If you want to sell on Amazon, it makes sense to take advantage of everything that Amazon Seller Central has to offer. The sales platform offers tools that can help you become a successful trader and the platform.
What is Amazon Seller Central?
Amazon Seller Central is Amazon’s sales platform. Merchants can use it to list and sell their products on Amazon. They act as “third-party sellers”.
In return, Amazon charges merchants a sales commission that varies depending on the category. In return, the shipping giant processes the payments and offers a number of other services, such as storage and shipping, on request.
One of the biggest advantages for small retailers is that Amazon allows them to sell across Europe without having to meet additional costs or undertake extensive market research. They can save a great deal of time and money by letting Fulfilment by Amazon (FBA) assume responsibility for the storage and delivery of their products.
The sales process for retailers varies depending on how extensively they use Amazon’s services. Do they add product listings and the like via an API, or do they create their product pages manually? Do they use Amazon FBA, or have they decided to remain responsible for storage and shipping themselves?
Your experience with Amazon Seller Central, therefore, depends on how big you are as a retailer, your goals and how much you let Amazon do for you.
What are the requirements for registering with Amazon Seller Central?
You only need to meet a few requirements to be allowed to sell on Amazon. If you register as a Private Person, you will be able to sell privately. You need to provide Amazon with your personal data and have an account in the EU.
If your company or business wants to sell on Amazon, you must use a company account and provide additional information. This includes the most important company data, such as:
- The company name and the date of its registration
- The type and nature of the business
- Company registration number
- Business address
- Beneficial owners and authorised persons
- Primary contact data
- Payment method for withdrawals
- VAT Registration Number
The amount of information that you will need to provide depends on how you wish to operate on Amazon. In a lot of cases, it is enough to submit a copy of an authorized person’s ID and a copy of a tax certificate.
What does it cost to sell through Seller Central?
Registration is free of charge, but fees are charged for each sale. This means that the cost of selling via Seller Central depends on a number of factors:
- Tariff: with the individual selling plan, you pay a basic fee of £0.75 for each item sold. The professional selling plan costs £25 per month.
- Category: Amazon takes a certain percentage – usually between 7-15% – of the sale price of each item. With Amazon Devices Accessories, however, the referral fee is 45%.
- Minimum fee: a minimum fee of £0.25 is charged in most categories
- A closing fee of £0.50 per media item that is sold is charged
There are a number of special cases that also incur additional costs. For example, there are processing fees for refunds, inventory fees as part of Amazon FBA, and high-volume listing fees.
Amazon itself offers a pretty good overview and a calculator for your specific costs when selling via Amazon.
Which seller account should I start with?
Amazon offers two plans: professional and individual selling plans. In many cases, the professional selling plan will be the most economical option: it starts to pay off once more than 40 items are dispatched per month.
There are also a number of features that you can only use as a professional seller. These options can increase your sales and make working with Amazon much easier.
- Advertising opportunities
- The chance of winning the Buy Box
- Reports and API access
- Multiple users per account
- Amazon Sales Coach
If you are a very small seller, the single seller rate would be the best option for you.
The individuals selling plan makes the most sense for those looking to sell only a few products. It works for those looking to sell on Amazon as part of a start-up business, and it is suitable in situations where selling products online is only a small side business. The £25 paid as part of the professional tariff would be a net loss for these kinds of merchants.
You can only take full advantage of some of the benefits offered by the professional selling plan 90 days after you have registered. This is effectively your probation period on Amazon, during which you are being assessed. How good is your performance as a merchant? Are you proving to be reliable?
If Amazon places its trust in you during this period, you will have a chance to win the Buy Box, which will make it easier for you to generate sales.
Do I have to use FBA?
No. Every seller is free to decide whether they want to use Amazon FBA or not. However, there are a number of advantages to using Amazon FBA, especially when you are just starting out. You are more likely to be perceived as trustworthy by your customers, and it will be easier for you to scale your operations.
Because you don’t have to worry about shipping, storage, and returns, it’s easier for you to satisfy the high demand for your products.
On the other hand, you will become more dependent on Amazon, and you will need to plan how much stock Amazon holds for you very carefully. Otherwise, you risk being hit with a reduction in your storage capacity and having to pay high fees if you store individual items for longer than a year.
What tools are available?
The tools that you can use for your sales on Amazon depend on the plan that you are using. Your options expand considerably if you use the professional selling plan.
This is because there are advertising options that are available to you, and Amazon offers a number of other functions. Moreover, you can also access several third-party tools thanks to the APIs that you can use.
Admittedly, there are considerable additional costs that you will sometimes need to meet. You can automate your advertising, receive sales forecasts, calculate your margins, and identify products that you could start selling.
You will also be able to use some very powerful Amazon SEO tools.
What are the benefits and risks of Amazon Seller Central?
Amazon has tremendous market power. The shipping giant accounts for around 50% of all e-commerce sales. For many small retailers, it is much easier to increase the visibility of their brand with Amazon.
Using an alternative online shop, on the other hand, can make a big dent in a small business’s budget, and it will need to be maintained permanently after it has been launched. That is why using Amazon is a comparatively risk-free way for retailers and brands to start selling online. This is especially true for private individuals, hobby traders, and start-ups.
Even delivery, storage and returns are taken over by Amazon as part of FBA.
Whilst this is so, it is a bad idea for a company to become too dependent on Amazon. If Amazon accounts for a large proportion of sales, changes to the terms and conditions can significantly impact the company’s profits. Your company may then have no choice but to grudgingly accept these changes.
Amazon is constantly evolving in response to what its competitors are doing, and companies that sell their products on the platform have to take this into account when they agree to collaborate with Amazon.
Conclusion: Amazon offers retailers a lot
With Amazon Seller Central, Amazon has made it much easier for traders, manufacturers and private individuals to sell their goods online and increase their sales.
The fees that need to be paid with the professional selling plan are often worth paying because you can place advertisements and receive valuable data from Amazon as a professional seller.