The Pros and Cons to Selling on Amazon Handmade
Selling on Amazon Handmade is something I recommend to EVERYONE. Still, there are some pros and cons when it comes to selling on the platform. Are the cons worth it? For me, the answer is absolutely yes, but I know every person's business and situation is different. Due to that, I thought it might be even more helpful to write out a list of pros and cons so you can make an informed decision for yourself.
The Pros of Selling on Amazon Handmade
High Sales Volume and Traffic
Amazon is HUGE, and the built-in traffic on the platform, well, there isn't another online platform or marketplace that even comes close to comparing to it. There are an estimated 103 million US Amazon Prime subscribers, and that doesn't also account for the amount of non-Prime customers visit Amazon every month!
4,000 items are sold on Amazon PER MINUTE!
Most sellers, if they take the time to understand how Amazon's algorithm works and make sure their listings are optimized, will make sales reasonably quickly.
FBA (Fulfillment by Amazon)
Fulfillment by Amazon is a great way to really increase sales. Plus, it helps you save time on order fulfillment, packaging, customer service inquiries, etc.
High ROI (return on investment) for Advertising
Amazon advertising campaigns are GREAT when set up correctly. The ROI is much higher on Amazon than say, Facebook marketing, Etsy promoted listings, or Google ads.
The fact that the Handmade category is juried is a good thing. This means that they are limiting who can join the platform. They don't want one handmade category (ex: handmade jewelry) to be completely overwhelmed compared to other categories.
It can be annoying if you are rejected at first, but remember, this is definitely a good thing for sellers!
The Cons of Selling on Amazon Handmade
Higher Fees to Sell
Yes, the fees are higher to sell on Amazon vs. Etsy. Still, when you add up all of Etsy's separate fees, Amazon's 15% selling commission (that includes everything) doesn't seem too bad. Still, it's a con of selling on Amazon Handmade because it means we are taking a slightly bigger hit with our profit margins.
Or, use it as a reason to increase your prices. Which, let’s be honest, likely needs to be done anyway! Most handmade sellers do have a habit of underpricing their work.
Metrics That Must Be Met
Amazon is strict when it comes to their expectations of sellers and not giving much wiggle room. It's true that Amazon almost always sides with the customer. That's also a reason why they have such huge sales volume and basically dominate the e-commerce market, though.
But, for sellers, it can be a con of selling on the platform. Some specific policies and procedures are tough on small, handmade business owners. Still, we agreed to their policies when we signed up. It's just a matter of if it worth it to you in the long run.
If you make sure you are aware of all of the metrics and understand their policies, you should be fine. You might just need to let go of some control over certain situations.
Amazon's lenient return policies are another reason why customers LOVE shopping on Amazon. For sellers, they can be a pain in the butt, though, especially when it comes to handmade items.
If you make only holiday-related or party related items, for example, dealing with customers returning items after their events might be a big issue. It’s up to you to decide if it’s worth it, not worth it, or if you choose to increase pricing to account for more of these situations.
Competition is higher, of course. In total, not just Handmade, there are over 2.5 million sellers on Amazon, and we are all competing with each other.
Is selling on Amazon Handmade worth it? For me, yes! I encourage handmade sellers to give it a good shot and really evaluate their business when it comes to selling on Amazon. You might want to only offer non-personalized items. Or, you might want to increase your prices to account for higher selling fees and higher customer returns. There are always things you can do to make it even more worthwhile. If you give it a real shot though, I’m almost certain you’ll love it!