The process involves procuring products in bulk directly from manufacturers or distributors and then reselling those goods on the Amazon marketplace. This business model leverages economies of scale to offer competitive pricing and generate profit. As an example, a business might purchase a large quantity of a popular toy from a manufacturer at a discounted rate and then list those toys for sale on Amazon at a price point lower than individual retailers can offer.
Its significance lies in the potential for high-volume sales and profitability. By establishing relationships with suppliers and optimizing product listings, businesses can tap into Amazon’s vast customer base and generate substantial revenue. Historically, this approach has allowed entrepreneurs to build successful and scalable businesses, often providing a pathway to financial independence and brand recognition. The advantage resides in bulk purchasing to lower the average cost per item.