Amazon.com, take II


Yesterday I ranted a bit about Amazon.com’s marketplace. Today I have two more examples that I’d like to share with you, viagra buy demonstrating some flaws in the Amazon marketplace.

First, consider another book that we sold today. This book sold for $2.50 cents. This time the buyer choose expedited shipping. When a buyer chooses expedited shipping, the variable closing fee changes to only $.44 cents. Amazon’s commission is still 15% (in this case, $.38), and the just-because-we-can fee of $.99 is still assessed. Amazon’s total commission for this sale then was $1.81. Since the buyer chose expedited shipping, Amazon added $5.49 for shipping. Add those totals up: Buyer paid $7.99, Amazon took $1.81; I ended up with a deposit of $6.18 cents, from which I have to pay for packaging and shipping.

Since I’m sending the package out Priority Mail (after all, the buyer paid for expedited shipping, right?), I don’t have to pay for packaging. The post office covers that for you. However, because the book weighs 2.5 pounds, Priority Mail shipping is $6.40. Take that out of the $6.18 that I got paid, and I end up $.22 cents in the hole for having sold this book.

Amazon knows the shipping weight of the book. It is plainly listed in the item’s description. Why can’t they charge the customer enough money to cover shipping? How can Amazon tell a customer that the order will go out priority mail, and only charge $5.49 for shipping, when Amazon KNOWS that the item can’t ship for less than $6.40? Amazon needs to adjust their shipping prices accordingly such that shipping credits more accurately reflect actual postage prices.

Second, here is one book I have for sale: It’s listed at $.01. When this book sells, Amazon will get no commission, but they will still get the $1.23 closing fee and the $.99 just-because-we-can fee. That is $2.22 that goes into their lump “commission.” That means that the buyer will pay $3.50 with shipping, Amazon takes their $2.22 cut, and I end up with $1.28, from which I pay shipping and packaging. Mail rates start at $1.59, sans packaging. (Unless I can send the item first-class, which is cheaper if the book is quite light.) I’m realizing that I’ve got to raise the price of my book!

Amazon should not be allowed to take a commission larger than the amount of the sale price of the book. The commission in this example is equal to 2220% of the book’s sale price. How is that fair? It would be fair if Amazon would restrict their commission to a maximum of 100% of the item’s sale price. Then at least I could maybe afford to ship the item to the customer. At least I could get rid of the book without having to pay somebody to take it.

Third, Amazon’s shipping charges are different for marketplace orders than for Amazon.com orders. In the Marketplace, Amazon.com only collets $3.49 for standard shipping and $5.49 for 2-day shipping. Amazon however realizes that this isn’t enough money to ship items. Note that when THEY ship books from Amazon.com’s own stock, they collect $3.99 for standard shipping and $9.48 for 2-day shipping. Marketplace users get $.50 less for standard shipping and $4.00 less on 2-day shipping than Amazon charges their own customers! Why does Amazon think it costs them more money to ship an item than it will cost a Marketplace seller?

Ah well. In the end selling with Amazon marketplace is a choice. The trick is to only list books that you can sell for a profit. If you are considering selling on Amazon’s marketplace, beware of Amazon’s fees! Make sure you know in advance how much money you’ll make for a book’s sale, and then make sure that it is at least enough to ship the book wherever it needs to go.

Maybe its time to do as Dave suggested and check out eBay. Hey, maybe I’ll at least try it and see what happens. It can’t be worse than Amazon, can it? (Famous last words, I know!)


9 responses to “Amazon.com, take II”

  1. Don’t go to ebay yet. I have to jump on this gravy train of cheap books brought to you by Paul Pehrson Books, Inc.

    Are you listed on Nasdaq?

  2. Thank you very much for this post. I was just wondering, since you have much experience with amazon and perhaps with ebay as well, are there enough buyers on ebay looking for books for them to sell? For instance, if I had a less common book like a Spanish book, would it be likely that it’d sell on ebay? I’m also not very familiar with ebay selling accounts. I believe they charge a $0.20 listing fee. Is there any additional charge after that? Perhaps a % charge from the sale price as a commission? Amazon does rip you off for low cost books (selling and buying!)!!

    Thanks again!

  3. Chocolette,

    Based on my experience, I think it would be hard to get a good price using a normal e-Bay auction, because supply doesn’t always match demand. With Amazon, you can list a textbook, and keep it listed until it sells. With eBay auctions, you have to re-list the item every week or so in order to keep your auction current. Besides that, you don’t get much say in the price.

    For a rare book, or for a text book, I think Amazon.com is the easiest way to go. You just put in the price you want to sell at (realizing the Amazon.com commission), and let it go. When it sells, you ship. But rare book buyers and textbook buyers are fewer and can be far-between, for which Amazon.com is, in my opinion, a better option.

    Good luck, though, with whatever you decide.

  4. Maybe everyone should stop selling on amazon for a few weeks unless they give us more for shipping. I will check out abebooks though

  5. Maybe you should stop wasting your time selling nickel and dime items on Amazon and then complaining about how little you make, and spend your time on more productive and lucrative pursuits.

  6. Maybe you didn’t read my post clearly. My intention was never to spend time trying to get rich selling items on Amazon. I had a few extra books we wanted to sell. This is clearly not a business for us. In total, we were listing like 25 books we were considering getting rid of.

    The point of my post was to talk about Amazon’s ridiculous fee structure. The percentage cuts they take on items they sell are immoral. It’s also immoral that they charge more money to ship items from Amazon than they allow Amazon Marketplace sellers to charge. I want to make people aware of what I consider to be Amazon’s dishonest business practices with relation to Marketplace sellers.

    We don’t have to agree. But it is unfair to characterize my comments as me trying to make a ton of money selling nickel and dime items on Amazon. I just want to be able to sell some extra books and get fair compensation for it.

  7. I totally agree with you, Amazon’s shipping charges are just rip-off in seller’s expense. For example i sold a fitness ball today, it’s sold for 13.95, Amazon fees 3.73 and Amazon charges buyer 6.49 for shipping, but hey! The buyer is from CA that means $14.70 shipping cost for me, so 16.71-14.70=2.01. Great isn’t it. So considering the product cost, i ended up losing money! I sell something but still lose money.

    See, in my opinion Amazon will never fix it unless thousand of sellers leaves for this reason, because Amazon simply makes more money this way, cheap prices because of cheap shipping costs simply attracting more buyers and even though sellers loses more money, Amazon has fixed fees.

    Amazon and eBay; two perfect examples of American capitalism and greed. Simply showing the reason why the economy is collapsing and millions of people losing their job.

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