Planning to sell on Amazon? Selling On Amazon, but thought of staying or not? Have you heard of these statistics?
Amazon is the place where consumers turn to conduct a product search instead of Google and Amazon has more than 200 million monthly visitors.
Sounds good right? These statistics might seem attractive but Amazon has some disadvantages too.
Every business has both positive and negative aspects, knowing that information is essential while selling on Amazon. That’s where we are here to help you out with the pros and cons of selling on Amazon.
BENEFITS OF SELLING ON AMAZON
Selling on Amazon has lot of benefits that you need to really look into to take any decisions:
1. HUGE MARKETPLACE
Amazon is a well-known customer centric ecommerce platform, with that more than 200 million people shop on Amazon each month.
85% of brands selling on Amazon, is based on the huge customer base and the customer acquisition. According to Amazon, 50% of all items sold on the platform were by third-party sellers.
By selling on Amazon, seller can automatically gain credibility and trust. This is because most of the customers are more likely to buy a product from Amazon than from other stores.
Amazon’s brand name, and their customer service attracts many shoppers to purchase products.
For small retailers looking to scale their business, can opt for Amazon which can provide you a great exposure to the customer base that they couldn’t reach on their own.
2. GET STARTED EASILY
Getting started on Amazon is relatively easy. Starting your own ecommerce store is not as easy as you think.
If you’re starting out on your own, you’ll have to set up your own website, find and manage warehouse space, package, need to ship products, and manage customer service inquiries.
While with Amazon FBA you don’t have to worry about the picking, packing, storage, shipping, and customer service, they will handle all for you.
3. INTERNATIONAL EXPANSION
Since Amazon is one of the biggest and most trusted platforms globally, it’s easy to start selling in different markets. While they’ve only launched sites for 13 countries, they do ship to over 100 countries worldwide.
Selling on Amazon internationally gives you the ability to reach a global customer base without having to start from scratch or setting up the logistics to sell and ship internationally.
4. PERFECT FOR UNIQUE PRODUCTS
If you’re selling or manufacturing a unique product, Amazon is a great place by which you can get more customers and brand visibility.
Since it’s a unique item you’ve much control over the product pricing. Though that unique item isn’t price sensitive, you can make better margin for that product.
Also, at Amazon you can get brand protection and also control your brand’s presence to prevent others from purchasing your products and reselling them on Amazon.
CONS OF SELLING ON AMAZON
Even though it has more benefits to sell on Amazon, there are also some downsides you really need to be aware of:
1. HIGH COMPETITION
With a huge customer base, it also has many sellers selling on Amazon. If you’re selling the same product as other sellers then you’ll be competing with them for the Amazon Buy Box.
There may be dozens of sellers offering the same product, but only one seller will have the highest Buy Box Score and ultimately win the sale.
To cope up with the competition, there are many best practices you need to follow to get that sale.
Focusing on customer service, fulfilling orders on time, Amazon SEO, competitive pricing and lot more.
In spite of this competition many sellers are making huge sales and profit on Amazon. However if you need to have less competition, you need to sell restricted category products.
Amazon restricted certain categories to ensure the well-being and safety of the customers. Getting approval is really a tedious task but it has the benefits of high-demand products and low competition.
But, we make it easy for you by recommending The Funnel Guru ungating service expert gets you ungated in any of the restricted categories without any hassles.
2. SELLING FEES
Amazon charges a monthly fee in addition to referral and other fees, which vary based on product category.
Amazon has two selling plans: one is an individual plan, the other is a professional selling plan. You can opt for individual selling plan if you’re not quite sure what you’re going to be sell, or you sell less than 40 items a month.
Regardless of the plan, sellers will need to pay a referral fee for every item that’s sold. The amount of this fee varies based on the product category. In addition to this, if you have opt for FBA it also involves some fees.
3. LIMITED CONTROL ON CUSTOMER RELATION
Since Amazon owns the customer relationships, you have only limited opportunities to communicate with buyers to engage with them for future purchase.
Also Amazon has certain rules and regulations in place for Buyer-seller messaging and connecting with customers, violation of the rules leads to suspension.
When it comes to deciding whether to sell on Amazon or not, it’s totally up to you. Even though it has some downsides, it has unavoidable benefits that you need to consider.
Also while selling on Amazon, you need to really consider ungating restricted categories by The Funnel Guru an ungating expert gets you ungated in any of the restricted categories.
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