Your Own Amazon Shop? Here’s How to Open a Seller Account on Amazon [Step-by-Step Guide]

E-commerce has rapidly developed during the pandemic. Even now, as the growth curve flattens somewhat, online retail continues to grow. Additionally, the boundaries between German e-commerce and brick-and-mortar retail are increasingly blurring thanks to pick-up points, same-day delivery, and more. Many sellers successfully combine online sales with offline business. If you are also eyeing the online market, now is the time to consider whether to start with a complete online presence or if having your own Amazon shop is the better option.

Before you dive into wild action, you should take a closer look at the advantages and disadvantages of the two models of online retail. It’s like buying a car: one person will be happy with a nimble mini, while another needs a spacious station wagon.

How much are you willing to invest?

Having your own online store or an Amazon shop both cost money and come with their own advantages and disadvantages. However, it is evident that the investment in your own online store far exceeds the costs of setting up a seller account on Amazon. You need to consider several costly decisions:

In addition, there are significant amounts for setting up and creating product pages, as well as high time and cost expenditures for marketing, SEO, and SEA. Depending on the scale of your business and the goods you offer, five-figure amounts can quickly add up. Ongoing operations and necessary developments also incur costs. If you opt for a cloud solution, there may be monthly base fees, transaction costs, and fees for integrating payment solutions.

In comparison, the startup costs and the time required to use the Amazon sales platform are relatively low. You need hardly any startup capital for your own Amazon shop, and the effort required to create listings in an established and easily discoverable ecosystem is manageable. Of course, there are costs involved here as well, but they are comparatively low. However, Amazon charges fees and commissions for the presence of listings on its marketplace. The sales fees for most categories range between 7% and 15%. Additionally, there is a monthly fee of €39.

Amazon is the most successful sales platform worldwide and provides access to a very large customer base. Nevertheless, as a seller, you need to invest a lot of work if you want to really take off. If you want to prominently place your products on Amazon, you will not be able to do without Amazon Advertising.

This comparison shows that the decision between Amazon and an online shop largely depends on whether and how many resources you have available and how long you can endure an initial dry spell.

Own Amazon Shop vs. Online Store: Advantages and Disadvantages

Determining the actual profit cannot be done with the simple calculation of “selling price minus purchase price.” Competition, technical implementation, ongoing costs (storage, packaging, shipping, manpower, etc.), marketing, and customer service all play a significant role in calculating profit.

In your own online shop, you are in control, no question about it. The customer is less price-sensitive, competitors are not breathing down your neck, and you retain the full profit. However, you also bear the full risk: Will your investments in building the shop pay off? Can you attract enough customers? Do logistics and fulfillment work? Ideally, with your own online shop, you can build your brand and retain loyal customers, but this is very resource-intensive.

Now let’s talk about your own Amazon shop.

On the marketplace, thousands of online sellers are competing, so the competitive pressure is extremely high and customers are price-sensitive! The offers often resemble each other closely, and in this situation, the price often decides – however, the lowest price is not necessarily the winning factor, as proven by a study from Northeastern University Boston. The seller’s rating profile, fast delivery, and a competitive selling price significantly contribute to winning the Buy Box on Amazon. Many of these tasks can be covered by the marketplace’s own service, Fulfillment by Amazon. You also don’t have to configure the price manually; it can be easily and fully automated through the use of a repricer to adjust to market conditions.

Excursus: What is the Buy Box?

The Buy Box, known in German as the “Einkaufswagenfeld,” is a visually striking yellow box with the label “Add to Cart,” which you can see on every Amazon product detail page. The Buy Box guarantees high visibility for the respective online seller’s items and thus optimizes sales on the marketplace. Only one seller appears with their product in the Buy Box and captures all sales, which occur approximately 90% of the time through the shopping cart field. Given this prospect, the placement behind the small yellow button on the product detail page is highly sought after among online sellers.

Of course, all of this comes at a cost. Even though fees and commissions reduce the profit on individual items, they also have a positive aspect: they are reasonably predictable in the medium term. Additionally, when selling on Amazon, you remain on the safe side. You pay fees, and in return, you can rely on the software running smoothly and the processing functioning properly. No surprises.

Overview of the Advantages and Disadvantages

To make your decision a bit easier, we have summarized all aspects of the two business models in the checklist below.

Criterion	Own Online Store	Own Amazon Shop
Start-up Investments	The initial investment in your own online store can quickly reach five-figure amounts depending on your business. Several costly tasks are involved: selecting and configuring the e-commerce system, setting up and creating product pages along with texts and images, as well as significant time and cost expenditures for marketing, SEO, and SEA.	Setting up your own Amazon shop is straightforward and does not require huge investment costs. The time required to use Amazon is manageable, and the effort involved in creating listings in an established ecosystem is relatively low.
Ongoing Costs	If you opt for a cloud solution, there may be monthly base fees, transaction costs, and fees for integrating payment solutions. Similarly, a self-developed online store incurs costs for implementation, ongoing operations, inventory management, packaging, shipping, marketing, customer service, and the necessary manpower.	Amazon charges fees and commissions for selling products. For most product categories, the selling fees are around 15%. Additionally, there is a monthly fee of €39. The advantage is that Amazon handles the technology, storage, fulfillment, customer service, and more on your behalf.
Marketing	Prepare yourself for a dry spell right from the start. To promote a new online store, you should expect significant time investment and costs for advertising, social media, marketing, SEA, etc. However, these investments will pay off in the long run.	Amazon is THE search engine for online shopping. The sales platform provides access to a very large customer base. However, your items won’t sell themselves. You can achieve a quicker start by prominently placing your listings through Amazon PPC.
Scope for Design	You have full control over your brand image – shop layouts, product design, additional features for customer retention, etc., are entirely in your hands.	On Amazon, you often have very rigid structures and can hardly change the product description (e.g., for branded goods). However, if you want more flexibility, you can also register your own brand.
Brand Building and Customer Loyalty	Customer loyalty and brand building are in your hands – with good product quality, friendly service, fast delivery, and reliability, customers will remember your name and buy from you again.	Customer loyalty belongs to Amazon, not to you as an online seller. Here, only the best price, the best rating profile, and the best service count.
Profit and Margin	The profit margin in an online shop is known to be higher than when selling on Amazon. However, many costs cannot be broken down into individual transactions. Only by calculating the revenues and expenses can the actual margin be determined.	The fees and commissions reduce the profit margin of individual items but are reasonably predictable in the medium term. By automating certain processes, such as price adjustments, the Buy Box can also be won with a higher price.

Open Your Own Amazon Shop – Step by Step to a Professional Seller Account

We assume that you already have a user account with Amazon. Most online shoppers have ordered something from Amazon at least once. If you do not have a business or an account registered with Amazon, you should tackle these two steps first.

Once all the information has been correctly entered, you can complete the process by clicking on “Complete Registration.” Your seller account is now created, and you can start filling your own Amazon shop with products. However, it will take some time before you can list products and actually start selling, as Amazon first reviews all the information and documents.

FBA vs. FBM

Having your own Amazon shop also raises the question of whether you want to use Fulfillment by Amazon (FBA) or handle the logistics yourself – referred to as Fulfillment by Merchant (FBM) on Amazon. At first glance, this seems like a significant decision, but upon closer examination, it is likely to be straightforward for most newcomers.

If you have your own logistics in place, including storage, picking and packing, customer service, and returns management, and can ensure fast delivery, then using Fulfillment by Merchant (FBM) on Amazon could be an option for you.

If this is not the case and you would need to build such structures, then FBA is likely the better choice for you at first. When you use the FBA program, you send your goods to an Amazon warehouse and focus on marketing your products. Amazon, on the other hand, takes care of the fulfillment:

This is very convenient and especially helps smaller sellers ensure a high quality of fulfillment, which is difficult for new Amazon sellers using self-fulfillment to achieve.

Disadvantages of FBA

Of course, FBA also has its disadvantages for your own Amazon shop. Corresponding fees for the service are deducted per order, which must be taken into account in the pricing calculation to ensure an adequate margin. Additionally, mistakes can happen at Amazon – known as FBA errors. For example, products may be damaged during the shipping process, rendering them unsellable. The seller, who ultimately owns the item, is entitled to compensation for this. Unfortunately, Amazon does not reliably handle reimbursements independently, so sellers theoretically have to take care of the application process themselves.

Fortunately, there is a simple solution on the market for this. With SELLERLOGIC Lost & Found Full-Service, reimbursement management becomes a breeze: no hours spent sifting through FBA reports, no tedious gathering of all information for a case, no copy-and-paste into Seller Central, and above all, no nerve-wracking communication with Amazon.

Learn more now about how Lost & Found can make your work as an Amazon seller easier and additionally improve your profitability.

Conclusion: Is Having Your Own Amazon Shop a Good Idea?

Our society is undergoing sustainable changes: The leisurely window shopping has long since ceased to be part of many people’s weekend routine. Instead, we browse through the offers on Amazon in the evenings after work. Creating your own store is easier than you might think.

Whether you plan to create a complete online presence or prefer to open your own Amazon shop depends on many factors. However, the pandemic has shown that diversification is important. So why not start with your own Amazon shop to get to know the e-commerce business, and then gradually build your own online store?

Especially in the early stages of your e-commerce career, Amazon offers many advantages. Here, you can gain experience without spending huge amounts on building your own online presence. You also don’t have to worry about technology and marketing as an online seller. The fees and sales commissions are also predictable over a longer period while maintaining consistently excellent quality for logistics and fulfillment. Once you have gained enough experience, you can take the next step towards your own online store.

Frequently Asked Questions

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