What Is Amazon Marketplace?

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Many people like the thought of selling things they no longer need but don't know where to begin. Amazon offers the opportunity to get your new and used items in front of millions of shoppers and make a little, and in some cases, a significant amount of extra money. Keep it casual by selling your used books and games while you get to know the Amazon platform. After getting your feet wet, you may quickly find yourself with a bona fide business selling wholesale products, used items and even your own branded creations.

What Is Amazon Marketplace?

The Amazon marketplace is a component of the Amazon.com website. It allows third parties other than Amazon to sell their goods directly on Amazon.com. In 2017, approximately 51 percent of all the merchandise sold on Amazon was sold by third-party marketplace sellers. Amazon charges fees to sell on its marketplace, including a customer referral fee, a variable closing fee for certain items and in some cases, optional shipping, customer service, warehouse storage and product advertising fees.

How Much Does it Cost to Sell on Amazon Marketplace?

Amazon charges a 15-percent referral fee on each sale, although certain product categories may have fees ranging from 6-to-20 percent. Each seller also pays a fee of either $0.99 per item sold, or a monthly "Pro Merchant" fee of $39.99, plus a variable closing fee on books, DVDs and other media items.

Subscribing to the Pro Merchant program allows sellers to move as many units as they can for one flat monthly fee, so the Pro Merchant choice makes sense for anyone selling more than 40 units per month. In addition, Amazon offers other services as add-ons.

This includes fees for the Fulfillment by Amazon program and Amazon ad campaigns. Despite all of the add-on fees, if you were to start selling on Amazon today, and ship products to customers yourself, you can sell many items that cost only the per-unit $0.99 fee and the referral fee.

How to Be Successful Selling on Amazon

Being a successful seller on Amazon requires that you have the desire and ability to provide top-notch products and customer service. Having a multi-faceted skill set is beneficial. However, you can find freelance help for any of the various tasks you need to sell on Amazon.

The selling experience requires comfort with a computer, from listing items and checking inventory levels to purchasing postage online and responding to customer inquiries. Having enough capital to purchase and replenish inventory each month Is also important, and Amazon rewards you for keeping your items in stock by listing your products higher in its search engine results.

Buying the Right Inventory

You'll also want to focus on buying merchandise for resale at the lowest possible price. Some ideas are purchasing wholesale from a liquidator, using sale coupons, taking advantage of discounts at big box stores, garage sales, thrift stores and auctions. The marketplace can get extremely competitive price-wise, and you have an obvious advantage if you can buy goods for less than other sellers.

To sell products successfully, consider creating unique products, choosing a niche you know well and offering the most popular products within that niche, researching consumer trends to see what's hot and considering seasonality. For example, sell beach chairs in summer, backpacks when school starts and holiday-themed items in November and December.

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About the Author

Cynthia Gaffney has spent over 20 years in finance with experience in valuation, corporate financial planning, mergers & acquisitions consulting and small business ownership. She has worked as a financial writer and editor for several online finance and small business publications since 2011, including AZCentral.com's Small Business section, The Balance.com, Chron.com's Small Business section, and LegalBeagle.com. A Southern California native, Cynthia received her Bachelor of Science degree in finance and business economics from USC.