Blog » Product Sourcing in 2021 – The Complete Guide for Amazon

Product Sourcing in 2021 – The Complete Guide for Amazon

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The decision to start a business on Amazon is not a difficult one.  The difficult part is finding what products offer the best profit margin for you.  This starts with product sourcing, a professional company like Sourcing Nova and follows a very simple flow chart:

Research > Amazon tools > Product sourcing > Execution and implementation

This post will walk you through each step of the product sourcing process for selling on Amazon.  We have also taken steps to optimize the process for you.

Product Sourcing

It is the rare business owner that creates and sells their own products.  Because of this, a product sourcing company is necessary.

However, blindly selecting a product and going head-to-head with competition is a recipe for financial disaster even for the most savvy of salespeople.  Instead, you need to start with product research: trends, customer preferences and prospect analysis.

This may seem overwhelming at first, but all this takes is a little time and the Internet.

Finding profitable products on Amazon

Again, this is a process.  One of the most important things you should know about product research is the customer is what matters.  You may not like a particular look, color or function of a product, but it is not what you want that will make you profits.  Keep this in mind at all times.

Keyword search

All research on the Internet starts with keyword searching.  You are looking for products with a search volume of 100,000 or greater.  A high volume helps you be certain this is a product people will want now and into the future.

Associated costs

The best products have three characteristics: small, light and durable.  This means your shipping costs are exceptionally low with little chance of damage in the shipping process.

High durability

As mentioned above, products that are tough and do not break easily are ideal for new Amazon e-sellers.

This means products such as mirrored furniture, vases, glass and the like are best left for some other retailers.

Learn from mistakes of others

For every one successful Amazon e-retailer, there are countless who have struggled or failed before making it.

Their stories on what did not work is gold for you.  You can learn volumes more from mistakes than successes.  Look up what tried.  What worked or failed on their behalf?

Fundamentals to remember

These are the absolutes you need to consider when product sourcing.  Therefore, look for products with the following:

  • Profit margins of 25 to 35 percent;
  • Products with 30 reviews or more;
  • Bestseller ranking within the top 2,000;
  • The golden trio: lightweight, durable and small;
  • Find a quality manfacturer and sourcing agent.

Best tools for product searches

Each of these tools have the advantages and disadvantages.  There some that are completely free, and some that are free with limited access without payment.  Regardless, you can find almost everything you need with these helpful tools.

Jungle Scout

Jungle Scout is one of the best companies on the market offering product research tools for those just getting started with e-commerce sales and Amazon.  Tools within Jungle Scout give access to a huge database, filter down categories and get very specific with your products.

AMZ Tracker

AMZ looks at trends and organic keyword results.  The tool looks at other sellers and finds what their competition’s numbers look like – daily sales, revenue, inventory and other data.

Rank Tracker

Rank Tracker sets itself apart from other tools because it collects ranks on products and ranking strategies based on your direct competition.

Product Sourcing in 2021

Now that we have covered how to look for products to sell, it is time to learn how to get those products.  Here is a list of the best methods retailers use for product sourcing in 2021.  Each product can vary in origin and nature.  The main categories are as follows:

  • DIY
  • Private label
  • Drop shipping


There is high potential in DIY, but it comes at the expense of getting your brand established.  If you do manage to earn a solid business following, the profit margin is limitless.

There are so many easy to make products that can be made at home, packaged and shipped to customers that finding an appropriate product niche should not be too difficult.

Private Label –

Private label is using product sourcing to find, brand and name a product as your own.  There are approximately 50 percent of Amazon sellers selling private label products.

There are two paths you can take: Design your own products, or look for something unique and different not currently offered by known brands.

Getting off the ground with private label can take a significant investment but can build a brand in a sea of other sellers with similar products.


This is the final product sourcing method and is ideal if you do not have the ways to manage inventory, own products personally or have the ability to ship products to your customers.

The drop ship method gives you the opportunity to find a quality manufacturer for storage, selection, packing and shipping for your products.  In return you pay for the products after an order comes into your Amazon store.

Final thoughts

You made it!

Be sure to leverage all of this information to your benefit.  Doing so will give you the confidence you need to start and maintain a successful Amazon e-store.

Just remember – all of this starts with product sourcing.

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