When I started looking at what the referral fees are it's amazing that Amazon is able to keep prices so reasonable and even cheaper than retail when they are paying up to 10% as a referral fee on some products.
If you think about how hard it is to make a net profit of 10% on something, the ability to capture that kind of profit without having to produce anything (other than buyer interest) is awesome!! When we owned a restaurant we tried to keep food costs to 35% because after labor, the cost of the building, waste and other expenses we would have been thrilled with a 10% net.
In comparing notes with classmates, it seems that many states have no sales tax for services vs. products/goods. So starting with a service definitely makes your Minimum Viable Product musch simpler. I also like the idea of advertise and sell first and then become a supplier second. If you have a good sales funnel, you can always change the referral to your own product later.
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