of success.

2. Amazon Profit Core Building: Inventory Management

Streamline Inventory Restocking to Prevent Stockouts and Overstocks

Running out of stock hurts Amazon sellers by damaging rankings, increasing ad costs, and causing weeks of lost sales recovery. Overstocking ties up cash and leads to extra storage and fulfillment fees.

Here’s how to avoid the biggest inventory management mistakes:

Running Out of Stock

Mistake: Stockouts in Amazon Seller Central harm SEO rankings.
Fix: Keep 60-90 days of inventory in FBA (Fulfillment By Amazon) and track levels with Amazon’s Restock Inventory Tool.

Ignoring Lead Times

Mistake: Relying on just-in-time inventory without considering delays.
Fix: Plan 2-3 months ahead, accounting for production, shipping, and check-in delays.

Overstocking

Mistake: Excess inventory leads to high fulfillment centers storage fees.
Fix: Use Amazon AWD for bulk storage and replenish FBA as needed.

Poor Demand Forecasting

Mistake: Guessing leads to stockouts or overstock.
Fix: Use Amazon’s Forecasting Tool to track sales trends and growth.

Not Preparing for Seasonal Demand

Mistake: Running out of stock during peak seasons or overstocking during slow months.
Fix: Adjust inventory based on seasonality and historical data.

Ignoring Low Inventory Fees

Mistake: Too little inventory triggers fees.
Fix: Maintain at least 45 days of stock to avoid penalties.

How to Handle Stockouts on Amazon

Increase prices. Gradually raise prices by 10% to slow down sales. If you lose the buy box, lower the price to regain it.
Pause ads. Pause your ads to avoid spending money on products you can’t fulfill.
Close listings (if needed). If your product is a single listing, consider closing it to preserve your BSR. For variations, leave it open.

3. Amazon Seller Profitability Core Building: Product Pricing

Set The Price Right

Pricing your products correctly is essential for driving sales and maintaining profitability on Amazon. Here are the key strategies to avoid common profitability challenges for Amazon sellers and maximize pricing impact:

Not Using Dynamic Pricing

Mistake: Failing to adjust prices regularly can limit sales and ranking potential.
Fix: Periodically lower your price by 10-20% for 1-3 days each month to drive traffic and increase sales, while protecting your profit margins.

Raising Prices Too Quickly

Mistake: Large price hikes can cause you to lose sales and your buy box.
Fix: Start with a price drop to attract sales, then gradually increase. Avoid price hikes over 10% to prevent buy box removal.

Ignoring Promotions

Mistake: Not factoring in promotions like Prime Day can disrupt pricing strategy.
Fix: Align your pricing with promotions but ensure temporary price drops don’t hurt long-term margins.

Over-Discounting

Mistake: Heavy discounts damage perceived value and future pricing.
Fix: Be cautious with discounting, as Amazon uses the last 30-90 days’ prices to calculate averages, affecting future price changes.

Signs It’s Time to Adjust Your Pricing

Here’s when you should revamp your pricing strategy:

Sales have stalled. If your conversions are dropping, your price may be too high.
Your inventory levels are high. If stock isn’t moving, a temporary price drop can boost velocity.
Competitors are outpricing you. If similar products offer better deals, adjust to stay competitive.
You want to trigger a strikethrough price. This makes your discount look more appealing to shoppers.

4. Amazon FBA Profitability Core Building: Amazon Advertising

Avoid Costly PPC Mistakes

Amazon ads aren’t “set and forget.” Many sellers waste money on broad, high-competition keywords instead of targeting high-converting search terms.

Skipping Sponsored Products

Mistake: Jumping into Sponsored Brands or Display Ads too soon.
Fix: Master Sponsored Products and Video Ads first.

Targeting Broad Keywords

Mistake: Bidding on high-volume terms that don’t convert.
Fix: Focus on long-tail, niche-specific keywords.

Ignoring Auto Campaigns

Mistake: Only using manual targeting.
Fix: Run Auto Campaigns to discover profitable keywords.

Changing Too Much Too Fast

Mistake: Using every ad type without testing results.
Fix: Follow the 80/20 rule—optimize Sponsored Products first.

Not Adjusting Based on Data

Mistake: Letting ads run without tweaking bids or keywords.
Fix: Analyze ACoS, pause bad keywords, and optimize regularly.

Ignoring Competitor Targeting

Mistake: Only bidding on generic terms.
Fix: Use Sponsored Display Ads to appear on competitor pages.

Quick Checklist for Launching Amazon PPC Campaigns

Optimize Your Listing

Ensure your listing has at least six photos and a well-written description. Add a video for extra engagement.

Add A+ Content

Make sure A+ content is live on your listing to improve appeal and conversion rates before running ads.

Set Up Your Amazon Store

If you have Brand Registry, create a Brand Store to avoid directing customers to competitors when they click your ads.

Use FBA (Fulfilled by Amazon)

Run ads only on products with the Prime badge (FBA) for better performance.

Get Reviews

At least one review can double your conversion rate. Aim for organic reviews, but Vine can help.

Limit Keywords in Campaigns

Add no more than five keywords per manual campaign for better focus and optimization.

Monitor & Optimize Regularly

Run weekly negations and set up both auto and manual campaigns for data-driven adjustments.

Take Advantage of Peak Seasons

During peak periods like Black Friday or Christmas, increase ad spend to capitalize on higher traffic and conversions.

5. Amazon Selling Profitability Core Building: Fee Management

Optimize Fees and Costs

Effective fee and cost management is crucial for maintaining Amazon profitability. Here’s how to avoid common mistakes:

Understand Amazon’s Fee Structure

Mistake: Not fully understanding all the fees Amazon charges.
Fix: Learn about FBA, storage, and referral fees, and track them regularly to manage costs.

Avoid Overstocking

Mistake: Overstocking and incurring high long-term storage fees.
Fix: Monitor inventory and use Amazon’s tools to avoid excess stock and storage fees.

Factor in Referral and Transaction Fees

Mistake: Not including Amazon’s fees in your pricing.
Fix: Ensure product prices cover referral and transaction fees, protecting your margins.

Watch Shipping Costs

Mistake: Underestimating FBA shipping fees.
Fix: Regularly review shipping costs and optimize packaging and methods.

Track Profits Accurately

Mistake: Not tracking fees and costs in one place.
Fix: Use tools like Sellerboard to track fees, costs, and profits in real time.

Optimize for Profit Margins

Mistake: Focusing too much on price and neglecting margins.
Fix: Always account for all fees and costs when setting prices to ensure profitability.

6. Amazon Selling Profitability Core Building: Review Management

Proactively Manage Reviews

Reviews impact sales and rankings. Ignoring them leads to lost revenue. Here’s how to manage them effectively:

Ignoring Negative Reviews

Mistake: Letting bad reviews pile up.
Fix: Monitor and respond professionally. Request removal if it violates Amazon’s policies.

Not Preventing Common Complaints

Mistake: Repeated bad reviews on the same issue.
Fix: Improve listings with clear descriptions and better images to set expectations.

Not Encouraging Positive Reviews

Mistake: Waiting for reviews to appear.
Fix: Use Amazon’s “Request a Review” tool and follow up with customers.

Ignoring Fake Negative Reviews

Mistake: Doing nothing about competitor review bombing.
Fix: Spot suspicious patterns and report them using Amazon’s Report Abuse tool.

Failing to Address Misleading Reviews

Mistake: Letting false claims hurt conversions.
Fix: Update titles, bullet points, and images to clarify product details.

Not Using Discounts to Boost Reviews

Mistake: Expecting reviews without sales volume.
Fix: Use limited-time price drops to increase orders and feedback.

Get Reviews on Amazon Without Violating Policies

Use Amazon’s Review Request Tool

For FBA orders, leverage Amazon’s internal API to automatically send review requests to customers.

Send Direct Messages for FBM Orders

For FBM orders, use Amazon’s messaging system to request reviews, but avoid sending too many at once to prevent messaging restrictions.

Avoid Proactive Messaging Spam

Be careful not to overwhelm customers with too many review requests. Keep messages helpful and within Amazon’s guidelines.

Maximize the Honeymoon Period

In the first 4-8 weeks after launching, focus on competitive pricing and excellent service to boost organic reviews.

Use sellerboard for FBA

sellerboard can automate review requests for FBA orders while ensuring compliance with Amazon’s rules.

7. Amazon Selling Profitability Core Building: Listing Optimization

Optimize Listings To Boost Conversion

Properly optimizing your Amazon listings is crucial for visibility and sales. Here are common mistakes and how to fix them:

Hidden Suppression

Mistake: Listing issues causing hidden suppression, making your product unsearchable.
Fix: Avoid image/text issues that cause suppression. Follow Amazon’s formatting guidelines.

Underutilizing Image Space

Mistake: Relying solely on images without enough detailed text.
Fix: Use all available space with quality images and relevant text. Include alt text with keywords in multiple languages.

Weak Main Image

Mistake: Poor main image that reduces listing appeal.
Fix: Ensure the main image is clear, eye-catching, and shows the product in use.

Lack of Product Use Demonstrations

Mistake: Not showing the product in action.
Fix: Add images or videos demonstrating how the product works.

Missing Information

Mistake: Missing key details like barcodes or important product facts.
Fix: Include necessary labels and product information to avoid extra charges.

Overstuffing Text

Mistake: Cluttering listings with too much text.
Fix: Be concise and focus on key benefits, avoiding repetition.

8. Amazon Selling Profitability Core Building: Brand Protection

Protect Your Brand, Protect Your Profits

Failing to secure your brand invites hijackers, counterfeiters, and lost sales. Here’s how to stay protected:

No Trademark = No Protection

Mistake: Selling without a trademark.
Fix: Register a trademark to unlock Brand Registry and safeguard your business.

Skipping Brand Registry

Mistake: Letting competitors run ads on your brand name.
Fix: Enroll in Brand Registry to access A+ Content, Brand Stores, and Sponsored Brand Ads.

Ignoring Hijackers

Mistake: Allowing unauthorized sellers to list your product.
Fix: Use Amazon’s infringement system to report and remove them.

Not Branding Your Product

Mistake: Selling generic-looking items that attract copycats.
Fix: Add logos and branding to product images and packaging.

Not Monitoring Listings

Mistake: Missing sudden price drops, duplicate listings, or fake reviews.
Fix: Regularly check your listings and report suspicious activity.

9. Amazon Selling Profitability Core Building: Profitability Tracking

Track Profits, Not Just Sales

Many sellers focus on revenue but ignore actual profits. Here’s how to stay on top of your numbers:

Not Tracking Real-Time Profits

Mistake: Relying on Amazon’s reports.
Fix: Use tools like sellerboard to monitor sales and expenses daily.

Ignoring Hidden Costs

Mistake: Overlooking FBA fees, PPC costs, and returns.
Fix: Audit all expenses to ensure your pricing stays profitable.

Running Ads Without Checking ROI

Mistake: Wasting money on PPC without tracking results.
Fix: Monitor ACoS and TACoS to keep ad spend profitable.

Poor Inventory Planning

Mistake: Overstocking or running out of stock.
Fix: Maintain a 60-90 day supply based on sales velocity.

Missing Amazon Fee Changes

Mistake: Failing to notice FBA fee hikes or lost inventory.
Fix: Set up alerts for unexpected charges.

Amazon Selling Profitability Core Building — Start Optimizing Today

Ready to take your Amazon business to the next level? Mastering profitability core building is essential. From selecting the right products to optimizing listings and tracking profits, each step makes a big difference.

Avoid common mistakes that drain profits, like poor pricing, stockouts, or ineffective advertising. Implement these strategies today and start building a solid foundation for sustainable growth.

Take action now and unlock the full potential of your Amazon business.

Author Bio:
Steven Pope, founder of the Atlanta-based My Amazon Guy, leads a team of 500+ Amazon experts. His agency, generating $20 million in annual recurring revenue, has propelled the sales of over 400 clients. They offer comprehensive Amazon support, covering everything from advertising and search engine optimization to product presentation and catalog management.

Having built a successful 7-figure Amazon brand himself, Steven understands the challenges sellers face. This experience, combined with his agency’s success, positions him as a go-to resource for Amazon sellers and brands.

Beyond agency work, Steven is dedicated to educating the Amazon community. My Amazon Guy boasts a library of over 2,000 instructional videos, reflecting his commitment to sharing expertise and helping sellers thrive.