Got Product? The best places to make a profit.
The Pros and Cons of Selling on Amazon, eBay, and Etsy
One of the quickest ways to get started selling online is to leverage the power of third-party sites. E-commerce giants like Amazon, eBay, and Etsy, are well-established sales and marketing platforms. Especially with more people staying home, people choose to shop on these sites, and the numbers keep growing.
Because these mega-sites have created the platform and keep it running, there’s no need to build a personal website. They have also created the most important search feature so that interested buyers can easily find your product. Using the site’s shopping cart helps you avoid a lot of the expense and hassle of setting up an independent e-commerce website.
Let’s look at three top e-commerce sites and discuss the pros and cons.
Amazon: There is no doubt that Amazon is the leader of the pack. There are more than two million sellers on their website, representing 40 percent of all sales. It is easy to set up your seller account and get started immediately. Creating a storefront inside Amazon is fast and secure, and can give you instant credibility.
A benefit of using Amazon is that there is a high level of trust among users. Plus Amazon has created a return and refund policy that makes the customer feel safe when purchasing.
Amazon Pros:
A Huge Potential for Sales
The size of Amazons’ audience is the most obvious benefit. Listing your products on Amazon gives you instant access to a pool of already established customers. This can assist in marketing your product to a worldwide audience as a bonus to your marketing efforts.
People want to shop in one place with ease.
Amazon has a built-in customer base that no standalone site will ever match. Wayfair, Overstock, and other ‘single item category online stores’ can’t compete with the inventory choices on Amazon. Furniture, home accessories, and more can be found in one place with amazingly fast and in many cases Free delivery.
Earn Repeat Business Without Marketing
Amazon keeps the buyer’s purchase information in an easy to find location that makes reordering simple. Amazon’s algorithm lets customers see a list of recommended products when on the site. If your product catches the attention of a customer you could get an unexpected sale. Amazon also has a large network of affiliates that make a small commission when they point people to your products by featuring Amazon ads on their websites.
Seller Back-End Support
Amazon makes it simple to stay on top of your business, including inventory tracking, credit card processing, and sales tax collection. You get an email that reminds you to log in and check your report and payment for your products as well as data on clicks, sales, and more.
Amazon has a fulfillment program that allows you to stock your product in its fulfillment centers. They will pack and ship your product, giving you the advantage of using the famous 2-day free shipping option that most Amazon buyers love and want.
Selling on Amazon: Cons
Competition
No matter what your product is, the competition will be sky-high. There will be thousands of other sellers selling either the same product or something similar. (Unless you create a unique handmade item) Your best bet is to create a stellar description, amazing pictures, and drop your price a little bit.
Fees
No matter what platform you choose, even if you make your site, you’re still faced with fees. You will want to do your research on your Amazon fee plan and add those costs against your profit factor. Using Amazon Fulfillment will take an even bigger part of your profit margin and is worth researching before you sign up.
Ebay
eBay: eBay was one of the first opportunities for there to be a virtual community where openness could lead to confidence. Started in the early 1990s as an auction site, eBay became a beacon of online buying and commerce. By 1998, eBay changed into the platform where you can ‘buy it now’ or bid like we see today.
You can sell personal items or list your products so they have a way to generate more revenues and attention. It is an engaging marketplace where you can find unique items and often find incredible deals.
Pros
You can take advantage of their years of online sales.
One of the advantages of selling on eBay is that there are over 160 million active buyers on the website during any given month. That means a lot of potential customers will find your product. That can translate to higher sales for your business or individual sales effort.
It is an easy way to acquire new customers.
Using eBay to sell your product means you get to take advantage of added exposure to product discovery. Customers might be searching for the products that you sell right now and discover them with your auction listing.
Using eBay for items that need to be purchased often, you have the chance to create repetitive business through personal world-class service and fulfillment, giving you the edge over your competitors.
It is effortless to become a seller on eBay today.
Setting up an eBay storefront is easy. You can get your first listings up and running in about 30 minutes. The first step is to sign up for an account and become a seller, which gives you up to 50 listings for free, and then a per-listing charge for each additional item if you do not operate a store.
If you want to open a storefront on eBay, then there are five different options available. See the eBay website for current pricing.
Although you can operate a business as a non-store on this platform, you will not gain access to data insights that could help your business to grow.
You do not receive any competition from eBay.
When you decide to start selling on eBay, there is no need to worry about this marketplace trying to become competitive with the products you offer if they become popular. Unlike Amazon, this sales platform does not sell any of its products. That means shoppers are only seeing the items that are available from third-party sellers.
You can sell almost anything on eBay.
As long as your company is not trying to sell something illegal, then you can create a listing for almost anything with this marketplace. There are some restricted items that business owners will need to take into consideration before signing up for their eBay store. But this gives the home crafted or personal items a platform as well as manufactured products.
It is an open and transparent transaction.
Feedback potential from each listing allows you to develop a sterling reputation on eBay. Positive feedback can contribute to the chance at a sale because of your history of service. It does take some time to build this reputation, but it is open and honest so that other consumers will trust what people are saying about you. If starting from scratch, then you will need at least a year of positive feedback to secure consistency in your sales.
Cons
There are numerous seller fees that you must pay, even if you don’t sell an item.
When you start selling on eBay, you will receive 50 free listings per month, but then you must pay $0.35 in most categories for every other listing beyond that. Then there are final value fees that you must pay. Some can be as high as 10% for sellers. Some fees in other categories are even higher.
You can acquire final value fees.
The platform charges you an additional four percentage points on top of the standard final value fees if your eBay account doesn’t meet or exceed the minimum performance standards in the United States. You must be an eBay top-rated seller or at an above-standard designation to avoid this additional cost.
Final value fees increase by four percentage points for any sales that occur in those specific categories that are affected by the returns and items listed as shipping an ‘item not as described’ in their service metrics.
You have limited control.
eBay focuses on the products in each listing instead of the sellers. eBay can decide to restrict how much you can brand your presence on each item that you sell. There are also specific ways that you be required to communicate with customers. The platform can cancel your listing at any time.
You will face significant competition on this platform.
Although there is an opportunity to gain additional exposure for your brand, it can get lost in the thousands of listings for similar products. That makes it a challenge to stand out from the competition. eBay introduced upgrades to address this, but that adds an extra cost.
Bargain shoppers love eBay.
Bargain-hunters flock to this website. You will find that there are a lot of shoppers who want to have the cheapest possible transaction that can lead to rude with negotiating skills. If you’re looking to sell expensive or items that have personal value you may want to rethink eBay.
You must have a way to ship items within 24 hours to be successful.
This marketplace rewards the sellers who can ship their items in 24 business hours or less. When you do not offer this, your listings will have less visibility in the search results.
Etsy
Etsy: If you are selling homemade or uniquely created products then Etsy is where you should consider setting up shop. Etsy is focused on handcrafted and unique one-of-a-kind items and has 1.5 million sellers around the world.
When you make handmade items or sell vintage items, it can be difficult to drive traffic to your personal website or sales platform. Etsy gives the hand-crafted artist a great platform to sell goods.
What Are the Pros of Etsy?
There is a lot of potential traffic available for your Etsy store.
It could take years to build traffic to your own website that Etsy can provide on day one. Millions of unique visitors come to the site every month, looking for specific items to meet their needs. These are people looking for special or unique items they can’t get in a retail store.
It is super simple to get started.
It takes about 15 minutes to get your Etsy store up and running. Like the other platforms, the layout, billing, and shipping are done for you. So you can focus on making things to sell and then listing them in your store.
Etsy is a community.
Etsy wanted to focus on the community of sellers making their platform a better experience for sellers. Sellers share their tips and experiences freely with one another so that everyone can find a path toward success. You can mentor, be mentored, and make money all at the same time doing something you really love.
Etsy algorithms are seller-friendly.
The algorithms on Etsy are designed to drive traffic to new stores. Your items can be at the top of search listings right away, giving you a boost in sales from the start.
What Are the Cons of Etsy?
Everyone jumped on the Etsy bandwagon
As with all internet sales platforms, if you started years ago, there might have been a dozen sellers in your category. Today there could be thousands. Etsy has opened up the platform to mass producers in addition to craft shops and individual sellers.
With so many looking for extra income and a side gig, Etsy is a low-cost viable option to showcase your handiwork. That gives many an opportunity to start a home base business without huge start-up costs. That’s why the Etsy platform is full of competition.
Be sure the profits outweigh the fees.
Unlike other sites where you can buy ready-made products, if you are creating handmade items you must include your time in the equation. This, and the fact that there are so many who will copy your product make it difficult to stand out and make a profit.
Search engine optimization is virtually impossible.
When it comes to SEO many Etsy sellers like to say that you can either please the platform or please Google. If you’re good at SEO or have another source to drive traffic to your store then, by all means, use it. You’ll have to decide if you want to try to pull in traffic from Etsy then learn the best SEO tools for the platform.
Selling on any platform is not a get rich quick plan. In fact, it takes years for any online store to make a substantial amount of money. It also takes continuous work to keep your listings fresh, manage inventory, sales, and shipping. Whether you create your own website and sell your products or choose an established online platform, it’s best to research them and get the facts on fees, site rules and tax requirements for your state.
