How to become an Amazon merchant

When you think about buying something online, naturally your thoughts go to Amazon. Amazon is the world’s most widely used eCommerce site with over 1.5 billion dollars in sales on Prime Day in 2018 alone. They have over 300 million active customers in over 180 countries. Amazon is the retail destination that is the selling platform for sellers of all kinds. From Fortune 500 companies to individuals, everyone thinks of Amazon first.

If you are an entrepreneur that has developed a product or service and want to reach the broadest amount of people, you use Amazon as your delivery vehicle. But HOW do you start selling on Amazon?

Amazon has two selling plans

Amazon’s merchant account uses two selling plans; Individual and Professional. The difference is basically how you pay for your sales. Before you begin your registration, decide which plan will work the best for you. The individual plan will cost you $0.99 per sale, while with the professional plan you pay $39.99 no matter how many items you sell. If you are new to the Amazon Merchant program, I would recommend starting with the individual plan. You can always later upgrade to the professional plan. The same applies to downgrading in plans, if you do start out in the professional plan and afterwards decide to move to the individual plan you can do so from your account. Log on to your account, the first page will be your seller account information page. On the far left side of the screen look for “Your Services”. Click on the manage link to edit your settings for the type on account you have. One word of caution, do NOT close your account….mark the status of your listings inactive. If you close your account you will lose any inventory you may have sent to the fulfillment centers.

Which plan is right for me?

The individual plan may be right for you if;

  • you plan to sell fewer than 40 items a month
  • you want to keep your costs low
  • you don’t need Amazon’s advanced tools or add-on programs
  • you haven’t decided on what you want to sell

The professional plan may be right if you;

  • Think you will be selling more than 40 items a month
  • you would like to apply for add-on products like Launchpad, Amazon Business or Handmade
  • you want access to advanced selling tools
  • you are an advanced e-commerce merchant already

What you need to get started

  • Access to your bank account routing number & account number
  • A chargeable credit card
  • A government issued ID (Driver’s license if you are in the United States)
  • Your tax ID information (either your social security number or if you are a business, your EIN number)
  • Your phone number
  • Sometimes they will also request you send a copy of a utility bill verifying the address you list on your application

How much does it cost?

Some of the fees associated to an Amazon Merchant account are;

  • Subscription fees – These are the fees associated to the selling plan you choose. The individual plan will cost you $0.99 per item you sell. The professional plan is a flat $39.99 per month and no per item fee.
  • Selling fees – These are fees charged per item sold they include referral fees (usually around 15% of the item’s selling price) and variable closing fees (these apply only to media categories like CD’s, records, ebooks, etc.)
  • Shipping fees – Amazon shipping rates will apply. they are based on the product category and shipping service selected by the buyer.
  • FBA fees – If you choose to let Amazon fulfill your orders (Fulfillment By Amazon) there are fees for order fulfillment, storage of your products in Amazon’s fulfillment centers and optional Amazon services see Amazon’s fee schedule.

If you are just starting to sell on Amazon, I would recommend you choose Fulfillment By Amazon (FBA). They will charge you for their services, but the cost if nominal and will save you a lot of work, allowing you to focus on your business.

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