San Diego, CA -- (SBWIRE) -- 05/14/2014 -- Recognizing there are valid reasons to sell on Amazon, here are the three reasons that you should not sell there. If you use Fulfillment by Amazon —Amazon does the shipping — you know nothing about the customer. All you see is the revenue. They own the data and the customer relationship.
Pricing. It’s not cheap; the pricing structure means it will not work for low margin products. You’ll pay a subscription equivalent to $480 per year, plus per-transaction fees based on a share of your revenue. Fees for media products are higher with closing fees per item as well (typically $1.35).
If Amazon accounts for 50% of the business, then it is very difficult to turn off a significant revenue-producing channel. Amazon is a good strategy for some merchants. It represents 30% of the ecommerce market, so listing your product on Amazon’s marketplace will get your product in front of a huge potential volume of traffic. But one needs to recognize that they are merely the supplier of the product, and while it may generate a significant revenue stream, it’s not for everyone, and it’s not building a business in a sustainable way.
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