A couple weeks ago I did a blog post asking for reader suggestions about what content they would like to see in future posts. Today’s post was written to answer the question, “is it better to sell on ebay or amazon?” I will be covering how I decide which platform to list on as well as how I decide whether or not to use the fulfillment by amazon program.
Selling on eBay or Amazon – Which One is Better?
Deciding if it is better to sell on ebay or Amazon is a decision based on personal preference as well as the items you are selling. My personal preference with items that I sell is to sell them on amazon using the fulfillment by amazon program. I make my sourcing decisions with this in mind, but I do sell a decent number of items both via amazon merchant fulfilled and on ebay. The reason for this is that there are some items that are profitable that are not fit for the FBA program.
Below is my basic thought process when evaluating any potential item to resell (note that this assumes the item fits my required profit threshold, if the item does not fit my minimum profit threshold I will move on immediately):
As my preference is to sell via FBA that is always the first question that I ask myself. I am willing to accept the lowest profit per item here as I have to do the least work to earn the profit. I am generally looking for a minimum profit of $5 per item and 50-100% return on investment for items that I sell via FBA depending on how fast I expect them to sell. If the item fits these criteria I purchase them right away and don’t do any further analysis.
If the item is not something that I can sell via FBA, then I consider if I can sell the item merchant fulfilled on amazon. A few reasons that I may not want to send an item to FBA are: amazon has considered the item a hazardous material, the item weighs less than 13 ounces and can be shipped USPS first class, the expiration date is quickly approaching, and lastly seasonal factors don’t allow for the approximate 1 week transit time that FBA requires. For items that I sell merchant fulfilled, I am looking for a minimum profit of about $10 and at least a 100% return on investment. The reason for the higher standards is that it requires more of my time, and I have to be available to ship the item out when it sells.
If I find an item that is not fit to sell on amazon, then I decide if I want to sell the item on eBay. The primary items that I sell on eBay are clothing items. Selling clothing on amazon requires approval, and I have not attempted to gain this approval to this point. The majority of the items that I sell on eBay are clothing, but other reasons for selling items on eBay include: the item is damaged/flawed and requires pictures, an incomplete board game (items that are not 100% complete are not eligible to sell on amazon), or rare items that I want to auction off. As eBay requires more time to list items for sale and requires me to be around to ship it when it sells, I generally look for at least a $20 profit per item and at least 100% return on investment.
If I find an item that is not fit for sale on amazon or ebay, I will occasionally try to sell the item on craigslist or via my personal network. I very rarely get to this step, but a few items that I have sold via craigslist are: wakeboards, bikes, and golf clubs. If I sell via this route, I am looking for at least $50 profit per item and 100% return on investment.
This is the basic decision process that I go through whenever I am evaluating items to resell. I prefer to list in the method that allows me the easiest listing and shipping process, and ideally does not require me to ship the item when it sells to the end customer. This is why I pick FBA for the majority of my items. Selling via merchant fulfilled, eBay, or on craigslist, requires more of my time and that is the reason that I look for higher returns when selling via these methods.
These are simply the guidelines that I use and I have found work for me. You will have to decide what mix of the available platforms makes the most sense for your business. If you have any questions or comments, please leave them below or send me an email at grant.ryanj@gmail.com.
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Hi Ryan
I’m new to selling online and came across your site which is great. Thanks for all the information.
One question I have is why don’t you post an item on both Amazon and Ebay at the same time if you have multiple items in stock and it can be replenished?
Hi Graham,
I do this on select few items, but for the most part I just use Amazon FBA for the convenience. Most of my sales are there, so that is where I focus most of my efforts. This isn’t to say I might be leaving money on the table by not cross-listing, but at the present time I am focusing resources elsewhere.
Best Regards,
Ryan
Thanks Ryan. I’m just starting so haven’t moved on to Amazon FBA yet. If all goes well I’ll follow that path.
Graham
Thanks for writing this article Ryan it is very informative. I’ve actually made a decent living off eBay and made it full time. I ventured over to Amazon but never quite got any sales. eBay has restrictions but nothing compared to Amazon. I feel in order for a seller to make it on Amazon they need to have Amazon fulfill everything. Anyways, just my two cents :). Please keep updating your blogs as I have found them very fun to read !
Thanks for the kind words Jenny! I will definitely plan on continuing to post here on the blog.
Best Regards,
Ryan
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Hi,
for the amazon FBA, say for example, you send in an item but it does not sell for 2-3 months. Does amazon charge any storage fees? Also is there a clause where if an item does not sell for certain days, they send it back? Wat are the rules and costs?
Hi Genie Talks,
Amazon does charge storage fees. On a per item basis they are very small, but you can see the totals in each of my monthly income reports. They don’t make you send items back after a certain amount of time, but if an item sits at their warehouse for a year or more there are “long term storage fees” that are pretty expensive.
Best Regards,
Ryan
thanks,
So if you decide that a particular item is not selling and want to recall it from amazon, you will be charged a Inbound shipping fee right?
Hi Genie,
Yes if you want to have an item returned to you from amazon warehouses there is a fee. It’s $0.50 for standard size items, and I believe oversize items are a little bit more.
Best Regards,
Ryan
Do they charge the return shipping fee? Is it discounted rates or full rates?
The fee to get an item returned from the warehouse is a flat fee. They don’t charge any “weight handling.” So to get a standard size item sent back to you, it only costs $0.50, so it’quite a good deal.
Best Regards,
Ryan
Another quick question: When selling books new that Amazon also sells, will they always drop their prices to match yours or will they ever let you get the buy box? I can’t remember ever seeing a FBA selling having the buy box on a book, that’s why I ask.
Hi Sean,
That is a good question. From my experience and from what I have heard from others, you cannot get the buy box for a book in new condition. I believe this is only true for books, as amazon will share the buy box in other categories.
Best Regards,
Ryan
You don’t or haven’t ventured into Etsy? I have a friend who sells alot on Etsy but I haven’t sold anything there. She says you have to have 100 items listed and I don’t want to put in the time for stuff to just sit.
Hi Debbie,
Currently I have not tried Etsy. Amazon and ebay currently provide plenty of opportunity for me to sell my items.
Best Regards,
Ryan
Another quick question:
Would you ever buy a product where the profit margin after all costs was only about a quarter of the purchase price? For instance if you found a top 500 product in a category like toys or video games? I’ve been doing this, and it’s good so far, but a little worried if returns or price changes might come and bite me.
Hey Sean,
That is a good question, and yes I have been experimenting with this. For items that sell very quickly I think it is worth seeing about a 25% ROI, and I have been starting to buy some of these items with around a 25% ROI. As you mentioned, you have to be very careful with price changes and potential returns, but the potential definitely is there.
Best Regards,
Ryan
I’ve only been selling on FBA for a month. I’ve had a few toys I bought on clearance that had a good sales rank and close to a 100% ROI when I sent them in. Shortly after they went live, Amazon was flooded with the same toy and the price dropped to the point where I’ll now lose money if I want to compete. Would it be a good idea to keep my price up and hope the low price stock gets bought out, even if I have to wait till Christmas season, or will the prices continue to drop so I’m better off taking a small loss now instead of a big loss later and incurring storage fees while waiting?
Hey Paul,
I have had that happen as well on a few items. I am considering doing a entire post on it in the future. It really comes down to how you want to run your business and if you can use the cash right away. I find that in general prices will recover over a couple of months so it is often worth holding your price, but if you think you can make more money by selling at a loss and reinvesting the cash that could be an option as well. Personally, I try to hold out for a month or 2 at least to see if the price will recover quickly, and then I continue to evaluate as time passes. Hope that helps.
Best Regards,
Ryan
Yes this helps. Thanks as always.
No problem!
My two cents (I am a Newbie). Amazon doesnot charge storage fee for 365 days. Would it not be better to hold the item for 8 months at high price. You never know. When you set a high price, you are encouraging other sellers to set the price bar high and slowly once the stock goes low, prices should rise?
My two cents!
Hello Genie,
Amazon does charge fees for storage for the first 365 days, but do not charge long term storage until 365 days. Your strategy mentioned could work, it really comes down to each individuals business model. For me personally, I like to have items sell quickly so I price at a level that should allow this to happen.
Best Regards,
Ryan
Hey, I’ve just started this about a month ago and my first amazon FBA shipment arrived with them today. Already quite a few of the items have sold from it, so quite happy about that. Seems like buyers really go for FBA stuff over merchant fulfilled – I guess I do too when buying.
I’m in UK where the rules are different (dated items need to have 18 months remaining to be sent in!) so I’ve found some of the products I’ve bought I’ve had to merchant fulfill.
My question is: Do you check if an item can be sold on FBA before buying or just go on instinct? For instance recently I was about to purchase some discounted condoms then thought ‘maybe they might not trust others with this’ so checked on my laptop and I was right, they weren’t allowing merchant to sell (even those like me with Health category approval). I can’t see a way to check if you can sell in the profit bandit app, so I was tihnking is it worthwhile going to a starbucks with your laptop just to check if you can sell items prior to purchase?
Hey Sean,
Glad to hear you have had some quick sales with FBA!
I generally don’t check to confirm that items are able to be sold via FBA before buying them, and just go on instinct. If you want to check though, you can try listing the item from your phone and seeing if it allows you to submit the item. If you click the “sell it” button in profit bandit, it should bring you to amazon where you can test list items to see if they are allowed. Hope that helps.
Best Regards,
Ryan
Another criteria I use is whether or not I purchase a product intended for Amazon FBA only to find out that it is a restricted product (e.g. certain brands of electronics). When this happens, to eBay it goes!
As for merchant fulfilling products, I do this when the item is either lightweight or not worth the hassle of shipping to Amazon FBA. Usually the rank is so low and I have purchased it at such a deep discount that I feel I can compete with FBA sellers. 95% of the time it works. 🙂
Hey Yolanda,
That has happened to me as well finding an item is restricted and then having to sell on eBay. It’s not as easy as FBA, but it’s great to have eBay as an option to sell on as well. That’s also a good strategy on the merchant fulfilling products.
Best Regards,
Ryan
Ryan,
Great post as usual! How well does your merchant fulfilled items sell? Do you find it harder to move items using merchant fulfilled? Also, this is more of an ebay question but do you mostly auction items or do buy it now?
Thanks Zoli!
I find that items sell better through FBA, but they still sell pretty well via merchant fulfilled. I don’t have any hard data I can point to, but I find that items sell via either method, but they definitely receive quite a boost in the likelihood of selling with FBA.
As for my eBay listings, I do about 95% fixed price listings, and 5% auctions. I only do auctions when I want to sell something quickly, or if it is rare and collectible that there is a lot of demand for.
Best Regards,
Ryan
Hi, I would like to know if I need to have a professional seller account to have Profit Bandit App. I see this App is $15.00 for iPhone. Do I pay another $39.99 on top every month. I don’t have a FBA account yet. I’m planning to open one soon and I would like to get the profit Bandit app first and just play around with it before I start buying or jump into FBA. Thanks
Hi GS,
Yes there has been a recent update and you need a pro merchant account to use profit bandit, but your first month as a pro seller is free from amazon so you would have a month to try it out before you pay the $39.99 per month. Let me know if you have further questions.
Best Regards,
Ryan
Thanks for your reponse Ryan. Is there another iPhone app that you can suggest that I can use before actully opening amazon FBA accout. Thanks
No problem, and I would recommend trying out this app: https://www.sellermobile.com/ It’s made by amazon specifically for sellers, I haven’t been able to try it out yet since I am an android user, but I think it should work well.
Best Regards,
Ryan
I was able to use profit bandit with a merchant account. You have to contact profit bandit and have them set it up for use with merchant account.
Hi Paul,
There has been a recent change within the past month or so that requires the pro merchant account. I have had some individuals forward me the emails from profit bandit saying they can no longer do the work around that was done in the past.
Best Regards,
Ryan
Thanks for making a blog post about my question Ryan, I’m flattered. This was a very informative article that will help many.
Hey Jay,
No problem at all! Thank you for suggesting the post idea.
Best Regards,
Ryan
hey ryan
i was wondering if you have tips to how to boost my ratings on amazon
i send little cards asking for feedback and still nothing
its frustrating because i do my best to satisfy the customer.
also do people leave feedback on the things you sell or nothing at all?
what is your feedback/rating looking like?
Hi Stacey,
I receive feedback on very few orders and agree that it can be frustrating. My current score is 98% positive, it was 100% but have received 2 neutral feedbacks in the past 3 days that I am working on resolving. I did this post a couple months ago explaining my feedback strategies: https://onlinesellingexperiment.com/maintaining-a-great-amazon-seller-feedback-rating/ If you have any questions after reading that, please let me know.
Best Regards,
Ryan
That’s the same thought process I use! Great post. Selling things on local facebook groups are also a good product outlet (with no fees!).
Hey Stephen,
Thank you, and that’s a great tip about local facebook groups as a no fee way to sell product.
Best Regards,
Ryan