Today, Amazon offers two programs for running your business:
- Seller Central;
- Vendor Central.
Let's take a look at each of them in more detail.
What Is Amazon Seller Central and What Are Its Pros and Cons
Amazon Seller Central means sellers list, price as well as market their products. Anyone can use Amazon Seller Central to get started with selling in the marketplace. If you are a 3rd party seller, and you wanted Amazon buyers to see your inventories on the website, Amazon Seller Central is the perfect option for you with Amazon FBA. But remember that before getting started with selling on Amazon, you first need to sign up and create your Amazon Seller Central Account.
Though the seller needs to put in more work and maybe more money in terms of fees, Amazon Seller Central Seller tends to have more control as compared to vendors. The 3P sellers typically have more control over their products prising and also over their client base.
Using Amazon Seller Central, you will get access to more detailed analytics which helps sellers to boost their bottom line. Pricing control enables to take advantage of periods of high demands and provide sales-something crucial to staying competitive.
Disbursement can be made within a few days and not weeks. This frees up money for the business and helps sellers streamline purchasing and other processes.
- Flexible logistical options
You choose the delivery option that is convenient for you and your business: Amazon FBA, Amazon SFP, or Amazon FBM. Each of these options has its own advantages and disadvantages, so you should analyze them all. However, you have the right to choose from, which is great.
When you present your brand and your product, you understand perfectly what you are talking about. You can create a listing description and fill in A+ content in a way that encourages the customers to buy it. After all, you control the listing of goods completely.
When selling on Amazon, you need to pay a considerable commission. Therefore, when you set a price and calculate your margin, you must take into account all possible fees, including Referral Fees, Variable Closing Fees, Fulfillment Fees, etc.
- Business success depends on you
When you sell as a 3P Seller, marketing, inventory management, advertising, and many other options are up to you. Amazon only acts as a platform for selling. And whether your product will be sold or not is up to you.
What Is Amazon Vendor Central and What Are Its Pros and Cons
Amazon Vendor Central pertains to the web interface used by distributors and manufacturers. If you are selling through Vendor Central, you will be referred to as the first-party seller. You are acting as a supplier, selling and offering in bulk to Amazon. The registration on Vendor Central is by invitation only. Amazon Vendor Central is one of the options for interacting with brands that the company has wholesale business relationships with. If you are a vendor, you sell products to Amazon depending on the number of items they want to purchase. But your margin may be not as high as expected.
- You sell a product in bulk
You don't need to fight for every new order and every new customer. Your only buyer in this case is Amazon. You sell not one, not two, or even not three units of goods. You sell tens/hundreds/thousands of units at once, depending on how many Amazon is ready to buy at the moment.
- User-Friendly and Highly Accessible Amazon Vendor Dashboard
This is one of the biggest perks of Amazon Vendor Central. A user-friendly Amazon Vendor Dashboard is available here to effectively analyze business decisions and choices.
Consumer confidence in Amazon is very high. If they see an item listed with Sold by Amazon status, it greatly increases the chances of selling the product. This ultimately benefits you in the end.
- Better Advertising Opportunity
You will have much better advertising opportunities so you are allowed to create targeted ads campaigns more precisely. Your options here are wider than Amazon Seller Central sellers have. Therefore, you can attract more targeted buyers and build a more flexible advertising strategy.
- You simplify your business model
Using Amazon Vendor Central, you work with only one buyer and that's Amazon. You also don't have to deal with tax issues, lost inventory, and more. Amazon does it for you.
- Amazon chargebacks often happen, and the minor oversight in the shipping requirements might cost you.
- Amazon's sole distribution channel can hurt the business in the end up. What happens if Amazon will no longer buy your product? Are you out of business? This possibility is very real, and you should understand it.
- You don't control products cost. Amazon promises that it will comply with minimum advertised price (MAP) requests. But you cannot be sure of this. Therefore, your final profit may be less than you expected. The algorithm forms the price based on its internal evaluation factors. And you can't impact it.
Amazon offers multiple options for the sellers when starting to put their products online. The traditional seller outlets are Amazon Seller Central and Amazon Vendor Central. Choosing the best Amazon selling program is possible if you take the time to weigh the pros and cons of each of them to get more profit.