You have just started out with a thriving brand that sells sportswear goods and your business is traditionally booming. Not only do the local customers love your product; your social media profile is basking in the limelight. You thought why not go a step ahead and start selling the product to a much bigger market in the USA.
Among countless options that your buddies will provide, you sure won’t drop the ball on selling your goods on Amazon. Because let’s face it; Amazon is by far the undisputed leader in online selling platforms around the world.
There are two ways that you can sell your products on Amazon.
● You can sell directly to customers as a third-party marketplace seller
● You can sell wholesale to Amazon as a first party vendor.
If you are a third-party seller, you will host an account in the Amazon Seller Central. However, if you are a first-party vendor, you will host your account in the Amazon Vendor Central.
But, as a small-sized sportswear goods seller, thinking to tap into a much bigger market, you wonder how you will decide which is the best possible selling solution on Amazon for your business.
Let us clear that misconception so you can decide which account is the best option for your business.
Vendor Central is a platform specifically designed for manufacturers and distributors. But, if you want to sell your products on Amazon as a first-party vendor, you need to get an invite from Amazon first. You see, Amazon Vendor Central is basically an invitation-only vendor program.
Most first-party vendors establish an incredible relationship with Amazon just like the ones they do with their traditional retailers in business. Amazon puts up a purchase order for a certain product and all the brands invited are responsible to fulfill that request if a purchase is made for the product. However, for other retailers who are not part of the vendor central, Amazon takes up the responsibility of controlling the retail pricing, inventory, customer fulfillment, and customer service.
The best way to identify whether a product is sold from an Amazon Vendor Central account is the small message under the product details saying “Ships from and sold by Amazon.com.”
Sold by Amazon (Pro) – The best thing about Vendor Central program is that you can join the Vendor Central program only if you are invited by someone from the Amazon company. All products that you now sell on Amazon will be listed as “sold by Amazon.” It will instill trust and confidence in many shoppers and you will eventually land good numbers on sales.
Avoid Extra Charges (Pro) – With Amazon, if you are on the vendor central program, you can easily avoid all additional costs involved. It means you don’t have to pay for referrals, any fulfillment costs or any other seller associated fees. As a seller vendor planning to go pro on Amazon, all you ever have to do is pay a fixed fee of $39.99 per month and you can sell unlimited products.
A Cap on Profit Margin (Con) – When you are selling through a vendor central program, you give the option of selling in the hands of your buddy, Amazon. The profit margins are not revealed to you and in case a product value depreciates over time, you can actually run into a loss, based on the Amazon marketplace. Since there is no minimum pricing policy available, your product price drops indefinitely.
Inability to Launch New Products (Con) – Have you recently designed an amazing new gear at your sportswear store and are planning to go live with it? Well, if you are on the Vendor Central program, let me pop your bubble. Amazon only allows you to sell products where there is a potential to sell. And, hence it does not offer incentives on new products at all.
The second option you have on Amazon is to make use of the Amazon Seller Central platform. This platform allows you to sell products directly to customers who are searching for them on Amazon. It enables you to become a third-party marketplace seller who wants to sell their products through Amazon.
Unlike Vendor Central, Seller Centrals have the liberty of controlling their retail pricing and inventory. They have two options at their expense:
If you are choosing the FBA option, you need to pay Amazon for these fulfilment services.
Products fulfilled by the sellers have a title under the product description, “Ships from and sold by Seller.” In case fulfillments are handled by Amazon, the title under the product description appears as “Sold by Seller and Fulfilled by Amazon.”
Get More Control on Products (Pro) – Selling through the seller central platform can be cumbersome and might require a bit more investment, as compared to vendor central counterparts. However, when you are selling products via a seller central account, you will have more control over your product. It will help you manage your own pricing and establish stellar customer communication.
Access to Better Analytics (Pro) – One great perk of signing up via a seller central account is gaining access to detailed analytics. It enables you to tackle unhappy customers directly by understanding their requests and fulfilling them right away. Analytics helps them control pricing, which allows them to fluctuate prices during high demand seasons or offer sales during the holiday seasons.
Not sold by Amazon (Con) – Here’s the hardline; sellers typically observe fewer sales than vendors simply because these products are not sold by Amazon. Buyers on Amazon visit the website for the best deals and have more faith in products that are directly sold by Amazon. However, most sellers still rely on their brand name and prefer the added flexibility as a benefit compared to decreased sales.
Inventory Management (Pro) – Unlike Vendor Central account, Seller Central account offers you the liberty of managing your own inventory. So, you have complete control over how many products you wish to sell. Whereas, when you are managing business using a Vendor Central account, Amazon can become rather demanding when it is running low on inventory.
To each his own; one has increasing benefits over the other. If you are the kind of person who wants to maintain a flexible edge at managing your products online, want complete liberty on pricing and handling inventory on your own, the seller central account is the best fit for selling your products.
However, if you have a ready production line which is proactive and capable of fast manufacturing and quick shipment deliveries, the Vendor Central account can be a great fit for your needs. While a Vendor Central account might provide you with good numbers, Seller Central account will give you quality in sales.
Are you a vendor who is opting in to sell their products via Amazon? What you need is a website to establish your online presence. After all, you can’t afford to lose the opportunity of getting your brand name published under each of your product descriptions, if you are selling through Seller Central.
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