Amazon, the E-commerce giant, is one of the oldest merchants on the web and has over 200 million clients around the world. Amazon is the unparalleled marketplace to sell products on the web. It gives an excellent platform for conducting online business and has proved advantageous for both buyers and sellers. Amazon is an extremely famous e-commerce site that can help expand your reach in the market and improve the visibility of your product in a unique way. In this study notes, we will try to comprehend in detail how Amazon Marketplace functions.
This study notes is prepared for those who want to utilize the Amazon Marketplace as a platform to sell their products online. It covers significant points that you will need to know to start an online business with Amazon such as how to create your account on Amazon Marketplace and list your product. It additionally describes what are Amazon’s charges in return, how Amazon manages the delivery, how you should deal with the customers’ feedback and other important issues.
To benefit out of this study notes, you need to have a passion for online business. You should have the desire to know about Amazon Marketplace and how it helps to expanding the visibility of your products across the globe.
There are different reasons why you should think selling at Amazon Marketplace. In this basic section, let us take a look at some of the prominent reasons why you should choose Amazon Marketplace.
The best explanation of selling on Amazon is the scale of their online visitors. Amazon alone draws the eyeballs of almost 85 million visitors monthly, so you can evaluate the number of folds by which your sale will increase. Additionally, the probability of your product reaching the clients increases.
Amazon has millions of varied customers across the globe who visit on a frequent basis. If one goes by statistics, every one out of four online customers purchase from Amazon. They visit Amazon Marketplace with the explicit intent to purchase and may discover your product while browsing, which they may have otherwise purchased from some other seller or may have never experienced.
Thus, you acquire a potential client and if you serve them with quality products, the chances of winning a repeated and global business is all yours.
Amazon can deliver your product, through Amazon’s FBA service, Fulfillment by Amazon, to the client faster and at cheaper rates than you can do it yourself. You add to the customer’s satisfaction by including Fulfilled by Amazon text or its Prime logo to your product.
You can sit back and relax, and enjoy stress free and trusted product delivery! You can also dispatch the product yourself, wherein you are responsible for packing the product and have it shipped by yourself or hire a fulfilment service to do it for you, any way you might like.
There is a bucket list of products that you can sell on Amazon. You can sell a little or a lot, Amazon gives you all the required tools and experience to have a effective sale.
Clients love easy buying, something only Amazon’s one click purchase can grant. Subsequently, once you become a seller on Amazon you are laced with Amazon’s e-commerce expertise, its easy payment and delivery options which will adorn your online business.
Amazon offers hassle-free and timely payments. Payment for your product is deposited into your bank account and you are notified via email that your payment has been made. Additionally, Amazon deducts its charges only after you make a sale.
Amazon offers professional services to guide you through every step of selling your product online, for example, what product you should sell and how to sell.
Amazon isn't just an online store, rather it’s a Marketplace! It is one of the oldest merchants on the web and has over 200 million clients worldwide. There are many potential purchasers who put their trust in Amazon and prefer buying purchasing from Amazon only, even if the product costs slightly higher than at other e-commerce sites.
Undoubtedly, the primary advantage of selling on Amazon is its high traffic volume. The main reason for which is the strategic working of Amazon people on the presentation of the products, encouraging people to buy, serving them quality product with simple buy and return options.
Why jostle through the tedious and extravagant process of making and maintaining a website, putting efforts to direct the traffic towards it? All you need is to locate the right product to sell and at the perfect cost and Amazon will get you the right clients.
Another major advantage that should be listed is Amazon’s growth rate. Amazon’s income has grown rapidly and has reached a remarkable value, close to 70 billion dollars a year, which is indeed faster than the overall rate of e-commerce development.
Amazon alone isn't the player behind this success story, there are around 2,000,000 thirdparty merchants having their share in the e-commerce pie. Amazon has not been a one-size fit solution for all of them. Many seemed skeptical and ventured out, making their own sites or selling on some other sites resulting in decreased sales, incurring heavy losses, and lastly returned to Amazon. For some sales through Amazon made up for the losses, for some it saved their business.
There are no charges for listing your product in the catalog and you can begin selling without paying anything until your product has been sold. It helps in smooth shipping of your product and Amazon even handles return policy for you. This adds to the Amazon advantage!
You must certainly be researching what choices you should essentially make before beginning to sell your product. The very first choice you should make is about the type of account you should hold. Also, what product should you sell, and thirdly how should you manage the shipment and return for the product.
Amazon offers two types of accounts − Individual Account and Professional Account.
If you are a small seller with very few items to sell or just testing the waters, this type of account is customized for you. It is a pay-as-you-go system and includes no monthly account fees. You only need to pay a $0.99 fee each time an item is sold and have access to a basic set of tools for management and ordering.
You can sell multiple items that already have posting on the site but can' create new listings on Amazon. Additionally, you can't apply to sell in the restricted categories on Amazon like health, personal care, grocery, garments, footwear, watches, beauty items, etc. You can't offer free shipping to lure consumers, Amazon chooses the shipping rates for you. You may, however, upgrade your Individual Account to a Professional one, whenever you want.
If you are selling 40 or more products then you can settle for this plan. It includes monthly subscription charges of $39.99 but you can also enjoy a waiver of $0.99 attached with selling of each product in Individual Account.
You have access to advanced management and inventory listing tools and can make new product listing pages. You can also apply to sell products belonging to the restricted category or choose the shipping charges for your product. The advantages of making the choice to become a professional seller far exceeds the potential downsides.
You can discover what to sell links on the Amazon webpage. There are huge number of products open to sale for both Individual and Professional account holders aside for some marked by asterisk for which Individual account holders need to take prior approval. These are, however, open for Professional account holders.
Once you make up your mind to sell on Amazon, just do not jump in with both feet. Browse through the category lists by clicking the sell on Amazon link on the homepage and see what general category products are feasible for you. Following is the gist of what products you should avoid selling.
Illegal products − Amazon displays a list of banned products for each category, mostly illegal and unsafe products or products that promote violence in any form like firearms, toy guns, crossbows and different weapons.
Hacking devices like radio jammers and cell phone unlocking devices.
Fraudulent or deceptive products − Amazon doesn't permit products that infringe on others’ trademark like fake-branded clothing, shoes, bags, or watches.
Prescription drugs, for they might be fatal whenever consumed without advice.
Alcohol, though sale of wine from Amazon certified merchants is permitted.
The product you are listing should be authentic and certifiable. If you claim to be selling a certain product, then the product you ship to the customer should be the same, nothing similar or close about.
Now that you are well-versed with what to avoid selling, you should reach to selling of more and various products. It would be helpful if you choosw a professional merchant account. Once you have an account, you can generally go to the Amazon Help Center for any question or help.
Another significant question that often pops up is whether you should sell new or utilized products? Amazon is an ideal platform if you want to get rid of some unwanted stuff at home and make some money out of it.
Many categories listed on Amazon allow selling of utilized products like used books, DVDs, electronics and sports kit. You simply need to ensure that you list the product condition correctly and give most possible details, failing which you will receive a negative input from customers who will rightfully demand a refund.
Listing is an fundamental part of building up your online selling business. It involves creating your product catalog by indicating the mandatory and striking details of your product. Posting your product on Amazon gives your store visibility to countless customers online. It can be done in four different ways −
The simplest way for a newbie is to list one’s few products to coordinate the existing product list and click the ‘Sell on Amazon’ link. You can look by the item’s title or use the product code for filtering the matching products. You need to be a registered seller before beginning the sale of your item.
If you are a professional seller, you may be able to list a new product to the Amazon catalog. However, Amazon doesn't permit you to add everything you want. The products in most of the categories need a GTIN number to kick-start it’s selling. The GTIN number is a globally unique 14-digit number used to recognize trade items.
ASD is a Windows desktop software application enabling merchants who prefer working offline to easily list their products on Amazon. Utilizing its interface, you can upload products you want to sell, create product data, list catchy offers, etc.
You can also utilize Excel templates to upload inventory on the Amazon website. The technique involves the following steps −
Step 1 − Select the pre-built template most appropriate to your inventory and save the file to your computer. The pre-defined templates give contextual help in building your inventory file with data validation.
Step 2 − Click the ‘Save’ button and download the file on your system.
Step 3 − After downloading, open the file utilizing Microsoft Excel and add the product information for as many products you want to sell. After finishing adding the information, save the work as an Excel workbook. Keep a backup copy with a date indicated for future reference.
Step 4 − Go to the ‘File’ menu and save your spreadsheet in ‘Text (Tab delimited) or (.txt) format’.
Step 5 − Browse to find the template you saved on your computer and click the ‘Upload now’ button to finish.
It can take from 15-20 minutes to a day prior your listing is visible in the search list and the products are ready for sale.
Amazon doesn't want duplication. Each item listed on Amazon should just exist once inside the Amazon catalog. This is because the client doesn't want to get messed up in different pages for a single product. Unless you sell unique or custom products, there’s a fair chance the items you’re selling already exist on Amazon, so everything you need to do is match your products to ones that already exist in the Amazon catalog.
Let us now discuss how to enter information about an item you want to sell on Amazon. Let’s see how to enter information about an item you want to sell when the product is already in the Amazon system, i.e. you need to add yourself to the list of merchants who are already selling a specific product.
The added product already has an Amazon Standard Identification Number (ASIN). It is a unique block of 10 letters and/or numbers that identify items on Amazon. Every product that is added to the Amazon catalog is allocated a new ASIN.
To start, log into the Amazon seller Central and search for the product by its ASIN or by name. Once you have discovered the right product, click on ‘Sell yours’ button to get started. You can view the general information of the product you are selling at the top like the product title, ASIN, manufacturer details, etc.
You can also click on the Amazon Detail Page link to know the detailed information of your product, even your competitors’ pricing information. The first field to enter is Stock Keeping Unit (SKU) number. Just as every product has an ASIN, every individual item entered in the Amazon family by any merchant has a unique SKU number, which permits you to track the item.
The next field to enter is the Condition Field. This is an optional field but it is acceptable to fill in the field particularly if you are selling a used product. The next thing to enter is uploading the photos. You can add up to six photos for your product.
Other fields are Legal Disclaimer and Seller Warranty fields. These fields are there at the bottom of the page. After the Disclaimer, there is the tax code field. Enter a code here to tell Amazon what tax class the product belongs to.
Next is the handling time information, which is the time you require for shipping the product. Amazon has default handling times, however, the merchants have the adaptability to change the value to as many as 30 days. It is better to leave this box empty and try to ship the product quickly. You need to tell Amazon whether you are going to ship the product yourself or you will utilize the Amazon FBA system.
The following screenshot shows how to list a new product in Amazon Marketplace −
The following screen capture shows how you can upload your inventory file in Amazon Marketplace −
The Add a Product tool lets you create new product detail pages on Amazon. Detail pages become a permanent part of the Amazon catalog and you along with different sellers can create listings for these products.
Every product sold on Amazon has a page showing various sellers with their listed prices for the similar product. Customers can find the pages and listings through search and browse, and include the seller with lowest listing or best rating to their Amazon shopping cart or wish lists.
In this section, we will talk about the types of expenses that Amazon charges from the merchants who do business utilizing its platform −
Let’s discuss these in detail, beginning with Variable Closing Fees.
Amazon charges sellers a Variable Closing Fee for each product sold through Amazon’s platform. This fee is charged in addition to a referral charge. This fee is somewhat complicated and has varied over the years. It depends on several things like the product type and the shipment technique.
Going by the product type, Amazon splits the products in two categories: Media Products or BMVD products and non-media products. BMVD includes music, videos, books, DVDs, computer software, video games, etc. It is simpler to calculate the variable closing fee for BMVD products and is almost a standard value of $1.35. So, whether you are an individual seller or a professional seller, using FBA or shipping yourself, you need to pay $1.35 for every BMVD product that you sell.
For non-media products, if you are utilizing FBA, then there will be no variable closing expense. If you are shipping by yourself and offering free shipping, even then you won’t be charged the variable closing fee.
Coming to the last situation in which you are shipping the product yourself and you are also charging a shipping fee. In this situation, the variable closing fee to be paid, is calculated by taking a fixed fee and adding an amount per pound of shipping weight.
The basic rate is $0.45 per item sold plus $0.05 multiplied by the number of pounds of delivery weight of the product. For example, if your product weighs 10 pounds, then you will be charged a fixed fee of $0.45, plus $0.05 × 10 = $0.5, i.e. a total of $0.95 as variable closing expense.
|Product Type||Domestic Standard||Domestic Expedited||International|
|Music & DVD's||$1.35||$1.35||$1.35|
|Computer & Video Games||$1.35||$1.35||Not Available|
|Video Game Consoles||$1.35||$1.35||Not Available|
|Product Type||Domestic Standard||Domestic Expedited||International|
|Non-Media products||$0.45+$0.05/lb||$0.65+$0.10/lb||Not Available|
You might be knowledgeable with this term by now. Let us take at the fees related to it. Amazon charges a fee for shipping the product for you, which will lower than the expense you will incur in shipping the same product. The computation of fulfilment fees for orders placed on Amazon is based on the category type and the product size level.
The charges as per Amazon for Standard-Size Media Products, applicable on both domestic and international orders are listed below.
|Fulfillment Fee||Product Size Tier ($299.99 or less)||Zero- Fee Fulfillment($300 or more)|
|Small Standard-Size||Large Standard-Size|
Order Handling (per order)
Pick & Pack (per unit)
Weight Handling(per lb)
Based on the Out bound Shipping wt.
|Over 2 lb.||$1.24+$0.41/lb.(Above the first 2 lb.)|
The charges according to Amazon for Standard-Size Non-Media Products, applicable on both domestic and international orders are listed below.
|Fulfillment Fee||Product Size Tier ($299.99 or less)||Zero- Fee Fulfillment($300 or more)|
|Small Standard-Size||Large Standard-Size|
Order Handling (per order)
Pick & Pack (per unit)
Weight Handling(per lb)
Based on the Out bound Shipping wt.
|Over 2 lb.||$1.95+$0.39/lb.(Above the first 2 lb.)|
The charges as per Amazon for Oversize Media and Non-Media, applicable only on domestic orders are listed below.
|Fulfillment Fee||Product Size Tier|
|Small Oversize||Medium Oversize||Large Oversize||Special Oversize|
Order Handling(per order)
Pick & Pack(per unit)
Based on the Out bound Shipping wt.
|$2.06+$0.39/l b. (Above the first 2 lb.)||$2.73+$0.39/lb. (Above the first 2 lb.)||$63.98+$0.80/ lb (Above the first 90 lb.)||$124.58+$0.92/l b. (Above the first 90 lb.)|
Applies to plasma and projection large screen television units with screens 42” or larger. However, smaller televisions could qualify for the Special Handling Fee dependent on factors like weight and on how carefully it is to be handled
Referral fee is the fee that you pay Amazon for referring the deal to you and for giving an access to a massive audience. Venders pay a referral fee on each item sold which is determined on the product price and on any gift wrap charges borne by the buyer.
Items in several categories have a per-item minimum referral expense as listed below −
|Product Type||Referral Fee Percentage|
|Cell phone devices, Camera & Photo, Consumer Electronics, Video Game Consoles||8%|
|Industrial & Scientific Products||12%|
|Books, Beauty products, Baby products, Clothing & Accessories, Furniture & Decor, Health & Personal care, Home & Garden, Kitchen Products, Luggage & Travel Accessories, Musical Instruments, Office Products, Shoes, Watches, Handbags & Glasses, Sports, Toys & Games, DVD, Video Games & Software||15%|
Amazon has cut its referral charge by 1-7% on some categories including computers, laptops, mobile devices and tablets, electronics, computer games, educational software, musical instruments, etc.
In this section, we will talk about the two different types of Account Settings on Amazon Marketplace.
An individual Account is the least essentiality to sell products on Amazon. There is a referral fee attached, and in some cases, there is a variable closing fee. There are FBA charges if you are utilizing the service and the shipping costs if you are delivering the product yourself.
To set up a professional account, you have to go to Sell on Amazon page and click the Sell as Professional button. Thereafter, follow the steps given below −
If you are outside the US, check the worldwide seller links for important instructions and notification.
Next, enter the legal name of your business and click the checkbox.
Read the agreement and click the Continue button.
After this, you will be approached to enter a display name, the name of your business inside the Amazon system, the listing name for your product, your address and contact details, and your credit card information. Click Save & Continue to push forward.
Complete the Amazon verification by entering the PIN number texted to you or listed in call to you by Amazon.
You will also need to update your tax status to Amazon.
To begin with, click the Launch Interview Wizard button on the Tax Identity page.
You will be asked whether you remain in the US or overseas, the structure of your organization, the sole proprietor, your tax ID number, tax address, etc.
Follow the Wizard attentively and once you are done, leave the Wizard.
You will be coordinated to the previous page, click on ‘Complete Registration’ to finish off.
You may likewise need to give your Bank Account Information. This is for utilizing the record to get your income moved to you by Amazon. Likewise, on the off chance that you need endorsement for selling into any of the limited classes, click the Help and quest for Category Approval or snap the Category Link.
Next, you have to give Seller Information, as portrayed in the following screenshot.
After providing Seller Information, verify your identity, as shown in the following screenshot.
Once you have verified your identity, set up your account, as shown in the following screenshot.
Now, the final icing on the cake! Add the products you want to sell and list their costs.
All Amazon sellers want the coverted Buy Box. This is the equivalent as all website holders need their website to rank on top of Google search. When a buyer searches for a product, there may be many sellers selling the same product with various offers.
Amazon can't list all the sellers on the main page of the product. Rather, it filters the sellers and picks one and encourages people to purchase from that seller. This selected seller is the ‘Buy Box’.
Amazon’s idea of ‘Buy Box’ is to make it convenient for customers to make a reliable and quick choice. Buy Box eligible sellers are professional sellers who have met performance based requirements.
There is no extra fee for being Buy Box eligible, and the sellers must keep up their performance levels to hold the status of Buy Box eligibility.
Following are some of the manners that can help you secure a position in the Buy Box.
Be a professional FBA merchant − FBA merchants are most likely to be in the Buy Box. Chances of a non-FBA merchant to be in the Buy Box is a rare occurring.
Lower price − When two FBA merchants are in the race of being in the Buy Box, the one with lower listed price removes the pie.
List your product accurately − You should aptly describe the product and its condition to be in a authentic seller list.
Ship on time − Build reliable shipping methods to deliver the correct product in time to the buyer and with enough time to beat the estimated delivery date. In case you are unable to make the estimated delivery date, tell your customer in time for the same, whatever maybe the issue.
Interact with your customers − Inform the customer about the status of their order. The right update to the customer can help build the customer’s trust.
Provide customer-friendly services − Pay attention to post-transaction affairs like refunds, returns, and trades.
The more efforts you put in and the better you perform, the more probable are you to get in the Buy Box.
The shipping method you use within Amazon is of your decision, considering it meets the customers chosen timeframe. As referenced before, it is beneficial to go by FBA (Fulfillment by Amazon) Service. The less time you spend each day arranging for proper packaging, the additional time you will have in finding and posting new products.
There are many Amazon customers who need a complete Amazon experience. They need Amazon to handle the shipping. Some others may prefer buying products from non-FBA merchants, only if the price difference is remarkable or there is no Amazon dispatching option.
You can either manage shipping yourself or can depend upon Amazon for the same. If you take charge of shipping, then Amazon takes an order and sends the requisite information to you. You will be answerable for packing and shipping the product to the customer.
Amazon also offers Fulfillment by Amazon (FBA) service. Everything you need to do is just ship your product to an Amazon warehouse and Amazon is responsible for packing and delivery the product for you. Thus, you can easily operate your Amazon account sitting anywhere across the globe.
Suppose you wish to work with the Amazon FBA service and want Amazon to deal with the shipping. In this situation, you need to follow the steps given below −
Sign up for an FBA account and choose the Amazon shipping button while posting the product and click the ‘Save and Finish’ button. The product needs to be shipped to the proper Amazon Warehouse for it to be dispatched.
Create a new shipping plan which includes all the information about the shipment to be sent to Amazon. The location from where the product will be shipped is the address you entered while setting your account. However, you can change this address by entering another Ship-From address.
Next, you need to enter the detail of the product type, whether you are dispatching individual products or case-packed products.
If you are shipping a dozen of utilized mobiles, each with a alternate model, or having the same model but varying condition will be listed as an individual product. Amazon will scan the barcode of every individual item that you send.
On the contrary, if you are shipping a dozen identical units, all with the same SKU number and same condition, then the shipment will be listed as a casepacked shipment. Amazon will simply check the barcode of only one item from each case and enter the number of items.
You need to inform Amazon about the number of units you have prepared for selling. Once you indicate how many units you're offering for sale, Amazon can recognize stock changes that occur in your store. Thus, you should always be sure that you have enough inventories to cover the quantity displayed on Amazon.
If you want to list a new product in the Amazon catalog, at that point you need to follow the steps given below −
Click the ‘Create a new product’ button.
Select the category into which you want to list your product. Amazon then shows a list of sub categories.
Continue browsing through the sub-categories and select the suitable one.
You will then be directed to the area to add the product information. Begin filling the product title, the name of the product, the manufacturer name and the model number.
Next, you need to enter the unique product number, a Global Trade Item Number(GTIN), an International Standard Book Number (ISBN) for book, a Universal Product Code (UPC) or European Article Number (EAN). Amazon checks for the validity of the number, so do not try entering a fake number.
You can upload pictures using the ‘Images Tab’. At least, one picture needs to be uploaded in this case. Give due consideration to the quality of the picture you are uploading as bad picture look unprofessional and turn the buyers off.
The key to great sales lies in how efficiently you describe and display your product. Attempt to display the information in a bulleted list marking the striking features of your product. Try covering maximum details, as inadequate information results in lowering the confidence of the buyer in the worth of your product.
Click the ‘Save and Finish’ button after you are finished with all the entries.
As indicated earlier, it may take a few days for the product to start appearing in the search list.
We have by far learned how to list a new product or include a seller account with an existent product. But the processes discussed works only for a small number of products. What if you want to sell thousands of products? Entering the details of each item would be extremely tedious.
In such a case, uploading lists of products into Amazon Seller Central comes to your rescue. It doesn't mean that you do not need to input the product data. You clearly need to enter all the data, the product cost, its condition, quantity, etc. but you will be entering it into a spreadsheet and upload the spreadsheet on Amazon. The whole procedure of uploading is the same as talked about earlier.
If you want to save your time, do not go into setting the exact price. Set all the prices a little on the higher side − higher than the viable sales price of the product. At that point using some pricing tool, modify the same as per the arrangement of rules in the tool.
Amazon has a repricing tool that could be very helpful. Merchants need to utilize such pricing tools because prices change very quickly with upcoming new merchants and new inventories. Thus, one needs to keep a check and keep the costs reasonable without making any improvements manually. These tools use Amazon Web Service’s Application Programming Interface (API). They track information about your pricing and your opponent’s pricing and modify your pricing to appear more competitive, accordingly escalating your sales and drawing you closer to the Buy Box.
Amazon has no issue with merchants using these tools. Indeed, they understand that managing large number of products isn't possible without automation and they like tools with a tendency to push the pricing down, because it provides lower costs to their customers.
You may also identify the maximum and minimum price limits you are OK with and automate pricing. This will automatically adjust your prices within the competent range. The only thing to be cautious should be the Minimum Price field. Users who are new to the repricing tool may lower their prices below a reasonable limit and may suffer heavy losses. So, these tools have been laced with a wide range of different settings that permit you to protect yourself from pricing items excessively low.
There are a variety of rules that decide how and when the tool should change your product price, how to manage with FBA and non-FBA products, and which products and merchants to price against. Depending upon the program and the price of the service, you can choose upon the schedule of how often you want the tool to reprice.
Earning most profit is the ultimate goal of all the sellers and it should be, for this is something that draws most sellers to Amazon Marketplace. There are two key parameters in the definition of a profitable business. They are −
You can detect whether the product you are investing upon is worth it or not by gauging its demand. Try looking at how many people are exactly interested in buying the product you are going to sell. What is the requirement for the same? How many different sellers are in line to meet the demand and with what quality product?
The margin you are getting on your sales is similarly significant. Something a lot of people are selling doesn't necessarily mean is going to sell well with high profit. There is no standardized benchmark for what exactly is a good margin. Margins depend to a great extent on the quantity. If the demand is high and you are getting a lower margin on the product, even then the sale will consequently become a profitable one.
Following are some tricks to target high sales −
Target the Buy Box − Winning the Buy Box is something than just price. Pricing down to beat a seller with a poor rating is of no worth in comparison to winning the Buy Box otherwise.
Compare your costs against condition with competitors − Compare your prices with competitor’s new product against a new and utilized product and then list your price.
Do not follow the flock − Avoid pricing against merchants with low rating. Buyers don't like to buy from a seller with low rating. If a couple of merchants are lowering down their costs to fight it out, don’t be a part of them. Basically stay away and focus towards different goals.
Try getting the highest rating − Your customer is undoubtedly your greatest resource! Supply quality product to your customer at reliable rates and good shipping service. Look at the post-transaction grievances and try settling most of them. Keep a constant check on your price and quality. Give due consideration to the customer’s feedback and reply to any inquiry. All this finally enters you into the zone of highly rated seller.
It is quite an effort to know how much income you can generate by selling a product on Amazon. Being one of the most popular marketplaces for online merchants, Amazon has a wide array of charges - marketplace account fees, variable cost fees, referral fees, shipping costs, etc. The fee depends upon whether you are an individual seller or a professional merchant, shipping your product yourself or using FBA (Fulfillment by Amazon).
One cannot estimate how much benefit can be earned by selling a product. Here, the readymade Price Calculators come to the rescue and helps you calculate how much profit are you going to make on the sale. Amazon Price Calculators are well equipped to help the sellers in determining their total profit on items after shipment and all money related transactions.
Let us take at the functioning of such a calculator.
Enter the details of the product such as its measurements, weight and the item’s price.
Let us consider that I am a bookseller selling a book with dimensions 9.5 × 6.6 × 1.5 inches, having a cost of $18, and utilizing Amazon FBA Service.
Open the Amazon Revenue Calculator and under the title ‘Revenue’, enter a value of $18 under the category ‘Amazon Fulfillment’.
Click on the ‘Calculate’ button. The calculator separates and displays the individual fees that you will need to pay to Amazon.
The Calculator displays the following outcomes −
Let’s analyze the results produced by the Calculator −
Amazon charges a Referral Fee of 15% of the item’s price on books. That makes the referral fee = 15 × 18/100 = 2.7.
Amazon will charge you the Variable Closing Fee of $1.35 because the books are listed under Media or BMVD product, and Amazon charges $ 1.35 on any BMVD product that you sell.
Coming to the Fulfillment Costs, refer to the Fulfillment Cost Table in Chapter 6 for Standard-Size Media Products. Since your product costs beneath $30,0 you do not qualify for Zero-Fee Fulfillment and will be charged $1.06 for pick and pack (per unit) and $1.24 for weight handling since the book weighs 1.5 pounds.
You don't have to pay any order handling fee or outbound shipping charges, since the weight is below 2 lb.
Amazon also charges a monthly storage fee of $0.03 per unit. Thus, the Fulfillment Cost Subtotal becomes $1.06 + $1.24 + $0.03 = $2.33.
Your total cost totals to $2.7 + $1.35 + $2.33 = $6.38.
The Item price was $18. Hence, your margin becomes $18 - $6.38 = $11.62.
Next, the calculator requests for the number of items you are selling in a month, let’s say 30 numbers. The calculator shows a chart comparing the revenue, cost and margin impact for selling 30 books.
The calculator also compares the values of your satisfaction and Amazon’s fulfillment. The fulfillment charges under the tab ‘Your Fulfillment’ are tentative and have just been taken for producing the example. However, Amazon’s FBA charges are always lower than the shipment charges you will confront.
The basic question that comes to mind is how is the sales tax on Amazon determined?
If a product is subjected to sales tax in the state in which it is shipped, the tax is determined on the total selling price of the item.
The total selling price includes shipping of the product and handling charges, gift wrap charges, etc.
The tax that the customer needs to pay relies upon the identity of the seller, the type of item sold, and shipment destination.
The amount of estimated tax appearing on the order may differ from the tax charged ultimately. This is because the factors can change between the time of putting an order and the time of transaction.
Amazon has collaborated with many sellers. For sales within the United States, Amazon calculates taxes on the seller’s behalf. Information can be viewed in the Seller’s Shipping and Tax information section.
Let’s see how you, as a merchant on Amazon, should deal with Sales Tax −
Open the Amazon portal. Go to Settings and click the Continue button.
The very first document provides an overview of how Amazon maintains the taxes. The next document shows the product tax codes. Click the Continue button and scroll down. Here you can configure your tax settings.
Amazon has a partner Vertex that manages the database of sales tax rate. The seller can choose where to collect the tax, each state in which you have a nexus, also characterized as your presence in that State. Amazon utilizes the data from Vertex to calculate how much sales tax is to be charged.
Select the product type that applies to your products. Click on the check boxes next to the States in which tax needs to be collected and then enter your sales tax ID number into the required box. Vertex calculates sales tax for each item, on the rates it has for these areas and the product type. However, the settings may change by entering the rate while checking the custom rate check box.
Amazon charges sales tax on shipping and handling as well as on gift wrap, although not in all the States. Shipping and handling charges are not taxable if they're shown as separate costs on the sales invoice. Check for the State in which your product is being shipped and click ‘Continue’. Amazon will charge the sales taxes you specified and will transfer the amount along with your different earnings. The seller is responsible for paying tax to the Tax Authorities.
In this section, we will discuss the delivery process involved when you are on Amazon Marketplace.
When you go for fulfilling orders yourself, you need to ship the products to the customers. Amazon sends you a mail as soon as your product is picked by the buyer. However, it may happen at times that you may not receive the email instantly and it may take up to 20 minutes to get the complete order information. Amazon informs you what you sold and at what price and the fee that you will be charged. Your duty is to dispatch the product to the buyer in time.
You can go to the Manage Order page and print the packing slip. Then confirm Amazon that the shipment has been done successfully. The order page has a complete list of information about the order, such as where it is going, the date and the time of order, the expected shipment date, the expected delivery date, and the shipping technique.
You can also send a message to the buyer by clicking the buyer’s name if necessary through an anonymous Amazon email address. Neither the buyer sees your email address, neither you will see the buyer’s email address.
Now the main task is to ship the product. The first way is to print the order packing slip to create a document that contains all you need to ship the product. Tear the shipping address off the top of this document and attach it with the package. The other way is to use the shipping services through Amazon by clicking the Buy shipping button. Enter the package weight and size. Click on the most appropriate shipping method.
FBA shipments are a great relief for the seller. You simply need to sit back and relax while Amazon handles the entire shipping baggage. You will get an email notifying that your order has been shipped. You can however see the transaction specifications by going to Orders and clicking the order number.
There is much more to fancy when you use Amazon’s FBA service. You can send the shipment orders to Amazon asking them to ship a product from Amazon’s warehouse to a customer that you met through some other platform, say eBay. Go to Seller Central, click Inventory and then Manage Inventory.
Select the product you sold and select Create Fulfillment Order from the Actions button at the top. Enter the destination address and email address of the buyer so that the buyer can receive the tracking information. Select the delivery method you want to use and you will notice that the fees changes on the right. Review the details and select ‘Place Order’.
Amazon Seller Central is the web interface utilized by merchants to manage their orders. An individual selling via the Amazon Seller Central is considered a third-party seller. Smart sellers use Fulfillment by Amazon (FBA). However, anyone can utilize the Seller Central and can hold full control of their product listings and pricing. There are four primary management areas - Managing your inventory, handling sales, shipment of products, and dealing with returns.
There are two ways of getting into the Seller Central −
Sign into your Amazon account and click ‘Your Account’ button, then click the ‘Seller account link’.
The second way is to directly go to the Seller Central by using the URL sellercentral.amazon.com.
On loading the Seller Central, you will see a dashboard which contains a couple of areas of your interest. There is additionally a menu that leads to the intricate details of how to manage your account.
You can clear the screen a little by collapsing some of the boxes by tapping on the small down triangles and selecting collapse. The boxes can also be moved as per your preferences.
The top left of your screen displays the orders box which gives the basic information about your sales. You can directly go to the manage order page from here.
Next is the Performance box which provides various measures of seller’s performance like the seller’s rating.
Then comes the seller forum boxes which are not important to all the sellers.
Next, there are the general boxes like the search box which permits you to quickly browse through the Amazon catalog. On the right side of your screen is the payment summary box which shows you what Amazon owes you or what is expected on you.
There is the case log box which contains a link to the case log page where you can see the answers to your queries from Amazon.
There is also the Sales Summary Box which shows the number of items sold and their monetary value over a period of 7 days, 15 days and 30 days.
The Amazon Seller Coach provides suggestions for improving your product listings, announcements and promotions.
Finally, there is the message link which takes you to an zone in which you can respond to the customer’s inquires.
So far, we have examined how to list a product, raise its sale, its shipment, and so on. Let us now talk about how to manage the inventory while it is still in the Amazon system.
Open the Inventory Menu on the Seller Central. There will be two Manage Inventory choices at the top to help you in managing your inventory, be it seller shipped or an FBA inventory.
Click the Filters button to view the type of item you want to see.
Utilize the Status dropdown to select the inventory items you want. You can see the items having listing issues by clicking on the Quality Issues link. You can see the products that are not deactivated by Amazon though they have inappropriate or insufficient information. These products can be improved by changing the information in the listing. You can also see the problems with the product images that you uploaded, problem with product description, and so on.
There is additionally a Stranded Inventory link which shows items that are in the Amazon Warehouse but for which there are no listings and are not being sold. You can look through the help system to know the way to fix it.
There is a Price Alert link that takes you to the products that have valuing issues.
You can carry out actions on your products utilizing the Actions button.
If the status for the product shows “Active”, it implies that the item is listed for sale.
If it shows “Inactive”, it implies the item is listed but not being sold.
There may be different messages like “Out of Stock”, “Pricing Error”, “Closed” which means that you closed the listing or “Reserved” which implies that the item has been sold but not shipped.
“Incomplete” means that some significant information is missing in the listing.
The Condition column shows the chosen product’s condition and the Available column lists the number of items you have in stock.
The Fee Preview column gives you how much fees you need to pay to Amazon on selling the product.
In the next column, you can see the current listed price of your item along with its delivery price. You can change the costs directly from here if you wish to. Click ‘Save’ to save your changes.
You can also click the options of Lowest Price, Buy Box Price and the Buy Box Eligible.
Lowest price shows the current lowest cost of the product.
Buy Box Price shows the current cost of the item in the Buy Box.
Buy Box Eligible shows whether your product is qualified for the Buy Box.
You can manage FBA Inventory by going to Inventory menu and choosing the option, Manage FBA Inventory. Another way is to utilize the Inventory Amazon Fulfills links at the top of the Manage Inventory page. You can look for a product by entering the product title, merchant SKU, ASIN or FNSKU (Fulfillment Network SKU). This is an extraordinary identifier which distinguishes each item entering the Amazon warehouse and its merchant.
You can even ask Amazon show only items with fulfillable inventory which includes the inventory on shelves and prepared to sell. You can also ask for items that have no fulfillable inventory which incorporates the items for which you have the listings and which are assigned to FBA however for which Amazon has no stocks. Furthermore, there are items with unfulfillable inventory which includes the items that are in the warehouse but can't be supplied.
Amazon gives reports for the sellers about the details of their sales.
You can discover the Inventory report option in the inventory menu and an order report option in the orders menu.
You can see the FBA items in the active listings report which includes all the active postings.
There is additionally a cancelled listing report, sold listing report, listing quality and suppressed listing report which show you the quality issues related to your listing. You essentially need to select the report you want to see and click the request report button. A message will flash mentioning it will take Amazon up to 45 minutes to create the complete report for you. When it is prepared, download the report to see its content.
In the order report, you can choose a time period for which you need to see your orders. You can utilize the new orders and the unshipped orders link on the top of the page.
If you want to see the FBA orders, utilize the fulfillment option on the Reports menu.
The Payment menu option takes you to a report that shows all the information related to your sales, income, profits, and charges.
The Business Report option takes you to a very complicated and highly configured reporting system that gives a report on almost everything.
The Fulfillment option gives reports to manage your inventory, which guides you about the amount of inventory you should keep in the FBA system.
Next, there is the Tax library which provides all tax-related reports.
You can also view the transaction report, request payments, refunds, fees, services, and so on. Click the total value to see the whole transaction details.
There is also an All Statements tab that leads you to your settlement reports and reports that show what Amazon charged you or paid you on any specified settlement date.
Amazon Selling Coach Reports show you the opportunities, restocking of your inventory, popular products, and so forth.
Hence, this area is of extraordinary worth to the seller to spend time on, as there is a wide range of useful and quality information.
You have now mastered the art of selling on Amazon portal, including how a product sells, how to manage your inventory, and so on. However, keeping your customer’s satisfied is similarly important.
Satisfied customers keep purchasing from you. You are currently tagged as a trustworthy seller. Good customer feedback leads to repeated sales. There are certain things like supplements, household needs, sports equipment, etc. which a buyer subscribes and purchases consistently. Good rating assists to bond with the customer. Also, it lures different buyers to purchase from you. Another reason to earn good ratings is Amazon keeps a close eye on ratings.
Just a point to be noted - Good rating is directly proportional to higher sales. It decreases the chances of losing customers. The main thing to keep the customers happy is to ship a wellpackaged product on time. To lessen your burden, opt for FBA. Amazon ships within deadline and packs the products properly. On your part, you can make sure your products are quality ones and in great condition.
To help you see what your customers are saying about you, Amazon gives you detailed information. Look for the Performance Box on seller’s central page. There you can view your performance, messages, ratings, back claims, and so on.
Asking customers for reviews is the best and least expensive way to get abundant reviews. You can create Facebook Review Groups. These groups are a wide network of people who give awesome reviews for giveaways.
You can reach bloggers directly to give you reviews for cash or a product. Many bloggers appreciate free products for reviews. They may not give you reviews directly on Amazon yet they can post your links on their page. You can create your own reviewer group. It may include your friends and relatives and can give them selective discount in lieu of a review.
To get more and more reviews, you have to send an email to your customers to file a feedback about the product. Track the customers, contact them personally and ask them to pen down their reviews about the purchase.
Repeat your emails. Schedule them in a manner like sending the first mail after five days of their shopping and second email after ten days. Out of all the customers you contact, even if half of them are convinced with the proposal to write a review for you, it is a winning circumstance for you.
There are times when despite your best efforts you can't earn good ratings and feedback. Don’t panic if this happens. Rather look how to deal with poor customer rating. However, Amazon doesn't let the customers write feedback that includes obscene language or the seller’s info like contact details, etc. You can contact Amazon support team to get it eliminated.
Secondly, for a bad review go to Manage Feedback page, search for customer’s info and contact your customers. Politely listen to their complaint and offer to get things done right. Apologize for your mistakes. Offer change in product, either half or full refund. Make the customer happy so that you receive better reviews.
Amazon keeps an eye on the behavior of each seller to guarantee they are performing well. If a seller falls too low on the rating scale, he/she won’t be selling on Amazon for long. Performance area has three parameters on the basis of which a seller is evaluated by Amazon. These are −
This area provides a quick summary of your account health. This page has green boxes with checkmarks which gives a knowledge that everything is fine in the account. Ideally you do not want to have yellow triangles or red octagons with an ‘X’ in them which highlights the flaws your account has.
One significant check is ‘Order Defect Rate’ which shows the percentage of orders with problems - either negative feedback or the filing of an A to Z guarantee claim which shows that you can't reach an agreement with the customer. Then there is the ‘Contact Response Time’ which is a proportion of how well you responded to the buyer’s messages and in time. Any answer from your side after 24 hours is rated as a late response.
Next comes a ‘Perfect Order Rating’ showing the percentage of orders for which everything went well. Amazon calls this as POP Score and you will like to have a score of 95% or higher.
Seller rating isn't shown to the customer however it is a vital tool of placing you in the Buy Box. The merchant with a high seller rating gets the Buy Box. The Amazon Seller Rating is a score on a scale from 0 to 100. A score of 0 to 84.49 is viewed as fair, 84.5 to 96.49 as good, 96.5 to 98.49 as very good, and 98.5 to 100 as outstanding.
This summarizes the customer feedback data. Amazon keeps a check on how you are serving its customers, so you need to continuously put efforts in winning the customer’s satisfaction.
In this section, we will discuss about selling the products in bulk on Amazon Marketplace.
When you begin enjoying the sale of your product, you will have a mission to generate more demand for your product. You may want to stick to the following tips for the same −
Expand globally − Sign into the Seller Central and go to Inventory. Select ‘Signup for International shipping’ from Manage FBA Inventory. Signing with Amazon FBA Export, you will be distinguished and enabled to export all the export-eligible products on Amazon.com. With FBA Export, Amazon delivers your product to international customers at no extra cost to you.
Give exciting offers for promoting your product − Sign in to Seller Central and go to Advertising, then Manage Promotions. Adding offers to your products are an incredible method to provide more visibility to your product.
Expand the portfolio of your product − Lace your product with striking pictures and details to have an influential portfolio. You may anytime sign into the Amazon Seller Central and view your Business Report.
Register for sponsored products − Sponsored products let you advertise the products you listed on Amazon. Choose the keyword you need to target and set a costper-click bid for it. There is no charge for registering. You will be charged only when your ad gets clicked.
Take advantage of Amazon FBA service − When you use FBA Service, you have a chance to sell more during the busiest days of the year which helps you focus more around your business.
Amazon permits you to automate your business with the help of its FBA Service. It ships individual orders and you need not hurry to a post office every day to ship the order. Even the returns are handled smoothly and the entire negative feedback related to the fulfilment experiences are taken up by Amazon itself.
All the inquiries related to the order status and tracking details are handled automatically. Hence, there is no need for any tech work, no website maintenance hacks, no warehouse maintenance issues, no worries about storage, package or delivery and no customer dealings on your part. FBA goes about as a savior by automating almost 90% of your business.
Third-party sellers are independent sellers who offer a variety of new, used, or refurbished products. Amazon has 2 million-plus third-party sellers across the globe who sell about 47% of units shipped by Amazon. These sellers have encountered an astonishing revenue growth by using the Amazon platform and their number is increasing four-folds every year. The majority of them, even the biggest sellers put their faith in Amazon FBA Service.
Third-party sellers themselves are an asset for Amazon for they give an incredible amount of selection and increase the client choices. They make up for a competitive environment resulting in bringing down the prices of an article which attracts more customers towards Amazon.
To guarantee that Amazon integration works easily with your store and you have a voluminous sale, there are a few best practices that needs to be taken care of.
You should remember the following in mind in order to use Amazon Marketplace in an effective manner −
Get a Pro Merchant Subscription rather than of an Individual one.
Sell with FBA service instead of taking the big responsibility of delivery the product yourself. It will help you in dealing with the huge influx of orders without taxing your time and assets.
Stay competitive amongst the highly rated seller and focus to win the Buy Box.
Work upon the customer’s feedback. Attempt to implement genuine advices.
Make sure the currency you use in your Amazon seller account is a similar currency you use in your store.
When applying a Sale Price to an Amazon listing, set a ‘Sell Start Date’ and a ‘Sell End Date’ to restrict the amount of time you will be offering the item at a lower cost.
Add unique listings. Unique products are more liable to make a decent deal.
Provide discounts to lure the customers.
Have enough inventories to satisfy Amazon orders within the specified shipping time frame.
For Amazon orders, add the shipping technique and the tracking number to the order before clicking Complete Order to guarantee that the tracking information is sent back to Amazon. Only one tracking number can be utilized for one order.
There are many problems that will surface once you start the selling process. Following are some such problems and the approaches to solve them.
Managing low sales − At times, despite selling a very good product you may not receive a very welcoming response from the customer, resulting in poor sales. Try to figure out the reasons for the same and implement the approaches to increase the sales.
Managing quality amidst competition − There are hundreds of sellers who may be selling the similar item as you. Hence, you need to stand apart. In doing so, you need to discover ways in which to make your product look more appealing than the others in the race. It ought to have the desired quality along with a practical price.
Lowering prices and margins − At times you will have to lower the price of your product as other competitors have started to sell the same product at a lesser price. This needs to be done even if it results in lesser profit. However, even if the price goes low, be sure to maintain a decent demand for the product. Only then will you be able to remain in business.
Managing inventories − You need to be calculative of when and in what quantity you will need require product to maintain a smooth and controlled flow of the product. It should not be such that you have a demand for a product but are unable to meet it. It should also not be the other way that you have loads of product but less demand for the equivalent. It is this basic to stock up the right quantity.
Managing cancellation of order − Sometimes it happens that the customer places an order for purchase and then cancels the order. Try figuring out the reason and amend it so that such cancellations do not occur again.
Managing return or exchange of products − Many a times the customer demands an exchange or return of the product. Know the complaints and try to meet the customer’s need. The product may be in proper shape when you shipped it but may have got damaged on the way. No customer will be willing to accept the damaged product for a fair sum that he/she paid. These types of losses happen in business and you need to bear them in return of winning a dedicated customer.
Managing poor rating − The other big ordeal is to deal with a poor rating. You need to continuously keep a check on your rating and regulate it. No customer likes to purchase from a seller having a poor rating or a poor feedback for they can't put their trust in such a seller. It thus becomes mandatory to deal with your ratings.
Managing poor customer feedback − There will be times you will have to deal with arrogant customers. To pacify such customers and make them believe in your product, behave tactfully with them. Listen carefully about their problem, be cool and resolve it in an efficient manner. Do not exaggerate or argue with your customer. If the customer is too aggressive, apologize so that the customer doesn't turn away from your product. Winning the customer is half the business done.
Following is a list of significant terms frequently encountered on Amazon Marketplace −
Amazon Price Calculator − Pre-designed calculators by Amazon which are well prepared to help the sellers in determining their total profit on items after shipment and all financial exchange.
Amazon Seller Central − Amazon Seller Central is the web interface utilized by merchants to manage their orders.
ASD (Amazon Seller Desktop) − ASD is a Windows desktop software application enabling sellers who prefer working offline to effortlessly list their products on Amazon.
ASIN (Amazon Standard Identification Number) − A unique block of 10 letters and/or numbers that distinguish items on Amazon.
BMVD (Books, Music, Video, and DVD) − BMVD are media products including books, music, videos, DVDs, and so on.
Buy Box − Amazon selected seller for the customers.
Consumer Electronics − Electronic equipment intended for a regular use.
Demand − It refers to how much (quantity) of a product is desired by buyers at different prices.
E-Commerce − Electronic commerce, regularly written as e-commerce is the trading of products by using computer networks, such as the Internet or online social network.
FBA (Fulfillment by Amazon) − An Amazon service which permits you to store your products in Amazon's fulfillment centers. Amazon picks, packs, ships, and gives customer service for the products.
SKU (Stock Keeping Unit) − Number given to each individual item that enters the Amazon family.
FNKSU − Fulfillment Network SKU. It distinguishes both the item and its merchant.
Free Shipping − Shipment of an order without charging the expenses for delivering it to the customer.
GTIN (Global Trade Item Number) − An identifier for trade items to look up product information in a database (often by entering the number through a bar code scanner pointed at a genuine product) which may have a retailer, manufacturer, collector, researcher, or other entity.
Inventory − A complete list of items such as property, goods in stock.
ISBN (International Standard Book Number) − A unique numeric identifier for each book. An ISBN is appointed to each edition and variations of a book (except reprinting).
Margin − The gross profit between the cost to make a product and its selling cost.
Order − A commercial transaction for a purchaser’s intention to purchase.
Price − The amount a customer pays for an item, the list price minus any discount.
Product Detail Page − The page where customers read details about a product for sale on Amazon.com, including its name, ASIN, picture, price, description, customer reviews, and ordering options.
Quantity − The amount of product people are willing or ready to buy at a certain price.
Referral Fee − The fee that you pay Amazon for referring the sale to you and for giving access to a massive audience.
Variable Closing Fee − Fee charged by Amazon on the sale of every item.
Return − Sending back of the product by customers when they are disappointed with the purchase.
Revenue − The money paid to Amazon or a third-party vendor for the purchase of products.
Search Box Link − A link through which visitors can utilize Amazon's powerful search engine to locate products they are interested in.
Seller − Whoever fulfills the order, whether Amazon or a third-party merchant.
UPC (Universal Product Code) − A particular type of barcode to identify products universally.