Prime Profits: How to Start an Amazon Business Canada

By Maurice | April 27, 2025

Starting an Amazon business in Canada can be an exciting venture for entrepreneurs looking to tap into the vast potential of e-commerce. With a sprawling digital marketplace that’s accessible to millions of customers, Amazon provides a platform that can catapult your products into the limelight and help you establish a thriving online business.

In this article, we’ll guide you through the essential steps to embark on this journey. By the end of this article, you’ll have a clear understanding of how to start an Amazon business in Canada, set for growth and ready to take on the challenges and opportunities that come with selling in one of the world’s most dynamic e-commerce markets.

Let’s begin your Canadian e-commerce adventure and unlock the potential of selling on Amazon.

1. Setting Up Your Amazon Seller Account

Starting your Amazon business in Canada involves a few key steps to get your seller account up and running. You’ll need to decide on the type of account, register your business, and understand your tax obligations.

Choose Your Account Type

When you begin, you must select the appropriate seller account type, as it will affect your fees and selling capabilities. You have two main options: an Individual plan, where you pay a fee per item sold, preferable if you don’t expect to sell more than 30 items a month, or the Professional plan, with a monthly fee regardless of the number of items you sell, which is more economical if you plan to sell at higher volumes.

To understand the fee structures and benefits in detail, refer to this guide by Amazon Canada.

Register Your Business

Registering your business for an Amazon Seller Account is straightforward. Whether you use an existing customer account or a new business email, having the following documents and information ready is crucial:

A chargeable credit card
Government ID (identity verification protects sellers and customers)
Tax information
Bank account details

After gathering these, you can begin your registration process and set up your account profile, which includes inputting details about your business such as name, address, and product information.

Understand Tax Obligations

Understanding your tax responsibilities is essential to operating your Amazon business in compliance with Canadian laws. This includes understanding the Goods and Services Tax (GST), Harmonized Sales Tax (HST), and Provincial Sales Tax (PST) as they may apply to your sales.

You may want to consider consulting with a tax professional or using resources provided by Amazon’s guide on tax to navigate these obligations accurately. Keep in mind that Amazon provides a platform for you to manage tax calculations on your sales, which you can configure in your seller account settings.

2. Planning Your Amazon Business

Before diving into selling on Amazon, you need to lay a solid foundation for your business:

Market Research

Start by identifying a niche or products that have a demand in Canada. Research your competition and understand customer preferences. Use tools like Amazon’s Best Sellers pages to see what’s popular. This insight will help you strategically position your product listings for better visibility and sales.

Creating a Business Plan

Develop a business plan that details your business goals, operational structure, and sales strategies. Outline how you want to manage inventory, fulfill orders, and handle customer service. Your business plan should also include how to create an Amazon seller account and whether you’ll go with Amazon’s Individual or Professional plan.

Budgeting and Finances

It’s essential to have a clear financial plan, including initial capital required and ongoing expenses such as Amazon fees, shipping costs, and marketing. Consider whether you’ll require external funding or if you’ll bootstrap your business. Remember to keep track of all your expenditures for reporting and tax purposes.

3. Sourcing Products

When starting an Amazon business in Canada, effective sourcing of products is crucial to ensure profitability and customer satisfaction:

Identifying Suppliers

To kickstart your Amazon venture, your first move is to find reliable suppliers for your products. Engage in a search for profitable products that are in demand by consumers on the Amazon platform. Consider both domestic and international suppliers, but be aware of the import regulations and additional costs that might apply when sourcing from abroad.

Negotiating With Suppliers

Once you’ve identified potential suppliers, negotiations play a pivotal role. You should strive to secure optimal prices without compromising the quality of your goods. It’s vital to understand the supplier’s minimum order quantities, payment terms, and shipping schedules. Establish clear communication and lay the groundwork for a long-term partnership.

Product Quality Assurance

Maintaining high standards of quality is imperative. Start with a stringent sample testing process to assess the product quality before placing large orders. Set clear expectations with suppliers regarding the quality and work together to rectify issues if they arise. Strong quality control measures help protect your brand’s reputation and can lead to positive customer feedback.

5. Building Your Brand

When starting an Amazon business, building a strong brand is critical for standing out in a crowded marketplace. It’s about creating a unique identity that customers can trust and recognize.

Developing Your Brand Identity

Your brand identity is the face of your business. It should reflect your values, your products, and what you want your business to represent. Begin by choosing a compelling name and designing a memorable logo that resonates with your target audience.

Develop a consistent color scheme and typography that will be used across all your platforms. Consider your brand’s voice as this will set the tone for your content and customer interactions.

Branding Your Product Packaging

The packaging of your product is often the first physical touchpoint customers have with your brand, so make it count. Use the packaging to reinforce your brand identity with your logo, colors, and a style that’s unmistakably yours.

Keep your packaging user-friendly, and consider the unboxing experience, as it can significantly influence customer satisfaction and lead to valuable word-of-mouth marketing. Additionally, including custom inserts or thank-you notes can enhance the customer’s experience and encourage repeat purchases.

6. Launching Your Products on Amazon

Before you begin selling on Amazon, it’s crucial to understand the steps involved in launching your products effectively:

Product Listings

Creating a product listing is your first step towards introducing your products to Amazon’s vast customer base. Each listing should include a unique product identifier, such as a GTIN, UPC, ISBN, or EAN.

Be meticulous with your product details; they should encompass clear, high-quality images and thorough descriptions relating to the features and benefits of your product. For a more detailed guide, you can visit the Amazon Launch Bootcamp which offers live virtual sessions to aid in your launch process.

SEO Best Practices for Amazon

To improve the visibility of your products, apply SEO best practices specifically tailored for Amazon’s algorithm. This includes:

Keyword Optimization: Incorporate relevant keywords into your product title and description.
Engaging Content: Utilize bullet points and concise, informative language to connect with your audience.
High-Quality Images: Images can boost conversion, so include multiple angles and zoom-in features.

Pricing Strategies

Your pricing strategy can make or break your Amazon venture. Set competitive prices by analyzing your costs and the pricing landscape of your competitors. Take advantage of Amazon’s automated pricing features to stay relevant and competitive. It’s also beneficial to consider the impact of Amazon fees on your pricing structure.

7. Amazon Fulfillment Options

Choosing the right fulfillment option is crucial for your Amazon business. It affects your operational workload, customer satisfaction, and shipping efficiency.

Fulfillment by Amazon (FBA)

With Fulfillment by Amazon (FBA), your products are stored in Amazon’s fulfillment centers. When a customer makes a purchase, Amazon takes care of the storage, packing, and shipping of the product. This service also includes handling customer service and returns. FBA might be a great choice if you’re looking for a hands-off approach to shipping and customer service while also scaling your business.

Advantages:
- Access to Prime customers
- Simplified shipping and handling
- Potential for higher visibility on Amazon

Fulfillment by Merchant (FBM)

With Fulfillment by Merchant (FBM), you retain more control by shipping products directly to your customers. You take on the responsibility for storage, packaging, and all aspects of customer service. FBM can be more work for you, but it offers greater control and potentially lower costs if you already have an established logistics system.

Advantages:
- Control over inventory and shipping
- Personalization of packing and delivery
- Avoidance of FBA fees if you have a cost-effective logistics setup

8. Marketing and Advertising

Once you’ve set up your Amazon business, a solid marketing and advertising plan is crucial to attract and retain customers:

Amazon Advertising

Amazon offers various advertising solutions to help increase your product’s visibility. The most common are Sponsored Products, which promote individual listings, and Sponsored Brands, that showcase your brand and a selection of products.

You can even use Sponsored Display ads to reach potential customers on and off Amazon. Utilizing these tools effectively will help your products stand out among others.

External Marketing Channels

Apart from advertising on Amazon, employing external channels is essential for driving traffic to your listings. Social media, email marketing campaigns, and Google Ads can significantly extend your reach. For a cohesive strategy, ensure your content across these platforms is engaging and aligns with your brand’s voice.

Leveraging Customer Reviews

Customer reviews are influential for your product’s success. Positive feedback can lead to higher conversion rates, so aim to provide excellent customer service to encourage reviews. Remember to monitor and respond to reviews, as this can lead to improved trust and credibility with potential buyers.

Frequently Asked Questions

To start selling on Amazon Canada as a novice, you simply need to create a seller account, choose the right selling plan, and list your products. The registration process is straightforward, and you can decide whether you want to sell as an individual or use a Professional account, depending on the volume of sales you anticipate.

Yes, you can operate an Amazon business in Canada without having your own inventory by using the Fulfillment by Amazon (FBA) program. This lets you store products in Amazon’s fulfillment centers, and they will pick, pack, ship, and provide customer service for these products.

The costs to start an Amazon business in Canada include the subscription fee for a Professional Seller account, referral fees on each item sold, and fulfillment costs if you use the FBA program. The exact fees vary depending on your product categories and your chosen fulfillment strategy.

Obtaining a business license may be necessary to sell on Amazon.ca depending on local regulations and the type of products you plan to sell. It’s important to research and comply with local laws to conduct your business properly.

To sell products on Amazon Canada using the FBA program, you need to set up an Amazon Seller account, create your product listings, prepare your products, and ship them to an Amazon fulfillment center. Amazon takes care of storage, shipping to customers, customer service, and returns for these products.

Potential earnings from an Amazon business in Canada vary widely based on factors like product selection, pricing, competition, and overall strategy. Some sellers might see profits quickly, while others take longer to establish a presence and customer base. Researching the market and understanding costs is crucial for estimating your potential earnings.

Resources for Starting a Amazon Business in Canada

About the author

Maurice

Maurice (Moe) Muise learned the ins-and-outs of government while an employee of the Government of Canada in Ottawa for 10 years. His current focus is helping small businesses in Canada to identify and maximize funding to grow their business.