For growing e-commerce brands, creating an Amazon seller account can bring huge money-making opportunities. With more than 2.4 billion visitors in the US alone, selling on Amazon is often presented as an obvious way to grow your e-commerce business.
While Amazon is a very profitable channel for some, others may be less comfortable with the potential risks. It all comes down to your unique goals and growth model.
So is now the right time to start selling on Amazon?
Whether you’re already a successful Amazon seller or a new brand looking to use Amazon as part of a broader multichannel strategy, here’s what you need to know about Amazon seller accounts today.
A Complete Guide to Amazon Seller Accounts
- How to Become an Amazon Seller
- Types of Amazon Seller Accounts
- How to Create an Amazon Seller Account
- How to Handle Multiple Amazon Seller Accounts
- Optimize Your Amazon Selling Experience With Brand Registry
- FAQs About Selling on Amazon
- Create a Winning Strategy for Selling on Amazon
How to Become an Amazon Seller
So you’ve decided to ramp up your presence on Amazon — or dip your toes in the water for the first time. As a soon-to-be member of one of the world’s most powerful e-commerce marketplaces, the world of online shopping is your oyster.
To prepare for the Amazon seller account creation process, you have some additional decisions to make regarding your relationship with Amazon.
1. Your Business Model
If you’re already selling your products on other e-commerce marketplaces, you probably have an idea of which business model you’re operating with.
Some popular e-commerce business models include:
- Private Label: Rebrand existing products under your own label.
- Wholesale: Purchase new products in bulk at discounted prices for resale.
- Retail Arbitrage: Find discounted products in physical stores or online to resell.
- Dropshipping: Transfer customer orders directly to the product manufacturer or supplier instead of holding inventory.
2. Your Fulfillment Method
One of Amazon’s greatest differentiating features is its fulfillment options.
Amazon allows new sellers to choose how they’ll get products to customers, using these two options:
Fulfillment by Amazon (FBA): Amazon FBA spans the globe, thanks to the Global Selling program which allows sellers to fulfill orders internationally by shipping goods through Amazon’s expansive network.
With FBA, sellers ship their goods to a fulfillment center assigned by Amazon. As orders roll in, Amazon will take care of the picking, packing, shipping, and returns for a fee that depends on the item’s size, height, and category. This frees up your time to focus on other important tasks, like marketing and product development.
Fulfillment by Merchant (FBM): FBM puts sellers in the driver’s seat. You get more control over shipping times and products — e.g., you can conduct a final inspection before sending goods out and can use custom packaging instead of the classic Amazon box.
Since Amazon won’t be involved in your fulfillment process, you’ll have one less fee to pay to them. If you secure good deals with shipping carriers or a 3PL partner, you can increase your profits and pass the savings on to customers to make your items more appealing.
3. Your Amazon Seller Account Type
During the application process, you’ll need to choose which type of account fits your business.
As a growing brand on Amazon, you have two main options — individual and professional.
This is an important decision, though you can change it later. Let’s explore the pros and cons of each type of account.
Types of Amazon Seller Accounts
Both individual seller and professional seller accounts are considered third-party sellers’ accounts. They’re similar to most marketplace accounts and are suitable for both registered businesses and self-employed business owners ready to set up shop on Amazon.
With third-party accounts, you’ll be responsible for your stock, listings, account health, and advertising. You can also set your own product prices. If you choose to self-fulfill (vs. the FBA fulfillment option), you can set your own shipping rates.
Individual Selling Account
The individual plan includes:
- The ability to list 20 items ($0.99 fee for each item)
- Additional referral fees per sale
- Restricted inventory space limit
Professional Selling Account
If you sell more than 40 units per month, a professional selling plan is your best bet. It includes:
- Unlimited listings ($39.99 per month)
- Additional referral fees per sale
- Larger inventory space
- Advanced selling tools like APIs and reports
- Advertising and promotion capabilities
With either type of third-party account, selling on Amazon is going to cost you.
Here are some of the selling fees Amazon charges:
- Referral Fees: Amazon’s cut for giving you access to their customers. These per-sale percentages vary by product category and range from 8% to 22%.
- Fulfillment Fees: Charges associated with using the FBA option. These also vary by category.
- Inventory Fees: Going the FBA route involves a level of strategic inventory management. Monthly fees as well as aged inventory and removal order fees can add up.
In addition to third-party sellers’ accounts, established manufacturers and distributors may qualify for a vendor account. These invite-only accounts mean Amazon takes ownership rights over your inventory, including managing your product portfolio, marketing, and selling your items.
It makes selling a little more hands-free than the third-party sellers’ accounts — but the reduced workload comes at a price.
Amazon charges three core fees for vendor accounts:
- Market Development Fund: Covers portfolio management costs, marketing, and everything in between. The rate hovers at around 5-15%.
- Freight Allowance: Covers Amazon’s transport of vendor goods to its warehouse. The freight allowance fee sits between 2-3%.
- Damage Allowance: Designed to account for irreparable goods that can’t be put back on the shelves. Instead of sending the damaged stock back to the vendor, Amazon charges between 2-3% for disposal.
How to Create an Amazon Seller Account
Ready to create your Amazon seller account?
Before you sign up, you’ll need:
- Business email address
- Credit card
- Government ID
- Tax information
- Phone number
- A bank account, and a statement with information matching your ID
Now that you’re all set, let’s get started creating your account.
- Go to the Beginner’s Guide to Selling on Amazon.
- Scroll down a bit and click either “Sell as an individual” or “Sell as a professional,” depending on which account type you chose.
- Enter your email, choose a password, and click “Create your Amazon account.”
- Enter your business location and type. Amazon will verify your location, so be sure this is accurate.
- Enter your personal information. You’ll be asked to verify your phone number with a PIN via automated text or call.
- Enter your billing information. Amazon will validate your bank account and credit card numbers.
- Add information about your products and store. This step includes things like:
- Your store’s name (you can change this later)
- Do your products have UPC codes?
- Any diversity certifications you have
- Manufacturing details
- Verify your identity using your ID and a bank statement.
- Complete an identity verification call with an Amazon associate.
The setup and verification process is extensive, but it’s all meant to keep Amazon’s ecosystem a safe and enjoyable place to do business for both sellers and shoppers.
How to Handle Multiple Amazon Seller Accounts
If you’re looking to set up more than one Amazon seller account, we’ve got good news. It is possible to get approval for a second account or more. However, you must get approval from the big boss — Amazon.
Signing up for multiple accounts without Amazon’s consent is a big risk, even if done accidentally. It can get your account suspended or even result in being banned for good.
How Many Amazon Seller Accounts Can I Have?
Amazon will assess requests for multiple accounts on a case-by-case basis. You must have a genuine business need and a healthy existing account.
Managing multiple Amazon seller accounts can be tricky. It’ll create more work in your business and increase your financial obligations, which can quickly complicate your Amazon business if you’re not on top of your game.
It’s not about how many Amazon seller accounts you can have, but how many your business needs (and can handle). If you decide to pursue another account, develop a plan for maintaining your existing store while expanding.
To assess whether you should go down the multiple account route, here are some scenarios in which taking on another store might make sense:
- You’ve scaled your current product portfolio to the max.
- You’re financially and mentally ready to launch a new store.
- You found a new opportunity in another niche you can’t serve with your existing store.
- You’re preparing to outsource the bulk of the work in your existing store.
- The products you want to launch will have different sales tax obligations.
How to Open Multiple Amazon Seller Accounts
Once you meet the requirements, applying for another seller account is simple.
Here are the steps to take:
- Get a separate bank account, credit card, and email address together. You can keep the same business entity.
- Open a case via Amazon Seller Central to submit your intention to open a new account with a different bank account, credit card, and email address under your existing business entity. Then, request approval. Keep your email short and focus on the purpose of your second account (e.g., for tax purposes).
- Wait for the go-ahead from Amazon.
Optimize Your Amazon Selling Experience with Brand Registry
Customer experience and brand building are more important than ever for Amazon sellers, and Amazon Brand Registry is a potential game-changer for your revenue potential.
With a registered Amazon brand and eye-catching Amazon Storefront, you can rise above the noise with branded content and get access to brand analytics tools to guide your business decisions.
Brand Registry is vital for long-term success and sustainability in today’s hyper-competitive e-commerce market. It helps you showcase your brand’s unique personality and offers you protection from unruly, counterfeit sellers.
For example, some sellers may partake in listing hijacking, undercutting your product listings with a lower price to win the Buy Box and steal your sales. As a registered Amazon brand, you can report these sellers, get them booted off your listing, and restore your rankings.
To qualify for Amazon Brand Registry you must have a:
- Pending or registered active image or text trademark
- Trademark from a qualifying country
- Trademark on your goods or packaging
Benefits of Registering Your Brand
Once you’ve attained registered brand status, a new world opens up. You’ll have new options to present your store through images, videos, and text.
Amazon offers three main features for registered brands:
- A+ Content aka Enhanced Brand Content or EBC: Made for professional Amazon seller accounts, the A+ Content feature lets you use premium multimedia content to promote your store. Designed to grab attention, drive traffic, and increase sales through text and images, A+/EBC is the ultimate spokesperson for your brand. When used correctly, you can elevate your brand’s value and highlight your products’ quality to win over more Amazon customers.
- Amazon Stores Builder: Built to resemble an online store, the Amazon Stores, or Amazon Storefront, feature lets you craft a shopping experience similar to what shoppers would get on their favorite websites. From splitting items into categories to eye-catching banners and videos, your brand will have the ultimate opportunity to display its mission and values to attract your dream customers.
FAQs About Selling on Amazon
To maintain a top-quality platform for buyers and sellers alike, Amazon has strict guidelines.
Here are the answers to your top questions to help you get things right from the outset.
When Does Amazon Pay Seller Accounts?
The short answer is every two weeks — but the long answer is far more complicated.
Amazon also requires an account level reserve for all sellers to cover any potential returns and chargebacks which can further delay your payout. To protect your store, you may want to establish a relationship with a reliable e-commerce funding provider in case you don’t receive funds from Amazon on your predicted payout day.
What Is the Amazon Inventory Performance Index (IPI)?
The IPI score is a metric Amazon uses to keep standards high on its platform.
The Amazon IPI assesses sellers in four key areas related to inventory management:
- FBA in-stock rate
- FBA sell-through rate
- Excess inventory percentage
- Stranded inventory percentage
The highest attainable IPI is 1,000. A high IPI score will get you better rankings and more inventory space. However, you could experience limitations if your IPI score slips below the “threshold” — which changes regularly but usually ranges from 400 to 500. A below-threshold IPI could leave you with slashed inventory limits, suspended listings, and dropped rankings.
How Can I Sell on Amazon without “Owning” Inventory?
There are several ways to sell on Amazon without physically managing inventory yourself:
- Fulfillment by a Third Party: If you have physical products but just don’t want to manage the fulfillment and shipping details, send your products to a third-party warehouse and let them handle the rest.
- Dropshipping: This business model allows you to sell products in your store without ever touching them. When you get an order, you purchase the item from a supplier and have it shipped directly to the customer.
- Digital Products: You can sell digital products on Amazon without any of the inventory management headaches and fees — for example, audiobooks, eBooks, print-on-demand shirts, or art prints.
Is Selling on Amazon Worth It?
For many e-commerce sellers, Amazon is a key sales channel. Whether you’ll see a healthy ROI comes down to having a clear understanding of the costs and benefits.
Some of the benefits of selling on Amazon are:
- Access to a massive network of purchase-ready shoppers
- Advertising and promotion opportunities for professional accounts
- Robust analytics and reporting
- Hands-off options like FBA and vendor accounts
- Flexibility and scalability
If you want to sell on Amazon, you have to play by Amazon’s rules.
Some of the potential drawbacks could include:
- Ongoing fee changes
- Learning curve to managing your listings and orders
- Shifting fulfillment guidelines
- Stiff competition and potential for a price “race to the bottom”
We think that the pros of selling on Amazon far outweigh the cons. If you’re not already selling on Amazon, learn more and start selling in the Amazon Store.
Create a Winning Strategy for Selling on Amazon
Running a successful Amazon store can be a great way to reach your topline goals, but it’s hard work.
When you need a partner you can rely on for consistent cash flow when selling on Amazon, our team at SellersFi is here to help.
With the Amazon Revenue Advance, you get your Amazon Marketplace earnings paid to you in full without having to wait for Amazon’s 14-day disbursement. Funding comes in the form of short-term working capital of 1-3 months and fees as low as 1.5%.