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Amazon FBA SellerHow to Start an Amazon FBA Business: LLC Setup
Thinking about selling on Amazon? Amazon's fees can take about 28% of a $29.99 sale before you pay for the product, and one sales number makes Amazon require $1M of liability insurance. Why an LLC matters here, and the key Bizee screens, start to finish.
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Why an LLC for this business
The names
Your ID, business papers and bank statement must match what you registered
Claims
Over $1,000, you or your insurer deal with the customer directly
Insurance
$10,000 in a month: 30 days to carry $1M, under the right name
How to start it, in order
- Do the fee math first: 15% referral fee in Home and Kitchen, an FBA fee by size and weight, and a 3.5% surcharge (as of Nov).
- Form your LLC and get its EIN if you need one. Amazon checks your ID and business papers against what you register.
- Open a bank account in the LLC's name. Amazon wants a statement from the last 180 days with the business name.
- Register on Seller Central: Professional is $39.99 a month, Individual is $0.99 per item sold.
- Check your state's seller's permit rules: California and Texas answer differently.
- Get liability insurance: $1M per occurrence, required within 30 days of a $10,000 month, and before listing in 11 safety categories.
- Selling kids' products or imports? Check the CPSC testing and certificate rules before you order.
Every fact in this guide was checked against a primary source before the video was made.
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