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The question we often hear from our clients sounds like “What is the difference between Amazon Vendor and Sales Central?” It is quite a controversial issue which is required the detailed analysis of both tools. In this article, we will try to figure out which benefits you can get using these Amazon marketing tools and how they can affect your business developing.
You can find a lot of articles and discussions based on this theme. However, what is used to be clear has become increasingly complicated due to the last changes to Amazon Brand Registry. Currently, Amazon ranking system takes into account additional features, rules, fees, and restrictions.
So we feel a strong need for discussion the difference between Amazon UK vendor central and sales central following the last ranking algorithm updates and novelties.
This article will be useful for those who have the buyers contracted about selling via Vendor Central or those who want to make the switch from Seller central to Vendor central or vice verse. So, let us go on.
What is Amazon Vendor Central?
Amazon Vendor Central is Amazon online interface which is used by manufacturers and vendors. If you are selling your stuff through this Amazon program, you are the first-party seller. It means that you are not interested in drop shipping, you are selling in bulk. This program is best for big manufacturers who have their own factories. You can be registered on Amazon Vendor Central only by invitation. If you see the phrase “Ships from and sold by Amazon.com.” on a product page, it means that is a participant of Amazon Vendor Central.
According to this program, Amazon manages all your orders and ships them to various warehouses throughout the country. Moreover, Amazon holds merchandise and fulfills individual orders.
The benefits of Amazon Vendor Central
Among the benefits of Amazon Vendor Central program, we can enumerate simplicity, familiarity, and protection. So let us discuss these features more detailed.
When I am talking about simplicity, I mean that Amazon makes everything for you. Everything you need to do is to sell big orders to Amazon and ship inventory to warehouses. Amazon handles all fulfillments and returns.
Another benefit is familiarity and simplicity. Amazon uses a simple straight-up wholesales model according to which you can negotiate terms up front.
Moreover, according to this program, Amazon owns your stuff and makes all best to sell it more than products of any third-party sellers with whom Amazon has to share its revenue.
So, as Amazon pursues its own interests, the participants of Amazon Vendor Central program receive numerous benefits such as:
- Amazon’s algorithm prizes its own products;
- “Ships from and sold by Amazon.com” prescription inspires user’s trust and credibility;
- Amazon Prime eligibility (inventory is always shipped on time, and Amazon assumes all customer services and compensations);
- Amazon products usually win the Buy Box for understandable reasons;
- Amazon provides you with a high protection as you are now business partners.
Moreover, utilizing this program, you receive access to Amazon Marketing Services (AMS) and other premium marketing opportunities which are not available within any other selling programs. You receive a chance to use Amazon A+ content program and Amazon Vine. These tools will help you boost your sales up to 10% and expand your brand awareness.
The weak points of Amazon Vendor Central
The biggest minus of this program is the low margins. You have to pay enormous fees for Amazon services, so your profit may be lower than your spendings for the first time. Moreover, you have any control over your retail price and cannot set the minimal cost.
One more negative side is that you have limited geographic marketplace. All your sales activity can be based only on Amazon.com. If you would like to retail your stuff on other Amazon subdomains, you will need to create additional vendor central accounts.
According to this Amazon program, you can’t control the inventory size. It means that you can’t benefit from increasing demand on your stuff and vice verse if your products do not move fast enough, Amazon can charge you for warehousing (the more time you can’t sell it, the higher charge you will pay).
Another weak point of this program is slow payments. You can get your payment within 60 days. If you want to get it a little bit faster, f.i for 30 days, you will need to pay 2% fee. Moreover, there are a lot of other associated fees such as Market Development Funds and packaging fees.
In contrast to Amazon Seller Central, Vendor Central does not provide any analytical and research functions. Vendor Central Analytics is limited and does not show a full picture of your market presence. Moreover, you can check any data concerning your customers. It is prohibited for you to contact your buyers. Any customer issues are solved by Amazon’s Customer Service.
To conclude all the was mentioned above, I would like to say that Vendor Central can satisfy your business needs if you are a prominent manufacturer who is looking for one more marketplace. Under this circumstances, you will receive a great opportunity to expand your brand awareness and improve your products exposure as well as earn a chance to focus on production, innovations, and self-improvement. Using this program, you do not need to worry about shipping, customer support and other time-consuming services you will need to do as the third-party retailer.
What is Amazon Seller Central?
Amazon Seller Central is the online tool designed by Amazon with a purpose to help online merchants to market and sell their stuff directly to Amazon’s consumers. Generally speaking, Amazon Seller Central is used to help third-party, and marketplace sellers boost their rankings and revenue.
Utilizing Amazon Seller Central, you have two options for fulfillment orders you receive from your customers. You can either handle shipping and customer services by yourself or entirely rely on Amazon in this regard. On this case, Amazon will handle this for you by enrolling your products in the Fulfilled by Amazon program. Another common cause for using Amazon Seller Central is an ability to control the messaging of your products with a purpose to prevent retailing your stuff by other unknown third-party sellers.
The strengthens of Amazon Seller Central
According to this program, you are selling individual units to individual Amazon shoppers via the single marketplace. That is why we can say that this program is excellent for third-party online merchants who do not feel interested in wholesale marketing. It is a flexible and user-friendly program that affords merchants a lot of control functions. It is open for all Amazon retailers, so you don’t need any invitations.
There are two options you can select using this Amazon program:
- Individual selling plan
According to this plan, you do not need to pay any fees for subscription. However, each time you sell a product, you need to pay $0.99 fee for Amazon. Taking into account the number of functions you receive for this money, this price seems reasonable.
- Professional selling plan
Using this plan, you do need to pay for monthly subscription. It costs $39.99 per month and does not require any per-item fee.
Using ASC, you receive the higher margins and a full control under your pricing. You do not need to pay any fees as wholesalers do, so you make and keep more per each purchased item.
It is worth to mention Amazon Seller Central serves in tandem with Amazon FBA program. It means that you can opt to have Amazon warehouse inventory, fulfill orders, and personally handle customer services and returns.
One more benefit is that you can get payments within a short period (up to a weak).
ASC can serve as an analytical and reporting tool, providing you with relevant reporting data on a regular basis. Moreover, you can access demographic data about your customers and contact to them to resolve any issues. However, using this Amazon program, you have control not only under your customer data but also under your inventory. It means that you can easily recall your inventory from Amazon if you need to allow it elsewhere.
The disadvantages of Amazon Seller Central
First of all, it is worth to say that this program is not free and can seem costly for small businesses. Moreover, both individual and professional plans require additional fees that variable for different market niches and categories.
Another negative side of this program is that if your participant of Amazon product fulfillment, you may incur fees to keep them in storage. It can be a problem for Amazon vendors whose items sit too long.
However, the biggest problem with my mind is high market competitiveness. Anyone can become Amazon third-party seller and every day their amount is rising. If your products are based on a competitive market niche, you will spend a lot of time on price wars and diminish your products. Moreover, Amazon may also retail the same products as you sell, becoming your TOP market competitor whom you will never be able to outsmart.