This article was provided by Megan Stanczak. Megan Stanczak is an Amazon Strategy and Listing Optimization expert, as well as the owner of Stanczak Retail Consulting. She is dedicated to helping product-based brands achieve steady and sustainable growth as Amazon sellers.
Selling on Amazon for the first time can be confusing and stressful. First, there are so many choices! What account should I sign up for? How should I fulfill my orders? Plus, what’s with all those FEES???
There are common questions most new sellers have when they are trying to decide whether or not to start selling their product on Amazon, and understanding what to expect can ease a lot of new seller anxiety.
Let’s go through the 6 most common things to expect when selling on Amazon for the first time.
You’ll need to choose the type of account
First, you’ll need to choose which type of Amazon account to sell through. Amazon has two main platforms a business can sell through – Vendor Central and Seller Central.
Vendor Central is by invite-only and it is a portal to sell your inventory TO Amazon via a wholesale agreement. This is ultimately very similar to selling inventory wholesale to any retailer. Unless you are expecting to sell well over $1M a year (off the bat) via Amazon, Vendor Central is most likely not the solution for you.
White Vendor Central is invite-only, anyone can sell on Seller Central. Seller Central is a portal to sell your inventory ON the Amazon marketplace. This also allows you more control over your product listings and inventory.
Within Seller Central, you then have the choice to sell via a Professional Account or an Individual Account. If you have found your way to this article, you are most likely a business with inventory ready to sell now – meaning you’ll want to choose the Professional Account. An Individual account is for individuals who are occasionally trying to resell new or used products on Amazon.
PRO TIP: If your brand has a trademark and you’ve registered for a Seller Central Professional Account, be sure to enroll in Amazon Brand Registry – this will give you extra listing advantages like A+Content and adding video to product pages, as well as additional brand protection.
There are different ways to fulfill your customer’s orders
There are a few main ways you can fulfill your products – for the purpose of this article, we’ll talk about the two main ways to fulfill on Amazon Seller Central – FBM (Fulfilment by Merchant) or FBA (Fulfilment by Amazon).
Fulfillment by Merchant (FBM) – This is exactly what it sounds like, FBM is when you are selling your product through Seller Central, and fulfilling customer orders through your own warehouse or a non-Amazon 3rd party warehouse (or maybe even from your living room!).
Fulfillment by Amazon (FBA) – Instead of fulfilling customer orders yourself, you have the option to send your inventory to Amazon Warehouses. They will pick, pack and ship your orders, handle your customer service inquiries and manage returns. You will also automatically gain the Prime badge on your listings, which isn’t available via FBM (unless you’ve enrolled in and been approved for Seller Fulfilled Prime).
YES, there ARE selling fees – and they can vary
Selling fees on 3rd party platforms can be a shock to any seller who is new to selling through an online channel other than their own website. Amazon has several different types of fees, depending on the type of account and how you choose to fulfill your orders. For the purpose of this article, I will be talking about the most common fees associated with a Seller Central Professional Account.
Regardless of how you will be fulfilling your orders, all Professional accounts will be charged a 15% referral fee per order, as well as a $40 per month subscription fee for the professional account.
For orders being Fulfilled by Amazon (FBA), there are more fees like FBA Fees that cover handling, shipping and customer service, and monthly storage fees (to name the most common). Check out Amazon’s FBA Fee Calculator to get an estimate of what your fees would look like.
PRO TIP: To use the FBA Fee Calculator, you’ll need to enter the URL or ASIN for the product you would want to view estimated fees. If you aren’t already selling on Amazon, choose a product on Amazon that is in the same selling category as your product, and is an almost-exact size and weight (FBA fees are calculated by weight and dimension). Then, enter the selling price that you would like to sell your product and press “Calculate” to quickly view an estimate of what your FBA Fees could look like.
Are you finding that the estimated fees are too high for you to be profitable on Amazon? Consider raising your selling price on the platform, or build shipping costs into your selling price if you are offering free shipping – customers are willing to pay a little extra for the convenience of shopping on Amazon. But please, don’t price gouge – or risk having your account shut down by Amazon.
To avoid account suspension, you’ll need to manage your seller central account daily to meet Amazon’s requirements
Amazon is notorious for suspending Seller accounts that don’t play by their rules (even if those accounts are trying their best to abide!). It’s very important to know where and how to manage your Amazon Account Health to maintain an active account status. Even if you are selling via FBA (Fulfillment by Amazon), you’ll still need to check into Seller Central daily to make sure you are maintaining your Account Health. Managing your Account Health will look different depending on how you fulfill your orders. If you are an FBM seller, you’ll need to maintain your Account Health metrics. If you are an FBA seller, you’ll need to maintain your Inventory Performance Index rating.
Managing Account Health for FBM – To maintain a healthy FBM account, be sure you are shipping your customers order by each order’s ship date, and are providing shipping that will get the package to the customer by the order’s delivery date. Each order has this information available, and you can access it by going to Your Orders>Unshipped Orders. You can monitor your current performance and take any necessary action by visiting your Account Health Dashboard and making sure your metrics are at or above Amazon’s Target. If any of your metrics fall below Amazon’s target, your account will be at risk of suspension – meaning your product listings will be suppressed, and customers won’t be able to order your product if you have it listed by Fulfillment by Merchant.
Managing Inventory Performance Index for FBA – Since Amazon will be fulfilling your customer orders for you, they won’t need to track your shipping performance. Instead, they’ll be tracking how you plan for and manage your FBA inventory levels. Visit your Inventory Performance Index (IPI) dashboard at least once a day to monitor your performance and take any necessary action. If your score falls below 400, your FBA storage will become limited, and you may incur extra storage fees.
You’ll need to optimize your Amazon product pages for Amazon SEO
The biggest mistake I see new sellers make is that they sign up for their Amazon Account, list their products quickly without doing any keyword research or understanding how Amazon wants them to list their product.
This leads to low traffic, minimal sales, and it opens a can of worms to future issues with your listings (and in some cases, issues with your account status).
If you want Amazon customers to even find your product to begin with – you’ll need to optimize your Amazon listings for Amazon SEO! Amazon SEO is different from Google SEO, so don’t assume just because you’ve conquered SEO for your own website that you’ll know how to optimize for Amazon!
If you really want to try to DIY it yourself, please (I beg you) invest just a tiny bit in keyword research and optimization tools. They are usually pretty affordable, and you should get your money back in the form of the Amazon sales you’ll experience within the first month of product optimization (if not the first week). I recommend Helium 10’s suite of tools for Amazon sellers, specifically their Platinum Plan. If you’d rather purchase their tools a-la-cart – choose their Cerebro, Frankenstein, Scribbles, and Magnet tools, in that order. Helium 10 provides excellent tool training videos that will help you successfully optimize your listings – don’t skip over these! If you are going to DIY optimization, use my Helium 10 affiliate link and coupon code SRC50OFF for 50% off Helium 10.
Don’t forget to promote!
Another mistake I see most new sellers make, is that they assume that because their products are listed on Amazon they are automatically going to see a big boost in traffic and sales. This is usually NOT the case! Because it now seems that EVERYONE is selling on Amazon, in most cases you’ll automatically have a lot of competition already on the marketplace.
Once you’ve optimized your product listings for organic traffic, the next step is to drive traffic to your product pages – it’s especially important to do this within the first 30-days of any new product launch.
Check out my Amazon Product Launch Checklist for a comprehensive list of steps to guide sellers through advertising and promoting products, how to best gain product reviews, and how to maintain account health.
Is selling on Amazon right for your business?
The key to selling on Amazon for the first time is understanding what to expect and how to follow Amazon’s rules. If you have inventory ready to scale, the demand for your type of product (or even better, a dedicated audience), and the ability to dedicate time daily to your account it’s usually a no brainer. For a more detailed, step-by-step outline on how to get started selling on Amazon, check out my FREE Guide to Selling on Amazon for Beginners.
Disclaimer – Some of the links listed in this article are affiliate links. I make a very small commission if you use and subscribe with these links. I only refer to products or programs that I trust and use myself.