Amazon Marketplace

Amazon enables you to sell your own products in several ways. At its most basic, you can simply sell your copy of products it already sells via its website - so if you hold stock of a book Amazon already lists, someone can choose to buy your copy - but what we're going to look at are the more flexible Amazon Advantage, Advantage Professional and Pro-merchant programmes.

With the Advantage programmes, you apply to Amazon and, if accepted, you can start adding your products to Amazon's catalogue. Next you need to ship your stock to Amazon's warehouse, for which there's an annual fee of £20 exc VAT. The goods need to comply with Amazon's terms and conditions, and it takes a selling commission.

If, however, you fancy the idea of a shop within Amazon with control over shipping and the ability to sell more than books, CDs and DVDs then an Amazon Pro-merchant account may be for you.

Amazon lays down much stricter selling guidelines than Ebay but you may find users trust Amazon shop more. For example, Amazon insists you dispatch the items within two business days of payment. You must also maintain a seller feedback of greater than three out of five and you have to use its inventory-loading tools to upload your data to the company.

Amazon offers excellent payment protection to your customers, which helps build up trust with your users but can be a little frustrating to have a payment refunded with you having to prove that this shouldn't be the case. Ebay uses a Resolution Center to deal with disputes where customers and vendors can put their case and Ebay or PayPal mediate. Both systems work well but Amazon's does tend to make the buyer feel happier with the service.

The cost of running such a shop is £25 exc VAT per month plus 8.05% on electrical goods and 11.5% on other goods. These commission rates are quite a cut into your profit margins, but as with Ebay you have no hosting costs.

Author: Mark Newton