When it comes to online shopping, two names stand out above the rest: eBay and Amazon.
These two companies have been battling it out for years to be the top e-commerce site on the web. So, which one is better?
In this eBay vs Amazon guide, I will compare both eBay and Amazon in terms of pricing, fulfilment methods, receiving payments, and more.
I will also look at the pros and cons of each platform in order to help you make an informed decision about which platform is right for your ecommerce business.
Keep reading to learn more.
Table of Contents
What Is Amazon? A Look At Amazon
Amazon is an American multinational technology company based in Seattle, Washington, that focuses on e-commerce, cloud computing, and artificial intelligence.
Amazon is the largest e-commerce marketplace and cloud computing platform in the world as measured by revenue and market capitalization.
Founded in 1994 by Jeff Bezos, Amazon was originally a way to sell books online but soon diversified to sell a wide variety of consumer goods.
Amazon has since expanded to offer streaming services with Prime Video and Music and produce its own line of consumer electronics with devices like the Kindle and Echo.
Amazon is now also a major provider of cloud computing services through its Amazon Web Services arm. AWS offers a variety of services like storage, databases, and analytics that are used by major companies like Netflix, Airbnb, and Instagram.
Most people know Amazon for its e-commerce business, but the company is quickly becoming a major player in other industries as well.
Pros and Cons of Selling on Amazon
Pros
- Lower fees: Amazon’s fees are lower than eBay’s. Amazon charges a flat fee of $0.99 per item, plus a referral fee (which is a percentage of the total sale fixed price). Referral fees on Amazon also tend to be lower than the final value fees on eBay.
- Buyer trust: Amazon has built up a lot of trust with buyers over the years. This is because Amazon has a great return policy and also offers buyer protection.
- More branding opportunities: Amazon offers more branding opportunities for sellers than eBay. On Amazon, you can create a “Storefront,” a mini-website showcasing your products. You can also create coupon codes and discounts to help promote your own brand and products.
- Fulfillment services: Amazon offers fulfillment services through its “Fulfilled by Amazon” (FBA) program. This program allows you to store your products in Amazon’s warehouses, and they will handle the shipping and customer service for you. It allows you to also have the Prime badge, which will increase sales to amazon prime members.
Cons
- More restricted categories: There are more restricted categories on Amazon than there are on eBay. This means that as an amazon seller, you will have less freedom to list the products you want to sell.
- Extra FBA fees: If you use Amazon’s fulfillment services, you will have to pay extra amazon fees. These FBA fees can add up quickly if you sell many products.
- More difficulties in listing products: It is more difficult to list products on Amazon than it is on eBay. This is because Amazon has more rules and guidelines that you need to follow. It also means that it will take you longer to get your products listed on Amazon.
- More competition: There is more competition on Amazon than there is on eBay. This is because Amazon is a more popular platform, so more sellers are using it. This means that if you sell on Amazon, you will have more competition and a lower chance of making sales.
What Is eBay? A Look At eBay
eBay is an American multinational e-commerce corporation based in San Jose, California, that makes business-to-consumer and consumer-to-consumer sales through its website possible.
eBay was founded by Pierre Omidyar in 1995 and became a notable success story of the dot-com bubble.
eBay is a multi-billion dollar business with operations in about 32 countries as of 2022.
The company manages an online auction and shopping website in which people and businesses buy and sell a wide variety of goods and services worldwide.
The website is free to use for buyers, but sellers are charged fees for listing items and again when those items are sold.
Pros and Cons of Selling on eBay
Pros
- Less competition: There is less competition on eBay than there is on Amazon. This is because Amazon is a more popular platform, so more sellers are using it. This means that if you sell on eBay, you will have less competition and a better chance of making sales.
- Customer loyalty: There is a lot of customer loyalty on eBay. eBay shoppers tend to be loyal to the sellers they buy from on eBay and are less likely to switch to other platforms or sellers.
- Fewer category restrictions: There are fewer category restrictions on eBay than there are on Amazon. This means you will have more freedom to offer products you want to sell.
- Easier to list products: It is easier to list products on eBay than it is on Amazon. This is because eBay does not have as many rules and guidelines that you need to follow. You can get your products listed on eBay faster and with less hassle.
Cons
- Smaller audiences: eBay’s audience is smaller than Amazon’s. This is because Amazon is a more popular platform, so more people are using it. This means that you will have a smaller pool of potential buyers to sell to on eBay.
- Less buyer trust: There is less buyer trust on eBay than there is on Amazon. These buyers tend to be more mistrustful of the sellers they buy from on eBay and are more likely to switch to Amazon.
- No fulfillment service: eBay does not have a fulfillment program, so if you use eBay to sell products, you will be responsible for storage, shipping fees, and customer service.
- Higher fees: eBay charges higher fees than Amazon. This is because eBay is a less popular platform, so they need to charge more to make up for the lack of users.
What’s the Difference Between eBay and Amazon?
Let’s take a look at the difference between amazon and eBay:
The Selling Fees
Amazon Selling Fees
There are two different selling plans on Amazon: Individual and Professional. Your decision will be influenced by how many sales you hope to make, but most sellers choose the professional plan.
Image Source: Amazon.com
The Individual plan is a great starting point if you’re a beginner in eCommerce and unsure of how many sales you’ll make.
With this plan, you can sell up to 40 items each month without paying a monthly fee, and each item costs just 99 cents.
The Professional plan is the best option if you anticipate selling more than 40 items per month. It allows for unlimited sales and costs $39.99 every month for professional sellers.
Other than the fees you pay for your selling plan, referral fees are also paid on each item you sell.
According to the type of product, you may pay anywhere between 8% and 15% of the total cost. Finally, several extra costs are associated with joining Amazon’s Fulfillment by Amazon (FBA) program.
eBay Selling Fees
There are two categories of selling fees on eBay. Once you list a product, some insertion costs are first involved.
After selling a product, there are final value fees.
A PayPal processing fee, which is not paid to eBay but is nonetheless a component of the transaction, will undoubtedly be incurred by you.
The insertion fee for each listing and category on eBay is $0.35. You are entitled to a monthly listing allowance after creating an eBay Store.
Basic Store costs $24.95 every month and offers 250 free listings. Anchor Store packages cost $349.95 each month for 10,000 listings
Image Source: eBay.com
You cannot get the return fees if your product fail to sell. And every time you list your product again, you will need to pay the insertion fee once more.
eBay fees for final value are calculated as a portion of the product’s purchase price as well as handling and shipping charges.
The amount you end up paying will vary depending on the type of eBay account you have.
Fulfillment Methods
Amazon Fulfillment Options
An edge Amazon may have over all other eCommerce platforms is its well-developed fulfillment service.
If you sell on Amazon, you can either pack and ship orders yourself on Fulfillment by Merchant (FBM) or outsource the effort to the company through Fulfillment by Amazon (FBA).
Image Source: Amazon.com
With FBA, Amazon will handle everything from sorting, packing, shipping, and even returns, refunds, and customer service in your stead.
It may not be for free, but it provides a huge advantage for Amazon sellers that can’t or don’t want to rent a warehouse or ship products on their own.
Fulfillment on eBay
In 2019, eBay attempted to launch an in-house fulfillment service called Managed Delivery. As of 2022, the project seems to have been discontinued.
You only have one fulfillment option when selling on eBay: packing and shipping your own orders. Another option is to enlist the aid of third-party sellers or fulfillment options.
Advertising
Advertising on Amazon
With the aid of the Amazon Sponsored Products program, your products can make it to the top of search results for certain keywords.
You will pay every time your customers click on an advertisement link in this pay-per-click (PPC) program.
As a result, it’s imperative to keep track of the number of finances you have spent on advertising campaigns.
Nevertheless, Amazon Sponsored Products is a cutting-edge service with lots of applications and additional tools that can help you manage your marketing campaigns.
Advertising on eBay
eBay provides Promoted Listings, which increase your products’ visibility in search results.
Your product is promoted alongside those of other sellers, each with their own bid, after you “bid” a sum that will be paid in addition to your final value fee, typically between 5 and 10%.
You only need to pay for eBay Promoted Listings whenever a product sells; the best thing is that they are easy and straightforward.
Even though the program isn’t particularly complex, it gets people’s attention and boosts sales.
Getting Paid
Getting Paid On Amazon
An Amazon seller’s account must be set up through a multi-step process on Amazon. Users are automatically registered for Fulfillment by Amazon and Professional accounts.
Account data is entered based on the user’s current account. The section for Tax Identity Information is the last one.
Getting Paid On eBay
Opening an eBay account (or using an existing one) and beginning to sell are the only steps required for eBay sellers.
An eBay seller is paid by direct deposit into their linked bank accounts.
Do Consumers Trust Amazon or eBay?
Although bith Amazon and eBay are trusted by consumers, Amazon is generally trusted more.
This is likely due to the fact that Amazon has built a reputation on putting the customer first.
Being able to win and keep the trust of its customers is so important to Amazon that it is reflected in the company’s values, mission, and vision.
Amazon also offers more buyer protection than eBay. Amazon has an A-to-z Guarantee that protects buyers from scams, while eBay only offers a Money Back Guarantee that covers certain types of transactions.
Frequently Asked Questions (FAQs)
Is It Riskier to Sell on E-commerce Sites?
The risks of selling on eCommerce sites depend on the platform you use.
For example, Amazon has an A-to-z Guarantee that protects buyers from scams, while eBay only offers a Money Back Guarantee that covers certain types of transactions.
So, if you are looking for a platform with low fees and good buyer protection, then Amazon is the better choice.
However, if you are looking for a more diverse company that is available in more countries, then eBay is the better choice.
Can I Make a Living off of Selling on E-commerce Sites?
Yes, you can make a living off of selling on eCommerce sites. In fact, many people do just that.
However, it is important to keep in mind that there are risks associated with selling on eCommerce sites. For example, the fees associated with selling on Amazon and eBay can eat into your profits.
Additionally, scammers may try to take advantage of you if you are not careful. So, while making a living off of selling on eCommerce sites is possible, you need to be aware of the risks involved.
Is Amazon Bigger Than eBay?
Yes, Amazon is bigger than eBay. Amazon had 469.8 billion USD in 2021, while eBay only had a revenue of 10.42 billion dollars during the same period.
Additionally, Amazon is a more diverse company than eBay.
In addition to being an online marketplace, Amazon also offers cloud computing services, digital streaming services, and its own line of consumer electronics.
eBay, on the other hand, is primarily an online marketplace.
What Are Popular Alternatives to Amazon And eBay?
There are a number of popular alternatives to Amazon and eBay. Some of the most popular options include Etsy, Overstock, Bonanza, eBid, and eCrater.
Each of these platforms has its own unique features and benefits. so, it is important to do your research to find the platform that best fits your needs.
Is Amazon Better Than eBay? Amazon vs eBay Comparison
Both Amazon and eBay are reliable platforms. However, Amazon is more reliable because it has more safeguards compared to eBay.
Although eBay also has safeguards in place, they are not as secure as those Amazon has.
You are also provided with the means and the resources by Amazon to succeed as an FBA seller. With fulfillment by Amazon, customers are assured of receiving their shipments on time.
The Final Verdict
So, which one should you use? Should you consider selling on amazon vs ebay? The answer depends on your needs.
If you need to reach a larger audience and are looking for a platform with low fees and good buyer protection, then Amazon is the better choice.
However, if you are looking for a more diverse company and more freedom to list your products, then eBay is the better choice.
If you are just starting out, I recommend selling on Amazon first because it is easier to list products on Amazon and you will reach a larger audience. Once you have more experience, you can then start selling on eBay.
Read our guide on ways to make passive income on Amazon to get started.
