Individual or Professional account? How to choose the right selling plan on Amazon?

I will not be wrong if I say that most buyers nowadays start there search from Amazon. The main reason being that no other marketplace has a wide choice of products available as Amazon. As a result, most sellers, big or small, prefer to show their presence on Amazon to increase sales and visibility. 

Which Selling Plan to Choose?

Whether you run a small business out of your home or own a larger brand, Amazon has a selling plan to cater to all needs. Yet you may find yourself asking – Which selling plan is best for me? Before you decide to sell on Amazon, you must understand the needs of your business. No one size fits all. There are a couple of things that you should understand to get a leg up on the competition and avoid some expensive mistakes. If you are a brand owner, you may want to go with a Professional plan and list your products under your brand name. If you are a reseller, you will want to check out the popular products that already exist and offer them in Amazon’s stores. 

Individual Plan

This plan is right for sellers that plan on selling less than 40 products on Amazon. As an individual seller, you avoid paying any monthly fees. However, you pay a $0.99 per item fee for every sale and referral and a closing fee. A buyer will purchase from you through Amazon, and you will ship the order on time to the buyer. Keep in mind that Amazon is customer-centric, and buyers always have the upper hand. Resolving any concerns raised by a buyer is critical. For instance, a buyer opens an A-Z claim for a product sold by you. You will have to respond to the request proactively. Failure to do so can result in suspensions and lower low-performance metrics. In most cases, Amazon decides in favor of the buyer. You have to be ready to respond to such queries and present your side for closure.

Professional Selling Plan

With a professional account, you will not be subject to that $0.99 fee, and you’ll have access to a few more resources available to you through Amazon to help you sell more. However, you will have to pay $39.99 per month for your subscription, and you will be responsible for paying referral and closing fees. The professional plan also allows you to list your products under Prime label either through Fulfillment by Amazon or Seller Fulfilled Prime. 

Fulfillment by Amazon

Using FBA, you can send your inventory to the Amazon warehouse and use their pack and shipping services for a fee. This service is right for your businesses if you prefer outsourcing shipping logistics and customer service to keep yourself free to explore other business opportunities and growth. You can send your inventory to Amazon using the deeply discounted shipping rates from Amazon. All your products under FBA will be eligible for Prime shipping to the buyers. When a buyer makes a purchase, Amazon packs, ships your product, and takes care of any returns or customer issues for these FBA units on your behalf. FBA is a widely used choice for sellers, given the convenience it offers. The cost for pick and pack services, storage cost, amazon closing fees should be accounted for before pricing your product. 

Seller Fulfilled Prime

Seller Fulfilled Prime is useful for the sellers who don’t want to send their inventory to Amazon, yet want to use the Prime labels with their product. This plan is available by approval only. Under SFP, your products show on Amazon search as “Prime eligible.” When purchased by a buyer, you will be liable to fulfill those orders withing the Prime date specified, i.e., deliver the order in two days. Amazon keeps track of the items shipped. Any delay may result in the cancellation of your SFP account.

Amazon Vendor Services

Vendor Central Service is available through invitation only. These are the products labeled as” ship and sold by Amazon.” Amazon purchases the top-selling items on wholesale price and sends under their pricing on Amazon. Amazon sends purchased orders, and you are liable to fulfill them on the time frame mentioned. The details for payment and fees are in the contract. There are high penalties and fines for shipment delays and failure to meet the packaging requirement.

Comparing the plans

As an individual seller, you will not have to pay the shipping charges or storage cost to Amazon, but you lose the “Prime label” benefits of FBA and FBM. FBA is convenient as you will get time to focus on expanding your business than working on logistics, customer service, and returns, but it takes away a significant part of your selling price. SFP allows you to use your shipping carriers and save on shipping and storage costs to increase profits, but it can result in fines and account cancellations if you miss the Prime date.  You may want to consider all the facts and details before choosing the right plan for your business. Once you do, you are ready to sell. Good luck!

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