How to sell food products on Amazon?
The Grocery and Gourmet category on Amazon is restricted only to sellers who can demonstrate their products are high-quality and especially healthy.
The platform has strict policies for Grocery and Gourmet products due to the nature of products and health concerns associated with them.
Before selling food on Amazon, you must ensure that your products are registered and have approval from relevant health authorities.
You also need to be aware of the expiry period of food products, have detailed labels, and proper shipment material to avoid any kind of damage or harm.
The most convenient food items are snacks, canned food, biscuits, and cereals.
The reason is that the brands manufacturing these products have government approval and possess fewer chances of getting rejected by Amazon or customers.
The opportunity to sell food products on Amazon’s Grocery & Gourmet section
To sell through Amazon means you can get access to 200 million unique users every month. Since the food industry experiences much slower growth compared to other industries, tapping into such a large marketplace can help drive revenue quickly.
The challenges of selling food products online are now largely overcome if you follow Amazon’s policies. The ecommerce giant imposed restrictions and demands to provide all information related to the product’s quality and health requirements.
Considering the growing demand for ecommerce retailing and the numbers of users getting associated with Amazon, it should be a preferred choice for food sellers.
How to successfully sell food on Amazon
1) Identify the gaps & opportunities within Amazon’s food sales
Amazon’s marketplace faces tough competition and high saturation in every category. To sell on Amazon and rank your food product, you need to identify the right niche which has the potential for high demand and lower numbers of sellers.
Identifying products with low saturation of sellers, running some market research on Amazon’s platform is necessary.
To sell food products on Amazon, it’s recommended that you use any non-perishable food products such as snacks, biscuits, cereals, and coffee or tea.
There are two broad categories of food products:
Amazon provides you with an opportunity to sell both types of food products by meeting their requirements. In comparison to non-perishable products, perishable food products have low demand.
If you want to sell food products on Amazon, it’s recommended that you use any non-perishable food products such as snacks, biscuits, cereals, and coffee or tea.
The selection should be made by ensuring that the selected food product does not require a special environment for storage, packaging, and cost of delivery. Otherwise, it will consume all your profit margins and end up in a big loss to your business.
If you are interested in selling food products, which have high saturation on Amazon, you should focus heavily on differentiating your brand from the rest.
Consumers today prefer to purchase products that are sustainable to the environment, transparent, and contribute to their wellness. The food brands which offer organic, eco-friendly, and free-from X products are flourishing in the US market.
2) Identify suitable suppliers
To sell on Amazon, the most important factor is how you position your product and its brand. This is affected by numerous factors, including your supplier(s).
Competing with Quaker and Cap’n Crunch isn’t going to be easy as a new brand.
The food industry is a mature industry with strong international penetration. Moving to ecommerce as a new brand means competing against all the biggest, most powerful brands who have decades of experience in the food industry.
To stand out in fierce competition, the most important thing is the quality of your food products—together with your brand image. Selecting suppliers (or manufacturing the food yourself) is a very important factor to consider during the launch process.
To stand out in fierce competition, the most important thing is the quality of your food products—together with your brand image.
The cost of transportation of food products from the destination to the desired Amazon’s marketplace should be measured to make the right decision. Furthermore, it also includes the cost’s determination for packaging, labor force and currency appreciation while dealing with overseas suppliers.
Your final decision to select the supplier should be based on:
- Quality of food product offered
- The cost associated with dealing in specific food products
3) Design your brand’s identity & packaging
To sell on Amazon, it is very important to have a catchy display.
If you are selling food products such as snacks, biscuits, or other pantry products, you must ensure your brand’s logo and packaging are outstanding.
To design appealing logos and packaging, spend as much time as you can on your brand image. This is equally as important as the quality of your food product.
The national food brands operating in the market have unique logos and packaging which help in attracting the attention of new customers. What makes them stay then is the quality.
Creating an eye-catching brand with appropriate brand design can help you differentiate your brand from the national brands. From brand-mark to color selection, each factor should go in line with your company’s mission and vision.
Creating an eye-catching brand with appropriate brand design can help you differentiate your brand from the national brands.
The selection should be made according to the product’s nature and targeted customer’s interest. Your brand story is very important.
You should infuse it in your marketing to provoke customer’s emotions and interests in your products. It will help you in grabbing the attention of consumers and create a positive impact on a brand’s awareness and value proposition. Along with this, it will develop a network of loyal customers with high engagement and social proof.
How to receive Amazon approval to sell food products
Selling food products on Amazon can be the real challenge. To sell on Amazon, there are extra requirements to be met by the sellers before listing their food products. The two primary requirements are:
1) Acquire the approval of category or “ungate” the desired food products
The first stage of selling food products on Amazon is to acquire approval to sell through the Grocery & Gourmet category. It is among the few of the restricted categories and you cannot sell out any product without getting it ungated.
To ungate the product you are required to provide all the information related to your food products. There is a need for additional approval for organic food products.
After submitting the requirement, Amazon ensures that your selected food product comply with USDA regulations and seeks proof for your product’s compliance.
Amazon imposes strict regulations against its Grocery & Gourmet category because of the individual’s concerns associated with it.
The food products have a specific duration before which they are best to use. Along with this, the ingredients used in the product’s manufacturing are associated with health wellness.
Thus, Amazon ensures that they give the best experience to customers after checking all requirements before allowing sellers to sell through Amazon.
2) Be a professional Amazon seller
To sell food products on Amazon, you are required to have a professional selling account. Without it, you cannot get the ungated approval for your food products.
After acquiring the specific type of account, Amazon will ask you for the product’s invoices and Quality Management System.
This is required for verification and to ensure that the products are safe for consumer’s usage. Food products are very sensitive to consumer’s health.
To avoid any mishap, Amazon has imposed extra limitations to ensure that your products are best suited to be sold on Amazon. The extra thresholds are:
- Order defect rate of your product should be less than 1%
- Cancellation rate for your product should be less than 2.5%
- Late shipment rate should be less than 4%
It will take a period of a week or more for approval, depending on the magnitude of business on Amazon. Usually, it takes up to a week to get the approval.
Additional Amazon’s requirements for food products
Amazon has added extra requirements for food products to ensure that the customers are satisfied with the products offered to them.
You are required to ensure the safety and freshness of the food products; your product should be properly packed, and provide clear expiration dates.
Food product’s packaging requirements
The packaging quality should ensure that no harm or damage occurs while delivering the food products.
The packaging should include details about the name and address of the packaging company, the weight of the product, its expiration date, and any dietary claims.
Shelf life requirements
The majority of the food products have an expiration date.
Amazon demands that the perishable food products that are sold through FBA should have a minimum shelf-life greater than 90 days. In case, the product’s expiration date is within 50 days, then those food products are removed from the shelf.
The products whose expiration is in less than 50 days are disposed of.
Food product labeling requirements
Amazon also has specific requirements for product listings on Amazon.
The listing should include details regarding the ingredients and nutritional information within the product’s images. The images should display only the food product to be sold, without any other product included.
To ship food products to Amazon’s fulfillment centers, certain rules are developed. The shipment is expected to include the following details:
- Shipper or owner’s name and address
- Person’s name to whom the shipment is being sent
- Country’s name, territory, or state, where contents were grown
- Shipping content’s statement
Amazon’s fees for the Grocery & Gourmet category
Unlike other categories, Amazon has varying fees for the Grocery & Gourmet category. The food products priced less than $15 are charged an 8% fee while those which are priced $15 or above are charged a 15% fee. This is done by Amazon to attract more sellers to sell to their platform instead of moving to alternative ecommerce suites.
If you’re unsure on how to get started, Emplicit has helped dozens of food brands launch successfully on the Amazon marketplace. With a strong focus on brand storytelling and ensuring a diversified brand image, we help you achieve not just a pretty look but also strong business performance.