Selling on Amazon?

Poppy Design · Jul 31, 2008

Hi

Just out of interest, has anyone any experience of selling their goods via Amazon?

You know when to go to buy something from Amazon you usually get presented with options from Amazon direct and also Amazon partners.

A client mentioned this to me the other day and it would be interesting to hear how other people have got on?

Thanks
Joanne

Jul 31, 2008

I've considered it, but not gone ahead with it so far, I was offered an Amazon shop, but the costs are really quite high and I couldn't see how I could commit to their terms either. 25% of all sales prices, and all prices must match your own website, plus it did state that orders had to be despatched within 24-48 hours - which is just unfeasible on made-to-order products.

I thought the commission was ridiculously steep, and having polled a large number of friends, family, colleagues etc I couldn't find anyone who would go on Amazon looking for jewellery, all said they would just search the web - in which case I'm already well placed.

Those that I do know of who actually sell on Amazon dont find that its a great return and advised me not to bother at the rates that were being offered (I believe they are on better terms as they have been on Amazon for a while).

I'd be willing to test the waters but not at 25% of my price, I dont have margins which allow anything close to that kind of cut!

lesliedocherty · Jul 31, 2008

hi,

its £25 a month & 15% of all transaction, ive just joined, so will let you know how i progress with it

Mister B · Jul 31, 2008

I do very well indeed thank you very much

As Boho quite rightly says, commission is quite high and the prices need to be competitive so most retailers work on a low margin. Fortunately for me, I operate a vertical manufacturing/retailing operation and as such have a little more room for manouvre. More than most anyway.

Actual rates which I pay are £25 monthly fee plus 15% commission. Rates vary according to category.

The only concern that I have will be that eventually it may implode due to the volume of sellers on there. That and the fact that there are more and more discounters appearing by the day...

Mister B

Mister B · Jul 31, 2008

Sorry, meant to point out that you also pay 15% on total transaction price including postage.

Mister B

TotallySport · Jul 31, 2008

is it not 15% plus VAT?

Poppy Design · Jul 31, 2008

Yes I bought an ice cream maker on Amazon last week and of course the Amazon direct was top of list but it was £7 more than the 2nd seller! ... so of course I went for the cheaper one! exactly the same product but a third cheaper.

I guess Amazon is suitable to certain products.

Paul Kelly ICHYB · Jul 31, 2008

There has just been another great thread on this - search for it!

Bottom line is that Amazon should be seen as another method of exposure/route to market!

Rusty · Aug 1, 2008

We did try an Amazon shop for one of our online shops. It is £25 per month plus 15% commission excluding vat. On top of that you also had to pay a percentage of the postage which for us made it unworkable.

The final straw tho was the category selection, they were quite restrictive over which categories you can put your products in. For instance they have a jewellery category but it was closed to all but Amazon themselves so the only category to put jewellery items in was the Home and Garden section.

Kerry

Aug 1, 2008

Interesting..all of you guys were offered something quite different then, the offer to me was 25% of everything and no additional fees - as per the details from my email below.

Simple Set Up:
1. Open an Amazon Seller Account
2. You upload a product feed to our servers and appear as a merchant on Amazon's detail pages.
3. When a customer buys from you, we handle the transaction, and take a commission from the sale 4. We pass the order details to you, you fulfill the order 5. Funds are disbursed automatically to your bank account every seven days.

What you do not pay for:
1. No upfront payment
2. No monthly charge to maintain and secure your pages 3. No set up fee 4. No page integration fee 5. No store front fee 6. No payment transaction fee 7. No charge for Customer Service Your exposure on [FONT=Arial, sans-serif]Amazon.co.uk[/FONT][FONT=Arial, sans-serif] 1. Your page will be similar to his one created for Sports Shop 4U:
[/FONT][FONT=Arial, sans-serif]http://www.amazon.co.uk/Marcy-F1120BLK-Ascot-Cycle/dp/B0009NXO9W[/FONT][FONT=Arial, sans-serif]
2. Branded storefront similar to these merchants:
Mondera: [/FONT][FONT=Arial, sans-serif]http://www.amazon.com/Mondera/b/ref=sv__img?ie=UTF8&node=13404221[/FONT][FONT=Arial, sans-serif]
Bose: [/FONT][FONT=Arial, sans-serif]http://www.amazon.com/Bose/b/ref=sv__img?ie=UTF8&node=13542431[/FONT][FONT=Arial, sans-serif]
Office Depot:
[/FONT][FONT=Arial, sans-serif]http://www.amazon.com/Office-Depot/b/ref=sv__img?ie=UTF8&node=1064952[/FONT][FONT=Arial, sans-serif]
3. Your logo will appear on the Offer Listing pages:
[/FONT][FONT=Arial, sans-serif]http://www.amazon.co.uk/gp/offer-listing/B0009NXO9W[/FONT][FONT=Arial, sans-serif]
[/FONT]
The breakdown of charges is as follows.

The programme operates on a revenue share model which would be 25% of the total retail price including VAT and shipping.

There are no other costs to participate such as no upfront costs, no monthly fees and no integration charges.

The 25% fee includes;

All credit card processing and credit/debit card fees.
Marketing and sponsored links on shopping & search engines and Amazon associate sites.
Fraud risk management.
All transactions related to customer service.
Support team during integration.
Fast track technical support as needed.
Ongoing account management.

I'm not sure I totally agree with the argument about exposure, I think it very much depends on the market your in and the margins you operate to, I dont need the exposure via Amazon, I rank on page 1, so my items would be found if thats what someone wanted anyway, and if people aren't looking on Amazon for my products in the first place then its not going to be exposure. Also I have spoken to a lot of my regular customers about it and they all seem to be of similar opinion that its not a place they would go and look for jewellery so I think it has to be seen as one of those avenues that are horses for courses. Some people clearly think they do well out of, personally at the moment at least I think I will stick to Google Base and my website.

TotallySport · Aug 1, 2008

Nice didn't realise you could customise your shop page so much.

Mister B · Aug 1, 2008

Interesting post Boho, I was not aware that they were offering this scheme as well. IMHO, 25% is totally out of most peoples reach and TBH, most would walk away from it.

I understand your thoughts on the exposure issue, for me, its just another stream of revenue. As long as it doesn't detract from my core business and treated as bunce then everything is fine. Make hay whilst the sun shines. If you can that is

Mister B

Aug 2, 2008

Mister B said:
Interesting post Boho, I was not aware that they were offering this scheme as well. IMHO, 25% is totally out of most peoples reach and TBH, most would walk away from it.

I understand your thoughts on the exposure issue, for me, its just another stream of revenue. As long as it doesn't detract from my core business and treated as bunce then everything is fine. Make hay whilst the sun shines. If you can that is

Mister B

I get the feeling it was perhaps a targeted approach, as Rusty says the jewellery side on Amazon is very restrictive and I had tried to get information about listing my jewellery on Amazon about 6-12months or so before and been told that category wasn't open, so perhaps thats why they came back and made an offer. But a quarter of everything including postage and VAT is just unreasonable, afterall you don't get a choice about paying those, so why should you give up 25% of it when its not a profit generating part of the sale? To do that would mean I'd end up with virtually no gain from the sale as I'd still have to pay the full VAT and postage my end.

I think a percentage of the actual sale price is fair (not 25% though).

It would be interesting to know if any long term Amazon merchants have ever renegotiated their terms and whether there is any flexibility in their approach - I dont expect anyone to offer up their terms if they have managed to do it, but just an idea of if its happened would be useful - though of course if anyone would be willing to PM what their more favourable terms were if they exist, then I would love to see if I can negotiate a better offer from Amazon myself

If it wasn't for them wanting such a large slice then I think it would be a very interesting potential channel for me to tryout.

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Selling on Amazon?

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Rusty

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