Interested in selling your products on Amazon?
From humble beginnings as an online bookstore, Amazon has grown to become the world’s leading online retailer, enjoying worldwide net sales of close to $500 billion in 2018. Since launching their “Fulfilled by Amazon” program, more and more small businesses are selling their products on the site, enjoying the mammoth audience and logistical advantages the retailer brings.
What is the Fulfilled by Amazon Program?
Logistics are a problem for businesses of all sizes. Amazon realized this and leveraged their own logistics network into a money maker for the business. For a relatively small fee, businesses who partner with Amazon on this program can have the company handle all their logistical needs. They simply ship their products in bulk to their closest Amazon warehouse, where the company will pick, pack and ship them out as they are sold. It’s cost-effective and allows small businesses to leverage a world-class logistical network without any of the associated headaches.
Setting up Your Account
The first step toward selling on Amazon is to visit the site and create an Amazon Seller account. You’ll need to have your business name and address to hand, a telephone number you can be contacted at, a chargeable credit card and valid bank account. You’ll also have to give detailed information and specs for the product you’re selling. This assists Amazon’s team in creating the information needed for your product’s SKU.
Once these steps are accounted for, you will be instructed on how and where to ship your inventory so Amazon receives it. The company’s two main Canadian warehouses are located in Richmond, BC, and Mississauga, ON.
Breakdown of the Fees
With fulfillment by Amazon, you’ll pay for pick and pack, weight handling and inventory storage. These fees cover the storage of your products, shipping and customers service and returns of your products. For a full breakdown of the current fee system, please see the table below:
Benefits of Using Fulfilled by Amazon
Tap into a Huge Audience
eCommerce is rapidly growing across Canada. With fulfilled by Amazon, your products get in front of millions of potential customers. Your products will also be eligible for Amazon Prime, which means consumers can receive your product for FREE within two days across most of the country.
Businesses who handle their own logistics often have to charge expensive shipping rates to ensure shipping is revenue neutral and protect their profit margin. Fulfilled by Amazon listings are sorted by product price without a shipping cost. Amazon Prime customers won’t have to pay a cent in additional shipping, it’s included in their subscription.
Industry Leading Customer Service and Returns
It’s remarkable how bogged down entrepreneurs can become with customer service and the returns process. Fulfilled by Amazon means packing, delivery, customer service and returns are all handled by Amazon, leaving entrepreneurs free to tackle bigger issues.
Fulfill Orders from Other Channels
A secondary benefit of using Fulfilled by Amazon is how it can fulfil orders from other channels using inventory stored in an Amazon warehouse. You manage the inventory through an online user interface, which can direct Amazon to return the inventory in their fulfillment centre at any time.
How to Sell on Amazon.com
Interested in tapping into Amazon’s global network of websites? Your products can be listed globally on other Amazon marketplaces. However, you will need to account for tax and regulation requirements in those marketplaces. View Amazon’s 16 Step Checklist for Selling Internationally to get started.
United States Taxes
If you’re hoping to sell your product in the United States, the level of effort you will need to go to depends on how you plan on selling. We recommend reading this guide to the various scenarios you’ll face when selling in the United States. On the most basic level of selling, you won’t need to account for US taxes. All taxes will be paid in Canada. However, there are some scenarios where US taxes would need to be paid, so it’s best to read the guide and assess your own situation.