June 16, 2020

Types of Seller Accounts on Amazon: Complete Guide

If you are planning on selling products on Amazon, then it is worth knowing about the different types of Amazon seller accounts. There are individual, professional, and some other types of accounts that you should be aware of.

Individual seller account - short summary

  • This is a free seller account. Each sale attracts a $0.99 fee.
  • Suited for those barely selling any products (under 40 per month)
  • Not ideal for those who want to use Amazon FBA at some point.
  • Not ideal for those who are planning to run their business long-term.
  • No promotional tools (e.g. no securing the Buy Box)

Basically, you should only be opting for an individual seller account if you are not running a business. While businesses that are selling fewer products may see some merit in the free seller's account, you will be sacrificing certain tools that can make earning money on the platform a little bit easier for you.

Professional seller account - short summary

  • Costs $39.99 per month. No $0.99 fee on sales. You only pay the referral fee.
  • Ideal for businesses with large product offerings. You will save money if you sell more than 40 products per month.
  • Ideal for those who want to use Amazon FBA
  • Promotional tools allow you to boost sales
  • Better inventory management

If you are planning to run an Amazon business and want to make a decent number of sales on the platform over the course of many, many years then a professional seller account is going to be the best option for you.

Individual Seller Account

When it comes to Amazon seller types, this is probably the most popular. It is completely free to register an individual seller account on Amazon. You can also list an unlimited number of products, although this isn't 100% recommended. If you are the type of person that is not shipping more than 40 products per month, then you are one of the types of sellers on Amazon that would probably benefit the most from having an individual seller account.

For the most part, the product listing features with an individual seller account on Amazon are the same as any other one of the types of seller accounts on Amazon. There may be a few limitations here and there, but these limitations won't ever really be at the point where they can severely hamper your business. As we said; you really do have the opportunity to list an unlimited number of products on the marketplace.

While businesses can register for an individual seller account on the platform, and it would be completely free of charge, it is not going to be recommended for most companies. This is because while there are no fees for signing up to an individual seller account, there will be additional fees when you sell a product.

Amazon charges $0.99 per sale with an individual seller account. This is on top of their standard fees for selling (known as referral fees). This means that individual seller accounts are fine up to a certain point. However, if you are running a business, the $0.99 fee will start to stack up rather quickly. In fact, if you are planning to sell more than 40 products per month, as most businesses should, then you should opt for the Professional Seller Account.

Professional Seller Account

If you are looking for the business type of Amazon seller account, then the professional account is what you need. Do bear in mind that there is a monthly cost to the professional seller account. This will be $39.99 per month. Amazon has had it set at this price for a while, so we doubt that it is going to change any time soon.

Thankfully, that $39.99 per month is going to come with a few benefits over the individual seller account. These benefits will make it a bit easier to make huge numbers of sales on Amazon. However, the main benefit is the fact that with this one of the types of seller accounts on Amazon, you do not have to worry about paying that $0.99 per item sold fee. This is why this is the type of account you should opt for if you are planning to sell more than 40 products in any given month. Do bear in mind that if you sell below 40 products, you will still be charged that $39.99. However, for many, this is going to be fine. The professional seller account isn't too expensive and it does give a few more features for boosting sales.

For starters, with a professional account, you have a lot more control over the management of your inventory. You also have the ability to generate reports, something that an individual seller account is unable to do. This can make it a little bit easier for you to work out which products are selling and which ones are not. Basically, you can come up with a more 'focused' business strategy. Only professional accounts will be able to collect sales tax too. Only professional accounts will have the ability to set their own shipping rates too.

It is worth noting that some of the more popular categories on Amazon are restricted to professional seller accounts only. So, if you wanted to list products in the DVD or video game category, for example, then you would need to have a professional seller account. In fact, all of the major categories require an Amazon professional seller account, partly to help to keep competition down to a minimum for Amazon.

The main benefits, however, come from the promotional tools that you have available to you when you opt for a professional seller account.

As you may well know; one of the main ways that you can boost the number of sales that you generate through Amazon comes from obtaining the buy-box. Once you have this, the number of sales that you do will shoot up. You are only able to have control of that buy box if you have a professional seller account. So, even if you are selling under 40-products per month, it may be worth opting for this type of account simply because of the long-term benefits you can enjoy from scoring that buy box.

Finally; only professional accounts can run promotions on Amazon. While this may not be something that you will want to do all that often, it is good to have the ability to run promotions when sales are running a little bit low.

Fulfillment by Amazon - FBA

This isn't technically an account type on Amazon, but a lot of people regard it as separate, so we figured we would mention it. We do want to point out that you can use Amazon FBA with either an individual or a professional account. However, the individual account is lacking a lot of tools that make running Amazon FBA easier, and thus we would only recommend using FBA with a professional seller account.

So, what is Amazon FBA? Well, this is when you ship your products directly to Amazon. Amazon will keep your products in their warehouse. When the item is sold, Amazon will ship it out for you. It is probably as close as you will ever get to a truly automated business with Amazon. Of course, the standard fees and terms apply e.g. you will not be able to use Amazon FBA in professional-only categories if you have an individual seller account.

Other Account Types

Generally speaking, you are not going to need to worry about the other account types on Amazon. These are 'invite-only'. For example; if you sell products to Amazon (i.e. you are selling wholesale), then Amazon will provide you with a seller's account where you can manage everything and communicate with Amazon. Basically, it makes shipping new inventory to Amazon a whole lot easier. The only time that you will really need to worry about this type of account is if you are manufacturing something and wish to sell it directly to Amazon. A lot of companies have started out with pro accounts, caught the attention of Amazon, and then started selling directly to Amazon instead.

Conclusion

When it comes to types of seller accounts on Amazon, you only really need to make one decision. This is whether you should go down the route of a professional or individual seller account. Nine times out of ten, if you are planning to run a business on the platform, you should always opt for the professional account.



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