One of the first important decisions you’ll need to make is which type of plan you want to use. Not only your Amazon commission depends on it, but also the success of your business in general.
There are currently two types of Amazon FBA selling plans: individual and professional. In this article, we will compare the features of each of them.
What is the fundamental difference?
The main difference between the Individual and Professional plans is the projected sales volume.
Individual is designed for those who do not plan to sell large quantities. That is, it is usually used by sellers who sell 40 units (or less) of their product per month.
While the Professional Seller Plan is for “big players” who are set up for large volumes, want to run ads and win Buy Boxes.
Moreover, “professionals” have the opportunity to trade in ten additional categories:
- Car accessories and auto parts.
- Products in the B2B segment.
- Drawings, art objects.
- Collectible coins and vintage products.
- Delicatessen and groceries.
- Professional services.
- Science and industry.
- Video, DVD and Blu-ray.
Simply put, you won’t be able to sell silver bracelets or, for example, car mats, being an “individualist”, the platform will not allow you to choose such a niche.
The “Individual” tariff plan on Amazon.
It will cost you only 0.99 cents for each item sold. Its main advantage is the absence of a fixed monthly fee.
But it can also be called a major disadvantage. For example, if you sell 41 items in the current month, you will have to pay $40.59 (41 items x $0.99) as a seller’s commission.
An individual plan is ideal for testing the demand for new products and niches. However, you will not be able to use the advanced seller tools.
Important: These figures apply ONLY to the tariff and do not include referral fees (8-15%, depending on the category), fulfilment fees (delivery of batches to warehouses and order fulfilment), and other costs (for example, long-term storage fees).
You can learn more about all the figures, fees, taxes, tariffs and payments on this page.
Professional tariff plan on Amazon
It costs $39.99. It provides access to branded tools such as A+ Content, Stores, and others. Also, as a “professional”, you can:
- manage inventory balances with spreadsheets and reports;
- offer customers free delivery;
- use API integration;
- add multiple users to your account.
One of the biggest advantages of professional sellers on Amazon (compared to individual sellers) is their right to win a Buy Box (you can read what it is and why you need it in this article).
However, this may not be relevant to you if you sell products of your own brand/manufacture. Exclusive products receive “boxes” a priori, without competing with competitors.
Another huge advantage of the Professional plan is the use of pay-per-click (PPC) advertising, which means that you can promote your products to the top of the search results.
Which plan should you choose?
It would seem that the situation is simple: the Professional Seller Plan is much more profitable and comfortable than the Individual.
However, it all depends on your niche, strategy, and business plan. Amazon will never miss an opportunity to make money from sellers, but with the right approach, this expense item can be minimised.
For example, if your product is quite expensive and exclusive, not a basic necessity, and not cheap, then it may be beneficial for you to pay 0.99 cents per sale.