The Pros and Cons of Selling on Amazon

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Pros and Cons of Selling on Amazon Image

You’ve likely purchased an item or two on Amazon, and now, you wonder what it would be like to sell your items on the marketplace. As with any selling platform, there are pros and cons to selling on Amazon. Check them out so you can make an informed decision.

The Pros of Selling on Amazon

Access to Lots of Customers

Amazon was the most popular online store in the United States in 2016. The site gets more than 180 million visitors a month, and some of those visitors might want to get your products. As a seller, you want to put your products in front of the masses, so it makes sense to list on Amazon.

Easy to Use

You want to find something that is easy to use when setting up a selling platform, and it doesn’t get much easier than Amazon. Simply register for an account and list your products. You can make things even easier on yourself by having Amazon fulfill your orders. Then, your products will sit in an Amazon fulfillment center and go out when someone places an order. That allows you to take a hands-off approach to selling.

Reach New Customers

Finding new customers can be difficult. You have to get your brand’s name out there and find a way to drive traffic to your site. Those issues are a thing of the past when you use Amazon. People typically use the site to search for products instead of brands. They look at the price, reviews, and shipping options when making a decision. If you get great reviews and have a fair price, it will be easy for you to reach new customers.

The Cons of Selling on Amazon

Lack of Loyalty

When someone comes to your own ecommerce store and makes a purchase, he or she is buying from you, not Amazon. Customers on Amazon are typically loyal to Amazon instead of the brand, so it is harder to get repeat customers. Of course, you can slip marketing materials in with your packages to try to get repeat customers, but the person might remain loyal to Amazon anyway.

Seller Fees

Amazon takes out a percentage of each sale for its seller fees. The fees vary from one category to the next. In addition, if you sell a lot of items, you’ll need to get a Professional plan and pay a monthly fee on top of the seller fees. These fees cut into your profit margin.

Lots of Competition

More and more retailers are turning to Amazon, which means the competition is stiff. You can certainly make sales on Amazon, but you’ll likely have to slash your prices to do so. This also cuts into your profit margin.

The Bottom Line

Amazon is an excellent place to make some sales, but your profit margin will be lower than it would on other sites. It will also be difficult to find loyal customers. You can sell some products on Amazon, but try some other options, as well. Then, you can enjoy a higher profit margin from other ecommerce platforms while still getting out in front of customers on Amazon.

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