Amazon market is an online platform which enables retailers/traders/ vendors to sell their merchandises online using the huge set-up of Amazon. With Amazon market, you get added the chance to grow your sales in a new platform which already contains a variety of customer types and sizes. You can reach new customers. You can modify your commerce. Your sales revolutions can be increased. You have a chance of higher visibility of your products. Amazon provides various commercial modules, which suits different business needs. Amazon has combined its market in Europe. Even if you create only one account in Amazon UK, you can still sell your products across Europe where Amazon is present I.e. Italy, Germany, France, & Spain.
However, Amazon is just not present only in Europe. It also has a global presence such as the USA, Australia and Asia. You can boost your international sale through the International presence of Amazon.
There are various ways to use Amazon Market to run your own business:
1. Sell on Amazon
This is a no-commitment plan where the seller is privileged to sell his products to millions of users not only in the UK but all in Europe through the Amazon platform. The seller needs to sign up for the monthly selling plan which gives incredible benefits for the new start-up’s businesses. It makes a local business grow 10 times then it can grow by selling locally. They do not compete for the buy box or prime customers.
Advantages of Sell on Amazon feature:
- Scope for millions of consumers – You can easily target all of Amazon’s clientele and sell directly to them via the Amazon platform. You have no need of creating a new market place.
- No need of own website – The Amazon website is a highly trustworthy website for sellers and buyers. You don’t have to worry about making your own website. As a start-up business, you can use the Amazon website in order to sell your products.
- No-commitment plan – This is a monthly no-commitment plan. You can cancel anytime you want if you feel that you are not being benefitted by Amazon.
- Sell in entire Europe – One platform, one account allows you to sell in all of Europe. You don’t have to be just a UK seller anymore; you can expand your business in all of Europe where Amazon is present.
- Chances to grow further – Once you start selling on Amazon, you have further options to grow and enhance your business like using FBA facility, g, prime seller, etc.
2. Fulfilment by Amazon (FBA)
This case is used when the Seller is using Amazon’s operations. FBA helps the seller to grow his / her business from his / her home marketplace. Here the seller’s responsibility is to ship his / her product stock to the Amazon warehouse. Once the stocks have been shipped to the stock house, they will be fulfilled by Amazon. In other words, when a customer orders the product, it will be shipped by Amazon. Not only delivery but in the case of returns, it will be returned to Amazon. The actual seller does not come into the picture. All customer support will be supported by Amazon. For all these services, Amazon charge fees from the seller. The seller here pays for selling his / her stock on Amazon platform + storing his / her stock at Amazon centre + the delivery/return taken care by Amazon. For very rare cases, where the customer needs extra details on the quality of a product, Amazon might contact the seller for answering the customer.
The FBA option is clearly mentioned on the Amazon page:
Advantages of FBA:
- Prime badge – All FBA eligible items get a Prime badge. Being prime merchandise means your product will be shown with high status and will be visible and used by the Prime members of Amazon who are the most dedicated clients of Amazon platform. It comes with a promise of high-speed delivery of within 2 days.
- Fulfilled by Amazon badge – All FBA products will be shown as “Fulfilled by Amazon” on the product page. It gives a high weight to the product. A serious buyer will always favour the Fulfilled by Amazon option as all the after deals are done through Amazon. It comes with a promise from Amazon on the product quality + fast and prompt delivery.
- Buy Box – The FBA option gives the product to appear first on the page. It will always have a higher chance of winning in the midst of all its competitors.
- Less time spent on operations – The FBA option gives the business owner more time to think further on his / her business. All the operations are supported by Amazon once the stock reaches their facility centre, so no need to worry about the operations. The Business owner has more time to think about how to expand the business or can also freely enjoy a vacation.
- Less time on inventory management – The stock is safely secured at the Amazon fulfilment centre. So, you need not worry about the inventory any more. You can put all your focus on increasing your sales and let Amazon manage the packing and shipping stuff.
- Offers a trusted service – The FBA option is a trusted service provided by Amazon which is reliable and verified by its customers. So, if you decide to use FBA for your business, you are actually using the trustworthy name of Amazon.
- No more local – Once you join the Amazon FBA business, you are a no more local business. You can cover high levels of international grounds with Amazon. You need not sell only in the UK, once your stock reaches the facility centre, it can be sold all over Europe.
- Customer service – You need not worry about providing the customer service or getting extra charged for products returned. You need to pay any extra costs for gift wraps too. All these services are already included in the FBA.
Disadvantages of FBA:
- High Cost – The only disadvantage of FBA is its cost. Amazon decides all the cost and it can increase any time. So if your sales are good, the cost won’t be a big burden but if your products are not selling too fast and are stored in the Stock house, Amazon will be charging a big bunch of money. Amazon charges monthly inventory fees, especially on the products staying too long in the stock house, it increases the fees.
- Shipment to the Amazon Facility – You have to pack your products and ship your inventory to the required facility centre of Amazon. You have to scan each item and print labels on them. You have to create the entire inventory. This can be done on your own or you will need professional help.
FBA Fee is simply divided into Fulfillment fees and Storage fees. You can pay for the services you use.
- Fulfilment fees – It depends on the size of the product. The fee calculator checks the following parameters:
- The selling price of the item,
- The size of the item,
- The weight of the item
- Storage fees – The storage fees check the area your items cover in the Amazon warehouse. It also depends on low season (£0.65 per cubic feet per month from January to September) and high season (£0.91 £0.65 per cubic feet per month from October to December). You have the option to go for monthly storage fees or long term storage fees.
3. Merchant Fulfilled Prime
This case is used when the seller is using the Amazon platform only to publish its products as a prime product. The seller gets orders from Amazon and supplies the products directly to the customers from his own warehouse. The warehouse can be anywhere; seller’s house or his business office, etc. Locating the stock, packing the stock and delivery, returning, after-sales customer service is all done by the seller and not by Amazon. The seller has to bear all the shipping costs.
Advantages of MFP
- Prime Badge – The Merchant Satisfied Prime shows your item as Prime, which creates trust among the customers.
- Loyal Clientele – The badge brings in the most loyal members of Amazon to buy the products.
- More sales with Lightning Deals – It is the selection of prime objects which are promotional and appears on the Today’s Deal page. So you can get benefitted with such offers.
- Customer Service – Post-Sale consumer care will be handled by Amazon. Order can be tracked and return can be submitted through Amazon.
- Manage your stock at your house – You get to keep the stock at your own place. So you can easily manage your stock and sell them through various other channels.
Key features for Amazon business sellers:
- Spontaneous VAT invoicing – The newest VAT calculating service provided by Amazon does all the manual labour. You don’t have to manually create all the invoices. It will be done mechanically when the orders are produced on Amazon.
- VAT-exclusive price – You also get to see the EU-wide compliant VAT-exclusive prices. This factor helps increase your sale.
- Enriched visibility offer – Once you start getting a higher amount of sales, you will be offered special eligibility, where you can get an enhanced option on product visibility.
- Pricing and quantity discounts – The business customers are offered exclusive discounts from Amazon.
- Exclusive business offers – You have an option to make your product available only to business customers and not retail customers. So you can choose whatever suits you well.
- Pay by Invoice – Amazon handles all the credit risk valuation, the billing and the collection work for the trade owners. The risk of getting non-paying buyers is removed for the new start-up private owners.
Pricing plan for Amazon seller:
|Items sold||Less than 35 per month||35 or more per month|
|Benefit||Pay as you sell||Value pricing on huge sells|
|Monthly fee||—||£25 (excl. VAT)|
|Fee per product||£0.75||—|
Register a Company at Amazon
- In order to start a business in Amazon, you need to register yourself as a sole trader or you can also go for Company Formation. Once you have registered a Company or yourself as a trader, you can register your occupation at Amazon. SEED formations LTD. can help you in the process of Company Formation or register you as a Sole Trader.
- The second thing is to do market research on Amazon. Do a deep search using a tool/ software with which you can find the competitors and their prices on Amazon. You can look for gaps in any products. You can get help from SEED formations LTD. to do research for you.
- Third thing is to decide whether you want to sell only in Europe or across the World. You have to open Bank account in the UK or overseas accordingly. Again, SEED formations LTD. can help you in the process of opening a Bank account as per your convenience.
- Decide your target sale. If you target to sell less than 35, then choose an individual plan and if you target to sell more than 35, then go for the professional plan.
- Register your products on Amazon. This is the most important part. It will help the customers decide they want to buy your products or not.
- Try not to get stuck by selling only one product. Try to sell a variety of products to increase your earning.
Amazon Product registration Checklist
- Product title
- Brand Name
- Product Images
- Price &/ Discounts
- Stock availability
- ASIN, EAN, UPC, or ISBN code