Deciding to sell on Amazon is always a good thing. Almost all brands that are selling off their website or social media are now taking it to the eCommerce giant.

 

While it is easy to say that you want to take your brand to the next level, signing up and having an Amazon account for selling is a different story. 

 

This is also the reason why you will see many specialists, books dedicated to, and video tutorials on how to start selling with Amazon. If you are an experienced seller, you can look back at your challenges and know that it was never easy. 

 

To start off, there is a massive difference between signing up for a Vendor Central account versus a Seller Central account. Each platform depends on the benefits you desire and how everything works for you and your business. 

 

But don’t worry, we will try to condense all the pros and cons of both dashboards and how they should fit into your goals. 

 

The Vendor Central, Up Close

 

The website Webretailer defines Vendor Central as “an invite-only platform for businesses that want to sell their products to Amazon itself. When you sell to Amazon in this capacity, you are their supplier”

 

To explain the process further, once you get invited to this vendor club, Amazon will buy your products. You will then send Amazon the inventory they ordered. Finally, they cut you a check.

 

Pretty simple right? And possibly, guaranteed pain-free in selling through Amazon. However, without the possibility of being invited, the following benefits are perhaps out of reach:

 

It’s certainly sold by Amazon

 

Of course, there is nothing more convenient than Amazon itself selling your products, right? It’s like asking the boss that pays you to do the work they are paying you for.

 

If that’s not enough that Amazon will be buying your product and resell it with your brand name, you have to also expect that since Amazon bought your product it will earn brand trust and awareness without you spending any money through advertisement.

 

With that said, your only concern is about your back-office work such as inventory, billing, etc., and let Amazon introduce your brand to the world!

 

Pretty sweet, right?

The AMS Marketing tool

 

Aside from being backed by Amazon, you are also given a tool at your disposal called AMS or Amazon Marketing Services. With the AMS Marketing tool, you have a one-stop shop for your ads and what to use depending on your goal in your marketing area. 

 

This requires at least a background knowledge of how it works. Tinkering with AMS might not give you the best results you are aiming for. 

 

There are definitely a bunch of Youtube tutorials on how to understand the AMS marketing tool that you could self-learn through. 

The streamlining of business

You have to understand that when you sign up for a Vendor Central account, your business is definitely the wholesaler/distributor which makes Amazon the retailer. With Amazon directly buying your products, you do not have to worry about logistical options. 

 

And since Amazon is buying your products, traditional payment is definitely in the basket as Amazon pays you directly. No need to wait for customers to pay you or patiently wait for them to check out your products. 

 

Vendor Central, and its limitation

 

But before you think vendor central is the only option, here’s a fairly recent announcement from Jeff Bezos himself about the fact that third-party sellers are kicking Amazon’s butt when it comes to selling.  It seems that Amazon’s CEO transitioning to Executive Chair, Jeff Bezos, is saying that third-party sellers, those that sell through seller central, are beating Amazon at its own game.  Here could be a couple of reasons why.  

You have no control over pricing

Here’s the thing, Amazon does not always give you a competitive price. Of course, they want to give you a price that will benefit them as well but sometimes their main goal is to just direct as many customers as possible into Amazon to buy.  This not only increases traffic but also builds lifelong customers.  

 

It’s true that there are times when Amazon might give you a fair price, but this does not always happen. Remember that you are still selling on their platform. Thus, you can say that you might even lose money if it means being competitive and retaining customers. The thing is, there is no enforced minimum price for your products. 

Strict Requirements in fulfillment

The very specific requirements of Amazon make it particularly difficult for the wholesalers to replenish their inventory. Some vendors might find it challenging to meet the bulk orders that are required of them. 

 

When this happens and they do not meet the requirements, they are very vulnerable to chargebacks which is something that you don’t want to have as a problem.

Seller Central, Choosing Control

 

Here’s the truth about our brands, we like to CONTROL them.

 

When VDM Partners started private label or making our own line of products, we never wanted to take it solely on another company to completely take over the pricing of our products.

 

Thus, we opted to choose a Seller Central plan to sell our products. 

 

There are currently two types of Seller Central plans, the Individual and Professional plans. Of course, the Professional plan has more options such as putting promotions, gifts, and other special offers for your product that an individual plan cannot deliver. You can find more details about the comparison here.

Using FBA to match Vendor Central

 

Although not exactly as Vendor Central, there’s still a chance to insert the name of Amazon through FBA fulfillment. FBA stands for Fulfilled by Amazon.  This is a program where your products sit in an Amazon warehouse and as soon as you sell them on the Amazon platform, Amazon ships the products out.  

 

Obviously, Amazon fulfills the shipping of your products while you manage the selling of it on their platform. You can still take control of your inventory and especially how far you’ll go with lowering the price. 

 

Furthermore, FBA handles things like storage, shipping, and customer service. Amazon offers the following services to FBA customers:

 

1. The seller’s inventory is stored at an Amazon warehouse.

 

      2. Each order is expertly packed.

 

       3. Ship orders to retailers in two days using the company’s two-day shipping service.

 

      4. Customers are contacted via the company’s customer service center.

 

      5. Returns are processed on behalf of the seller.

The better analytics wins

 

Seller Central users, on the other hand, have access to comprehensive analytics that can help them boost their bottom line, and they can better control their returns by proactively addressing dissatisfied customers.

 

Furthermore, price control enables them to easily capitalize on high-demand periods or offer sales, which is critical for remaining competitive during the holiday season.

 

So if you are a sucker for numbers that tell a trend or a story, you will find it handy that the Seller Central has more of what you are looking for. 

The pricing is yours to control

 

We cannot put an emphasis on this enough. There is nothing that beats your control on pricing. Especially if you have a brick-and-mortar store or you have resellers who do not go online to sell your products. 

 

It can be damaging to your brand reputation if all customers just buy on Amazon because it has the lowest price and that price is extremely low compared to other store counterparts. With that said, it is only a matter of time before your resellers will stop purchasing from you. 

 

So what happens when Amazon is the only seller of your product? Of course, they could lower your price to the point of you losing money. You could always walk away per your contract. But imagine the losses that you would get before realizing you can fly solo and have more control of your products. 

 

With price control on your side, you can adjust your prices accordingly to boost your profits.

Seller Central, and its limitation

Fulfillment costs can be tricky

 

There’s nothing more frustrating than selling lower-priced items on Amazon. Because of Amazon’s shipping fees and other fees, it’s difficult to sell low-cost items at a profit. Even if you use Amazon’s FBA service, you’ll have to pay for it and it may not be worth it.

 

If you want a clearer picture of profit after you choose FBA, you can always check this Amazon calculator tool here.

 

Competing against Amazon can be tricky

 

The words “Ships from and sold by Amazon” appear next to Amazon Vendor Central products, giving them more clout on the website. Even if Seller goods are sold through FBA, these products sometimes outperform Amazon Seller Central goods.

 

However, time and again, there are many times that FBA Sellers can match the intensity that Vendor products have. Oftentimes, the right PPC advertisements, quality of product, and people you can trust on your team can accelerate a product’s sales. 

 

Here’s where we come in…

 

There are challenges in setting up an Amazon account. And even if you have been learning it for quite some time, it can still be too much for some and not worth their time. 

VDM Partners has helped many FBA sellers through wholesale agreements or consulting with people, tailoring a plan so that your products can get the sales and brand awareness it deserves. 

 

We build great listings for products to rank and build sales, we have a vast knowledge of PPC that is proven to increase keyword sales, and we implement proven strategies that we use on our own brand’s success. 

 

Get your free discovery call with us by emailing info@vdmpartners.com for more information.