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What is an Amazon Reseller? And, Is it Worth Reselling on Amazon?
What does it mean to be an Amazon Reseller?
Amazon's domination in the online marketplaces is legendary, but as the platform has developed, so has the way things are offered on the site.
Inevitably, this has resulted in certain instances of confusion. With references to Amazon's sellers, Amazon's resellers, FBA sellers, and FBM sellers, it's easy to see how you can become perplexed about the entire setup and how to get started with your e-commerce business. What kind of seller should you be in particular!
Which is it: A reseller or a seller?
Simply put, an Amazon Reseller is a person or a business who buys things in bulk or at wholesale prices and then sells (resells) them on Amazon.
In 2010, the Amazon marketplace was exclusively made up of resellers. Some use the Amazon dropshipping concept, while others already have a brick-and-mortar store or a standalone website.
These firms began to use Amazon to ensure that they could quickly reach a larger audience. They used the site to resell, which is where the term resellers came from.
Because they had successfully created connections with suppliers over many years, they also had access to some huge brands.
As the Amazon business model expanded in popularity and the number of resellers climbed, the rivalry grew. Until, eventually, these resellers found themselves in a scenario where competition had escalated to the point that prices had to be reduced, margins had to be reduced, fees had to be increased, and they had nothing left to separate themselves from the other resellers!
This was and continues to be a significant issue for resellers, who face significant challenges on Amazon because there is no restriction to the number of resellers who can offer a product.
The Amazon marketplace is built from the ground up to make it simple for anyone to list products - especially with Amazon's fulfillment system, FBA. Those resellers, of course, include the brand owners themselves, who might offer low prices that are impossible to match.
In the end, this means smaller profit margins and a race to the bottom.
Is it Valuable to Resell on Amazon?
It's a difficult path that will take time and patience, especially if you're competing with well-established resellers who have fine-tuned their selling methods over many years.
There's a lot of money to be made here. However, your approach, products, and work will determine how much will be determined.
With the emergence of more and more private label companies, resale has evolved into much more than merely selling well-known names. By creating their brands, resellers realize that they may become the brand's "exclusive reseller."
This, however, means that competition is no longer limited to national brands but now exists between national brands and private label companies and between different private label businesses.
As a result, it's understandable if some would-be Amazon Resellers are unsure if it's the right platform for them.
Despite the rivalry, many Amazon resellers continue to make decent profits.