As a consultant helping hundreds of small business owners successfully sell online, one of the most common questions I get asked is: "Should I sell on eBay or Amazon?"
There‘s no one-size-fits-all answer. The best ecommerce platform for your business depends on your product types, business goals, and fulfillment capabilities. In this comprehensive guide, we‘ll compare the two giants of online selling to help you decide.
Quick Comparison Overview
Before we dive into the details, here‘s a high-level overview of selling on eBay versus Amazon:
| eBay | Amazon | |
|---|---|---|
| Best For | Used, vintage, custom, and niche products | New, branded products with broad appeal |
| Seller Fees | 8-10% on average | 15% + other fees |
| Fulfillment | Self-fulfilled | Fulfillment by Amazon (FBA) |
| Audience Size | 147 million active buyers | 197 million monthly visitors |
| Ease of Account Setup | Easy | Stricter requirements |
| Competition | Lower | Much higher |
This table shows some of the key differences. But the full picture is more nuanced, so let’s explore some of these factors in more detail.
Seller Fee Structures Compared
One major consideration for any business is cost and profit margins – a key area where eBay and Amazon diverge.
eBay Fees
Selling fees on eBay tend to be lower overall than Amazon, making it appealing for smaller sellers and handmade product creators.
eBay fees consist mainly of:
- Insertion fees – ranged from $0.35 to $2.80 per item when you create a listing
- Final value fees – 10% of the total amount an item sells for, including product cost + shipping
- PayPal transaction fees – Around 3-4% of the order total
So if you sell a $50 item + $10 shipping, total eBay fees would be:
- Insertion fee: $0.35
- Final value fee (10% of $60): $6
- PayPal fee (~3% of $60): around $1.80
Total fees = $8.15, or around 13%, not including the cost of shipping supplies and marketing spend.
Amazon Seller Fees
Amazon has higher fees, especially if you use Fulfillment by Amazon (FBA) services:
- Referral fees – 8-15% of the product price
- $0.99 closing fee per item sold
- Variable fulfillment fees if using Amazon FBA
- Optional promoted listing fees
For example, a $20 toy would incur:
- Referral fee (15%): $3
- Closing fee: $0.99
- Total fees = $3.99 or 20%
That‘s before additional FBA fees or advertising costs which can eat into margins on lower priced items. But you make up for this by accessing Amazon‘s built-in audience and conversion-driving perks like Prime shipping.
Product Category Differences
Both eBay and Amazon are highly diversified marketplaces. But over the decades, clear specializations have emerged in terms of what sells best on each platform.
What Sells Well on eBay
eBay remains a top destination for:
- Used and vintage items – Electronics, video games, books, and clothing rack up billions in sales
- Specialty collectibles – From sports memorabilia to stamps to diecast car models
- Unique handmade products – Custom jewelry, artwork, clothing
- Hard-to-find products – Out of print books, niche hobby gear
eBay‘s auction model and broad audience cater perfectly to these categories.
Nielsen reports that the top selling eBay categories are:
- Vehicle Parts & Accessories
- Clothing, Shoes & Accessories
- Consumer Electronics
- Collectibles
- Home & Garden
What Sells Well on Amazon
As primarily a fixed-price marketplace, Amazon dominates demand for:
- New, branded products – Kitchen gadgets, toys, electronics, apparel
- Replenishable consumables – Groceries, health and beauty items, supplements
- Amazon proprietary devices – Echo, Fire TV, Kindle ebook readers
Nielsen reports Amazon‘s current fastest growing categories as:
- Pantry Items
- Fresh Food/Beverage
- Health and Personal Care
- Consumer Electronics
- Home Improvement Supplies
So carefully consider whether your products align with shopper demand behaviors on each platform. Rare coins will sell better on eBay than Amazon. Likewise, popular cookware brands do better on Amazon.
Account Set Up and Requirements
Becoming a seller on both platforms is relatively quick and straightforward. However, Amazon does impose more robust identity verification and account restrictions.
eBay Seller Account
As an individual seller registers by providing:
- Email address
- Credit card or PayPal account
- Telephone number
eBay‘s ID verification checks are minimal. This low barrier to entry appeals to casual sellers and hobbyists.
But it also means more duplicates and prohibited items get listed, with eBay relying heavily on buyer reviews and ratings for accountability.
Amazon Seller Central
Registering for an Amazon seller account requires:
- Business name, address, contact info
- Bank account number
- Tax information
- Government-issued photo ID
Amazon also conducts more extensive background checks for any past legal issues or abuse of policies. Sellers must have a professional selling plan subscription costing $39.99 per month.
This stricter entry helps build buyer trust in Amazon. But the rules also cause headaches for some sellers facing sudden account suspensions over inaccuracies or unintentional noncompliance.
Shipping, Returns and Fulfillment
Managing order fulfillment in-house or outsourcing the headaches to Amazon is a key decision point:
eBay
As an eBay seller, you handle the entire shipping process:
- Manually purchase shipping labels
- Pack orders
- Arrange carrier pickups
- Provide customer service for any delivery issues
This gives you full control and oversight of packaging costs, shipping speeds, and carrier options. But order processing and returns can become extremely time and labor-intensive at higher volumes.
Amazon FBA
With Fulfillment By Amazon (FBA), you send your inventory to Amazon‘s warehouses and they take care of storage, packing, shipping, and returns.
The benefits for sellers include:
- Products become Prime eligible for free 2-day shipping
- No labor required for fulfillment/returns
- Amazon customer service handles inquiries
- Warehouse storage across the US for faster deliveries
The tradeoffs are the variable FBA fees which often exceed your own fulfillment costs. Still for most medium-high volume sellers, the extra sales and conversion rates make up for the fees.
Final Considerations For Choosing Between eBay and Amazon
Beyond just fees and logistics, also weigh up audience demand, competition levels, and growth opportunities on each platform.
Audience Size and Buyer Behavior
Amazon touts over 197 million unique monthly visitors – a huge captive audience for tapping surging ecommerce demand. eBay‘s last reported figures were 147 active buyers globally.
But eBay enjoys stronger loyalty among niche hobbyists and collectors less swayed by Amazon‘s universal brand appeal. Understanding each platform‘s "typical customer" is vital.
Ease of Standing Out
Competition is fierce on both marketplaces, but breaking through the noise is statistically tougher on Amazon. Their singular website design also offers fewer options for custom store branding compared to eBay.
So if creating a recognizable brand is important to you, eBay provides more seller name visibility in listings and store customization abilities.
Growth Potential
Amazon FBA makes the platform very enticing for new sellers looking to rapidly scale up. Prime positioning incentives buyers to purchase from FBA offers over merchant-fulfilled products.
eBay however offers more flexibility to experiment with various pricing models and marketing channels to find which products resonate best with its diverse buyer base.
So weigh your capabilities against each platform‘s opportunities and limitations. The right marketplace for an artisan jeweler is vastly different from a bulk electronics wholesaler for example.
Key Takeaways: Choosing the Best Marketplace For Your Business
Deciding where to sell your products online requires careful evaluation across multiple factors from fees to fulfillment to audience demand.
As you compare eBay vs Amazon seller features, follow this decision framework:
Product Considerations
- Used/vintage vs. new condition items?
- Niche collectibles/hobby goods vs. broad consumer products?
- Custom/handmade goods vs. wholesale/replicable products?
Operational Capabilities
- Will you self-fulfill orders or use FBA?
- What are your packing/shipping capacities?
- Can you provide customer service at scale?
Financial Goals
- What sales volume and growth rate are you targeting?
- How sensitive is your pricing model to fees?
- Are you willing to spend more to acquire new customers?
Brand Visibility Needs
- Do you need greater control over store design and customization?
- How important is it to stand out amidst competing listings?
Carefully weighing up these key factors will determine whether eBay or Amazon (or even both) are the right sales channels for your small business. Most successful sellers diversify across multiple platforms – so don‘t limit yourself to just one or the other.
Instead of a one-size-fits all approach, adapt your selling strategy to play to each marketplace‘s strengths while navigating their limitations. Their systems may seem rigid, but small businesses can still thrive on these sales behemoths.
