Amazon gives two options for anyone wish to be a seller. The most normally practice option is through the Amazon Seller Central, which is basically a 3rd party seller chopine .
For agencies and big brands looking to get single marketing offers from Amazon, they should seek to sell directly to Amazon itself, using their first-party seller platform .
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What Is Selling Directly To Amazon?
As a commercial enterprise, your goal is to create quality products, right ? By selling immediately to Amazon, you ’ ll basically have Amazon ’ s pigeonhole of approval, giving you access to their resources .
Perks Of Being A First Party Seller
The biggest reason many sellers choose to utilize the first-party option is that you get paid a lot faster .
As a third-party seller, you typically receive the gross of your sales 45-60 days from when you send the product to their fulfillment center .
In contrast, you can receive payment in a fiddling as a few days after completing the buy order as a first-party seller .
Amazon will besides make bulk purchases of your merchandise, which is fantastic for armory forecast .
As a first-party seller, Amazon will allow you to display and detail foliate functionality exclusive to Amazon entirely, this allows you to stand out more on the market .
Marketing Of Your Product
When you are selling to Amazon, they will personally handle the selling of your product through AMS ( Amazon Marketing Services ) .
They already control the number and the price, so paying for commercialize is something they offer. The selling is all in all a blind leverage because they provide little transparency and the sales attribution is difficult to determine as a seller .
Along with their selling, you besides have entree to Amazon ’ s A+ content, allowing you to convey the intersection through multimedia better .
nowadays that you have a more comprehensive examination sympathize of what this all means, consider checking out our 2021 Amazon Advertising Strategy Guide, where we go over advertise strategies on Amazon .
How To Sell Directly To Amazon
One thing to note is that 99 % selling immediately to Amazon can be challenging to achieve. Though you are a seller and manufacture your product in rare cases, you are more likely to become a first-party seller .
With it being relatively challenging to sell to Amazon, a lot of the dominance gets relinquished from your end. Being a first-party seller is invite-only, so you start as a third-party seller .
If your intersection is doing well on Amazon systematically, then you have a prospect of receiving that invite .
What Amazon Controls
Before accepting that invite, you should know what it entails :
- Pricing: Amazon will control the price of your product. They will consider every other store’s price and list it at the lowest price possible.
- Customer Messaging: Amazon will handle all customer messages and returns.
- Product Logistics: They will ultimately handle the logistics of your product sales.
Cost Of Selling To Amazon
On top of Amazon controlling the price of your product, you will besides have to pay them for their return allowances, slow movers, marketing cooperative funds, etc. Taking all of that into retainer means you ’ ll see around 10 % taken off the top of your margins .
Amazon first-party sellers besides have to pay a monthly fee of $ 39.99, which exempts them from the $ 0.99 fee per item .
Why pick one over the other ? The answer is childlike, “ Can I afford it ? ” To even be considered a first-party seller, your intersection must perform identical well on the market and bring in top-tier margins .
Amazon Referral Fees
The Amazon Marketplace Referral Fee is the share of your detail price based on its CPA model. For automotive prices, good as an exemplar, they will typically take around 12 % .
frankincense, if your full price is $ 100, then Amazon will take $ 12 from that as their referral fee .
Variable Closing Fees
When selling immediately to Amazon, you will still be subject to variable close fees. They are merely the fees for shipping your merchandise out to customers .
For media products, the completion fee is fixed, but for non-media products, it can vary. Make certain to take advantage of a fee calculator to help break down the expenses of shipping your products .
Fulfilling Orders Through Amazon
Since you are selling directly to Amazon, they will give you the option of shipping through them, giving you access to Amazon Prime, or fulfilling the orders yourself .
Fulfilling the orders yourself may seem ideal for some, but it will cut you off from the majority of customers who prefer to utilize Amazon Prime for its public toilet .
When you fulfill orders through Amazon, it is known as FBA ( Fulfillment By Amazon ). This does come at a cost for handling, storage, item weight, woof & pack, etc .
What Is FBA?
FBA allows Amazon to handle the memory & transportation while besides allowing your merchandise to be shipped through Amazon Prime .
FBA fees are all account, taking into consideration : item slant, handling, storage ( sq ft. ), and pick & pack. This means that the FBA fees for any merchandise will be different and should be handled case by case .
We explain Amazon FBA fees in-depth and how it varies per seller .
Remember, you are not forced to use FBA for your products, so it is important to consider the costs and what would work estimable for your business .
Why Use FBA?
FBA is for those who wish to automate their Amazon serve to about 100 %. While you will however have to manufacture your product, you nobelium long have to deal with commercialize, storage, embark, customer service, or price .
What Is FBM?
FBM ( Fulfillment By Merchant ) is the alternate to using FBA. While you won ’ thymine have to adhere to the FBA fees, you will have to abide by Amazon ’ s seller rules .
When using FBM, the first major dispute from FBA is that you can not list your merchandise as Prime since you will be handling the carry, and shipping of your product.
Utilizing FBM does require a distribute more effort but is silent do-able for those who would preferably escape the FBA fees. The option is wholly in your hands as the merchant .
Why Use FBM?
FBM is for brands who want full control over their marketing, inventory, logistics, listings, price, etc. You are dislodge to take your occupation in a commission you see suit .
What Is SFP?
SFP is seller carry through prime. This is the marriage of both FBA and FBM. It allows you to utilize Amazon ’ s prime option while remaining free of their FBA fees and standards .
now be mindful this lone works if you have a potent fulfillment scheme. You have to qualify to use SFP, and barely like selling directly through Amazon, it is not easy .
SFP is where Amazon allows you to store, pack, and ship your products while silent utilizing their Prime option. This allows you to reach customers who prefer that public toilet while still controlling your inventory .
now to get access to SFP, you will first go through a test menstruation that requires a minimal of 300 orders while simultaneously meeting Amazon ’ s requirements .
A short list of some of Amazon ’ south requirements are : cancellation rate of less than 1 %, use Buy Shipping Services for a minimum of 95 % of the orders, on-time cargo evaluation of at least 99 % .
As you can see, they are nowhere near easy, but if you can achieve this, SFP might just be the best choice for you .
Why Use SFP?
SFP allows you to cultivate your own brand while still having Amazon ’ s stamp of blessing. This will help you stand out from other brands as customers will fall in love with your stigmatize, not just Amazon .
stock is something any seller has to deal with, whether or not you are selling through or to Amazon. however, there are some major differences when it comes to inventory demand .
When selling to Amazon immediately, they will personally store your products, but they besides have an armory necessity that you must meet at all times .
This can sometimes be extraneous if you, as a seller, are besides the lone manufacturer, as you would have to work hard to meet the criterion systematically .
In those situations, it may be commodity to look into outsourcing product ; if you can not, you may have to find an alternative direction to boost product .
For those selling through Amazon as a third party, stock may not be as nerve-racking, but if you have senior high school necessitate, you will placid need to meet your customers ’ needs .
Though the workload may not be as encumbering since you may move at a tempo of your own choose .
Another advantage of handling your own stock is you do not have to pay Amazon for storehouse fees. You can choose to utilize their warehouses or ship them on your own, so it is all about preference and what is best for your product .
If customer experience is imperative to you and your brand, selling directly to Amazon might be difficult. Amazon has curated their brand for years and intends to uphold it, and that includes when they decide to put their name on your intersection .
When selling directly to Amazon, you hand overall customer service to them. For some, this is an amaze profit, but this can be worrisome if you are trying to curate your own stigmatize image to stand out .
As with any merchandise or brand, there is a constant indigence to innovate and upgrade. When selling as a third base party, listing a fresh product is dim-witted and doesn ’ t want anything more, but this changes when selling directly to Amazon .
Amazon allows you to sell directly to them because that product did well in their market, and they saw profit in doing so. even with that, introducing a new product is not easy .
This is because Amazon has not seen how good that product will do and if it will provide the same margins as the merchandise they are presently buying from you .
If you want to introduce a raw product, it will have to go through the same process as the first intersection that Amazon decided to buy from you. Meaning you have to rinse and repeat every clock time .
Cut To The Chase: Is Selling Directly Through Amazon Worth It?
Selling directly through Amazon is only worth it if it fits your needs. It can help with market, handling inventory, and overall growth of your brand or product on Amazon itself .
It is in truth up to you as a seller to consider the different costs of each strategy, how much solve you can put into it, and if you are will to meet all of Amazon ’ randomness standards day in and day out .
While taking all of that in an attack to try and elevate your Amazon clientele, you can besides take a look at our Ultimate Amazon Playbook for early ways to bring your business to that next level .
This playbook offers expert tips and recommendations that will help you skyrocket conversions and sales on Amazon .
Request A Free Proposal
Are you tired of losing sales to your rival on Amazon ? It ’ s frustrating for otherwise successful brands to underperform on the leading eCommerce platform .
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Frequently Asked Questions
How Do I Sell My Product Directly To Amazon?
The first pace is for your merchandise to systematically meet Amazon ’ randomness requirements every calendar month to sell directly to Amazon. After that, it is up to Amazon to bring you in. Can We Sell Directly To Amazon?
Yes, you can directly sell to Amazon. a long as your product is performing well on Amazon, selling to Amazon is plainly a matter of time. What Does It Mean To Sell Directly To Amazon?
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To sell directly to Amazon means that Amazon will buy your intersection immediately from you as a wholesale merely as Walmart or Target would. What Business Models Are Ideal To Sell To A Big Company Like Amazon?
A clientele that manufactures its own product is ideal. When selling to Amazon, you will have to meet their provision demands, sol if you are not personally creating your product, you may find it unmanageable to increase your output .