Affiliate Marketing Versus Importing Products

Affiliate Marketing versus Importing Products

To make any money selling products online you have to either

• Make it yourself with its own barcode
• Import from somewhere where the labor is cheap and hope you don’t get copied
• because Chinese and Indian manufacturers sell to more customers that you. See the lower part of this Blogpost about importing from China.

I have spent 17 years selling products online on the following platforms:

1. eBay
2. Amazon
3. Our own website

Each method has its own charm pros and cons so let’s start where it all started for us with eBay.

eBay First let’s have a brief look at their costs. You really need to have an eBay shop as the listing fees are cheaper, although, if you have less than 30 items, you will not need a shop. Shops come in three different sizes depending on how many different products (SKUs) you have to sell.

• Basic Shop £27.00  or USA $27.95
• Featured Shop £77.00  or USA $74.95
• Anchor Shop £437.00  or USA $349

But it does not stop there, there is also Final Value Fees (FVF) and these vary depending which category your items are listed.

You pay one final value fee for items you sell on eBay, and you don’t have to worry about third party payment processing fees. i.e. Paypal at 2.9% of the sale price or any merchant fees.

The final value fee is calculated as a variable percentage (7.9% to 14.9%) of the total amount of the sale which includes the item price, postage, and any applicable taxes), plus a fixed charge of 30p per order. An order is defined as any number of items purchased by the same buyer at checkout with the same shipment method. Your final value fees are automatically deducted from your sales proceeds and the rest paid out to your bank account.

The best that can be said about eBay is that their telephone support is good. Certainly better than Amazon. 

Amazon Within a year I was contacted by Amazon to sell our products on their platform. So let’s have a brief look at Amazon’s costs.

With Amazon you just pay one monthly Shop Fee of £25.00 + VAT, (A kind of Sales Tax) at 20%) and then a Referral Fee that varies between 8% to 15% depending on which category your items are listed. The majority of categories are 15% However, You have to take care of delivery to the customer and delivery costs, and the dreaded returns.

Amazon also have a system called FBA (Fulfilment By Amazon) where you have all the above expenses the plus the cost of the fulfilling your sale to the customer and storage in Amazon’s warehouse.

How that works is that you prepare your items for sale: bar codes labels etc, and for quite modest fees UPS will come and collect them,  and take them to the Amazon warehouse.

When any items are sold Amazon send items from this FBA stock direct to the customer and put the money, less fees straight into your Amazon account. Then once a fortnight they transfer the sum of these sales in your bank account.

Any returns, Amazon take care of by sending the customer a label to their warehouse, and once a month they send them back to you or you can ask Amazon to destroy them. The customer gets his money back immediately he decides he doesn’t want the item. To precent fraud if Amazon do not receive the item back with 45 days and the buyer has kept the item, then after that the seller is refunded. Good system

The downside of this is that if you are selling expensive items on Amazon they sometimes, lose items. Also: if you are doing well with imported items from China or India, you can guarantee that Amazon will notice and copy your success.

The only way around this is to manufacture your own items and mark them with your own bar code. The optimum price for selling items like this is £40.00 ($50) and maximum price for manufacturing and landing should be no more than 30% to 35% of that.

 Also the telephone support from Amazon is appalling.

Our Own Website                                   

We have the same situation with deliveries as eBay or non FBA Amazon, but the selling expenses are much lower. The only selling expense is the merchant fees from the bank or PayPal.  These days we use PayPal whose fees are 2.9% depending what you turnover is on the previous month.

The big drawback here is trying to get traffic to your site which is extremely difficult, especially if you are selling something popular that can be bought on the high street.

However there are some cheap ways

• Leafleting in the boxes you send via Amazon or eBay is one.
• Posting questions on Quora and then answering them with text that has a link
• Making videos on Youtube (can be done with AI)
• Making use of the social platforms X (twitter), Tik Tok, Instagram, etc.

The more expensive ways if you have an advertising budget

• Advertising on Facebook moderately expensive
• Google is another. moderately expensive
• Advertising on TV. very expensive
• Advertising in the Newspapers extremely expensive

Importing From China 

When I first found out about Amazon FBA my wife had a very good idea. Her friend had a mastectomy and had bought Breast Forms for £89.00 in the UK (probably about the same price in USA and Canada)

Anyway a scan through Alibaba and contacting a Freight Forwarder revealed they would be $10.00 landed. We found the source and spent £2,000 importing them by ship, which took a month to get to us. And that was our first lot.

 Pre Brexit, we were able to sell them via Amazon FBA to France, Germany, Italy and Spain which trebled our income. It was the ideal product. It did not break in transit, and no one sent them back.  This is it, I thought. We are in the big time.

 And we made a lot of money for about 2 years. Then from being the only one on Amazon selling them, there suddenly appeared 200 other sellers, 98% Chinese and prices and sales took a nose dive.

If you do decide to import from China, use a Freight Forwarder based in your own country, don’t try and do it all yourself, otherwise you could end up with pallet loads of bricks. Freight Forwarders are very cheap and good value for money.

My rich friend with 65 retail shops tells me when he imports large amounts from China the manufacturers over there will postpone his order if they get an even bigger order while they are producing his.

They are totally ruthless and mercenary. 

Another reason to switch to Affiliate Marketing and let some else have all the above headaches.

If you need to ask questions, do it through the comments section below, and I/we will answer you within 24 hours

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