It’s a question worth contemplating if you’re trying to drum up business.
- Selling on Amazon could mean reaching more customers.
- It could also mean facing challenges and added costs.
If you own a small business, you’re fully aware that finding new customers can be a challenge. But the more customers you’re able to reach, the more products you’re likely to sell.
Now you can take different steps to advertise your business in the hopes of drawing in more customers. That could include building up a nice presence on social media. But if you really want to expand your small business’s reach, you may want to consider selling your products on Amazon.
Doing so, however, can be a bit of a mixed bag. So you’ll need to weigh the pros and cons of going that route carefully.
The upsides of selling on Amazon
When you make your products available on Amazon, you expand your audience to customers all over the country and even the world. Harvard Business Review reports that Amazon is the most visited ecommerce site in the US, with almost 3 billion visits a month. Amazon also boasts 200 million global Prime members and ships to more than 130 countries.
Just as importantly, about two-thirds of US consumers start their online product searches by visiting Amazon. And so if your goal is to expand your customer base, then making your products available on Amazon is a move that could really pay off.
Plus, Amazon has established itself as a trusted name in the ecommerce world. It’s known to stand behind the products it sells, and it’s also built itself a name as a business that’s mastered the art of efficient shipping. So if you put your products up on Amazon, there’s a comfort level consumers get to benefit from — whereas if they find your small business site via a random search, they may be more hesitant to place an order from your store directly.
The downsides of selling on Amazon
Selling on Amazon could work wonders for your small business — provided the costs involved aren’t prohibitive. No matter how you choose to sell your products on Amazon, you’re going to pay something.
If you decide to become a direct seller on Amazon’s platform, you’ll lose money to an Amazon commission for each sale you make. And if Amazon fulfills a shipment for you, you’ll pay for the cost of shipping and storage.
Plus, when you list your products on Amazon, there’s a lot of competition. And so even if consumers see your listings pop up, they may opt for a cheaper alternative to save money — even if the quality isn’t as high as what you’re offering.
Also, because there can be many low-quality products listed on Amazon, consumers may be less inclined to trust a brand they’re not familiar with. So even if a given customer finds you on Amazon, if they had a bad experience with a previous brand that was new to them, they may not want to give you a try.
What’s the right call?
If you’ve struggled to increase your customer base, and you sell a product that’s fairly easy and inexpensive to store and ship, then partnering with Amazon could end up being a smart move for your business. But be aware of the costs and pitfalls of selling on Amazon before going that route. You may want to start slowly and see how that relationship progresses before going all in.
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