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How Are eBay And Amazon Different?
EBay vs. Amazon: How Are They Different?
The electronic commerce (e-commerce) movement is bigger than ever and only shows signs of becoming bigger. Under the purview of e-commerce companies, both eBay (EBAY) and Amazon (AMZN) stand out as longstanding, major players in the marketplace. Both eBay and Amazon operate as online shopping sites, providing visitors the ability the browse through available products listed for sale or auction through each company's online storefront. While eBay and Amazon have each evolved over the last few years to meet the needs of today's consumers, there are distinct differences between the two companies. EBay and Amazon differ in terms of business models and pricing, services for sellers and ancillary services for buyers.
Business Models and Pricing Strategies
The greatest difference between eBay and Amazon is the business model under which each company operates. EBay is an auction house, and the company simply facilitates the sale of goods between third-party buyers and sellers. Buyers visit the site to search for products they want to buy from a vast array of individual sellers and then bid on items through individual auctions. Conversely, Amazon is a direct provider of goods, and customers visiting its site view products that Amazon maintains as inventory in its large network of warehouses. For some products, Amazon allows third-party sellers to offer purchase options to buyers, but the company keeps the majority of its products in-house.
Within an auction model, eBay employs a wholesale pricing strategy. In most cases, interested buyers must bid on items for sale on eBay Sellers list auction items for a three-, five-, seven - or 10-day period, and the buyer willing to pay the highest amount wins the product at the end of that time frame. Some items listed on eBay feature a "buy it now" option, which allows a buyer to purchase the product immediately, albeit at a premium. Amazon operates as a retail outlet, providing customers with fixed prices on all products. While various sellers may list the same product, there is no need for a customer to place bids or win an auction before purchasing.
Seller Services: Is eBay Cheaper Than Amazon?
EBay and Amazon differ greatly in terms of how each company works to facilitate sales. Because eBay needs sellers to list products on its site to generate revenue, the company is far more seller-oriented than Amazon. EBay actively invites sellers to participate in its auction marketplace, and the company provides platforms for sellers to offer products to buyers within an eBay store or through the auction site's classified section. Amazon is more buyer-oriented, actively inviting buyers to visit the site and browse through and subsequently purchase its own inventory. While some third-party sellers use Amazon to distribute products, the company is more focused on attracting buyers to the site.
Amazon Seller Fees
It doesn't matter if you're a small seller or big potatoes with an already established product line that you want to put onto the Amazon marketplace as a third-party seller. Amazon offers third-party sellers two different plans based on their prospective selling habits and other key features.
You'll have to decide which one fits your needs. The professional plan is geared toward those who plan on doing a lot of selling, while the individual account is a no-frills, cheaper alternative. Here are some of the features of both plans:
Amazon Professional Account
If you're planning on selling more than 40 items each month, this is the option for you. But it does come with a subscription fee of $39.99 each month. That means you'll be paying almost $480 a year to put and sell your products on Amazon. You also get access to Amazon Sponsored Products Ads, which put your products into ads on different product pages for customers to view. This option doesn't have any selling fees, but referral fees do apply.
Amazon Individual Account
This plan is tailored for anyone who plans to sell less than 40 items each month. The benefit to this account is the lack of a monthly subscription fee. But you do have to pay the selling fee to Amazon—$0.99 for every item you sell on the site. There are also referral fees that apply to each sale, just like the professional account. The one downside is that you have no exposure to your products through Amazon's Sponsored Product Ads.
Here's how Amazon calculates end revenue for an item sold by a third-party seller on the platform:
- Take item price, and. Add the shipping charges, which are paid by the buyer. Add any gift wrap charges, also paid by the buyer (if any). Subtract referral fee (which is calculated on the item price as well as any gift wrap charges) Subtract closing fee Subtract $0.99 per item fee (not applicable to professional accounts and others who don't pay subscription fees) Remainder equals total deposited to seller account
EBay Seller Fees
EBay charges its sellers two different fees: An insertion fee and a final value fee. Here's a breakdown of each:
- Insertion fee: The company's insertion fee is the same as a listing fee. All sellers get up to 50 zero fee listings every month. Those who have an eBay store may get more. Once those are used up, the fees cannot be refunded even if the item doesn't sell. Sellers are charged one insertion fee per listing, per category. The account holder gets one fee credit for every auction-style listing for which they paid an insertion fee, provided the item sells. Final value fee: If the item sells, eBay charges sellers a final value fee. The value of the fee, charged per item, depends on the total sale amount. Although tax is not included, the total sale amount includes shipping and any other additional charges added to the item's price.
Additional fees may apply. Here's a look at some of them:
Advanced listing upgrade fees: The company charges sellers fees if they add advanced listing upgrades. The fees are based on the type of upgrade added. These are add-ons to the listing that aren't covered in the basic listing or insertion fee. Not all listing upgrades are available with every listing tool.
Supplemental service fees: The site also charges sellers supplemental service fees. These range from shipping labels originated from the eBay site or refund reimbursements to eBay.
Additional Services for Buyers
Another vast difference between eBay and Amazon is the ancillary services available to buyers. Since 2010, Amazon has rapidly expanded its additional services, most notably through its rollout of Amazon Prime. The membership program requires users to pay an annual fee but grants them exclusive access to expedited two-day shipping at no additional cost; digital media, such as movies, music and Kindle e-books; and unlimited photo storage through the cloud.
Amazon Prime members can upload their outfits and get a fashion expert's opinion — here's what it's like to use in person
Amazon wants to help with that. The online retail giant rolled out a feature in March called Outfit Compare, which lets you upload two different outfits and get an opinion on which one looks better.
The feature is free and available in Amazon's mobile app, but only Prime members can use it. And while Amazon famously doesn't reveal how many Prime subscribers it has, estimates peg that number around 80 million in the US — which means a lot of people have access to this feature and may not even realize it.
If Outfit Compare sounds familiar, it's because Amazon launched a similar service called Style Check in conjunction with the launch of its Echo Look device, an Alexa-enabled camera that can take full-length photos or videos of you, help you build a "personal lookbook," and give a second opinion on your outfit.
But Outfit Compare has one key difference: While Style Check uses both machine learning and a fashion specialist to provide a verdict, Outfit Compare relies solely on real humans to judge your look.
I tested out Outfit Compare over the course of a few weeks. I didn't often use it to decide between two different tops or to pick the right pair of shoes, mainly because I didn't have the luxury of time in the morning or a full-length mirror at home. But snapping a quick mirror photo of my outfit each day did help me gain a lot of insight into how others might view my style.
Selling on Amazon Fee Schedule
Amazon collects the lower of the applicable fees stated below and any fees communicated to you by Amazon (such as promotional fees that Amazon may provide from time to time). This does not apply to certain sellers, such as warranty providers and other service providers, who will continue to pay selling fees in accordance with the rates provided in their program agreements.
You can also view more details about your fees with the Detailed Fee Explainer.
Monthly subscription fee
- Professional Selling Plan: USD $39.99 per month Individual Selling Plan: No subscription fee
Selling Fees
When your product sells, Amazon collects the amount paid by the buyer (including the price and any shipping, gift wrap, or other charges). Professional account sellers can set their own shipping rates for books, music, video, and DVD (BMVD) products, including offering free shipping, (see Activate custom BMVD shipping rates). For Individual account sellers, Amazon shipping rates will apply for BMVD products
See Shipping Rates for BMVD for a table of Amazon shipping credits for media products. For a table of Amazon shipping rates for all products sold by Individual sellers, see Shipping Credits for Individual Sellers.
Per-item fees
- Professional sellers: No per-item fee Individual sellers: USD $0.99 fee for each item sold
Referral fees
Sellers pay a referral fee on each item sold.
Items in some categories have a per-item minimum referral fee as listed below (for example, sellers pay the greater of the referral fee or the per-item minimum referral fee).
For all products, Amazon deducts the applicable referral fee percentage calculated on the total sales price, excluding any taxes calculated through Amazon tax calculation services. The total sales price is the total amount paid by the buyer, including the item price and any delivery or gift wrapping charges.
Referral fees vary by category, as listed below.
For sellers who use Fulfillment by Amazon, please see the FBA Features and Fees.
Registered Amazon Business sellers should refer to the Selling on Amazon Business Fee Schedule for applicable referral fees.
Prior approval may be required to offer products in the categories listed under "Categories Requiring Approval." Learn more
See "Referral fees" notes above.
(applied on a per-item basis unless otherwise noted)
- 8% for products with a total sales price of $10.00 or less, and 15% for products with a total sales price greater than $10.00
- 15% for the portion of the total sales price up to $100.00, and 8% for any portion of the total sales price greater than $100.00
- 15% for the portion of the total sales price up to $200.00, and 10% for any portion of the total sales price greater than $200.00
- 15% for the portion of the total sales price up to $300.00, and 8% for any portion of the total sales price greater than $300.00
- 8% for products with a total sales price of $10.00 or less, and 15% for items with a total sales price greater than $10.00
- 8% for products with a total sales price of $15.00 or less, and 15% for products with a total sales price greater than $15.00
- 8% for products with a total sales price of $10.00 or less, and 15% for items with a total sales price greater than $10.00
- 20% for the portion of the total sales price up to $250.00, and 5% for any portion of the total sales price greater than $250.00
- 15% for products with a total sales price of up to $75.00 18% for products with a total sales price above $75.00
- 16% for the portion of the total sales price up to $1,500.00 3% for any portion of the total sales price greater than $1,500.00
*Certain cell phone devices may require approval. Please see here to learn more.
1 Accessory products fall in the Electronics Accessories category. Bundles within the Camera category will be included in the Electronics Accessories category effective February 9, 2018.
2 The $0.30 per item minimum referral fee does not apply to Collectible Cards products in the Toys & Games category.
3 The Everything Else category is available to sellers for products that do not clearly fit within existing categories. Do not list items in the Everything Else category that appropriately fall within another category.
Rental Book Service Fee
For each textbook rental that is sold, sellers pay a rental book service fee of USD $5.00.
Closing fees
Sellers also pay a closing fee of $1.80 per media item that is sold. Media categories are Books, DVD, Music, Software & Computer/Video Games, Video, Video Game Consoles, and Video Game Accessories.
High-Volume Listing Fee
We charge a monthly High-Volume Listing Fee of $0.005 per eligible ASIN to cover our system costs associated with cataloging and maintaining large numbers of ASINs on Amazon. com. To be eligible for the High-Volume Listing Fee in a given month, an ASIN must meet the following criteria:
The ASIN is listed in a non-Media category. Media categories include: Books, DVDs, Music, Software, Computer/Video games, Video Game Consoles, and Video Game Accessories, among others. You have had an active offer on the ASIN at some point during the month. The ASIN was created at least 12 months ago. ASINs created less than 12 months prior are not eligible for the fee. The ASIN has not sold in the previous 12 months.
To help you grow the selection of products you offer on Amazon, we waive the High-Volume Listing for the first 100,000 ASINs that meet the above criteria. We apply the fee to your highest number of eligible ASINs above 100,000 during that month. You can view the number of eligible ASINs by going to the Inventory tab in Seller Central, selecting Inventory Reports, and then selecting High Volume Listings Report from the drop-down menu on the page.
For example, if during a month, you had active offers on 300,000 eligible ASINs, then we would charge you a fee of $1,000, calculated as $0.005 on the 200,000 ASINs that are above your free allowance of 100,000 eligible ASINs.
The fee will be calculated and charged monthly and shown in the next month's statement.
To know more about this fee, please visit the High-Volume Listing Fee FAQ page.
Refund administration fee
If you refund a customer for an order for which you have already received payment, Amazon will refund you the amount of the referral fee you paid for the item(s), minus the applicable Refund Administration Fee, which is the lesser of $5.00 or 20% of the applicable referral fee.
For example, if you refund a customer the $10.00 total sales price of an item in a category with a 15% referral fee, your Refund Administration Fee will be $0.30 ($10.00 x 15% referral fee = $1.50).
Examples of referral fee calculations
Media products
Individual Selling Plan example:
+ Shipping charges paid by the buyer
- Closing fee of $1.80
- $0.99 per item fee
= Total deposited to seller account
Professional Selling Plan example:
+ Shipping charges paid by the buyer
- Closing fee of $1.80
= Total deposited to seller account
Examples for Watch products
Examples of referral fee calculations for Watches products:
| For the portion of the total sales price up to $1,500.00 | $2.00 | $240.00 | $240.00 |
| For any portion of the total sales price from $1,500.01 and above | $0.00 | $0.00 | $165.00 |
| Referral fee | $2.00 | $240.00 | $405.00 |
Examples for other products
Individual Selling Plan example:
+ Shipping charges paid by the buyer
- $0.99 per item fee
= Total deposited to seller account
Professional Selling Plan example:
Start selling online
Frequently Asked Questions
Amazon has built a base of millions of satisfied customers by being responsive to their concerns and acting quickly to resolve problems. We extend this valuable customer trust to sellers through the A-to-z Guarantee program.
The A-to-z Guarantee Program is for situations where a customer never received a product or received a product that is materially different from what was ordered or expected. We ask customers to first contact the seller when they have a problem. If the seller fails to resolve the problem, the customer can file an A-to-z claim. When Amazon receives the claim, we send the seller an automated email detailing the claim and requesting basic information from the seller about the order and the fulfillment process. Amazon will then determine how the claim will be settled, which may include reimbursement of the order to the customer, at the seller's expense.
You can register today for the selling account of your choice, without the need to contact a sales person by clicking on the Sell as a Professional or Sell as Individual buttons on this page.
Before you begin the self-service registration process, be sure to have the following information available.
• Your business name, address, and contact information
• An internationally-chargeable credit card with valid billing address
• A phone number where you can be reached during this registration process
• Your tax identity information
If you want to close your account permanently, Seller Support can assist you. Keep in mind that you can use our Listings Status feature to suspend your listings, or you can remove your listings entirely but hold on to your account for future use.
Before you close your account permanently, please cancel and remove your listings and resolve all transactions. Find out more about how to close your account ›
We have videos, webinars, web pages, and more to help you find what you need.
When you sign up as a Professional Seller, you will have access to sell on our US, Canadian, and Mexican marketplaces through a North America Unified Account. This will enable you more easily to share product listing information and manage your inventory consistently across all three marketplaces. For all per-item transaction fees, sellers will pay the fees applicable to the marketplace in which the item was sold. If you're a Professional Seller, you will only be charged one monthly subscription fee for selling in North America.
If you already sell on Amazon in the US, Canada, or Mexico, you can use your existing bank account to receive disbursements in your local currency with the Amazon Currency Converter for Sellers (ACCS). If you are a new seller registering to sell in the US, Canada, or Mexico, you can be paid directly in your local bank account in the local currency, provided you have a bank account in a country supported by Amazon.
Amazon offers two selling plans. The Professional selling plan is available for a $39.99 monthly subscription fee plus per-item selling fees, which vary by category.
If you plan to sell fewer than 40 items a month, the Individual plan may be best for you. There is no monthly subscription fee. Instead, Individuals pay $0.99 per item sold plus other selling fees, which vary by category.
Learn more about Selling on Amazon pricing ›
Additional fees apply when you use Fulfillment by Amazon to pick, pack, ship, and provide customer service for your products. Learn more about FBA pricing ›
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