Table of Contents
- Why This List Matters
- Mistake 1: Buying Gated Brands You Can't Sell
- Mistake 2: Ignoring Sales Rank
- Mistake 3: Pricing Below Cost to Win the Buy Box
- Mistake 4: Skipping Keepa
- Mistake 5: Quitting Before Payout Cycle 3
- Mistake 6: Not Understanding the Difference Between FBA and FBM
- Mistake 7: Buying With Prime
- Mistake 8: Using Personal and Business Money Together
- Mistake 9: Sourcing the Same Lanes Everyone Else Sources
- Mistake 10: Buying Hazmat Without Realizing It
- Mistake 11: Buying Liquid Products in Glass
- Mistake 12: Not Tracking Every Unit and Cost
- Bonus Mistake: Over-Tooling Before First Sale
- Recovery: If You've Already Made One
- Next Steps
1. Why This List Matters
I've been doing Amazon FBA full-time since 2018 and I've coached over 70 students through The Scaling Society. The same 12 mistakes show up over and over in their first 90 days. None of them are exotic. All of them are avoidable if you know to look for them.
"The number one thing that is going to slow your growth in your online arbitrage business in your Amazon business are dumb mistakes that you can avoid. Yes, it's great to learn from your mistakes but it's even better to learn from other people's mistakes so you can just avoid them." Chris, Amazon FBA 2023: Step-by-Step Guide for Beginners to Avoid Common Mistakes
Read this once. Print it. Tape it to your sourcing setup. If you skip even half of these you'll get to your first $5K month 4-6 months faster than the average beginner.
2. Mistake 1: Buying Gated Brands You Can't Sell
Most brands and many categories on Amazon are gated, which means Amazon requires you to apply for approval ("get ungated") before you can list those products. Beginners ignore this and ship 30 units of a gated brand to Amazon, only to find out their listing is suppressed because they're not approved.
The inventory then sits stranded. You can't sell it on Amazon. You can pay a removal fee to get it back. You can liquidate it on eBay at a loss. None of those are good outcomes.
Fix: Run every ASIN through RevSeller or SellerAmp before you buy. Both show the restriction status in real time. If the indicator shows you're not approved, either get ungated first or pass on the buy. Get ungated on Amazon: the master guide.
3. Mistake 2: Ignoring Sales Rank
A product with a sales rank of 500,000 in Home and Kitchen might sell once a quarter. A product with rank 30,000 might sell daily. Buying 20 units of a 500,000-rank product means waiting 5 years to sell through.
Fix: Set a hard sales rank ceiling per category. For most beginner OA buys, my rule is rank under 100,000 in the main category. Looser for low-quantity buys (5 units of a rank-200,000 product is fine if margins are 60 percent+).
Use Keepa's 90-day sales rank average, not the current rank. The current rank is noisy. The 90-day average is signal. How to read Keepa graphs.
4. Mistake 3: Pricing Below Cost to Win the Buy Box
A new seller sees the Buy Box at $18.99. They list at $18.99 too. The next seller drops to $18.49 to win the box. The new seller panics and drops to $17.99. Soon the whole listing is selling at break-even or worse.
This race to the bottom is how beginners turn a $5 projected profit into a $1 loss.
Fix: Set a minimum price per ASIN below which you do NOT reprice. The minimum should equal your COG + all fees + a 15 percent buffer. Use a repricer (Aura, Bqool, SellerAmp Live) to enforce it automatically. How to use an Amazon repricer for OA.
5. Mistake 4: Skipping Keepa
Buying based on the current Amazon price is gambling. The current price is a snapshot. Prices on Amazon fluctuate constantly. The right number to model your buy against is the 90-day Buy Box average.
Beginners who skip Keepa walk into ASINs that look profitable today but historically average 30 percent lower than the current price. They buy 25 units. Two weeks later the price drops back to the historical average. They're at break-even.
Fix: Keepa subscription is 19 euros/month. Non-negotiable. Set up the Pro plan and read the 90-day Buy Box average on every buy. Keepa tutorial.
6. Mistake 5: Quitting Before Payout Cycle 3
Amazon pays out every 14 days. Most beginners spend money for the first 30 days with no payouts coming back. At day 35-45 they panic and decide "this doesn't work." The reality: payout 1 hits at day 30-35. Payout 2 hits at day 45-50. Payout 3 at day 60. By payout 3 the business looks like a business.
Fix: Plan for the cash gap. Start with at least $500-$1,500 of capital you can leave in the business for 60 days without touching. Don't put your last $200 into inventory expecting the payout to land before your credit card statement closes. How much money you need to start Amazon FBA.
7. Mistake 6: Not Understanding the Difference Between FBA and FBM
FBA is Fulfillment by Amazon (you ship to Amazon, Amazon ships to the customer). FBM is Fulfilled by Merchant (you ship to the customer yourself). Both can be profitable. Both have very different cost structures.
Beginners mix these up and don't realize that when they're listing FBM, they're paying their own shipping cost, packaging, and tracking labels per order. The math is different.
Fix: For the first 6 months, run FBA only. It's simpler, the Buy Box weighting favors it, and you don't have to handle individual orders. Switch to mixed FBA+FBM only after you have a sourcing rhythm. FBA vs FBM detailed comparison.
8. Mistake 7: Buying With Prime
Amazon Prime accounts cannot be used to purchase products with intent to resell. If Amazon detects you're using your Prime account to buy stuff you're shipping into FBA, they suspend your Prime account and potentially your seller account.
"The only rule that you should not break is that you cannot actually use Prime. You cannot purchase something with Prime with the intent to resell it because you're going to get your Prime account terminated and potentially your seller account." Chris, Free 20 Hours Amazon FBA Course | Complete NO BS A-Z Blueprint
Fix: If you source from Amazon (which is a real strategy known as Amazon-to-Amazon), use a separate non-Prime account or buy through Amazon Business (business.amazon.com).
9. Mistake 8: Using Personal and Business Money Together
Buying inventory on your personal credit card. Depositing Amazon payouts into your personal checking. Borrowing $300 from the business to pay rent. All of these break the LLC asset protection and turn tax time into a nightmare.
Fix: Open a business checking account and a business credit card. Use them only for business. EIN and business bank account setup.
10. Mistake 9: Sourcing the Same Lanes Everyone Else Sources
You watched 4 YouTube videos that all said "check Kohl's clearance." You and 8,000 other beginners are now scanning the same Kohl's clearance section every day. Margins on those ASINs collapse fast.
Fix: Source from smaller retailers (Boscov's, Belk, Stage Stores, Burlington's online section). Use Keepa's reverse product finder with your own custom filters. Run rabbit-trail sourcing off your existing winners. How to find profitable OA products.
11. Mistake 10: Buying Hazmat Without Realizing It
Some products (anything with batteries, aerosols, flammable liquids, anything pressurized) are classified by Amazon as hazmat. They take 4-6 weeks to clear hazmat review before they can be sold via FBA. Beginners ship hazmat to Amazon and wait weeks unable to sell.
"These mistakes can cost you millions of dollars on Amazon if you make them. I'm going to tell you about three kinds of products that you need to avoid if you do not want to lose money because it's cool to talk about sourcing strategies but if you do not pay attention to those things, all those efforts that you are going to do with sourcing fall flat." Chris, Don't Make These Mistakes: Amazon FBA Products that Can Cost You Thousands
Fix: RevSeller and SellerAmp show hazmat status on the product page. Skip anything with a hazmat indicator until you're a more experienced seller and have hazmat-cleared in your Seller Central.
12. Mistake 11: Buying Liquid Products in Glass
Glass jars and bottles break in transit. Amazon will receive the broken units, mark them unfulfillable, and charge you removal fees. You lose the inventory and pay extra fees on top.
Fix: Skip glass-packaged liquid products as a beginner. Stick to plastic or non-liquid products. If you must buy glass, ship in heavily padded bubble wrap or skip it.
13. Mistake 12: Not Tracking Every Unit and Cost
The most painful version of this mistake: tax time comes and you don't know which of your 800 transactions were inventory buys, which were Amazon fees, which were shipping costs. You spend 40 hours reconstructing 12 months of history.
Fix: Connect your business bank account to QuickBooks Self-Employed or Wave on day one. Spend 10 minutes a week categorizing transactions. The 10 minutes saves you the 40 hours.
14. Bonus Mistake: Over-Tooling Before First Sale
I had a student last month who'd spent $1,400 on sourcing tools, courses, and software before placing a single buy. Five different sourcing services running. Zero sales.
Fix: Two paid tools is enough for the first 60 days. Keepa and RevSeller (or SellerAmp). Add tools only when you have data showing you need them. Best OA software guide.
Watch me avoid these mistakes in real time
Every Thursday at 8 PM EST I run a free 60-minute training. I source a real ASIN, model the math, and walk through the checks that catch these 12 mistakes before they cost you money.
Reserve My Free Seat →15. Recovery: If You've Already Made One
If you've already made one of these mistakes, you're fine. Most of them are recoverable.
- Stranded inventory from a gated brand: open a case to request removal, then sell on eBay at break-even.
- Slow-moving inventory from rank-ignored buys: drop the price, wait 30-60 days, then issue removal orders on what doesn't sell.
- Cash gap blowup: pause new sourcing for 30 days, let payouts catch up, then restart.
- IP complaint from commingled inventory: appeal once, then commit to FNSKU labels going forward.
The mistakes that are NOT recoverable: account suspension from policy violations (Prime account misuse, hazmat shipping without authorization, IP infringement repeat strikes). Those can end your seller account. Avoid them on the front end.
16. Next Steps
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