misc Amazon, many questions...
- Thread starter AJ Drew
- Start date
salsalady
eXtreme Business
You're basically right, so far....
Someone called me about selling Pure Evil through their online store and we did business for a couple years. He received orders from his Amazon-linked store and would send a payment to me (through Paypal) with the buyers address. I shipped the PE directly to the customer. Not very efficient...but it worked. I got my profit plus shipping (which was about $3.50), he got his profit.
That's what you are seeing with the LDHS being sold by the Little Shop, although I would venture to guess the Little Shop purchased LDHS at wholesale and carry inventory.
In the Fulfilment By Amazon scenario, it is as you describe...merchants ship their products to the AZ warehouse where they rent shelf space and AZ picks and packs their product with whatever else the customer orders.
I started selling on Amazon in January. I don't use FBA, I pack and ship my own. I just went onto my AZ account and did a price comparison for Seller Fulfilled and FBA. The numbers are different than what I remember from when I started, but I probably didn't look at things right back then. I was just getting started and didn't understand things. Right now, using their comparison chart, it is much better to use FBA. Plus I don't have to print the shipping labels, go to the PO, pay for shipping boxes.....
Hmmmmmm.......definitely gonna have to look into this...and Right Away as it T'is The Season.....
Edit- nevermind! once again, I didn't fill in the form correctly. It looks like it's the same Referal Price per item whether seller fulfilled or Amz fulfilled, and then it's about $3 more per item for FBA. Less .50 for my shipping box, plus $1 per item to ship it to the fulfillment center....
My website uses PayPal for payment processing. Amz charges about 3-4x more per item for fees. I had to compensate somewhat for that in the Amz price, but then again, I'm selling prolly 5x more on Amz than through PP.
Someone called me about selling Pure Evil through their online store and we did business for a couple years. He received orders from his Amazon-linked store and would send a payment to me (through Paypal) with the buyers address. I shipped the PE directly to the customer. Not very efficient...but it worked. I got my profit plus shipping (which was about $3.50), he got his profit.
That's what you are seeing with the LDHS being sold by the Little Shop, although I would venture to guess the Little Shop purchased LDHS at wholesale and carry inventory.
In the Fulfilment By Amazon scenario, it is as you describe...merchants ship their products to the AZ warehouse where they rent shelf space and AZ picks and packs their product with whatever else the customer orders.
I started selling on Amazon in January. I don't use FBA, I pack and ship my own. I just went onto my AZ account and did a price comparison for Seller Fulfilled and FBA. The numbers are different than what I remember from when I started, but I probably didn't look at things right back then. I was just getting started and didn't understand things.
Edit- nevermind! once again, I didn't fill in the form correctly. It looks like it's the same Referal Price per item whether seller fulfilled or Amz fulfilled, and then it's about $3 more per item for FBA. Less .50 for my shipping box, plus $1 per item to ship it to the fulfillment center....
My website uses PayPal for payment processing. Amz charges about 3-4x more per item for fees. I had to compensate somewhat for that in the Amz price, but then again, I'm selling prolly 5x more on Amz than through PP.
Salsalady, I did not know you sell on Amazon. Am helping daughter to set up a review site. Nothing there yet, but will be at MilkWorthy.com There will be an online store which has a shopping basket for items fullfilled by Amazon. That way, one shipping fee instead of several. But probably going to do single item links with her affiliate code also.
I doubt very seriously it will make much money. Think Amazon pays like 5% but want to encourage her to realize what took most of my life to realize. If you want to do something you love, you really gotta make it profitable.
I doubt very seriously it will make much money. Think Amazon pays like 5% but want to encourage her to realize what took most of my life to realize. If you want to do something you love, you really gotta make it profitable.
I've sold a fair amount on amazon, but I haven't done FBA (Fulfilled By Amazon). I hated it doing it though, because I was charging a higher price, but making less money. I figured I could offer customers a better price when selling direct, so I stopped doing Amazon.
The thing about amazon prices is that they tend to be "Free Shipping" items that actually have the shipping bundled into the price. We all know there's no such thing as "Free Shipping". In this case, the LD is retailing for 11.43, whereas on his website it's 6.49. That means that while it might be a marginally better price buying 1, the more you buy, the worse deal Amazon is. There's no bundled shipping (or, they are bundling shipping, but they're not passing those shipping savings on to the consumer). Amazon's pricing scheme works better on big ticket items, because the shipping is a smaller portion of the overall cost of the items.
FBA makes the most sense if you're selling massive quantities. There's a certain tipping point where the cost of fulfilling via Amazon is cheaper than doing it yourself. But on a small scale it's definitely cheaper to do it yourself.
One other thing- Amazon now offers an alternative payment method, Amazon Payments, similar to paypal. That is something I'm using now, and I love it. It's just slightly more expensive in terms of Credit Card Processing fees (3%), but it's far cheaper than selling on amazon, and customers can use saved shipping info, Amazon gift cards, etc.
The thing about amazon prices is that they tend to be "Free Shipping" items that actually have the shipping bundled into the price. We all know there's no such thing as "Free Shipping". In this case, the LD is retailing for 11.43, whereas on his website it's 6.49. That means that while it might be a marginally better price buying 1, the more you buy, the worse deal Amazon is. There's no bundled shipping (or, they are bundling shipping, but they're not passing those shipping savings on to the consumer). Amazon's pricing scheme works better on big ticket items, because the shipping is a smaller portion of the overall cost of the items.
FBA makes the most sense if you're selling massive quantities. There's a certain tipping point where the cost of fulfilling via Amazon is cheaper than doing it yourself. But on a small scale it's definitely cheaper to do it yourself.
One other thing- Amazon now offers an alternative payment method, Amazon Payments, similar to paypal. That is something I'm using now, and I love it. It's just slightly more expensive in terms of Credit Card Processing fees (3%), but it's far cheaper than selling on amazon, and customers can use saved shipping info, Amazon gift cards, etc.
Heathotsauce, when you say you tried Amazon do you mean selling your own product or reselling? I wonder if it is not a good route for one but not the other. Especially if someone copacks or does not have their own warehouse space or doesnt want to hire folk to box n ship. In truth, the whole damn thing at Amazon confuses the hell out of me.
I was re-selling a variety of hot sauces, and I was shipping them myself (rather than sending them to an Amazon warehouse for distribution). It wasn't worth it to me, since my own website is doing well. But if I ever move to a larger warehouse, I'd reconsider because there wouldn't be the opportunity cost (right now, I only have so much storage space, so I'd rather use it for my own website/retail shop).
I can definitely see it making more sense if you are selling your own product. I've spoken to some sauce makers who told me something along the lines of: "sell it at whatever price you want on your own website, but you are not allowed to sell on amazon, because we want to be the only ones selling our own product on amazon". Which is fine by me.
Since the margins are slimmer on amazon, if you are selling your own product it probably makes sense monetarily since you get the product at cost, whereas if you're selling someone else's product, you're paying wholesale prices, plus all the fees associated with amazon. And most small sauce makers probably don't have the time/space to do a lot of shipping, so FBA would have the added bonus of being on auto-pilot. That being said, a lot of small sauce makers also work with fulfillment centers that aren't amazon, so that they can fulfill orders from their own online shop. Those independent fulfillment centers have lower costs, but don't have the built in marketplace of amazon, so you have to drive your own sales through your website. Amazon is able to charge higher fees, because they have the built in network of shoppers.
I can definitely see it making more sense if you are selling your own product. I've spoken to some sauce makers who told me something along the lines of: "sell it at whatever price you want on your own website, but you are not allowed to sell on amazon, because we want to be the only ones selling our own product on amazon". Which is fine by me.
Since the margins are slimmer on amazon, if you are selling your own product it probably makes sense monetarily since you get the product at cost, whereas if you're selling someone else's product, you're paying wholesale prices, plus all the fees associated with amazon. And most small sauce makers probably don't have the time/space to do a lot of shipping, so FBA would have the added bonus of being on auto-pilot. That being said, a lot of small sauce makers also work with fulfillment centers that aren't amazon, so that they can fulfill orders from their own online shop. Those independent fulfillment centers have lower costs, but don't have the built in marketplace of amazon, so you have to drive your own sales through your website. Amazon is able to charge higher fees, because they have the built in network of shoppers.
salsalady
eXtreme Business
The person selling Pure Evil was a reseller, I think my website price was about $26 and the other person's price through their Amz store was high $30's . I was not selling on Amz at that time so I didn't care. Now, if someone approached me about listing PE on Amz, I'd say OK, I'd sell PE to them at my regular wholesale price and their retail price needs to be equal to or more than my Amz price.
I'm again going back to the FBA calculator. If I add .50 for the box and bubblewrap, $1 for my time to package it, $1 for my time to go to the post office, .10 for the label, etc, etc....it's almost a wash and to not have to deal with the headach of daily checking, printing, getting to the PO......
ajdrew, to what are you refering to for 5%? Each merchant sets their own profit margins by the price listed. Amz charges rates per item (I think based on price). As I referenced earlier, Amz charges more per sale than PP. So I increased my price from $26.62 on my website to $29.99 on Amz.
A lot of people feel more comfortable buying on Amz or have Gift Cards or whatever that make it more available than just buying from my website with paypal.
It was one of those decisions that kind of felt like selling out to TheMan...but I have to say, even with the higher fees, the sales have made it worth it.
AND- as an amazon seller, I know that a lot of the times, the Amz price is likely not the lowest. I've done comparison shopping for a lot of things and sometimes I'll buy from Amz just for bundled shipping and sometime I go to the seller directly.
I'm again going back to the FBA calculator. If I add .50 for the box and bubblewrap, $1 for my time to package it, $1 for my time to go to the post office, .10 for the label, etc, etc....it's almost a wash and to not have to deal with the headach of daily checking, printing, getting to the PO......
ajdrew, to what are you refering to for 5%? Each merchant sets their own profit margins by the price listed. Amz charges rates per item (I think based on price). As I referenced earlier, Amz charges more per sale than PP. So I increased my price from $26.62 on my website to $29.99 on Amz.
A lot of people feel more comfortable buying on Amz or have Gift Cards or whatever that make it more available than just buying from my website with paypal.
It was one of those decisions that kind of felt like selling out to TheMan...but I have to say, even with the higher fees, the sales have made it worth it.
AND- as an amazon seller, I know that a lot of the times, the Amz price is likely not the lowest. I've done comparison shopping for a lot of things and sometimes I'll buy from Amz just for bundled shipping and sometime I go to the seller directly.
I don't sell on Amazon. I sell wholesale to a couple of people who started selling on Amazon.
And it causes headaches.
I get complaints by email about "your high prices on Amazon!" frequently.
I'm not an expert on Amazon - please remove my name from the topic title, as I don't want the Google to pick this link up and steer everyone away from my company website.
Thanks.
And it causes headaches.
I get complaints by email about "your high prices on Amazon!" frequently.
I'm not an expert on Amazon - please remove my name from the topic title, as I don't want the Google to pick this link up and steer everyone away from my company website.
Thanks.
Jeff from Sam&Oliver should be very handy in this thread.....
Gemini Crow Sauce Company said:
Yeah - another time the "search" feature would have come in handy, since I recall he posted a long and detailed description of the process and finances involved.
LD, I am sorry. Was interested in the topic and thought to use your product as an example to stimulate business. The title does not seem to have your product in it. Maybe a moderator changed it? Not sure, but even if it did, if there was a way to edit titles I havent figured it out. So I deleted the post and am using LD here so google doesnt find it.
On topic: I can definitely see a concern about re-sellers setting prices way too high. Is one of the things that really confuses me about some of our farmers market folk. We have a few who are full commercial, products sold in Krogers, but the Krogers prices are more than 50% higher. Punch line, the two places are four or five blocks away.
One changed his label to provide the name and address of his on farm market. Forget if it was the husband or wife that said it, but one of them said it worked great and increased sales on all of their products. This from a bottle of wine. Now they are doing taste testing and working with a huge African relief organization trying to tech bee keeping in Africa. Have seen them in the newspaper.
So wondering if your labels were to promote your website, could it cause an online version of customer migration the same as the little vineyard?
On topic: I can definitely see a concern about re-sellers setting prices way too high. Is one of the things that really confuses me about some of our farmers market folk. We have a few who are full commercial, products sold in Krogers, but the Krogers prices are more than 50% higher. Punch line, the two places are four or five blocks away.
One changed his label to provide the name and address of his on farm market. Forget if it was the husband or wife that said it, but one of them said it worked great and increased sales on all of their products. This from a bottle of wine. Now they are doing taste testing and working with a huge African relief organization trying to tech bee keeping in Africa. Have seen them in the newspaper.
So wondering if your labels were to promote your website, could it cause an online version of customer migration the same as the little vineyard?
salsalady
eXtreme Business
ajd~ Not sure about the question in the immediately previous post---
but to edit a topic title---
Click EDIT in your first post
then click USE FULL EDITOR
that will open a full screen with title, subtitle/bullet points, text body and Add Images features. You can add/delete/etc. You see it being used often for contests and giveaways. "Free Seeds Contest--CLOSED", things like that.
but to edit a topic title---
Click EDIT in your first post
then click USE FULL EDITOR
that will open a full screen with title, subtitle/bullet points, text body and Add Images features. You can add/delete/etc. You see it being used often for contests and giveaways. "Free Seeds Contest--CLOSED", things like that.
No worries - I asked the mods to change the topic title for the reasons I communicated previously. Not a huge deal. 
salsalady said:No worries-
Post editing is one thing I've learned a small bit about. Still can't post a jpeg or EPS image, but I got the dipsy down good!
DPSE= dipsy
Methow high tech:
Methow computer cooling system:
Methow 'puter virus:
