Today, businesses can showcase their products on one of the leading eCommerce websites like Amazon and eBay. These are the two biggest giants that dominate online retail with millions of customers worldwide. However, the question is whether selling is more beneficial on Amazon or eBay? As a retail seller, you must know the two forums and their B2C models to avoid making the wrong decision.
Although people consider that both these websites follow similar models, they are different from one another. Amazon has grown from a bookstore to a giant company with millions of potential customers. It offers a flexible forum where retailers can sign up within two minutes, register themselves, and start selling.
In comparison, eBay has expanded from collectibles and auctions. It features auction-style selling where sellers can list an opening bid and buyers can bid up from the opening price. It also has fixed-price listings for sellers who want to make quick sales. So, which one is more appropriate for your business? Here we’ve discussed the limits, fees, pros, and cons of selling on Amazon and eBay to help you out on this.
Limits of Selling at Amazon Vs. eBay
Every eCommerce site has a set of limits that determine the extent of opportunities for sellers to sell various products to the target market. At Amazon, the selling limits are not visible to the retailers. Once the seller reaches a certain amount of sales, Amazon reviews their account to determine if it is possible to extend the seller’s limit for adding more products.
Conversely, eBay has an account-based limit. New sellers can sell ten items with a total value of $500 per month. Once the sellers start meeting customer demands, eBay increases the selling limit accordingly.
Selling Fees at Amazon & eBay
Amazon’s charges start at a minimum of one dollar but can go as high as 25% of every item’s price. However, if sellers decide to store products in Amazon’s fulfillment centers (where Amazon packs and ships the items to their destined locations), they have to pay an additional listing fee.
In contrast, eBay’s charges may vary, depending on what you sell. Hence, it is best to use an eBay fee calculator to get a clear idea of overall costs. You can enter the shipping fee, sales price, additional charges to get an estimate of platform charges. Besides, eBay charges 10% of the sale price from every seller.
Pros of Selling on Amazon
Being one of the biggest retail giants, Amazon has a lot to offer to sellers. Here we are unfolding some of the perks of selling on Amazon.
- Vast Customer Base: Amazon leverages a built-in algorithm for recommended purchases that entices more people to the eCommerce site. It has over 5 million active members, with more than 197 million visits every month.
- High Trust & Credibility: Every retailer needs universal product codes (UPC) labels to sell on Amazon. Also, you can’t add any item that isn’t on the Amazon listing page. Besides this, Amazon has Reviews Servers that review every product to ensure they are suitable and appropriate for the customers.
- Incredible Customer Service: Amazon is famous for its impeccable business model that facilitates retailers and customers. Thus, in case of any query, customers can reach out to the sales representatives readily.
Cons of Selling on Amazon
Although Amazon is a big name in the retail industry, it has some downsides that retailers should know. Have a look below.
- No Branding Policy: Amazon doesn’t allow sellers to promote their brand; hence customers never know from who they are purchasing. In addition to limiting growth prospects, it doesn’t let businesses expand their customer loyalty.
- Immense Competition: The profit margins are pretty low on Amazon because multiple sellers offer the same products. Hence sellers need to be very tricky with the pricing, or else they can only enjoy limited profits when selling at Amazon.
- Order Management: Every seller must maintain an excellent order management system because even a slight delay can create reputational risk for businesses. Amazon has strict policies to charge hefty penalties against brands who fail to deliver quality services resulting in blemishing Amazon’s reputation in the marketplace. In most extreme cases, the website may also restrict your access to your store/account.
Pros of Selling on eBay
Currently, eBay has a gross merchandise volume of $94 billion a year, making it one of the world’s most substantial eCommerce sites. Here are some of the reasons why retailers can prefer selling on eBay.
- Customized Product Listing: As more people look for a personalized shopping experience, eBay lets retailers customize product information. You can add general descriptions, bullets, or listings while customizing the material and style.
- ERP Integrated: Retailers can connect their eBay shop with enterprise resource planning (ERP). It would give them real-time updates on stock levels, ensuring sellers have sufficient inventory to meet customer demand.
- Massive Customer Base: Today, eBay is the largest customer-to-customer (C2C) marketplace which means, you will gain immediate access to potential customers. According to Statista, 185 million buyers are active on eBay which means, sellers can reach out to millions of potential customers at once. In addition to boosting sales, it will help in building brand recognition.
Cons of Selling on eBay
Undeniably, the benefits eBay brings to the table are irresistible. Still, you should always look at the potential drawbacks before making a final decision. Have a look below.
- Customer Support: With a huge customer base, answering buyers’ questions and providing feedback is nothing less than an uphill battle. After all, there is no proper channel to get speedy replies that might result in low customer satisfaction.
- Cheap Prices & Low Profits: eBay is the marketplace where people acquire the cheapest bargain possible because of intense competition. Due to this, many people think eBay decreases prices and devalues the brands.
- Policy Restrictions: At eBay, sellers must operate under a set of fixed rules. Hence, they don’t have much control over many aspects of the business, such as return or exchange policy.
By now, you would have a clear idea of what these two retail giants have to offer. Nevertheless, putting one before the other won’t be possible because both of them offer different advantages. You have to proceed with the platform that best aligns with your company’s interests and objectives. Look into your pricing policies, branding, and available resources to ensure the platform you choose makes your business thrive.