Like most online sellers, I signed up and became an active seller on Amazon. And I love selling on Amazon!
But, then Walmart entered my world.
I started to wonder which platform was better for me to sell on for my ecommerce business. And I imagine I’m not alone.
While we don’t have to choose one over the other, it is helpful to understand how each one works and what selling and marketing or sourcing tools are available for each selling platform.
Whether we choose to sell exclusively on Amazon, Walmart, or on both, we all need a solid selling plan. This guide is designed to take a deep dive into Amazon and Walmart to teach us about the ins and outs of both platforms.
Amazon Vs Walmart Overview
I have to start by saying:
I know most ecommerce sellers know about Amazon and Walmart. If not, you have been living under a rock for the past 10 years.
Whatever your professional sellers strategy is, Amazon and Walmart are two major online sites that are neck in neck as the top retailers.
We all know that Amazon is on top of the game for online retailers or eCommerce businesses. But, did you know that Walmart Marketplace online is not far behind?
Of course, one obvious difference is that Jeff Bezos developed Amazon to be an online retailer. Whereas, Walmart started as a physical presence.
As a seller, you also know that eCommerce sales are the way to go. According to Marketplace Pulse, 2020 was the best year for eCommerce marketplaces in over a decade.
Both the Amazon and Walmart selling platforms offer a great outlet for sellers. Amazon used to dominate the online selling market, but in recent years Walmart Marketplace online has gained a lot of steam.
Amazon is the largest online retailer in both the world and America. In the United States, Walmart is the second-largest retailer on the internet.
Amazon vs. Walmart
Amazon and Walmart are similar in many ways, but each have their own strategy of doing business. A few of the key differences include the seller sign up process, proper pricing techniques to meet specific guidelines, and seller fees.
Walmart Marketplace sellers deal with fewer sellers and less competition than those selling on Amazon. However, getting beyond the application process to get approved to sell on their platform takes patience.
Walmart sellers also face more pressure once approved to offer low prices to grab the Walmart buy box.
Amazon, on the other hand, has a lot of sellers making it more competitive among sellers. However, Amazon is easier to join as a seller and not as driven by price as Walmart is.
For sellers, Amazon is easy to start selling on. To sell in some categories, you will need to be a part of Amazon Professional which costs $39.99 a month. Sometimes, you will also need to request certain selling privileges.
A Walmart Marketplace seller enjoys unlimited listings with no monthly fee. But, sellers have to go through a rigorous approval process first.
Walmart’s approval process is a bit more tedious and time-consuming. Once you’re approved, however, sellers enjoy less competition on Walmart compared to Amazon’s crowded marketplace.
Once Walmart accepts you as a seller, you have a good chance of having your products stand out among the limited invite-only thousands of sellers, as opposed to the more than 2 million third-party Amazon sellers.
Compare the two to see if there is a key difference between the two that is a deal breaker for you. Overall, the two sites have a lot in common.
Here is how they differ.
Selling On Amazon Marketplace
Amazon is the largest online retailer in the entire world. That’s right, the whole wide world extending far beyond a neighborhood market turned internet retailer located in one country, the USA. Amazon’s online marketplace has the largest revenue in the world.
Online sellers understand how it works. If we are going to make a decent profit through retail sales, we feel as though we need to be on the Amazon Marketplace.
Amazon may have humble beginnings but has grown to be known as a household name. Just jumping on the skirt tails of their marketing campaigns is often enough to boost sales up to a nice, profitable margin without much effort on the seller’s part.
Simply being associated with the Amazon name often equates to sales.
Getting started as one of the marketplace sellers on Amazon is fairly quick and easy. Of course, there are exceptions to every rule.
For instance, if you want to sell exclusive brand name items or shoes, there are a few more hoops to jump through to get approved. However, generally speaking, Amazon is an easy platform to sell on.
Let’s look at some specifics about selling on Amazon including any sales fees or additional costs, fulfillment of orders, customers, selling and performance tools, and what the best products to sell on Amazon are.
Fees
Amazon offers two kinds of accounts, either individual or professional. Individual Amazon sellers do not have to pay a monthly fee but are limited to 40 listings per month.
To sell some brands and in some categories, Amazon requires that sellers become professional.
Professional amazon sellers pay $39.99 a month to have access to unlimited listings in more than 20 categories.
Additionally, Amazon charges referral, as well as closing fees. For individual sellers:
- the price per item fee is $0.99 per item sold
- between 6 to 45% of the selling price of the referral fee
- a closing fee of $1.80 per item (only for items in the Media categories)
For an Amazon Professional seller, there is no fee price per item. The other fees are similar to an individual seller.
Fulfillment
Amazon has a few options to help get your products into the hands of your customers We will touch on the main three which are:
- FBA
- FBM
- SFP
Amazon FBA
FBA stands for Fulfilled by Amazon. This simply means that the seller sends their items to an Amazon warehouse. When a buyer purchases an item, Amazon takes care of packaging and shipping, so you don’t have to decide on shipping options or be marked down with a late shipment rate.
Another perk of the FBA services is that if you have a return, Amazon also takes care of returns for you.
Amazon FBM
Amazon FBM stands for Fulfillment By Merchant. In a nutshell, it means that you are shipping the products directly to the buyers. You will handle all of the logistics that go along with shipping and storing products.
Another piece of the puzzle you also have to manage is customer service.
Amazon SFP
Amazon SFP stands for seller fulfilled Prime. It is similar to Amazon FBM where you handle all of the shipping, but having the “Prime” badge has its advantages.
The major difference is you need to meet the obligation of shipping it to the customer within 2 days. You need to go through a qualification period before you can be approved for this program.
Customers
Any online retailer is nothing without customers. Customer satisfaction is important. As an online retailer, Amazon is sometimes referred to as being customer obsessed. Amazon ranks in the top five retailers in the American Customer Satisfaction Index.
Amazon understands customer service. What they do not offer customers is a convenient physical retail store.
One thing Amazon does extremely well is fast delivery of products and no-hassle returns. Customers are willing to pay a membership fee to be part of Prime just so they are assured of receiving items quickly once they make a purchase.
When looking for anything online, potential customers seem to flock to Amazon as their first choice. Amazon has worked hard to focus on buyers and to meet all of its customer expectations.
Customers can search for a variety of products and view your seller profile before deciding whether to buy.
Amazon offers two-day shipping to all Prime members for an annual membership fee. This is a nice perk for buyers, but for sellers, it means meeting specific criteria to gain those Two-Day Shipping Tags.
Amazon requires that its sellers maintain an order defect rate ODR of less than 1% tracked with valid tracking codes over a 60-day period.
Sellers must also keep their cancellation rate below 2.5% over a 7-day period and maintain a low late shipment rate at or below 4% over both 10-day and 30-day periods for seller-fulfilled orders only.
Tools
Amazon Seller Central offers some reporting tools that are beneficial. Amazon offers limited seller tools and reports. It does offer business and traffic data as well as fulfillment reports. It also offers Payment reports.
Seller Central on Amazon offers:
- Bulk product uploads and listings with Amazon’s inventory file templates
- Business reports
- Advertising offerings
- Fulfillment reports
- Payment reports
- Account health
- Brand dashboard
- Voice of Customer that shows customer experience health
- Brand analytics
- Seller Performance Standards reports
- Amazon selling coach
Best Products To Sell
Some products sell well due to trends or unusual circumstances. Others are constantly good sellers. But, what is the best type of product to sell on Amazon?
During 2020 and the first part of 2021, face masks made the top sellers list. During a typical year, health or personal care and beauty products do well. Items like nail polish or hair care products also do well.
Fitness items are popular such as water bottles, exercise bands, or yoga mats. Games and puzzles are also top sellers. Also, electronics and media items such as books and movies do well on Amazon which makes sense seeing as how they got their start selling books.
Look at the Best Seller pages, and read product reviews before making a decision. Also, look for items with excellent product ratings, and choose a product category that is in high demand.
Usually, camera and photos, books, and pet supplies do well. In general, toys, games, electronics, cameras, video games, consumer tech products with accessory items, books, clothing, shoes and jewelry, or home and kitchen items do very well on Amazon.
The way you present your item can also make or break a sale. Clear, high-quality product photos and product descriptions as well as ASIN, UPCs, or ISBNs are important to help customers find the exact item they are looking for.
Selling On Walmart Marketplace
Before you are able to sell on Walmart you will need to sign up on the Walmart Marketplace platform. Walmart will ultimately make the decision whether you will be able to sell on their platform.
They choose who can sell on Walmart based on the seller’s reputation and projected sales. They also look to see how well your values align with theirs before extending an invitation of selling privileges.
Walmart will look at other online marketplaces where you sell to see your retail presence, sales records, your seller ratings, your return policy, and your order defect rate as well as how you handle customer support and what your Buy Box success is.
Additionally, they favor brand owners over retailers. If you are a general merchant, Walmart will view you favorably if you offer low prices.
Walmart looks for the best of the best in sellers on their site before extending an invitation for selling privileges.
To be a good fit as a seller on Walmart’s online store, you must have an order defect rate that is less than 2%. Sellers with an On Time Shipment Rate above 99% will be considered, and they must provide valid tracking on shipments at least 99% of the time to avoid a late shipment rate.
Walmart’s approval process is often lengthy. Many claim it takes between 2-4 weeks to get invited to sell online through Walmart. So, patience will do you well.
To sign up to sell, go to the official Walmart Marketplace website, submit your application. If you are approved, you will receive an email with an invitation to create an account on Walmart’s Seller Central.
Once you’re approved, here is what to expect on their selling platform.
Let’s look at some specifics about selling on the Walmart Marketplace including any fees or additional costs, fulfillment of orders, customers, selling and performance tools, and what the best products to sell on Walmart.com are.
Fees
Sellers on Walmart enjoy zero monthly sales fees with unlimited access to listings in all categories. Walmart does not charge a monthly fee for sellers. Sellers are allowed unlimited listings.
Walmart does charge between 6 to 20% referral fee of the selling price. There is no closing fee or high volume listing fee on the Walmart selling platform.
Fulfillment
Walmart now offers Walmart Fulfillment Services similar to Amazon. However, Walmart only allows sellers to ship products to their centers from within the United States. Walmart’s fulfillment service is known as WFS Walmart Fulfillment Services.
WFS is currently only open to select sellers. Walmart Fulfillment Services uses its fulfillment centers, store distribution centers, more than 4,000 stores, and its company transportation fleet to ship orders.
Walmart Fulfillment Services WFS launched in February 2020. Before Walmart Fulfillment Services was launched, sellers used a dropship model.
They had to dropship through 3PL, a third-party logistics provider. Walmart Fulfillment Services provides 2-day express delivery fulfillment with customer service and return management.
Walmart offers comparable storage fees with monthly storage fees to Amazon, starting at $3.45 a unit. Additionally, there are no long-term storage fees.
The country of origin must be on the retail packaging, and all products must have UPCs on the packaging. Additionally, WFS puts a weight limit of 30 pounds on packages no larger than 25”x20”x14”.
Customers
Walmart is working hard to keep up with Amazon’s customer service rankings. Walmart is designed to get products that customers purchase into their hands as fast as they can.
Walmart also unveiled a program similar to Prime where customers can pay a yearly or monthly fee to receive free, fast delivery. Customers receive free, unlimited same-day shipping and free grocery delivery.
Almost every American lives within about 10 miles of a Walmart store, so customers are used to being able to shop either online or in person. Establishing a good, solid online customer base will be an important part of your selling success on Walmart.com.
Walmart customers are also looking for low prices. The retailer takes pride in offering the most price efficient items.
Walmart wants to make sure that customers feel confident in buying on their site and that they are getting the lowest price. Because of this, they implement price parity.
This means that if one of your products can be purchased from your store on a competing website at a lower price, including shipping, the item will be taken down off of the Walmart site.
Similarly, if any of your products can be purchased from any seller on Walmart.com at a drastically lower price, they will be delisted.
Walmart also offers a free 2-day shipping guarantee to customers on any order $35 or more without the need to be part of any special membership. Valid tracking is on all shipments.
Tools
Once you are approved as a Walmart seller, you will immediately have Walmart Seller Support access to several advanced selling tools on Walmart Seller Center. Some of the top-notch service for sellers features include:
- Reporting and Analytics
- Seller Tools & Support
- Campaigns & Promotions
- Advertising Manager
- Bulk File Uploads & APIs for integration
- Buy Box & Listing Previews
- Customer Feedback
From the Seller Central dashboard, you will be able to make sure you maintain the strict performance standards. You will see your seller profile information about sales history and ensure that you are providing satisfactory service.
Best Products To Sell
The top-selling item on Walmart.com may surprise you. Its top seller for several years has been bananas. Other food items also do well. Adding grocery delivery to the mix makes it all the more desirable.
Before making a product selection to sell on Walmart, consider items you can sell a lot of for less. Also, consider product availability and always look at product ratings.
Walmart got its start and is still a thriving brick-and-mortar physical store that offers low-cost items. This has carried onto their online marketplace platform.
Walmart offers 24 categories. It is important that you select the right category for each item. The categories describe specific attributes necessary for inclusion.
Walmart.com expects certain product requirements. The Walmart Marketplace requires that every item must have a UPC and a URL of clear, high-quality product photos.
Additionally, keywords in product titles and excellent item descriptions will help items sell.
In addition to their popular bananas, like Amazon, personal care and health items also sell well on Walmart.com. Consumer Tech products and accessories also do well on Walmart. Ultimately, any low-priced item will do best on Walmart.com.
Which Marketplace Is The Best One To Sell on?
Which marketplace is better is going to come down to a matter of preference. However, don’t put all of your eggs in one basket, so to speak.
It’s always a good idea to make your items available for sale on more than one platform through a multi-channel selling approach by choosing both Walmart and Amazon.
Using Tactical Arbitrage To Source For Both Amazon & Walmart
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Generally, if it sells well on Amazon, then the traffic on Walmart should also see similar sales if priced right.
Final Thoughts
Amazon and Walmart offer similar options for online sellers. Sellers know that there are benefits to both platforms. While Amazon rose to a highly competitive online presence,
Walmart has made strides to make it known that they are in the online selling market for the long haul.
Obviously, Amazon is a well-known online buying and selling platform. However, Walmart has jumped into the online market with both feet. Walmart has high expectations for its online sellers, demanding they maintain an impeccable reputation.
If you are an established eCommerce seller with a successful record, Walmart could be your platform of choice. If you are an up and coming or established third-party seller, Amazon may be your first option.
If you are interested in selling on a huge worldwide platform as well as selling on a smaller marketplace that has multiple brick and mortar stores with a physical presence, then Walmart and Amazon will both be the way to go.
You don’t have to choose between the two. Why not sell on both Walmart and Amazon with multi-channel selling? Wherever you decide to sell, make sure you do so with a carefully thought out strategic selling plan to increase your return on investment ROI.
Whichever platform you use, whether you sell on Walmart, Amazon, or both, Tactical Arbitrage is here to help you. This software is here to help you look for Walmart or Amazon flips and wholesale opportunities.
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