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Amazon FBA vs Shopify – What’s Best for Success in eCommerce?

E-commerce. Shopping cart with cardboard boxes on laptop. 3d

Looking to join the world of online selling? Great idea! According to Statistica, in 2021, over 2.14 billion people worldwide are expected to purchase products and services online. 

If you’re a small business wanting to sell your products online or you’re considering starting an eCommerce business, it’s important to use the right platform.

In this article, we’ll look at two of the most popular platforms: Amazon FBA vs Shopify. 

What does FBA stand for? Amazon FBA stands for “Amazon – Fulfilled By Amazon” which gives you a clue to one of the key differences between these platforms: one of the options that Amazon offers to sellers is to ship your product to the customer on your behalf… but more on that later.

By the end of this article, you’ll understand:

Amazon FBA vs Shopify — What’s the Difference?

Both Amazon and Shopify are huge names in the global eCommerce industry and both platforms make it easy to start selling online. You might think they’re very similar, but I can assure you that’s not quite true. 

So what separates these eCommerce giants and which is the best online marketplace you can choose when starting an eCommerce business?

Roll up, roll up, it’s a showdown — Amazon FBA vs Shopify.

Amazon FBA vs Shopify

Amazon FBA — a stallholder at a virtual market 

Selling on Amazon is a bit like owning or renting a stall at a fair — you are one of many stallholders displaying their products to thousands of interested fairgoers who happen to be wandering around browsing.

Amazon FBA vs Shopify - Amazon is like owning a stall at a market. Image of a woman shopping in a market.

The sheer number of people passing through the fair ensures that many people get to see what you have to offer at your stall. In the case of Amazon, this can literally be millions. 

Shopify — a brick-n-mortar retailer in a virtual world

Selling with Shopify, on the other hand, is a bit like renting or owning a small brick ‘n mortar store (or van like the image below). The shop is yours and you can decide what it looks like, how you’ll display your goods and everything in between.

Shopify is like owning your own shop. A food truck coffee stand made out of a van.

The downside is, there might not be many people wandering about looking for your store unless you advertise it. So social media marketing and other marketing strategies become a priority so that potential customers know where to find you. 

Amazon FBA vs Shopify — So… How Does Amazon Work?

As mentioned, Amazon is an online marketplace that sells products offered by different sellers all in the same place. If you’ve purchased on Amazon, you’ll know how easy this makes things for customers… you can spend hours browsing their virtual shelves.

ecommerce meaning

But Amazon also makes it easy for sellers, simply sign up for an account and you’re ready to sell. They’ll even take care of the shipping for you if you opt for Amazon FBA. Sounds good? Let’s take a closer look at the Amazon pros.

Amazon PROS

Easy to sign up and start selling almost right away

Amazon offers a 30-day free trial so you can sign up for free and start setting up your “stall” almost immediately. It’s very easy to use, even for those who don’t have any technical know-how. 

Amazon takes care of shipping if you opt for FBA

Most Amazon sellers opt to use Amazon FBA. In a nutshell, you only need to transport your products to Amazon’s warehouse and they’ll take care of the rest, including storing your products, keeping the inventory, and shipping for you. 

Easy costing assistance from Amazon

The servicing costs for FBA depend on how much you use. Amazon gives clear guidance on the costing and even provides a calculator to help you estimate costs. Fulfillment can be a key aspect that guides which eCommerce platform is better for your business. 

Amazon FBA also takes care of customer service including returns and refunds 

Amazon FBA comes with built-in customer service as well. They take care of any returns or refunds, which makes it easy for you as a seller. Being Amazon, you can be sure that the customer service will be excellent, which helps with your reviews. 

No need to worry about marketing — Amazon’s customer base is huge 

We touched on this briefly before, but selling on Amazon can literally put your product in front of millions of potential customers. This sounds ideal if you’re just starting out and don’t yet know the in’s and out’s of marketing. 

If you’ve had a glimpse of the challenges that some sellers face with eCommerce, you may think that the Amazon pros sound like a dream come true. But, before you decide if it’s right for you, let’s take a look at the cons.

Green thumbs up for pros, red thumbs down for cons

Amazon CONS

Your products are displayed the same as everyone else’s

To go back to our stallholder illustration, imagine being one of many fruit sellers at a fruit and vegetable market… there may be thousands of customers browsing but there’s nothing that can differentiate you from the guy next door. Amazon’s platform does not allow you to be creative in the way you display your products. Every product page is exactly the same. You can be creative in the way you describe your product… but that’s pretty much it and it’s hard to implement your own branding.

Highly competitive marketplace

With millions of customers comes millions of sellers and the marketplace is highly competitive. Sadly, some sellers can use tactics to undercut your prices or they might just be better at using keywords or “search terms” to rank their products higher than yours ie. on the coveted first page. 

You have to abide by the rules of Amazon

Amazon has very stringent requirements for its sellers. You’re limited in how you can “display” your products and various other rules. If you don’t play by the rules, you can risk suspension. Have a look at their note with regards to customer reviews

Amazon

Amazon fees

Depending on the plan you opt for, there will be Amazon fees that you’ll need to pay and this can eventually eat into your profits. 

If you opt for the Professional Selling Plan, you will be required to pay USD $39.99 per month once you have active listings. If you choose the Individual Selling Plan, there are no monthly subscription fees, however, you’ll be required to pay Amazon a fee for every product that you sell (USD$0.99 per item).

In addition, Amazon charges you referral fees, fulfillment fees (if you opt for Amazon FBA) and some may even experience additional fees depending on the seller. Amazon also charges fees for returns and makes it incredibly easy for a customer to return their product (even if there’s nothing wrong with it). The company always favors the customers and sometimes, as the seller, the returns can be costly for you. 

You have to make sure you get your product to Amazon

Unfortunately, it’s not quite as simple as throwing your products in a truck and sending them to Amazon. As a seller, you will first need to work out a forecast on how many products you can expect to sell. Amazon also has specific requirements for the labels and the prep of the products to be sent to them. Some sellers may find this process to be very time-consuming. 

The customer belongs to Amazon

If a customer purchases your product on Amazon, that customer belongs to Amazon. You’re not allowed to remarket or market to Amazon customers after the sale. 

Amazon is in charge

As a seller, you have very little control over selling on Amazon and sometimes Amazon can even make decisions about your prices. If you opt for Amazon FBA, you’ll have even less control over your products and hardly any contact with your customers. While this may be ideal for some, if you are wanting to build long-term customers through good products and excellent customer service, it can be challenging. 

Lastly, you are at the whim of Amazon’s decisions — their search algorithm can change, their terms can change, and they can ban sellers as they choose. Amazon has the power and you need to play within the Amazon parameters to sell on their platform.  

So How Do You Decide if Amazon FBA Is a Good Choice for You?

If you prefer to have a platform where you can just focus on selling your product and not worry too much about marketing, logistics, building a brand, and customer service — then Amazon FBA might be a good option for you. However, it’s worth taking the time to weigh up the costs to see if Amazon FBA makes sense for your business.

An old-fashioned scale to show weighing up the costs

Keep in mind that you will need to consider the time and cost that you might incur with packaging and shipping your products to Amazon. There will also be Amazon fees, return fees, and don’t forget sales tax which can get complicated in countries like the USA where there are different tax rates in each state.

Amazon FBA vs Shopify — What is Shopify?

Remember the example above? Shopify is like renting or owning your own shop — you literally own your own virtual store and have complete say over every aspect.

Lady working on her online store on her laptop

On Shopify, you’re empowered to build your own website in order to promote your brand and do the selling. The only products displayed on your webpage will be yours and… you get to decide how they are displayed. 

Although building a website can sound daunting, Shopify makes it very simple. They have many templates to choose from, and navigation and design are easy to understand. Also, their main platform is filled with help videos and help guides to walk you through every step. How cool is that? Let’s take a closer look at the pros and cons of using Shopify.

Shopify PROS

Easy to sign up and start building your online store right away

Like Amazon, Shopify makes it very easy to sign up. It offers a free 14-day trial and no credit card is required. You can literally start building your website and setting up your store within minutes. 

You can build your brand with your own website and online store

Building a brand is vital if you want to establish a successful business. Shopify’s easy-to-use features, templates, and comprehensive help center make this easy for users. 

Shopify offers various payment options and reasonable fees

After you’ve tried Shopify for 14 days, you can then select the payment option that would work the best for your business. The basic plan starts at $29/month up to $299/month. All contracts are month to month, so if Shopify is not for you, you’re not tied into a contract for a long time. On Shopify, transaction fees go up to 2% out of their value, which is not that bad.

Shopify offers 24/7 support plus a comprehensive help center

If you get stuck, simply reach out to customer support or search the comprehensive help center.

There’s also an active Shopify Community. If you have a question that you can’t find the answer to, pitch it to the community and they’ll be able to give you their hard-won tips and experience.

best ecommerce platform

Shopify CONS

As mentioned a few times, Shopify’s support and help guides are comprehensive and they can guide you through many of these cons. Shopify is a great platform, but it does have a few cons. 

You don’t need technical know-how, but some tech knowledge will be good

It’s very easy to set up an eCommerce store on Shopify and generally, you don’t need too much tech knowledge. However, as there are plenty of apps and integrations and some tech knowledge will be useful. You can always hire a freelancer to help with this if needed. 

You’re in charge of marketing your brand and driving customers to your site

It’s all very well to have a beautiful online store but if no one knows about it you won’t be able to sell. Unlike Amazon that has a ready-made market, on Shopify, you’re in charge of marketing and building awareness of your brand. Many Shopify owners rely on social media marketing, SEO, and traditional marketing to draw customers to their stores. Keep in mind that this will take time and consistent effort. 

You’re in charge of shipping and fulfillment

If you’re selling a product on Shopify, you’ll also need to work out where you’ll store your products and how you’ll ship them to customers. You’ll also need to work out what you’re going to do with returns. Luckily, Shopify has a fulfillment network to help you through this obstacle.

You need to take care of customer support

On Shopify, as the seller, you also need to take care of your customers. One of the pros of using Shopify is that the customers are your customers. However, with that comes the need to provide customer support. People won’t know about your products from the beginning, so you’ll really need to work on those marketing strategies and get your brand name out there.

How Do You Know if Shopify Is Good for Your Business?

If you’d prefer to build your brand and have full control of every aspect of your business, then Shopify will be a good choice for you. 

Keep in mind though, it will take more time to be established and there will be many aspects that you will need to consider. Once more, I recommend putting the numbers down and weighing up the costs with your business goals to work out if Shopify will work for you.

Amazon FBA vs Shopify — Which Platform is Best for Your Business?

Shopify and Amazon are both great. It all depends on how you want things to unfold. If you want to build a name for your brand and make it “famous” then Shopify is the best eCommerce platform — it will help you get there at a steady pace. 

You’ll need to take money into consideration as well as your marketing knowledge and the effort you’re willing to put in when you’re starting an eCommerce business. 

If you don’t care about building a brand and just want access to clients, then Amazon takes the title of the best online marketplace. Keep in mind though, you’ll have to make sure you understand and follow Amazon’s requirements.

Shopify and Amazon — Can You Use Both?

Yes, you can! You don’t have to be limited by one platform — you can get the best of both worlds and integrate Amazon into your Shopify account

However, there are a few requirements that you need to meet before you can integrate the two. Here are the main ones:

It might seem like a lot of work but if you are able to do your research and integrate the two, you’ll open yourself up to thousands of customers on Amazon.

Shopify vs Amazon FBA — Where to Learn More

It’s safe to say that as time goes by, there are more and more people starting an eCommerce business.

So how do you get a leg up? How do you out-market them? Out brand them? Out sell them? Good questions.

I tried to start a YouTube channel in the past and failed miserably after a year of creating, drafting, filming, editing, uploading, doing the SEO, and everything else that took so much time. 

After that experience, I realized that if I wanted to be successful in any domain, I needed to learn from someone who has achieved what I wanted to achieve.

Then I paid for a course and gobbled up its content like a teenager discovering Krispy Kreme for the first time. Doing a course helped me crystalize my thoughts, steer my actions and it led me to the creation of Love Work at Home.

Without that course I’d still be spinning my wheels, doing things that I think are important that simply aren’t.

stop wasting time

This is my experience, and why I’m so passionate about passing on valuable resources to help people fulfill their visions and dreams. 

A fact of life is that when we put hard-earned cash down for a course, we tend to commit more and get more out of it because we’ve “got skin in the game” so to speak. Here are the best courses for Amazon and Shopify.

Best Shopify Course

If you’ve chosen Shopify for starting an eCommerce business, you’ll want to take a look at these hand-picked courses. These will help you successfully start an online business.

How to become a Shopify Expert (from zero to hero !) 

On Udemy

Udemy course 1

Another pick for our list of the best Shopify courses is this very highly rated course based on more than 1,200 reviews on Udemy. The course is relatively short so you won’t be bogged down with content for months on end.

The Complete Shopify Dropshipping Masterclass 

On Udemy

Udemy course 2

Last but not least, you can always join the Complete Shopify Drop Shipping Masterclass. This course is also highly acclaimed on Udemy based on more than 900 reviews. This course has quite a bit more content than the previous course, so it might be more useful (fingers crossed).

Shopify Learn 

On Shopify

Shopify Course

This is a great resource and it’s completely free. It covers everything from planning your business to pricing, fulfillment, customer service, and everything in between. The videos are short and presented by experts in their fields.

AMAZON FBA COURSE

If you’ve chosen Amazon for starting an online business, there are courses to help you succeed here too.

How to Start an Amazon FBA Store on a Tight Budget 

On Udemy

Udemy course 3

First up, if you’re looking for a home business idea with low investment, check out this highly rated Udemy course based on over 12,000 ratings!

Marketplace Superheroes

screenshot from marketplace superheroes website

The team behind this course claim that their community members have sold over $33m worth of products and “completed over 1,343,700 orders on 7 marketplaces with simple, low competition items.” It’s hard to get a genuine review of this course, however, it crops up a lot when searching for courses, so at the very least they know their way around marketing!

Amazon FBA Course – How to Sell on Amazon MASTERY Course 

On Udemy

Udemy course 4

Lastly, this course is intriguing as it has a high rating on Udemy based on over 1,400 reviews, even with only 3 hours of on-demand video. Perhaps the articles contain more information. Either way, could this be the best amazon FBA course? It’s worth a look.

Amazon’s Seller University 

On Amazon

Amazon Course

Learn the fundamentals of selling on Amazon to how to build your brand, the Amazon Seller University covers everything that you need to know to be successful on this platform. 

CONCLUSION

Hopefully, you’ll now have a better understanding of Amazon FBA vs Shopify, and which platform will work for your eCommerce business. Take the time to look at the numbers and work out what platform will work well for where you want to take your business. Remember: you can work from home and be successful too, as many others have before you. 

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