EA42 Selling Dangerous Goods or Hazmat Products on Amazon

EA42 Selling Dangerous Goods or Hazmat Products on Amazon

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Hopping on the waitlist for selling dangerous goods? UPC versus FNSKU? In this episode of Entrepreneur Adventure. Todd answers some of your burning Amazon questions. Stay tuned.

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The Waitlist

So how can you sell “dangerous goods”? Even if you’re not looking to sell products marked as hazardous, sign up for the waitlist and get approved. Chances are you’ll want to sell something “dangerous” down the line. These products include paint, batteries, and anything potentially flammable.

Once approved, you’ve still got hoops to jump through. You can’t use Amazon’s shipping service if you’re selling dangerous goods so you’ll have to ship products using your own UPS or FedEx. Don’t forget to factor that in to your expenses when you’re looking at purchasing a product. You’ll also have to put the proper dangerous product stickers on the outside of your packages.

Nevertheless, bigger hoops mean less competition which of course means more profit. Check out this article for more information on how to sign up for the waitlist.

Shipment Status

Everyone has different opinions on shipping products directly to Amazon versus using FNSKU. Let’s break down the pros and cons.

With UPC, there’s no need to worry about labeling every product because Amazon does that for you. And with co-mingling, you’re more likely to win the buy box even if you’ve got lower inventory levels. That’s because your products are mixed with others and scattered through different fulfillment networks. So if your customer is on the West Coast, Amazon will grab a product from the closest warehouse.

However, if Amazon loses your inventory, they may reimburse you but they’ll likely sell that product themselves once it’s located. Essentially, it’s harder to track your products with UPC. Also, because of co-mingling, if another seller packages something incorrectly or sends in a faulty product, you may be held accountable.

Todd recommends choosing between UPC and FNSKU on a case by case basis. If a product is hard to package or edible, Todd recommends FNSKU so you’ve got control over quality and won’t be held liable for bad sellers. Otherwise, UPC is cheaper and easier.

Overall

Do you have questions for Todd? Ask away! Remember to like, share, subscribe, and leave a review where you’re listening.

Happy selling everybody.

Resources From This Episode

Outline Of This Episode

[00:37] Todd’s introduction to this episode

[01:35] All about “Dangerous Products”

[09:41] The pros and cons of shipping directly to Amazon

[20:48] Todd’s closing thoughts on this episode

Transcript

todd (00:00):
Not everybody can get approved to sell dangerous goods on Amazon. And if you’re not, you’re going to want to make sure that you get on the wait list right away. So you can get approved to sell these products that a large majority of sellers are not approved for. Stay tuned.

announcer (00:17):
Welcome fellow entrepreneurs to the entrepreneur adventure podcast, where we talk about Amazon wholesale and how you can use it to build an eCommerce empire, a side hustle or anything in between. And now your host Todd Welch,

todd (00:37):
What’s going on everybody. Welcome to episode 42 of the entrepreneur adventure wholesale podcast. Really appreciate you guys joining me today. And we’re going to be diving into a couple of questions that listeners have had. And the first one is getting into the Amazon dangerous goods program so that you can sell hazmat products. It’s not for everybody, but even if you’re not going to sell these products, I recommend you get on the wait list right away so that you can get approved for it. And down the line. If you choose to, you can sell these products. And then also we’re going to dive into whether you should trust Amazon to label your products or not. So let’s go, let’s get into this. If you want the show notes, entrepreneur adventure.com forward slash 42. Let’s do this. Alright, here we go. So this message came in from Nick and Nick says, this is Nick for Michigan.

todd (01:35):
I recently was approved by a brand to sell on Amazon, congrats, Nick for getting approved by a brand. That is awesome. I found a couple products that would be profitable and tried to list them before I purchased stock, which is excellent. You always want to try to list products before you buy them to see if you’re gonna run into these kinds of problems. He goes on to say they are considered dangerous goods by Amazon, and it says my account is not approved to sell them on FBA. Is there anything I can do to get approved? Thanks for your help. Okay. So thank you very much for that. Excellent question. Nick, I appreciate you submitting it. And again, really good work in getting approved for the brand and being smart enough to add the products to your inventory before ordering them the FBA dangerous goods program or the hazmat program.

todd (02:29):
Like we call it for short, I’ve been approved for quite a long time. I got approved back when you could just get approved for the program really easily, but now you actually have to get on a wait list. I’m going to recommend that you go ahead and get on the wait list for the hazmat program as soon as possible. And anybody else listening, you’re going to want to do the same thing, even if you’re not planning on selling hazmat or dangerous goods, because maybe some point in the future you might, and we don’t know how long it’s going to take to get approval for the program. So the first thing you’re going to want to do is go into Amazon and click on the help button. So go into your seller central account, click on help and search for the FBA dangerous goods program or head on over to the show notes, entrepreneuradventure.com/42.

todd (03:25):
And you will have the link there. We’ll put the link to the FBA dangerous goods, help article. And so basically what you have to do here is you can read through this. You’re definitely going to want to read through all the requirements and everything like that, but to get on the wait list, there is a little section where it says, check, if a product is a dangerous good, and it’s not really self explanatory, but what you have to do is click on the dangerous goods, FAQ button, and then click on next. And it is going to check and see if you’re eligible for the program. And if you are, it’s going to start and open up a ticket for you. Now on this account, I already applied for it, but I took a screenshot of it here. So what you’re going to say or what you’re going to see, it’s going to say the FBA dangerous goods hazmat program is not currently accepting new participants.

todd (04:28):
We created case ID, blah, blah, blah, blah, blah, blah, to add you to the wait list. And we’ll contact you when there’s an opportunity to participate. Now, unfortunately we don’t know how long it’s going to take to get approved for this. Hopefully it’s not too long, but that’s why I say get on his wait list right away so that you can get approved even before you’re going to be selling these products. Now for you, Nick, you’re already looking to buy these products and unfortunately you’re not going to be able to get cleared for hazmat right away. You could always go to the case and just ask to see if you can get somebody on the phone, see if there’s anything you can do to escalate the process, but there probably is not going to be. So you’re just going to have to wait it out.

todd (05:19):
So you’re going to want to get on this wait list as soon as possible. And for all of you out there who are not sure about what hazmat products are, these can be things like maybe paint or batteries or anything that could potentially be dangerous or flammable or things like that. Like butane would be. Some products will get put into the hazardous program even when they’re not. So it’s really good to be approved for it just so you can get approved for products. I’ve seen like hand soap in the program and things like that. So sometimes it’s good to have it, even if those products are not necessarily hazmat, but I sell quite a few different hazmat products. And what’s awesome about it is the competition is a lot lower because this program is gated. Remember the more hoops we have to jump through, the harder something is the less competition we’re going to have, the more profit that’s going to be available to us.

todd (06:24):
So getting in this program is definitely good. Now you’ve got to have to do some additional things here because if a product is in the hazmat program, you can not use Amazon’s shipping service. So you’re going to have to ship these products using your own FedEx account or your own ups account. So keep that in mind, your shipping rates are going to be a lot higher than when using the Amazon shipping services, which gets us really cheap, really discounted shipping rates. So you want to add that into your expenses when you’re looking at a product, if it makes sense to be able to purchase and sell it or not. In addition, when you are shipping these products, you have to make sure you’re putting the proper dangerous goods sticker on the outside. So if it’s flammable, there’s a flammable sticker that needs to be on the outside of the box.

todd (07:19):
And it has to have the information on it specific to each product. And you can find that out usually from the brand. Or if you look at the SDS sheet, the safety data sheet, it will show you on there, what is needed for transportation and things like that. So keep these things in mind that just because you get approved for the dangerous goods program, doesn’t mean you can just start sending in products. You still need to follow these different rules. So it’s definitely more work than selling regular Amazon products. But like I already said, the more work it is, the more hoops you have to jump through. Typically the more profit you’re going to see when you’re selling these products. So make sure that you’re following all the regulations, all of the requirements from Amazon, there’s a course that they have you take on this page, the FBA dangerous goods program.

todd (08:15):
There are several videos that you can watch to make sure that, you know, and understand how to handle hazmat, dangerous goods products. Now we’re not talking about like toxic waste or something like this or nuclear reactor material or something like that. We’re just talking about like a spray can of paint or our jar of paint or something like that. You know, paint is not inherently dangerous, but if it’s mishandled, it can be dangerous in transportation. It could start on fire if there was an accident or something like that. And the transportation company needs to know how to clean that up. So you’ve got to be careful with those kinds of things. So definitely get in the program, read through all the information, make sure you understand what you’re getting into, how to deal with this, but it’s definitely a good area to start selling products once you know what you’re doing, because again, there’s less competition, more profit, and you can find some really good products and sell in the dangerous goods hazmat program.

todd (09:24):
So hopefully that helped Nick. Let me know if you have any other questions at all. If you have a question, the listener out there, go over to entrepreneuradventure.com/ask, and you can record your question and we might answer that on an upcoming podcast episode here as well. All right. So the next question is from, will he says, good afternoon. My name is will. And I have been watching binge watching your videos on YouTube. My question, do you have a tutorial for shipping products directly to Amazon and have them label them or is it better to ship to Amazon and let them do the common UBC, whatever it’s called the FN SKU. Where Amazon does not label them and simply puts it into stock. So yeah, so you have the, either the UPC so you were correct on that, that UBC is using the barcode.

todd (10:21):
That’s on pretty much every product that’s out there. When you go to the checkout line, you scan the UPC to check out and it comes up on the system. The barcode that Amazon uses is the F N S K U it’s it’s called. And that is just a tracking number. That’s internal, just the Amazon. I don’t have a tutorial on shipping directly to Amazon, but I’m going to answer your question here. And hopefully that will help explain what you should do and how you should do it. So it’s kind of a hotly debated topic. Some people say you should always use the FN SKU, never use the UPC because they don’t trust Amazon that they’re not going to “lose your product” and then sell it themselves or something like that. I don’t think Amazon is quite that shady. I think there’s some bad employees at Amazon that don’t do things right.

todd (11:23):
Maybe some theft and stuff like that going on. But for the most part, I don’t have a huge issue with using the UPC. Some people only use it. Some people try to never use it and there are benefits to going both ways. And so we’ll go through those here. So first the benefits to using just the straight UPC on the product. So, number one, you don’t have to print out a label and put it on every single item or pay Amazon 30 cents currently to put a label on every single product. So that’s one of the benefits of UPC. The second benefit is that you get to do what’s called co-mingling, and this can also be a negative, which we’ll talk about, but the benefit of being commingled is that your inventory you send in, we’ll just go into a lump sum of everybody else’s inventory that also has, is using the UPC.

todd (12:27):
And so what that means is that even if you sent in only 50 units, you now get the benefit of every unit that Amazon has scattered throughout its entire fulfillment network. And so that really benefits you because then when you sell, if that customer is in New Jersey, for example, Amazon can grab from the warehouse closest to that customer, or if they’re in Nevada, they can grab from the customer warehouse. That’s closest to that customer. So doing the UPC really allows you to multiply your inventory and make it more likely that you’re going to get the buy box. Even if you have lower levels of inventory in Amazon. All right? So those are the main two benefits to using the UPC. So now let’s go over the negatives of using the UPC. So if you just use the UPC and you send it in and somehow Amazon loses your inventory, hopefully they will reimburse you for it.

todd (13:38):
Sometimes that can be a hassle, but typically they’ll reimburse you for any lost inventory. But when that inventory is found, if it’s found, Amazon is probably going to just sell that themselves, versus if it had an FNS K U on it, that inventory would have to go back into your seller central account into your inventory. So there’s more tracking and more accountability with the FNS, K you to make sure that your inventory remains your inventory. And so negative number two, to go along with that, if there are other bad sellers out there who are maybe sending in, beaten up product, dusty product, not packaged properly product, your good product is going to get commingled with theirs. So potentially you could get a bad unit sent out to the customer and then the customer is not going to be happy. And that strike is going to go against you regardless of where the inventory came from.

todd (14:45):
So that’s a really big negative when using the UPC. For sure. Now, as far as using the FN SKU is the positives for that, basically the reverse of the UPC. So the positive is your inventory remains your inventory, right? So nobody else is going to get commingled with yours and whatever you send in is what you’re going to sell so that, you know, the inventory is good. That’s going out. The second negative reason. Also the reverse is that your inventory is going to be limited to whatever you send in. So if you send in 50 units and they all go to the New York warehouse and there’s a customer shopping on the West coast, you’re probably not going to get that bypass because Amazon is going to give the buy box. Even if they’re a little bit higher price to someone who’s on the West coast, so they can grab the product from there, get to the customer faster and make the customer happier.

todd (15:46):
So that’s a major negative. You’re going to want to carry larger volumes of product. If you’re doing the FNS K U on Amazon products or on products that you’re selling on Amazon also, of course, with using the FNS KU then you’re going to have to take the additional time to slap that sticker on every single item you have to open up every single box, slap that sticker on everyone. So it’s more handling, more labor, got to pay for the stickers. And if you’re going to send it directly in Amazon, you’re gonna have to pay that Amazon, that 30 cents that I mentioned earlier as well. So that’s definitely another negative. Now. You’re not always going to get to choose. Sometimes Amazon just requires you to use the FN SKU. Like if they’ve had issues with the UBC in the past, they might require it or for various different reasons.

todd (16:43):
Maybe it has to do with broken product or bad product being sent in and things like that. And they want people to be more accountable. Sometimes they’ll force you to use the FN SKU, but a majority of the time you’ll have the choice. You can pick one or the other. So who your main question, which one should you choose? And my answer to that is it depends. I use it both ways, depending on the product. If I scan the product and they give them the option to choose, I weigh the benefits and the negatives of doing it and the type of product is it a product that could potentially get broken easy. Maybe it’s a glass product that could get broken easy. If somebody didn’t package it, maybe it doesn’t come packaged really well from the manufacturer or the brand. And so you have to do some extra packaging, like bubble wrap it or something that you’re going to definitely want to use the FNSKU

todd (17:39):
So you’re not getting commingled and some other Yahoo who doesn’t know how to do what you’re doing. You pull one of his inventory, send it to a customer and get a broken product, and then that’s going to be on you. So in that case, I definitely would use the FN SKU. If it’s something that’s ingestible that somebody could put in their body, I would probably use an FN SKU for that as well, because I don’t want to take the risk that someone sends expired product in or bad products. Something’s wrong. I don’t want the liability issue of worrying about someone else sending in the proper product, someone taking it, getting hurt or something like that. I want to know that it was my product that was sent out because it’s increased liability. Anytime someone is ingesting something. Now, if the product is something that comes in a good practice saying it’s not breakable, not really something that’s very easy to mess up.

todd (18:40):
Then I am just going to use the UPC because it’s easier. We don’t have to touch as many, and I can just ship directly from the brand perhaps. And it just makes all that easier, decreases your costs and things like that. So for me, it really depends on the product. I take it by a product by product basis and use my best judgment. If it’s something that I want to have more control over or not. And perhaps I go UBC, and then I find out that there’s been issues and I might switch to F and SKU. I rarely go the opposite direction, but I may switch to FNSKU. If I start having problems, like Amazon’s losing stuff, customers are complaining, things like that. I want to make sure that they’re getting my zippers or clothing or camping equipment or whatever it is that I am sending into Amazon.

todd (19:42):
So that is pretty much how I handle it. You know, it depends. I go back and forth on which way to go. I don’t worry a whole lot about Amazon being nefarious and stealing product and stuff like that. A lot of people do worry about that. I know Amazon screws up a lot of things. I don’t think they intentionally be nefarious. And if you have the proper invoices and everything, the weights of your packages are correct, and everything else they’ll typically reimburse you for that stuff. And then you’ll be fine. So you’re going to have to play it on and ear by ear basis, you know, case by case basis, I should say, and decide what you want to do as far as using the UPC or the FNS. K. So I hope that helped you will. I hope that answers that question. If not, shoot me a message.

todd (20:35):
Let me know. And again, entrepreneuradventure.com/ Ask, record me your messages, record me your questions. And I will hopefully answer those for you on an upcoming. Alright, so there you go. That wraps up this episode. I hope that answers the questions for you out there and for the rest of you out there. I hope that gave you some really good information to think about. Appreciate you listening. Please make sure you like and subscribe and give us a five star rating. If you’re listening to this on podcasts and of course share this with anyone else that you think might be interested in this information, whether you’re sharing with friends or you’re sharing it in a Facebook group that you’re in, that would be awesome. Help us spread the message, grow this podcast so that I can keep growing the podcast and helping you guys out there would really be appreciated. Thank you very much for listening. I’m entrepreneuradventure.com/42 for the show notes. And with that, this is Todd Welch signing off happy selling everybody.

announcer (21:44):
This has been another episode of the entrepreneur adventure podcast. Thanks for listening fellow entrepreneur and always remember success is yours. If you take it.

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