What is Amazon International Sales?
About Amazon International Sales
Amazon is an e-commerce company based in Seattle, USA, and is the world's largest shopping site that sells various products such as home appliances, food, clothing, household goods, and etc. Amazon.com（headquarter）operates local marketplaces in Japan, United Kingdom, Germany, France, Canada, China, Italy, Spain, etc., in addition to the United States. With purchases from more than 180 countries, 175 Fulfillment Centers (FBAs) set up around the world, and more than 800 million unique monthly visitors, you can start e-commerce and selling globally without having to ship it yourself. (Updated: July 23, 2021)
The world's largest
Online Shopping Service
According to a research in 2020, Amazon's share of the top 10 EC sales in the United States has reached nearly 40%, far ahead of other companies, and it reigns as the world's largest online shopping service.
The Merit of Amazon
Ease of product listing
You can start selling on Amazon by using existing catalogs so you can reduce the trouble of creating each product page. Your products can be shipped from the Amazon warehouse (FBA) so once you get used to it, you can easily list the product and deliver it.
Even though Amazon is good, but it is not the best e-commerce mall. In general EC malls, there is a concept of "stores", but in Amazon, it is just "a place to list products".
Therefore, the same products tend to be price-matched. It is not suitable for businesses that want to sell good products meticulously, branding their product, or set up stores to keep in touch with customers.
There is a monthly fee but no initial cost
In order to list products on Amazon, you must first register as a seller. There are two listing plans available, which are “Large listing service" and "Small listing service". The fixed cost for the "Large Listing Service" is the monthly subscription fee of USD39.99, whether it sells or not, while the "Small Listing Service" is free of charge (in the case you choose to utilize FBA, it will automatically become Large listing service).
Utilization of Amazon Warehouse (FBA)
Amazon has a unique warehouse system called FBA (Fulfillment by Amazon). FBA is a service that Amazon handles all the works such as inventory management, packing and shipping of products. You will have to pay a fee to Amazon, but this is an advantage if you have a large number of products and can't carry a large amount of stock, or if you want to throw the troublesome packing and shipping.
In addition, if you are using FBA, your products will be recognized as a product for prime members, which is very advantageous in terms of SEO, and as a result, there is an advantage that the product becomes easier to sell. From this point as well, FBA is a very important sales function in obtaining Amazon sales.
Easy to attract customers
With Amazon, you can use FBA to sell to Prime members, which will increase your chances of being listed higher in SEO searches by buyers. If you have your own online shop on your own domain, it is important to attract customers to sell your products. You can attract customers through SEO measures, social commerce using SNS, listing advertisements on Google, etc., but it costs a lot of time and money.
The Demerit of Amazon
You will need to pay for commission
When your product is sold, you will have to pay Amazon a commission on the sale so we recommend that you calculate the commission to determine the selling price before listing your item. The commission fees also vary on Amazon depending on the product category. Please note that sales and commissions are exchanged in US dollars, so your profits may fluctuate due to exchange movements.
You can't get customers or repeat customers for your shop
By selling on Amazon, it is difficult for buyers to recognize it as a "store", and it is difficult to create unique colors and contents. Therefore, the repeater strategy and customer acquisition theory of ordinary EC sites do not work at all in Amazon. Not only is it not possible to get the repeat customers but consumers who buy on Amazon are considered as ”Amazon repeaters."
If you don't have a "cart box", you will have a very difficult time selling on Amazon. For those who want to create a shop full of originality of their own, Amazon is not suitable for you while eBay is more suitable for this case.
High sales commission (royalties)
At Amazon, there is a sales commission you need to pay to Amazon every time a product is sold, and the rate is not cheap at all. For a flat rate of 10% on eBay, Amazon charges a commission of 6% to 20% of the selling price. For example, the commission rate is 17% for accessories and sports clothing, and 15% for shoes and handbags (as of July 2021).
If you use FBA for products sold from Japan, you can expect to pay around 25-40% commission fee to Amazon. In addition, for products in the media category, such as books, CDs and DVDs, you will also need to pay a category fee of USD1.8 (approximately 200 yen) per product.
Please note that the “Small Listing Service” may cost you more. Basic contracts concluded fee as a normal large sales commissions of 100 yen per item, it will cost you more on warehouse fee if you use FBA, and if you did not calculate the price with the selling fee, etc. in advance, it may result in a lower profit or a deficit than you thought.
To give you a rough idea, you should expect to pay 6-20% commission, 15% FBA fee, and 30-40% monthly fees and other costs.
It is essential to collect the number of reviews and ratings
In Amazon, the product pages with a lot of reviews are recognized as being trusted by users, which naturally has an advantage for SEO on Amazon. This is because a collection of reviews motivates consumers to buy and helps them understand the pros and cons of the product. At the same time, the seller can analyze problems and needs from the reviews gathered, make improvements and repeat PDCA (verification), resulting in a reliable listing page.
You must sell your products according to Amazon's policy
If you violate the rules set by Amazon, you will be suspended from selling (your account will be suspended). You will not be warned, just a one-sided notification that your account will be deleted and you will be asked to withdraw within 48 hours. If you do not comply with this, the sales on hold will be confiscated and the products you have deposited are likely to be destroyed, which is dangerous so you will need to withdraw promptly.
Amazon has stricter rules than eBay, and since detailed NG rules are not announced, in most cases you may not clear why your account/listings were deleted, so you are required to watch the latest rules and information from those currently operating on Amazon, and list correctly according to the rules.
Once the account is deleted, it cannot be restored. This is also the reason why Amazon's International sales are said to be difficult for beginners so if you are not familiar with it, it is is better for you to sell on eBay instead.
Amazon Sales Flow
In order to sell on Amazon, it is common to use FBA (Fulfillment by Amazon). The operation process is very simple because Amazon handles all the works such as inventory management and packing / shipping of products.
Create an account
Get an overseas Amazon account and a Payoneer overseas bank account.
Send your products to Amazon warehouse
Send and deliver your products from Japan to overseas Amazon's warehouses. An agency is recommended.
When the product arrives at the Amazon warehouse, you can use the product information catalogue or create a new one and start selling it.
Buyers purchase your products.
Packing and shipping of products
Amazon will pack the products and ship them to the buyes. In the case of cross-border e-commerce, Amazon delivers them from Japan. If you are using FBA, Amazon will also handle returns and refunds.
Collection of sales amount
Payment from Amazon is made on a 14-day cycle.
Difference between corporate sales and B2C sales (Amazon Business)
Amazon Sales is basically considered to be a B2C service but since 2015 Amazon starts to offer a B2B service called Amazon Business. Membership is open to businesses and sole traders and offers a range of benefits for business-to-business transactions.
In terms of usage, when a company or sole proprietor buys a large quantity of a certain product in bulk, it is possible to buy it at a lower price than the selling price for B2C. For this reason, if you are planning to sell in large quantities in cross-border EC, you should also consider selling to Amazon Business in addition to B2C.
What products are selling well on Amazon?
The products that sell well on Amazon include books, CDs, DVDs, Blu-ray discs, as well as daily necessities and consumable products such as the well-known skincare and cosmetics, home appliances from famous manufacturers, and products that meet the demand are selling well.
On the other hand, traditional Japanese crafts, rare products sold only in Japan, limited items, one-of-a-kind items, branded items, and other exclusive products which are purchased on eBay, and it is common practice at overseas to use eBay for different purposes.
List of prohibited items
Before listing your products on Amazon, you should carefully check that the products is permitted by the laws of that country and Amazon. Even if it is legal to sell in your country, it may be illegal to sell abroad, and if you do not list your products according to the policy, the listing may be deleted or your Amazon account may be deleted so you need to be very careful.
Examples of prohibited items
(There are many others prohibited items)
※As of 2021
- Illegal and potentially illegal products
- Recall target products / materials that cause discomfort (nudity, adult products, adult media, media containing images of persons under the age of 18)
- In-game currency for online games
- Amazon.co.jp limited TV games
- Doujin PC software, Doujin CDs streaming media players
- Amazon Kindle products, promotional media
- Some foods, imported foods and beverages
- Pets Veterinary medicines
- Dietary supplements, cosmetics and example ingredients not permitted for sale by Amazon
- Medical devices, pharmaceuticals, some of the specific cosmetics products / overseas medical devices, pharmaceuticals
- Health & Beauty products direct from overseas/li>
- Electric bicycle with pedals
- Picking tool, stolen goods
- Credit card cashing
- Unlicensed and illegal wildlife products
- Firearms, ammunition and weapons
- Products that cause discomfort
- Sanctioned countries, organisations and individuals
What can j-Grab do for you?
Amazon is one of the largest global shopping malls, and while opening a shop on the site it offers many sales opportunities. However, there are more disadvantages than advantages and it is not easy to manage.
j-Grab offers an individualized sales support and companionship support plan exclusively for Amazon, which is made possible by the fact that our representative, Yamada, who is also a founding member of eBay, senior cross-border EC consultant Yokogawa, and Amazon chief advisor Hayakawa, all have a thorough understanding of overseas Amazon sales methods, the latest rules, and policies.
We provide support for beginners who are new to Amazon, sales and customer attraction consulting for rapid growth with accounts that have already opened stores in Amazon, and tips on how to avoid troubles. We also have a special advice support plan that allows you to become independent in one year for those who cannot afford the high support fee.
For those who want to open/sell on Amazon, those who have already opened an Amazon account but have been deleted or suspended and sales do not increase, those who have lost the price competition and are selling on Amazon without profit, those who want to succeed in selling by linking Shopify, Magento with Amazon, j-Grab's cross-border EC consultant provides consultation from opening and store construction to sales increase, and individual consultation, so please feel free to contact us from the Contact Us page.
Edit: j-Grab Cross-border EC Lab