As rightly said, “the e-commerce industry is a force which no investor can afford to ignore”, because of the limitless opportunities and growth. It has drastically changed the scenario of retail markets and made it effortless for the customers to buy products and services as everything is just a few clicks away. Sellers also find it easy to reach to their customers located in any part of the world through e-commerce platforms without maintaining a physical store. Amazon being the largest e-commerce website believes on satisfaction of the customer and word of mouth. Being an Amazon seller will help you endlessly, let’s discuss in depth about the same in this guide by H&R Block.
Amazon is one of the fastest growing e-Commerce websites in the world and the biggest retailer in the United States of America. Based on the concept of “pay as you grow” this e-commerce sector launched in 2013, became the highest growing business in India.
Being an Amazon seller helps you reduce your cost and improve the profitability of your business. There are a few things to remember before you register as given below;
You can easily become a registered Amazon seller by following the given steps:
Step 1: Based on the concept of “Badalti soch”, Amazon now helps its seller to reach out to crores of customer in India without having to move to new cities to investing crores of money to open new stores. Go to the home page https://services.amazon.in/landing/sellerbration.html , once when you’re sure about what you actually want to sell to register yourself.
Step 2: Fill out the details and create your Amazon seller central account providing basic information about the business entity, address, telephone number and bank account details.
In addition to the basic details and documents provided, the seller also has to furnish several other details depending upon the type of business he opts;
In case the seller wants to sells the products in his own name, the business will automatically be declared to be a sole proprietorship business. However, there are certain advantages and disadvantages in case of a sole proprietor as the liability is unlimited and the promoter gets no protection against the same. Upon that it is not easily transferrable and cannot have investors and partners. The sole proprietor needs to submit the following documents;
It is better to start as an LLP or Partnership as the liability is limited and easily transferable. The documents required are as follows;
The most preferred form for seller registration is as Primate limited company, as it has the ability to take on investors and scale up the operations in future. The following documents need to be furnished;
A seller can also register itself as a Trust or a Foundation. The documents required are similar in case of an LLP or a Private Limited Company as stated above.
Note: Click here to learn about documents required for GST registration.
The working mechanism is fairly simple and interesting.
Step 1: Set up your store on Amazon-
Step 2: Receive orders from customer-
Step 3: Amazon delivers your order –
Step 4: Receive Payment from Amazon –
Step 5: Grow your business –
Step 6: Expand Globally –
The seller has the access to sell his products either;
Selling on Amazon helps you grow your business and earn higher profits. There are a number of benefits availed by the seller explained as follows:
The pricing structure of the Amazon is simple and it comprises of three components;
For example: In case you’re selling Laptop at a product price of 45,000, and cost price of Rs. 39,000 ,then the referral fee will be calculated @5% of 45,000 i.e. Rs. 2,250 and Closing fee will be Rs. 40 and shipping fee depending upon the weight for say, if the laptop is 2.5 kgs, shipping fee will be Rs. 143.
Therefore, the total cost comes to Rs. 2,463
And GST upon that @ 18% comes to Rs. 443.34
Hence, the total charge will be Rs.2,906.34
Thus, profit comes to Rs. 3,093.66
Note: The seller doesn’t have to calculate each and everything, pricing calculator by Amazon makes it effortless.
Before GST came into the picture, the E-commerce sellers had to comply with the law of CST / VAT and now as the GST is into operation it is mandatory to comply with its provisions. The seller doesn’t have to bear different taxes for different states as the GST rates are uniform. GST will also reduce the cascading effect and increase the scope of the seller.
Ans: Yes. There are rewards for sellers known as Amazon Seller reward program. It is a seller loyalty program for sellers on Amazon.in, where Amazon provides opportunities to registered sellers to receive Rewards by successfully participating in Reward-earning tasks/ contests.
Ans: Yes. If you are listing taxable goods, GST details are required to sell online. You need to provide GST number to Amazon at the time of registration. However, if you are selling only GST exempted categories, then this may not be required.
Note: that if you start selling any taxable goods you need to register for GST as per GST laws and provide your GST number to Amazon.
Ans: Yes. Amazon protects the seller against fraudulent orders placed on your products and payment fraud.