Practical Ecommerce

Quick Query: Amazon Exec Explains “Selling on Amazon”

Online retailers are frequently interested in new channels to sell their products. Merchants can consider auction sites and comparison-shopping sites, for example. And there’s also Amazon.com. Amazon competes with many smaller ecommerce merchants, but also allows those merchants to list products there, too. The service is called “Selling on Amazon” and the executive in charge of it is Sam Wheeler, director of seller services at Amazon.

PeC: What is “Selling on Amazon?”

Sam Wheeler
Wheeler: “It’s an easy and lightweight way for individuals and small businesses to take physical products that they have in their shops and put them on Amazon for sale and Amazon makes it really easy for its customers to find those sellers’ products. The sellers then ship those products to the customers, and then we transfer the money from the sale of the product minus a commission over to the seller. So, we keep it really simple and it seems to be working well.”

PeC: Can any merchant participate with any type of product?

Wheeler: “For the most part, the answer is yes. There are a couple of product categories that we don’t support. We don’t support digital downloads, so we don’t do MP3s or video files and then as you might guess, we don’t support the sale of alcohol, tobacco, guns, or live animals. It’s stuff you might typically find in a retail location.”

PeC: You mentioned shipping the products. Does a merchant need to use the Fulfillment by Amazon division to use the Selling on Amazon service?

Wheeler: “No.”

PeC: Tell us about the money that’s involved. How much does it cost a merchant to sign up for Selling on Amazon and how much of the selling price does Amazon retain?

Wheeler: “There is no cost to get started. The commissions [to Amazon] can range anywhere from 6% if it’s a personal computer to as much as 20% if it’s gourmet food or a jewelry item. The most common [commission] is roughly 15% for the majority of the categories.”

PeC: What if a merchant has hundreds or thousands of products?

Wheeler: “We do have another program, which is a subscription program, which starts at $39.99 a month and the same commissions apply. There isn’t a closing fee associated with that particular program and it allows you to list an unlimited amount of items.”

PeC: What are the logistics of getting all of the products up on your site, getting images of those products up on the site, obtaining adequate descriptions, keeping track of back-end inventory, keeping track of fulfillment. Are there tools out there to help with all of that?

Wheeler: “We make it easy to list your items. Amazons has millions of items already on its website and if you happen to have a product that matches to one of our products, all you need to give us is your price and your inventory and then how long it will take for you to ship that item.”

“Our sense is that most small businesses have the ability to do their own pick, pack and ship, so when we send them the order, we make it easy for them. We give them the address of the customer and all the pertinent details in order to fulfill on that particular customer’s order.”

PeC: What if a merchant is selling an identical product to what Amazon is selling, or perhaps there are 20 merchants selling identical products to what Amazon is selling. How do you determine how those products are listed on your site?

Wheeler: “If you were to go to what we call a product detail page and you can pick any one of our products, you would notice that on the right-hand side, we offer what’s the Amazon price and then we show a couple of other sellers’ [listings] and there’s another link there that says “see more sellers with this product.” You click on that and we’ve ranked it based on what the all-in price is going to be.”

PeC: Anything else on your mind as it relates to Selling on Amazon or other Amazon products?

Wheeler: “We’ve been in this business for a long time and a large amount of our success is predicated upon our abilities to build good partnerships with small businesses in a win-win opportunity. So, our goal is to continue to create opportunities for individuals and small businesses, to make money in a very transparent way, so they know exactly what our expectations are and if they live up to those expectations and our customers’ expectations, there’s an opportunity to make money. In America, all you can ask for is a chance, and that’s what we’re trying to give folks.”

Practical Ecommerce

Practical Ecommerce

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