As consumer shopping habits continue to move toward online marketplaces like Amazon, there are vast opportunities for brands to maximize profit in the evolving world of online retail. However, how you choose to sell your product on Amazon can have a big impact on your overall success.
There are two main ways that brands can sell their products on Amazon. They can sell directly to Amazon as their product distributor or they can open a 3rd Party Seller Account that is managed by the brand itself or by a trusted selling partner.
Which option is best for your brand? A quick look at the details makes the choice simple.
Selling Directly to Amazon
When you sell directly to Amazon as your distributor, there are three things you need to watch for.
First, Amazon rarely cares about honoring MAP policies, meaning you will have no control over how Amazon prices your product on their platform. Second, Amazon will order product directly from you in quantities they prefer, often allowing you only a day or two to fulfill the complete order. Finally, breaking Amazon’s purchase order by missing your deadline often results in thousands of dollars of chargebacks and account fees.
Opening a Seller Account
Fortunately, selling directly to Amazon isn’t your only option. In fact, for almost all brands, selling your product on the Amazon platform through your own seller account will result in higher profitability, regular sales, and consistent order quantities. It will also eliminate your risk of chargebacks and will create a scalable sales channel you can actually build around for future success.
The only downside of an Amazon seller account is the effort it takes to manage sales, launch new products, and optimize fulfillment. This is why we suggest brands hire an account expert.
A trusted selling partner like SupplyKick helps brands in one of two ways.
We can act as your trusted distributor, purchasing product in bulk, protecting brand identity and pricing, investing in product advertising, and managing regular ordering.
Or, for other brands that have plenty of warehouse space and would prefer to dropship, we can serve as an account consultant helping optimize marketing and logistics for your brand.
It is important for brands see the difference between selling their product on Amazon and the process of getting their product available on Amazon. Opening a seller account gives you control over your product’s appearance and performance. Working with a trusted selling partner takes away the burden of managing your account and allows for expertise in marketing, fulfillment, and risk-management on Amazon.
For brands seeking to maximize profitability on Amazon, the choice is clear.