Passive income is an ideal resource no matter your goal — growing your business, empowering a side project, or just living with increased peace of mind. Fortunately, achieving this is closer than ever thanks to the power of ecommerce. We’ll teach you how to make passive income on Amazon and maximize your performance on the leading online marketplace.

What is passive income?

Before getting into the specifics, it is income that is earned with little to no effort or active involvement on the part of the earner. It is often considered to be a form of residual income, as it continues to generate revenue even after the initial work has been done.

Passive income can come from various sources, such as rental properties, dividends from investments, royalties from creative works like books or music, affiliate marketing, and online businesses like selling products on Amazon or creating online courses.

The key feature of passive income is that it requires minimal effort to maintain once established. For example, once a rental property is purchased and tenants are in place, the landlord earns rental income with little to no involvement in the day-to-day management of the property. Similarly, once an online course is created and launched, the creator can continue to earn income from course sales without having to create new content or actively market the course.

Why does passive income on Amazon matter?

Passive income can be particularly important for small sellers on Amazon for several reasons:

  • Supplemental income: For many small sellers, Amazon may not be their primary source of income. However, earning passive income from Amazon can provide a helpful supplement to their overall income, which can help them to pay bills, cover unexpected expenses, or save for the future.
  • Business diversification: Relying solely on a single source of income can be risky, as changes in the market or industry can have a significant impact on revenue. By earning passive income through Amazon, small sellers can diversify their income streams and reduce their reliance on any one source of revenue.
  • Flexibility: Passive income can be earned with minimal time investment, which can be particularly beneficial for small sellers who may not have a lot of spare time to devote to their Amazon business. By earning passive income, small sellers can generate revenue without sacrificing other important aspects of their life, such as time with family or a full-time job.
  • Scalability: Passive income streams on Amazon can be scaled over time, meaning that as a seller’s business grows, they can continue to earn more passive income without significantly increasing their workload. This scalability can help small sellers to achieve their long-term financial goals, such as saving for retirement or paying off debt.

Startup Requirements

With any business venture, there are startup requirements — capital, time, effort, and the like. Creating passive income on Amazon is no different. You will need to invest time in learning about your strategies, finding best practices, and setting up your accounts. You will need to spend money acquiring products to sell and potentially advertising your catalog. Lastly, you will need to put in efforts to grow your audience and fulfill customer orders.

However, as you grow your business, passive income becomes more readily available. Once you’ve established your catalog and listings, you can outsource optimization, hire employees for fulfillment, or just let your established brand carry its weight.

Best Practices

Still looking for tricks on how to make passive income on Amazon? We’ve got some best practices that can help you outpace your competition and cement your brand in the minds of your audience.

While it is another expense at first, using Fulfillment by Amazon can net you extra benefits without your needing to lift a finger. All you have to do is ship your products to their warehouse and they do the rest — managing inventory, storing products, and fulfilling orders. Additionally, you can reach a larger audience and ensure two-day shipping without any extra effort on your end. We’ve got an entire blog to help you get the most out of the service. Check it out.

Another way to get the best performance out of your listings is to ensure they are optimized. Use relevant keywords, include accurate images, and be detailed so you answer customers’ questions before they have them. Keeping your pricing competitive will attract more customers and edge out your competition.

Lastly, we recommend using Flywheel 2.0. Our cutting-edge AI optimization software maximizes your results without you needing to lift a finger. It uses cross-marketplace data to optimize every listing every hour. This means you’re always as up-to-date as possible and providing your potential customers with the information they want, making them more likely to buy. Experience it for yourself with a free trial.