Navigating the Operational Landscape: Advantages and Challenges of Selling on or to Amazon



Iwona Nowakowska
e-Commerce Account Support



In today’s digital age, Amazon has emerged as a powerhouse in the e-commerce world. Its vast customer base, robust infrastructure, and extensive reach make it an enticing platform for businesses looking to expand their online presence. However, like any business venture, there are both advantages and challenges to consider from an operational standpoint when selling on or to Amazon.


  1. Broad Customer Reach: One of the most significant advantages of selling on Amazon is the unparalleled exposure to a massive customer base. With millions of active users worldwide, Amazon provides access to a global market that would be challenging to reach independently. This broad reach can lead to increased sales and brand visibility. Currently, there are about 300 million active accounts on Amazon and over 170 million unique users per month. This adds up to over $50 billion in European revenue alone.
  2. Infrastructure and Logistics: Amazon’s well-established infrastructure and logistics capabilities can be a game-changer for businesses. Utilizing Amazon’s fulfilment services, such as Fulfillment by Amazon (FBA), can streamline order processing, warehousing, and shipping, enabling businesses to focus on other core operations. Additionally, Amazon’s efficient delivery network can provide a positive customer experience with fast and reliable shipping.
  3. Customer Trust and Brand Credibility: Amazon’s reputation for customer satisfaction and trust can benefit businesses selling on the platform. Customers often perceive products sold on Amazon as reliable and of good quality. This built-in trust can boost brand credibility and result in increased sales and customer loyalty.
  4. To sum up->Selling on Amazon brings many benefits to the seller:
    • Segmented traffic
    • You don’t need to create an online store or website
    • Potential for internationalization
    • Buyer confidence


  1. Intense Competition: The immense popularity of Amazon also means intense competition. With countless sellers offering similar products, standing out from the crowd can be challenging. Businesses need to invest in effective marketing strategies, optimization of product listings, and pricing competitiveness to maintain visibility and drive sales.
  2. Dependency on Amazon’s Policies: When selling on Amazon, businesses must adhere to the platform’s policies and guidelines. While these policies aim to ensure a fair marketplace, they can sometimes be stringent and subject to change. Adapting to new policies and keeping up with Amazon’s requirements can require constant monitoring and adjustment of business operations. Business data cannot be migrated from Amazon to your own databases.
  3. Margin Pressure and Fee Structure: Amazon charges various fees, including referral fees, fulfilment fees, and storage fees. These costs, along with discounts and promotions, can impact profit margins. Businesses need to carefully evaluate pricing strategies and operational costs to ensure profitability while remaining competitive in the marketplace. You also need to consider other fees directly related to the settlement of deliveries, such as: shortage claims, chargebacks fees. If these fees are high, they can directly threaten the profitability of the business with Amazon.
  4. Limited Control and Branding: Selling on Amazon means sharing the platform with numerous other sellers, which can limit control over the customer experience and branding. Product listings and pages may have similar layouts, making it challenging to differentiate from competitors. Building a distinct brand identity and maintaining control over customer interactions may require additional effort and creativity. The competition also applies to Amazon itself because it commercializes its own and other brands’ products.


Selling on or to Amazon offers undeniable advantages from an operational perspective, including access to a vast customer base, streamlined logistics, and enhanced brand credibility. However, it also comes with challenges such as fierce competition, dependency on Amazon’s policies, margin pressure, and limited control over branding. Businesses should carefully weigh these factors, considering their unique circumstances, before deciding to leverage Amazon as part of their overall strategy. You will be able to see your performance metrics in your Vendor or Seller portal on Amazon. These metrics are used by Amazon to measure your business performance. They should be kept under constant watch as they are extremely valuable to Amazon. Meeting Amazon’s requirements means having advantages that the competition may not have.
By understanding the advantages and challenges of selling on or to Amazon, businesses can develop comprehensive strategies to navigate the e-commerce landscape successfully. With proper planning, optimization, and adaptability, Amazon can be a powerful platform to drive growth and expand market reach for businesses in the digital age. Exertis provide several years of experience in co-operating with Amazon so we encourage you to start the business with us !!!

To learn more about any of our offerings or to arrange an appointment with a member of our sales team please get in touch.