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📦 Amazon FBA: The Truth and Nothing But the Truth – A Real Story of $15,000 and 12 Months Without a Single Sale
Hello, if you are reading this post it will be because you are interested in the Amazon FBA business. You've probably already watched hundreds of videos and even thought about buying a course from one of the gurus you found on the net.
📌 This is just one story. On my website carliaconsulting.com I publish detailed analyses of different investment methods and income sources. All the content I create is designed to help you see the full picture.
I am going to tell you my experience, as a sample of what the Amazon FBA world really is. A case, my case, does not create jurisprudence, but it shows a reality that I did not see in many YouTube videos, in stark contrast to the hundreds of videos telling wonders.
Let's start at the beginning. If you came into this world as a way to achieve passive income, I can assure you to forget about it right away. The first thing you have to keep in mind is that it is a business like any other—it takes a long time to start and manage.
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🤔 The First Decision: Course, Solo, or Hybrid?
When I decided to jump into the pool, I was presented with 3 options:
- The Course Route: Hire a course from one of the network "experts" showing successful experiences of hundreds of students.
- The Solo Route: With what I learned from YouTube videos, launch myself on my own.
- The Hybrid Route (my choice): Learn with videos but hire a Virtual Assistant (VA) to accompany me from product search to launch.
Why I Chose the Hybrid Route
The courses I saw were skyrocketing in price—we were already talking about more than €3,000. I know how these courses work: their owners put in a lot of effort initially, but then they just want to sell and charge, with little interest in correcting videos and syllabi. In such a changing world, in a few months, 30% of the information becomes outdated.
Also, when you see that the same people selling the course for €3,000 sell you the creation of your LLC for €900 (when I created mine in a few hours for €150), it becomes clear that someone who doesn't charge a fair price for an LLC won't charge you a reasonable price to help with your Amazon business either.
I also looked for cases of no success from these courses. There must be many, even if it's because the user is "useless" and the course isn't to blame. Yet you find not a single bad reference. I've even found cases of people receiving contacts from legal teams when they decided not to speak well of a course. Who requires lawyers to keep their carpet shining? It doesn't give me much confidence.
The most important thing would be to join their student chats for support, but I also know how they work—1,500 people writing sometimes becomes a cage of crickets, not very effective for specific problems.
Regarding going totally solo, I immediately understood that it's such a complex subject that no matter how many videos you watch, you'd have 1,000 questions that would take many days to solve.
Therefore, I thought that hiring someone to accompany me from the beginning for about €450 (vs. €3,000 for a course) was the best option. More personalized treatment, better learning, and safer. So I went on Fiverr and hired a guy who seemed knowledgeable and nice.
🛤️ The Journey: A Timeline of Reality
We started working together near the end of July. While he was looking for the product to sell, I was doing some of the administrative work that needs to be done:
- Open the Amazon Seller Central account
- Open a checking account
- Create an LLC (since I wanted to sell in the USA)
- Set up a mailing address, bank account, telephone
- Apply for and register a trademark
- Hire someone to design the company logo
- And a long etc. that takes time and... money.
Another small criticism of course sellers: To attract the largest number of buyers, they greatly sweeten the time and especially the money needed to start selling. Without considering the course price itself, we're talking about costs for Amazon, brand registration, logo creation, listing design, A+ content, administrative and accounting management, software tools, and of course product price, transportation, customs, and a long etc. This is very far from the information that you can start with €3,000 to sell on Amazon FBA.
📊 Product Selection & The Cost of Tools
My VA proposed about 3-4 products where I saw potential. Of course, I already hired Helium 10—$80 per month. By this point, after several months, I had already spent $800 for nothing (overall, I've now spent about $10,000 and not even started selling).
With Helium 10 you can see how much selected products sell, how many competitors there are, what sales they make, etc. It's a very good product, but not cheap—especially if you're not using it because you haven't even started selling.
And thank goodness Amazon FBA doesn't charge the $40/month to have Seller Central open—otherwise, we'd be talking about another $400 thrown away.
🎯 The 25% Margin Myth
Everyone recommends that the product should leave you a 25% margin to be a good product. I think that's where most people are deceived. Without having sold even one product, I suspect that in the end, if most people get 10-15%, they'll be so happy... More on this later.
Of the 4 products presented, I selected two as the strongest candidates. Then, as recommended, you analyze customer feedback to see how to improve them. As the gurus say, it's not enough to launch the same as others—you must differentiate and improve your product.
So I wrote down the 5-6 main defects that users complained about in my ideal product.
🇨🇳 The Chinese Manufacturer Nightmare
Then you enter the phase of going on Alibaba and trying to deal with Chinese manufacturers that offer your product. At first, I let my VA take care of it. He started contacting manufacturers, telling them we wanted the product with these improvements.
That's when the first reality begins. Because of the time difference, you coincide only a few hours with the working hours of your manufacturer. Any question is easily answered the next day—and if you ask again, they might answer two days later. Days and weeks begin to pass without any progress.
The Chinese are fantastic at selling repetitive products. They have 100,000 bottles in their warehouse—you pay and they send you 500 instantly. But if you want them made with a different color and shape, there's no longer so much interest. In a distribution chain, what matters is manufacturing the same product wholesale, not stopping machines to create customizations for millions of "heavy" customers writing every day from all over the world.
The negotiation can easily take more than a month or a month and a half. You ask, and they always say yes to everything, then tell you they'll send a sample. You ask for a picture to see if what you've been discussing for days matches—they say what they have is like that, then you see it doesn't look anything like it, and you start all over again.
They told me they could make my product with additional protection and a specific material. After weeks negotiating prices, squeezing, "my boss has to approve it next week at the weekly meeting," after more than a month, the seller arrives and says the technicians told him this material can't be done—it doesn't even exist. He offers another similar one, but it wasn't very similar, so I had to start from scratch again.
When you don't trust the seller, you start talking to several sellers at the same time, which increases the madness. You can create a mass request (RFQ)—put your product with its requirements published throughout Alibaba, and sellers themselves make you offers.
Then the madness multiplied by 10. Offers and offers started coming in, each with a different price. You had to figure out why those differences, which took weeks of exchanging messages in the few hours of overlap—or getting up at 6 AM to match more hours with the manufacturer.
Think of a factory with a room of 20 operators answering thousands of questions, budgets, orders, etc. Since thousands of messages don't end in anything or are simply curious people asking, they don't put in great interest, and many times you have to be insistent.
By October, I still hadn't been able to get a final price offer for my product. Then the end of the year begins, when manufacturers only think about taking new orders for the Christmas campaign. A new customer no longer has preference and is forgotten.
📦 The First Sample Disaster
In October, after talking to the person in charge of my salesman (who had given me bad information that made me lose a lot of time and then tried to change prices with unethical behavior), we finally got them to send a sample by plane.
The product price was $12, but the sample was worth $200 (sample price is $50 plus express air transport). The manufacturer created a "false" invoice stating there were about 15 products to reach the $200 value. We waited about 12 days for arrival.
Upon arrival, customs—not stupid—sees a small package that was supposed to contain lots of things. Alarms went off, and they began asking for information. We had to explain there was only a $12 product inside despite what was indicated, and we gave authorization for them to open it and see we weren't lying. Another 20 days stuck in customs.
When it finally arrived home, we saw it was nowhere near the quality or the product we had ordered.
🔄 Starting Over (And Over Again)
It was now November. We had to start again, more seriously, with 3 other sellers. After more weeks of negotiations to finish adjusting prices, we found two who seemed to have everything clearer and decided to send two samples. Another $80+ per sample by plane, another 12+ days. Upon arrival, one was not the best quality, and the other one was.
During this time, after the anger of the first deception and the weeks lost in customs, the first frustrated and disappointed VA offered to quit and return my money—he was sorry, and that was it.
Again, find a new VA, explain the product, features, etc. Of course, we were already in the Christmas period, and everything slows down a lot.
By January, I got a new VA, and we started to close the deal with the selected manufacturer with the best product. At the same time, I started looking for an image designer for the listing and for the A+ content.
On Fiverr, I hired up to 5 different people. The first, after a week past the deadline, sent a product of very bad quality. Again, look for another, another week lost, and the photos were a horror. Look for another one—I asked him to send the photos one by one as he finished them to not waste more time. Another month until I could get the photos, at least acceptable. Another $150 for the photos.
When I went to make the first payment for the product so they could start manufacturing, they said it was Chinese New Year and factories would be closed for about 3 weeks. They wouldn't start manufacturing until March. Then they started to manufacture, and at the end of April, I had the product in the warehouses.
After the inspection (which you pay about $180 for), you detect damaged products, dented boxes, etc. The manufacturer guarantees to replace them, but you'll never know until customer complaints arrive if it was true or if they were damaged during the trip. Either that or go back and spend another $180 to do another inspection—which is never total, but 10-15% of the total goods.
My main source of real passive income while building my FBA business
💸 The Real Cost: What Nobody Tells You
In total, to get a good price, I had to buy 1,000 units at $12.50 each—that's $12,500 just in product. This is very far from the €3,000 offered by many course sellers as a starting point.
At this $12,500, now you have to take the product to the port of China and ask Amazon to take it to their warehouses. Transportation will be another $1,000 plus local freight of $200. Customs fee another $350, and I believe another customs tax will come later.
With all this, we're at the beginning of May. My product hasn't even left the manufacturer for the port of Shanghai yet. Now we have a week and a half because, from the Amazon Global Logistics application, the contract button doesn't work. We have to open claim cases with Amazon, requesting more and more information, and the days keep passing.
If all goes well and transport by ship takes a month, by the end of June I would start selling my first product—almost a full year after I started.
So this is my story: over $15,000 spent and almost a year later, I can't even say I've sold a single product. And not because I am incapable (or at least I shouldn't be), plus two virtual assistants who accompanied me in this launch year.
📢 The Advertising Reality (Coming Soon)
Then will come the world of advertising. I'll tell you about it when the time comes. But what I see reading forums is that it's a devilish world where all the possible margins promised and studied on paper go away.
For starters, you have to give away about 20-30 products for the Vine program, which allows you to deliver your product for free to Amazon-selected customers with the commitment that they will rate you and write a review. It doesn't have to be positive, but at least you'll start getting reviews.
If you don't have reviews, you're nobody, and your product won't be positioned on the first pages. Nobody searches for a product on page 6 of Amazon. So when you start selling, there's only one way to gain positions: lowering the price, waiting to gain reviews, and spending money on advertising.
My two virtual assistants have already told me that in the first 6 months, it will be normal to sell at a loss or without profits. What I sell will earn me €0.
Advertising in the USA is crazy. If you read Facebook groups, that's where people get most desperate and where they ask for help hiring the services of experts. You'll have to spend a lot of money to get your keywords positioned. For that, you'll have to bid more money than your competitors, plus constantly adjust your campaigns, playing with different options and strategies through trial and error.
Such mistakes lead a lot of people to despair as their 15-day budget is spent in less than a day. They have to keep putting money in or stop bidding—which would sink their product into the mud.
There are tons of groups on social networks of desperate people looking for advice or how to hire an expert to manage their ad campaigns to try to save their desired profit margin and not end up working just to pay the bills—or even losing money.
And as the information on Amazon is very diffuse and there's not a single screen where you can see your real situation (sales, expenses, income, etc.), you have to end up buying other software that allows you to extract information from Amazon's complex systems to show you if they paid you for goods damaged in their warehouses or transport, returns customers were making, or amounts spent on advertising.
📊 Turnover vs. Profit: The Great Deception
You find everyone talking about "I bill so much," but few say "I earn so much"—which is the only purpose of any business. Only net income is useful. If in the end you're able to find it out, I'd like to know the margin that everyone talks about as a goal—25%. If in the end we're not talking about 10% (as I've managed to elicit from many sellers).
And if to get a 10% net you've had to spend a lot of money, have headaches, deal with customer returns, and handle bad reviews (sometimes from your competition to hurt you) that lower your rating and therefore reduce your sales a lot.
And let's not talk about the hundreds of sellers who comment that there are hijackers who resell your product, accuse you of plagiarism, or throw prices. Before your complaints to Amazon, they will never do anything. Or you wake up one morning and your listing is blocked, and a desperate struggle begins with customer service that responds in automatic mode. You don't know the reason, and you'll struggle to figure out how to fix it. There are many experts offering their services to solve these problems, sacrificing even more of your margin.
In short, there are people who are doing well and even very well, no doubt. But after saying they have a turnover of €10 million, maybe they don't even earn €1 million. And for that, they've had to manage 40 products with their thousand problems and have hired a couple of people to manage the products, advertising campaigns, data analysis, etc. In other words, it has very little passive income.
💡 The P2P Alternative: Real Passive Income
In recent years, I've earned a net income of 12.5% on the money invested—my own and my clients'. This is with one hour a day (not completely necessary—with one hour a week I would perhaps obtain 12%). But for the sake of obtaining maximum income, I usually check investments every day.
I can assure that I earn net with 1% of the problems that Amazon FBA generates.
The business is very clear: it's for Amazon. They have millions of workers doing the dirty work, risking their money and time. When a product is good, they sell it themselves or simply with what they charge you for managing your product and your advertising campaigns, they get the millions that make it the largest e-commerce market in the world.
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🎓 The Course Business: The Real Money-Maker
Those who claim to earn millions (or rather, bill millions to finally enter 10% of the business moved) are forced to create products for selling Amazon courses to take advantage of their knowledge to bill after the sale of courses that are really profitable.
What's more, some of the most famous Amazon gurus who claim to bill millions with hundreds of products have even confirmed that they earn more selling the courses and mentoring than selling directly.
So, great that they help, great that people are launched. But I hope they do not deceive those who have little money with the idea that anyone with €3,000 can start, that in two months you are already selling (not earning). They don't tell the whole truth about a business where you need a large financial cushion to support the initial expenses, where your first order of 1,000 units will give you almost no income, and—if all goes well—after 6-9 months of selling, you will begin to have net income, which will have meant having to invest in buying another 1,000 units, paying another transport, and spending on advertising to start having your first income.
💭 Final Thoughts: The Truth First
So I will keep trying, and I hope to keep telling you when I finally get my product on sale, start running advertising campaigns, get my first customer reviews, and can assess the real margin and net income. If I get 10% income, I will be satisfied—if it does not occupy more than 20% of my time versus the 12.5% income and 1% of my time that generates passive income from investing in Crowdfunding platforms.
I hope you find my reflection useful. I am not trying to be negative. Maybe I had bad luck with the suppliers I contacted in China. Improving a product, which everyone recommends, complicates the manufacturing process a lot—but at least you create a small barrier to entry by not being so easy to copy. I also coincided with Christmas and Chinese New Year dates, which wastes a lot of time. I was also unlucky in finding bad image designers, and the time differences between China, Europe, and the US make negotiations and conversations take a long time.
But what makes me angry is to see hundreds of course sellers encouraging young people or people with few resources to quit their jobs, invest their savings of €3,000 with the promise of earning income in 2 months.
If I get someone to listen to me and my experience makes them reconsider, I will be happy. I do not discourage them not to do it, but I do want them to know the truth: that they will have many problems, that they will have to invest a lot of money, that it will take many months to see results, that the results are not profits, and that turnover is not the same as net income. Many times they will think about throwing in the towel when they don't see any sense in it.
That is Amazon. Once you know the rules, I encourage you to play—but without deception and with the truth first.
And the same happens with many other passive income methods that are sold as magic formulas to obtain passive income and thus soon obtain the famous financial freedom that allows you to work when you want, where you want, or not working at all, letting the money work for you. But that will be the subject of future posts.
Thank you very much for making it to the end. I look forward to your comments and reflections. It would be nice if other users tell their real stories of how their beginnings on Amazon went and if their story is closer to my experience or to the world of Disney that the gurus selling courses on social networks portray.
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