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Amazon and Ebay are the two largest eCommerce platforms. There are a multitude of sellers on them, however there are also a lot of limitations to be aware of. If you are just getting into eCommerce then below is a great summary of some of the things you need to take note of.
- Amazon’s listing fees start at a minimum of a US$1 and go up to 25% of the item’s price. This excludes any fees charged for fulfillment by Amazon. After adding seller, warehousing and other transactional fees, approximately 26% for every dollar of revenue needs to be paid to Amazon.
- eBay’s fees are typically cheaper and less complicated than Amazon. eBay’s listing fee depends on how you sell your product, e.g. auction style. The platform also charges 10% of the sale price, with a cap of $750 as a final value fee. Fees can be higher if you opt for advanced listing. See all upgrade fees options here.
Fees can be costly to new eCommerce businesses planning to use these platforms’ services to expand.
eBay and Amazon are saturated with thousands of sellers that your business will have to compete with. You are always subject to the risk of someone undercutting your price, which can hurt your sales.
Lack of Control over Branding
eBay and Amazon focus on the products, not the sellers. The only thing you have control over is the products’ photos and text. Customers are consequently unable to connect with your business and your brand presence remains weak. This also reduces customer loyalty.
Buyer over sellers
eBay and Amazon favor the buyer over sellers. Both platforms are known to suspend or remove accounts/product listings over negative feed-backs even when the seller isn’t at fault at times. Complaints about frozen assets and the detrimental impact on business growth have risen.
Amazon and eBay can be great starting platforms to venture out your dropshipping business. However, due to their numerous limitations, if you are looking to expand your e-commerce business, it may be a good idea to build your own online store (i.e. your own website).
Policies in detail
See links to learn more about eBay and Amazon’s shipping requirements:
If you need assistance with navigating e-commerce platforms, you can reach out to our specialists – hello(a)zhenhub.com or submit an enquiry here.