For most sellers in the US, Amazon FBA or eBay are the two most popular ins to the world of e-commerce. Together, they make up 43.4% of the country’s total retail e-commerce sales. That’s massive. But which marketplace is better? Where can you maximize your earning potential and build a promising online empire? Do you make more money selling on Amazon FBA or eBay?
Selling on Amazon can be more lucrative than selling on eBay. Amazon is 40x the size of its counterpart and offers greater sales potential, has fewer sellers (less competition), and generates higher net income that continues to grow year by year.
Amazon FBA or eBay – Comparing the Fees
During the 12 months ending May 31, 2020, American SMBs averaged $160,000 in sales while selling on Amazon. More than 3,700 third-party sellers grew their Amazon stores to over $1 million in sales, making the marketplace the best fit in terms of investment, returns, and growth. Let’s dive deeper into the Amazon and eBay comparison and take a further look at the numbers to better understand why selling on Amazon is more rewarding compared to eBay.
When selling on Amazon FBA, you usually need to pay a fixed monthly fee, set at $39.99 for Professional sellers. In addition, you must pay a referral fee on every sale you make. This can vary anywhere between 8% and 20% of the selling price, depending on your product category. However, for some items like Amazon device accessories, it can even rise to 45%.
Finally, you have the Amazon FBA fee. This fee is optional and only applicable if you’re using Amazon’s fulfillment and storage services to sell products online. It starts from $2.16.
Like Amazon, eBay also has some basic selling fees. eBay Store plans start from $4.95/mo with an annual subscription, allowing you to list up to 250 items for free. If you want to list items above your free allocation limit, you must pay an additional insertion fee per listing, depending on your store plan. All plans come with advanced listing tools to manage and promote your business.
eBay also charges a final value fee to sellers. This can be considered equivalent to Amazon’s referral fee. It is fixed at 11.7% of the total selling price (+ $0.30 per order) for sales of up to $2,500 for most categories. eBay doesn’t offer fulfillment services.
Example:
Let’s say you want to sell a product in the Home & Kitchen category. The product has the following landing cost and specs:
- Landing cost: $6
- Dimensions = 15” x 12” x 0.75”
- Weight = 6 oz
You set the selling price at $42.99. How much total fees will you have to pay to list and sell the product on Amazon and eBay?
As you can see, there isn’t much difference between selling fees on Amazon FBA and eBay. In fact, selling on Amazon FBA is roughly 3% cheaper if you include the FBA shipping and storage costs. Of course, you can find service providers that can offer you shipping and storage for eBay at lower rates too.
Amazon or eBay – Comparing the Market Share
This is where Amazon really comes into its own.
Amazon sells more products and attracts more customers compared to eBay. In 2020, Jeff Bezos and his team added eBay’s worth of sales to its gross merchandise volume (GMV), crossing $295 billion in value.
If you don’t know what GMV is, it is the total amount of sales generated over a given period of time. Companies typically measure their GMV on an annual or quarterly basis. Following are the reported GMV figures for different US marketplaces for the year 2020:
You can clearly see that Amazon dominates the US online e-commerce landscape pretty much unchallenged. It enjoys a market share of over 49%. In contrast, eBay sits at just about 5%.
In terms of customer base, Amazon has more than 126 million users in the US alone, who not only shop on the marketplace but also pay a monthly fee for faster shipping and other Prime benefits. eBay has over 159 million active buyers worldwide.
Amazon vs eBay – Comparing The Average Earnings of Sellers
Surely if Amazon generates more sales and attracts more customers than eBay, Amazon sellers should have higher average earnings than their counterparts?
Well, let’s take a look.
According to the 2020 Amazon SMB Report, US sellers make around $13,000 per month on average selling products on Amazon. In comparison, eBay sellers report income levels between the low and mid-range.
According to one thread, most sellers selling full-time on eBay make $4700 per month on average. While these numbers are not bad either, you’d definitely want to be selling where you have the opportunity to make more money.
Amazon FBA or eBay – Comparing The Top Sellers
Okay, but what about the top US sellers selling on Amazon and eBay? How do they fare against each other in terms of revenue?
Top 5 US sellers on Amazon and their estimated total annual revenue:
- AnkerDirect – $9.35 billion
- Zappos – $629.4 million
- Utopia Deals – $360 million
- 6PM – $155.7 million
- Pharmapacks – $24.8 million
Top 5 US sellers on eBay and their estimated total annual revenue:
- Second Sale – Information not public
- ThriftBooks – $150 million
- COMC – $21.7 million
- Discover Books – Between $100k and $5 million
- Blowitoutahere – Information not public
The Amazon big boys clearly come out on top, beating eBay top sellers convincingly. If they can make it big, so can you. Dare to dream!
Take the Leap to the Promised Land
Both Amazon FBA and eBay are great platforms to sell online and build a better future for yourself and your family. However, Amazon is just that more rewarding and gives you a much larger playing field to make more money compared to eBay. We hope you found the information in this post helpful. Keep hustling, and we hope to meet you on the Amazon marketplace.
About ZonGuru
ZonGuru is an all-in-one Amazon toolkit that helps private label sellers with product research, niche evaluation, competition analysis, listing optimization, inventory tracking, customer review acquisition, and running day-to-day operations of their Amazon business. Our tools bring you the most accurate data from across ten Amazon marketplaces, including the US, Canada, Mexico, UK, Italy, France, Spain, Australia, Germany, and India. We make selling on Amazon easier and more convenient.
