Alternatives to FBA: Marketplaces to scale your business

Many sellers consider alternatives to FBA, due to competition and other factors. In this guide, I’ll showcase other channels to scale your Amazon business.

Now, I still remain an advocate of starting on Amazon, before moving into other marketplaces. After all, Amazon owns more than 50% of the US eCommerce market share. But if you’ve hit the ceiling on other marketplaces, it’s time to consider other options.

Alternatives to FBA

If you’re looking to scale your business, then consider international Amazon marketplaces first before any alternative to FBA. The UK, for example, is Amazon’s 2nd largest marketplace.

Alternatives to FBA
I recommend alternative marketplace channels to those who have the cashflow to scale.

I’m certainly not an advocate of starting with Amazon Australia, no matter where you live. Many Australians read my blog monthly, and I would highly advise starting in the US marketplace.

eBay

eBay in some ways shares similarities with Amazon. Commonly those who have read my blog have sold at least once on eBay before. That said, eBay has fought over the last few years to transition itself into a retail-focused marketplace, instead of a 2nd hard marketplace. Amazon, has quite literally, left eBay in the dust. That said, many buyers enjoy paying with PayPal, which is a payment option that Amazon lacks.

Walmart

Whilst Walmart is a big-box store, they do allow 3rd party sellers on their platform. Many who sell on Amazon actually choose not to sell on other marketplaces, since many of these sellers are beginners and without the bigger budgets to expand.

Jet

Jet is another large marketplace which is actually owned now by Walmart, with a record $3.3 billion exit in 2016. Impressive! Especially considering that Marc Lore still owns 25% and remains as the CEO. Much like Walmart, many Amazon sellers are skipping on this potential gold mine of a sales channel.

Shopify

I’ve listed Shopify last, as this list is based on marketplace volume. The key advantage of selling on Amazon is the volume of buyers. If you merely create your own Shopify store, then without paid traffic on Google or social media, then it’s difficult to gain traction. SEO, whilst free, takes months to see decent results.

Note: I am currently building this blog post to include other marketplace channels worthy of consideration. Whilst there are literally hundreds, I would only recommend those with decent buyer volume. One option not mentioned here in Google Shopping, to be expanded on. Likewise, many consider expanding through the wholesale (offline retail) distribution channels.

Monitor stock-levels

Whilst it’s a good idea to consider alternatives to FBA, it simply is better to pay attention to your current inventory volume. Do you have the capital to weather the sales volume of other marketplaces, whilst remaining in-stock on Amazon? Running out of stock on Amazon is one challenge that all sellers experience at one time.

You’ll really have to consider Q4 sales spikes. Many sellers have a sell-through rate in Q4 at equal or beyond the sales volume of the other 9 months. If I had to choose, I’d only sell on Amazon, unless I had excess capital and was looking to build brand assets for the 7 figure exit.

Closing thoughts

Amazon sellers should eventually turn into eCommerce sellers. Progress and adoption of new marketplaces should be gradual and methodical, based on working capital and other factors.

The initial focus should be maximizing the opportunity that Amazon provides, before adopting new marketplaces. I have plenty of excellent resources that both new and existing sellers can use through their journey.

As usual, play the long game. Consider trademarks and design patents to protect yourself on other platforms.

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