If you are starting a business selling physical products, you might be deciding between starting your own Shopify store or leveraging Amazon's global marketplace. While Shopify does offer a lot more branding potential and the ability to avoid having to compete on price against the fierce competition found on Amazon, the positives of selling on Amazon's marketplace outweigh the downsides. Below, we will be going over what Amazon FBA is and why it's better than Shopify.
What Is Amazon FBA?
Amazon is the largest global marketplace in the world. It's no wonder a lot of e-commerce sellers are flocking to it. After all, the potential to capture even a sliver of the marketplace can be exciting. To begin selling on Amazon, you need to create a seller account. If you are selling under 40 products per month, you can go without a monthly subscription, but you will be paying more per unit sold. Whereas, if you are selling over 40 products per month, you need to pay for a monthly subscription plan that is $39.99 per month along with any per item seller fees. Amazon FBA specifically refers to Fulfillment By Amazon (FBA). This is the fulfillment program Amazon offers to third-party sellers. By using Amazon's FBA service, you can benefit as a seller by not having to worry about order fulfillment which can help a smaller seller scale their business without getting bogged down with orders. Likewise, you don't have to worry about inventory storage as you pay Amazon storage to store your inventory for you.
Why Amazon Is Better and What Is Amazing Selling Machine (ASM)
1. Amazon Brings In The Customers
One of the best things about selling on Amazon is the ability to leverage its incredibly global marketplace. You will be able to sell directly to Amazon's customers. Best of all, because you will be selling with Amazon FBA, your products will get the "Prime" designation which ensures that you are going to be able to sell to Amazon's most valuable customers. With Shopify, you will be responsible for having to effectively market your own brand and business to a non-existent market. This means you will be responsible for driving traffic to your business which can cause a lot of issues for businesses that are attempting to turn a profit. After all, you will be forced to spend money on paid advertising and rely on organic traffic which can take a while to see results from.
2. Amazon Handles Inventory Storage
Sellers that don't have their own warehouse are going to be able to benefit from selling with Amazon FBA because they will be able to pay incremental storage fees to avoid having to worry about renting space. With Shopify, you pretty much need to rent your own storage locker or warehouse in order to have the kind of inventory you need to grow your business. With Amazon, you simply send in all of the inventory you want and you pay them a fee to keep it. This alone can help you scale your business in a big way. For those that have minimum quantity orders, you will need to find storage space to house all of it. With Amazon, you don't have that same issue and you can take advantage of buying more inventory to lessen your per-unit cost.
3. Amazon Handles Fulfillment
One of the major issues a lot of businesses have when they are just getting started is not being able to scale fulfillment fast enough. When you sell through Amazon FBA, you will be able to scale your fulfillment as much as you want because you will have the benefit of being able to rely on Amazon's Fulfillment centers to do all of the work for you. Along with this, they will even handle customer complaints and returns. With Shopify, you will be responsible for not only shipping your orders out but also handling and processing returns on your own. This can take a lot of time and it can reduce your ability to scale your business the way you intended.
At the end of the day, Amazon is the better marketplace for those looking to start selling physical products. If you are looking to get started, you should invest in an Amazon selling course that is reputable and proven like the one mentioned in this article.