According to Edge Retail Insight’s most recent Food and Beverage Sector Report, Amazon’s global sales of edible groceries are estimated to exponentially climb from $14.5 billion in 2021 to an astonishing $26.7 billion by 2026 — a compound annual growth rate (CAGR) of 13%.
So if you want to make money online, selling food products on Amazon is an excellent option. With its vast customer base and easy-to-use platform, Amazon makes it simple to reach customers worldwide, whether selling pre-packaged snacks or fresh fruits, with everything from setting up your store to shipping orders.
So if you’re ready to start turning your passion into a profitable business, let’s dive in.
Selling Food On Amazon: What Are The Requirements
Selling food products on Amazon is not that easy. Actually, it is one of the restricted categories on Amazon. Therefore, sellers planning to sell food products must review Grocery & Gourmet Foods to ensure that all requirements are met.
In this additional category guideline, Amazon has set up strict regulations from different aspects to ensure that customers can purchase safe edible items from the platform.
- Seller performance requirements
- Product requirements
- Product listing requirements
Now let’s talk about these in detail.
Seller Requirements For Selling Food On Amazon
Grocery sellers must have good performance targets including:
- Has an order defect rate lower than 1%
- Has a pre-fulfillment cancel rate lower than 2.5%
- Has a late shipment rate lower than 4%
By setting strict rules on these aspects, Amazon tries to provide customers with fresh food products that are of good quality and delivered on time.
Product Requirements: Packaging And Labeling
Aside from strict rules against seller performances, Amazon also has stringent guidelines for products requiring specific labels, and product quality.
Hence, it is essential to take this seriously and ensure your food product is in good condition and adequately packed before shipping.
Finding the right wholesale distributor, supplier, and packaging company that understands Amazon guidelines and how to package food products safely and securely is essential.
Here are the product requirements Amazon set for the grocery and gourmets.
Food must be properly packaged and sealed
In order to ensure safe and healthy consumption, food should be carefully prepared, packaged, and sealed. In addition, food must be prepared in packaging suitable for shipping, which can keep it from contamination, spoiling, melting, and damage.
Food must be labeled with the necessary information
Amazon considers food a data-sensitive item, so an expiration date must be marked and displayed clearly on every unit. In addition, if the food is sold in multi-packs, the expiration date on the multi-pack packaging must match the earliest expiration date of the single product.
Food must comply with federal and state laws
Food must comply with all applicable federal, state, and local laws regarding food safety.
Food must be in brand-new condition
Sellers must not sell used groceries.
Food must have enough of its shelf life remaining
Amazon forbids sellers to sell food products that expire soon. Instead, every product must possess a shelf life of at least 90 days past the date by which it is expected to be fully consumed.
If your goods remain unsold beyond their expiration date, Amazon will remove them from your catalog and label them “unsellable.
Altering or removing expiration dates is also forbidden.
Food labels must be in English
Food Product Listing Requirements: What To Claim
For instance, all claims concerning ingredients, diets, or allergens (e.g Organic, Kosher, Gluten-Free, and Dairy-Free) must accurately reflect on a product’s label and have obtained the right regulatory authorizations for verification purposes.
If you make false advertisements in your food listing, for example, false dietary claims, then you might be at risk of losing your selling privileges.
Another example is that if you decide to create your bundle, including various products from different brands, you must fully specify this content in your product listing.
The importance of meeting the requirement
If you repeatedly fail to meet Amazon’s performance, food safety, and quality standards, you can no longer sell on Amazon. Instead, you’ll have to carry out a root cause analysis and take the necessary steps to ensure it doesn’t happen again.
Otherwise, Amazon reserves the right not only to remove your products from its marketplace but also to revoke all of your selling privileges indefinitely.
How To Get Approved To Sell In The Gourmet Food Category On Amazon
Now that you understand Amazon’s additional strict guidelines on the food category, if you are still interested in reaching new customers and expanding your business by selling food on Amazon, here is the step-by-step how-to guide.
Notice that the food category is considered a gated category in the Amazon marketplace. So you will have to apply for your selling qualification and wait until you get approved before selling.
Step 1: Set Up Your Seller Account on Amazon
To initiate the selling process on Amazon, you first register as a seller. If you have yet to do so, take care of that before continuing.
Create an Amazon Seller Central account and choose from two different selling plans:
- Individual: $0.99 every time you sell an item
- Professional: $39.99 per month no matter how many items you sell
The professional selling plan is recommended for those who take this online business seriously and plan to sell more than 40 items a month.
But if you want to try some side hustle on the Amazon marketplace, you can start with the individual selling plan.
Step 2: Get Approved To Sell Groceries
If you’re a beginner seller or have significant experience with Amazon, your access to the Grocery & Gourmet Food category will initially be limited. However, after attaining approval from Amazon regarding this specific product category selling groceries is possible.
If your account is established with excellent metrics and successful selling history, it may be possible for you to get approved in the grocery category.
Here is how:
- Select an item from the grocery category and copy its ASIN
- Find “Add a product” in Seller Central and paste the ASIN
- Click “Apply to Sell”
- Click “Request approval”
Now it is time to find out if Amazon auto-approves you.
If your selling application is not approved, you must provide some extra documents to Amazon before you can sell.
Select your identity
Amazon will need you to specify if you will sell as a reseller/distributor, a manufacturer, or both for the products you want to list.
- Reseller/distributor: If you plan to resell products through the retail arbitrage or wholesale business models, select this. You will need invoices from a legitimate wholesaler rather than retail grocery store receipts.
- Manufacturer: If you want to create a private label brand and sell your brand’s products, then you should select this. You will need to have invoices from your manufacturer.
You must submit at least one purchase invoice from a manufacturer or distributor to prove that your products come from a legit manufacturer or distributor.
- The purchase must be made within 180 days of your application.
- Your name and address must be listed on the invoice, matching the information in your selling account.
- The manufacturer or distributor’s name must be listed on the invoice. Amazon may contact them to verify your purchase before approving your application.
- You must order at least ten units of the same product
- For your application to be accepted, you must attach pictures of the physical item or its packaging to verify that you indeed possess the product
Step 3: Find A Reliable Supplier For Your Products
As mentioned above, Amazon requires you to submit an invoice from your manufacturer or distributor to prove that your grocery products come from a legit source. Receipts from retail grocery stores will not be accepted.
So before selecting a supplier for your grocery products, ensure they can provide an invoice that Amazon will accept.
You can search for “grocery wholesale distributors” on Google and check if any websites have the product you want to sell.
What If Amazon Does Not Approve Your Invoice
Dealing with Amazon can be tricky sometimes. For example, if Amazon denies your application and does not approve your invoice, then close the case and resubmit the application.
You can also talk to the Amazon Support team to see the issue and how to resolve it.
What Are The Safest Food Products To Sell On Amazon
Be aware that even if you get approved by Amazon to sell in the food category, you may not be qualified to sell all food products, as some may require extra licenses.
Therefore, here is a list of the safest food products to sell, which has a relatively long shelf life and is easy to store. They also do not need to be stored in a chill chain.
- Canned and bottled beverages
- Canned food
- Coffee pods, coffee beans, and coffee-grounded powder
- Tea bags and herbs
- Nutritional and dietary supplements
- Dry snack food
- Instant food
- Condiments & spices
- Rice and grains
Check the Best Seller Rank in the Grocery & Gourmet Food category and you will find that most of the best-sellers sell these non-perishable items listed above.
Can You Sell Meat And Fruits On Amazon
Technically, selling meat and fruit can be an excellent opportunity for online entrepreneurs looking to expand their customer base.
However, Amazon has strict regulations on refrigerated, frozen, and temperature-controlled food, and raw agricultural commodities. For instance, refrigerated, frozen, and raw agricultural commodities must be kept safe from contamination or spoilage during transport. In addition, the material must maintain optimal temperatures for its contents until reached by the recipient.
Amazon has strict regulations on your chill chain management and will audit it from time to time. For those who can not meet the requirements to ensure item safety and quality, Amazon will forbid them from selling in the future.
So unless you have proper storage and decide to only ship within limited zip codes, meat, and fruits can be difficult to come by online.
Chill Chain Validation And Verification
Temperature control is essential to ensure that the food you are selling on Amazon is safe and of high quality. Amazon will verify and validate your chill chain to ensure the temperature is properly maintained even in worst-case conditions.
You must submit proof to show that you can meet the temperature requirements of Amazon in worst-case scenarios.
You must execute a corrective action plan when you cannot meet the requirements. Otherwise, Amazon can remove your selling privileges.
You should keep the validation and verification records if Amazon regulators request them. Also, remember that Amazon will run periodic audits to check your chill chain compliance.
|Food type||Conforming temperature|
|Refrigerated meat||28-41° F|
|Refrigerated poultry||28-41° F|
|Refrigerated fish and crustacea (crab, shrimp, lobster)||32-41° F|
|Refrigerated processed dairy products or liquid eggs||32-41° F|
|Refrigerated processed foods||32-41° F|
|All refrigerated cut fruits, vegetables, and ready-to-eat fruits and vegetables||32-41° F|
|Refrigerated shellfish (clams, mussels, scallops, oysters)||32-45° F|
|Refrigerated shell eggs or fluid milk||32-45° F|
|Frozen foods||< 10° F|
|Whole, uncut, not ready-to-eat produce||32-65° F|
General temperature requirements for selling food on Amazon
How Much Does Amazon Charge for Selling Food?
Amazon charges a category fee for selling food based on the profit margins of each transaction. Businesses must understand these selling fees to comply with Amazon’s seller central policies.
There are two kinds of fees concerning selling groceries on Amazon:
- If your item sells at $15 or less, Amazon will charge you an 8% fee
- If your item sells at more than $15, you will pay a 15% fee
Individual sellers must also pay the $0.99 fee for each item they sell. However, those who subscribe to professional selling plans have to pay $39.99 per month without being charged for each item they sell.
Therefore, selling items in the food category charge more than average items and can affect your profit margin massively. Therefore, sellers who plan to start their businesses in the grocery and gourmet categories must calculate the profits carefully before making decisions.
Selling Food Items On Amazon: The Difficulties
Selling food on Amazon can be a great opportunity to expand your business and reach more customers. Amazon encourages sellers, especially those experienced and with good sales performance history, to expand their business in the food category.
However, as discussed above, selling in this restricted category can be troublesome and takes more effort to meet Amazon’s strict policies. So, before deciding to sell groceries on Amazon, here are the downsides to consider.
Take longer to get approved to sell
Grocery and gourmet food is a gated category. So for new sellers with no performance history, you must wait for Amazon to approve your application before selling. In addition, you may need to provide extra documents and pictures to prove that your product comes from legitimate sources, which takes time.
If your application is denied by Amazon, you will have to improve your documents and submit the application again until the trial and error process ends, which can be time-consuming for new sellers who are not very familiar with Amazon policies and regulations.
Stringent seller requirements
Amazon requires sellers to maintain a certain performance level, including metrics such as order defect rate, pre-fulfillment cancel rate, and late shipment rate.
If your performance metric does not reach the required levels, you risk losing your selling privileges in the food category.
Higher product standards
Amazon has higher standards for products sold in the gourmet category than other categories.
The products must be packaged and sealed appropriately to avoid contamination, spoilage, melting, or damage. The products must also be labeled properly, with all the information printed clearly in English.
Amazon also requires that the food items have a long shelf life so that customers can have sufficient time to consume the products. Therefore, the sellers must closely monitor the product’s expiration date.
All the requirements above lead to a huge challenge for those who only want to treat their Amazon business as a side hustle.
Strict listing requirements
Amazon has a strict listing requirement on what to claim in the food category.
You must be extremely careful about the ingredients listed on the detail page. For example, if you include words like Organic, Koser, Gluten-free, or dairy-free in your listing, you must first have these words on your product’s label. And you must have legitimate regulatory approvals for the claims. Sellers must also be careful about allergen-free claims.
So again, if you are treating this business as a side hustle, managing the regulatory documents or licensing can be a potential obstacle.
Since Amazon has more restrictions and harsh requirements on product standards, you will likely invest more to prepare your products to ensure they meet these requirements.
This may come from three dimensions:
- Packaging and labeling: Since Amazon has stricter guidelines on the packaging and labeling food items, you may need to spend an extra fee to meet the standard.
- Chill chain management: Amazon is serious about product quality, especially edible items. To ensure safety, Amazon set up a complicated chill chain verification and validation process, requiring sellers to pay extra money to maintain their chill chain capability.
- Selling fee: Amazon will charge more than the average items on food products. Fees are determined according to your selling price, ranging from 8%~15%.
All these operation costs add up to a big amount and might make the food items you are going to sell no longer profitable. Therefore, it will be harder for sellers to find profitable products in the grocery category.
More difficult to source a proper supplier
Sourcing a qualified supplier can be difficult, especially when you have higher standards for packaging and labeling. Therefore, you will have to pay more attention to verify the qualifications of the suppliers if you plan to start a food business on Amazon.
New third-party sellers who don’t have a sales performance history and need to apply for permission to sell in the food category will need to provide a valid invoice to Amazon to prove that their food products come from a solid source. Therefore, the supplier must be able to provide an invoice that Amazon accepts.
These all lead to more efforts to source a good supplier to cooperate with.
More difficult to find a qualified shipping company
Food shipment can be troublesome if your food products must be kept in a proper temperature range.
Finding a shipping company that ensures the chill chain management works well and will keep your food products in good condition, even in worst-case scenarios, can be challenging.
More effort to invest in business operations
Food products expire, inevitably. So sellers have to monitor their shelf life regularly to ensure they are all available and meet Amazon’s shelf life requirements.
Selling food products on Amazon can be a rewarding and lucrative business endeavor. However, building a successful business in the food category on Amazon requires a lot of planning and effort.
You will have to invest time and resources to meet the requirements of Amazon in this restricted category. Otherwise, you will be at risk of losing your selling privileges.
However, if you have considered all the factors mentioned above and are still planning to sell food items on Amazon, make sure you read through all the policies and regulations to run a legit business. You are recommended to start small to find out if you have enthusiasm for the food industry.
Frequently Asked Questions
How to sell Gourmet Food on Amazon?
Selling gourmet food products on Amazon can be a great way to reach more customers and increase sales. Position your food items as gourmet products on the platform, and it is essential to create dietary claims for each item, such as keto, gluten-free, or vegan.
What kind of license do I need to sell groceries on Amazon?
Your state or country may require different licenses depending on what type of food you are selling and where it is sourced from. Therefore, it is recommended to contact your local health department for more information about the licenses and regulations in your area when you decide to sell a restricted grocery item on Amazon.