As a relatively novel option for outsourcing all aspects of order fulfillment, there have been many misconceptions regarding Amazon’s ‘Fulfillment by Amazon (FBA) service. These include some dangerous misconceptions for potential consumers, sellers, and entrepreneurs looking into FBA.

If things couldn’t get any worse, the industry is crawling with hustlers who convince newbies that FBA is a get-rich-quick scheme that requires little time or effort but results in rapid profits. These so-called mentors make others believe they can effortlessly make large amounts of money in exchange for ‘minimal’ mentoring fees.

Having built his own nine-figure e-commerce business over just five years through the help of Amazon FBA, Gav Kwok knows the ins and outs of the system better than most. As such, he hopes to dispel the myths behind FBA and explain how aspiring entrepreneurs can leverage their strengths to find business success.

“FBA utilizes Amazon’s existing system to take care of all aspects of fulfillment, ranging from customer service to shipping and everything else in between,” he says. “In the case of our wholesale FBA business, we must ship products from our company partners and to our customers. It has the potential to be a very lucrative business model, but it’s tough to break into if you don’t already have the solid foundation you need.”

According to Gav, choosing the right products is critical to establishing a successful business doing wholesale FBA.

“Even when you’ve done your research and you pick a product that is perfect on paper; good sales history, great supplier relationship, et cetera; you can still fail to sell for like 30 different reasons that are impossible to foresee,” he says. “As with any business, nothing is concrete with the Amazon wholesale FBA model, and many things can happen.”

Gav also has a lot to say when asked about the business model’s reputation as a get-rich-quick scheme.

“For the longest time, I didn’t want to mentor in this space because I know many people here who have a bad reputation - people who make most of their money on courses and mentorships and don’t even run an actual business,” says Gav. “What I can say is it is not quick or easy, you have to work hard, and you have to work smart, and you will take many risks. I’ve lost millions of dollars making mistakes over the years.”

Nevertheless, Gav concedes that doing Amazon FBA might be the closest anyone can get to a legitimate ‘get rich quick business model.

“Millions of people use Amazon daily, which translates to a ton of organic traffic and reduces the need for advertising which can be such a money sink for a traditional business,” Gav says. “Do it right, and you can have profit margins of 25-30%, minimum, every month. A hedge fund that makes 15-20% a year would probably rake in a ton of investors, yet margins which compound every month are the standard for Wholesale FBA. Getting rich through Fulfillment by Amazon might not be quick and easy, but it can be quick.”