May 29, 2024

Navigating Amazon Handmade Fees: A Comprehensive Guide for Artisan Sellers

Discover how to Navigate Amazon Handmade Fees! Learn about and improve your accounting processes as an Amazon Handmade Seller!
Navigating Amazon Handmade Fees: A Comprehensive Guide for Artisan Sellers
Table of contents

In the vibrant world of handcrafted goods, Amazon Handmade has emerged as a prominent marketplace, connecting artisans with a global customer base.

As more creators venture into this niche platform, understanding the intricacies of Handmade at Amazon fees becomes crucial for maximizing profitability and ensuring long-term success.

In this guide, we'll delve into the various costs associated with selling on Amazon Handmade, compare fee structures across different platforms, and explore strategies to optimize your pricing and minimize expenses.

Whether you're a seasoned artisan or just starting your handmade business journey, this article will equip you with the knowledge and tools to navigate Amazon Handmade fees with confidence.

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Understanding Amazon Handmade

What is Amazon Handmade?

Amazon Handmade is a dedicated marketplace within Amazon, specifically designed for artisans and crafters to showcase and sell their unique, handcrafted products.

From jewelry and accessories to home decor, pet and party supplies, toys, and beauty items, personal care, clothing, shoes

Amazon Handmade offers a diverse range of categories for sellers to explore, including Accessories, Artwork, Baby, Beauty, Clothing, Shoes, Handbags, Home, Outdoors, Pets, Sporting Goods, and Stationery & Party Supplies.

By leveraging Amazon's vast customer base and trusted brand, handmade sellers can expand their reach and tap into a growing market for selling handmade products.

Benefits of Selling on Amazon Handmade

Selling handmade goods on Amazon Handmade comes with a host of benefits for artisans:

  1. Exposure to a large, engaged customer base: Amazon's millions of active customers provide a ready-made audience for your handcrafted items, increasing your potential for sales and growth.
  2. Trust and credibility: Associating your handmade store with Amazon instils trust in potential buyers, as they are more likely to purchase from a platform they know and trust.
  3. Streamlined logistics: Amazon's fulfilment services can handle shipping, returns, and customer service, allowing you to focus on creating your handmade products.
  4. Customizable storefront: Showcase your unique brand story and handmade items through a personalized Amazon Handmade store.
  5. Access to international markets: Amazon Handmade enables you to sell your handmade goods to Amazon customers worldwide, including European stores, expanding your reach and potential customer base.

Eligibility Requirements for Handmade Sellers

To maintain the integrity of the handmade marketplace and ensure that only genuine handcrafted items are sold, Amazon has set specific eligibility criteria for handmade sellers:

  1. Handcrafted products: All items listed on Amazon Handmade must be made entirely by hand, hand-altered, or hand-assembled by the artisan or under their direct supervision.
  2. Handmade by the seller: Products should be designed and crafted by the artisan themselves, with no outsourcing of production allowed.
  3. No digital or downloadable products: Amazon Handmade is exclusively for physical, tangible handmade items. Digital or downloadable products are not permitted.
  4. Approval process: Prospective handmade sellers must apply and be approved by the Amazon Handmade team before listing their handmade products. This process ensures that only genuine handcrafted goods are sold on the platform.

Amazon Handmade Fee Structure

Professional Selling Plan and Monthly Subscription Fee

To sell on Amazon Handmade, artisans must have a Professional Selling account, which comes with a monthly subscription fee of $39.99.

This monthly fee grants access to advanced selling tools and eliminates the per-item selling fees associated with individual selling plans.

The monthly subscription fee is charged regardless of whether you make any sales or not, so it's essential to factor this cost into your overall business expenses when selling on Amazon Handmade.

Referral Fees for Handmade Items

In addition to the monthly subscription fee, Amazon Handmade charges a referral fee for each handmade item sold. The referral fee is a percentage of the total sales price, including shipping and any gift wrapping charges.

For most handmade products, the referral fee is 15%. However, for jewelry and watch products, the referral fee is 20% for the portion of the price up to $250 and 5% for any portion of the price above $250.

It's crucial to factor in these referral fees when determining your pricing strategy to ensure profitability when selling handmade goods on Amazon.

Listing Fees and Other Costs

Unlike some other handmade marketplaces, Amazon does not charge any listing fees for adding or maintaining your product listings.

This means you can create and manage your listings without incurring additional costs, making it easier to keep your handmade store's various product offerings and catalogue up to date.

However, there are other costs to consider when selling on Amazon, such as:

  1. Shipping costs: You are responsible for setting your own shipping rates and incorporating those costs into your product prices. Make sure to account for packaging materials, shipping carriers, and delivery times when determining your shipping prices for your handmade items.
  2. Product photography: High-quality product images are essential for attracting Amazon customers and showcasing your handmade products. You may need to invest in professional photography or equipment to capture your handcrafted items in the best light.
  3. Marketing and advertising: While Amazon provides exposure to a large customer base, you may still want to invest in additional marketing and advertising efforts to drive traffic to your Amazon Handmade store and increase sales of your handmade goods.
  4. Materials and supplies: Don't forget to factor in the cost of materials, tools, and supplies needed to create your handcrafted products when calculating your overall expenses for selling on Amazon Handmade.

Setting Up Your Amazon Handmade Store

Creating a Professional Selling Account

To start selling handmade products on Amazon Handmade, you'll need to create a Professional Selling account. Here's a step-by-step guide:

  1. Go to the Amazon Services website and click on the "Start Selling" button.
  2. Choose the "Professional" selling plan and click "Create a New Account."
  3. Fill in your business details, including your legal name, address, and tax information.
  4. Provide a valid credit card for the monthly subscription fee.
  5. Complete the account verification process, which may include providing additional documentation.

Once your approved selling account is set up, you can proceed to apply for an Amazon Handmade seller account.

Applying for Amazon Handmade

After creating your Professional Selling account, you'll need to apply to become an approved Amazon Handmade seller. Here's how:

  1. Sign in to your Amazon Seller Central account.
  2. Click on "Programs & Benefits" and then "Amazon Handmade."
  3. Click on the "Apply now" button to start your Amazon Handmade application.
  4. Provide information about your handmade business, including your production process, materials used, and handmade product categories.
  5. Submit product images and descriptions for review by the Amazon Handmade team.
  6. Agree to the Amazon Handmade terms and conditions.

The Amazon Handmade team will review your full application process and notify you of the decision. If approved, you can start the application process of setting up your Amazon Handmade store and listing your handcrafted items.

Listing Your Handmade Products

Once your Amazon Handmade seller account is approved, you can start listing your handmade goods. Here's how to create a new product listing:

  1. Sign in to your Amazon Seller Central account.
  2. Click on "Inventory" and then "Add a Product."
  3. Select the appropriate handmade category for your product.
  4. Fill in the product details, including title, description, price, and shipping information.
  5. Upload high-quality product images that showcase your handmade item.
  6. Set your inventory quantity and shipping settings.
  7. Preview your listing and make any necessary adjustments.
  8. Click "Submit" to publish your listing on your Amazon Handmade store.

Repeat this process for each unique handmade product you want to sell on the platform.

Optimizing Your Amazon Handmade Store for Success

Crafting Compelling Product Listings

To attract Amazon customers and make handmade creations stand out in the Amazon Handmade marketplace, it's essential to create compelling product listings that showcase your unique creations and handcrafted items in the best light. Here are some tips:

  1. Use descriptive and keyword-rich titles: Include relevant keywords in your product titles to improve search visibility while accurately describing your handmade item.
  2. Write detailed product descriptions: Provide comprehensive information about your product, including materials used, dimensions, care instructions, and any unique features or benefits.
  3. Highlight your handmade story: Share the inspiration and process behind your handcrafted products to forge an emotional connection with potential buyers.
  4. Include high-quality product images: Invest in professional-grade images that showcase your handmade items from multiple angles and highlight their unique details and craftsmanship.
  5. Utilize bullet points: Break down key product features and benefits into easy-to-read bullet points to help customers quickly grasp the essentials.
  6. Incorporate customer reviews: Encourage satisfied Amazon customers to leave reviews and ratings, as positive feedback can greatly influence potential buyers' purchasing decisions.

By optimizing your product listings, you can improve your visibility, attract more Amazon customers, and ultimately increase sales on your Amazon Handmade store.

Providing Exceptional Customer Service

Providing exceptional customer service is crucial for building a loyal customer base and fostering positive reviews on your Amazon Handmade store. Here are some best practices:

  1. Respond promptly to customer inquiries: Monitor your messages and notifications in Amazon Seller Central, and aim to respond to customer questions and concerns within 24 hours.
  2. Be proactive in your communication: Keep Amazon customers informed about their order status, shipping updates, and any potential delays or issues.
  3. Handle returns and refunds gracefully: Have a clear return and refund policy in place, and work with customers to resolve any issues in a timely and professional manner.
  4. Go above and beyond: Look for opportunities to surprise and delight Amazon customers, whether it's through personalized packaging, a small gift, or a heartfelt thank-you note.
  5. Encourage feedback: Follow up with Amazon customers post-purchase to ensure their satisfaction and encourage them to leave a review of their experience.

By prioritizing customer service, you can build a strong reputation for your Amazon Handmade store, which can lead to repeat business and positive word-of-mouth referrals.

Utilizing Amazon Handmade Marketing Tools

Amazon Handmade offers several marketing tools to help you promote your handmade products and drive sales. Here are a few key features to explore:

  1. Amazon Advertising: Create sponsored product ads to increase visibility and drive targeted traffic to your handmade listings.
  2. Promotions and discounts: Offer price discounts, free shipping, or bundle deals to incentivize Amazon customers to purchase your handmade items.
  3. Amazon Posts: Share your brand story, product updates, and behind-the-scenes content through Amazon's social media-style feature.
  4. Amazon Live: Host live video sessions to showcase your handmade products, share your creative process, and engage with potential customers in real-time.
  5. Amazon Storefronts: Create a customized, branded storefront to showcase your handmade products and tell your unique story.

By leveraging these marketing tools, you can increase your Amazon Handmade store's visibility, drive traffic to your listings, and ultimately boost sales of your handmade goods.

Amazon Handmade for UK Sellers

VAT Obligations for UK Handmade Sellers

If you're a UK-based handmade seller, it's essential to understand your Value Added Tax (VAT) obligations when selling on Amazon.  If your business exceeds the current VAT threshold (£85,000 as of 2021), you must register for VAT and charge it on your handmade products.

When you create listings on Amazon Handmade, you'll need to specify whether your prices include VAT or not. If you're VAT registered, make sure to account for VAT in your pricing strategy to maintain your desired profit margins.

Fulfillment by Amazon (FBA) for UK Handmade Sellers

UK handmade sellers can take advantage of Fulfillment by Amazon (FBA)  to streamline their order processing and customer service.

By using FBA, you can store your handmade products in Amazon's fulfillment centers, and they will handle the picking, packing, shipping, and customer service for your orders.

To use FBA, you'll need to create an FBA listing for your handmade products and ship your inventory to an Amazon fulfillment center.

Keep in mind that additional FBA fees apply, including storage and fulfillment fees, so factor these costs into your pricing strategy.

Selling on Amazon Handmade Europe for UK Sellers

As a UK handmade seller, you have the opportunity to expand your reach by selling on Amazon Handmade Europe.

This allows you to showcase your handcrafted items to customers across Europe, including Germany, France, Italy, and Spain.

To sell on Amazon Europe, you'll need to create listings on the relevant European marketplaces and ensure that your products comply with EU regulations.

You'll also need to consider international shipping costs and any additional VAT obligations when selling to customers in other European countries.

UK Handmade Seller Support

Amazon provides dedicated support for UK handmade sellers through the Amazon Handmade Support team.

If you have any questions or concerns about setting up your Amazon Handmade store, navigating fees, or optimizing your listings, you can reach out to the support team for guidance.

Additionally, Amazon offers a range of resources and tutorials specifically for UK handmade sellers, including guides on VAT, FBA, and selling on European marketplaces.

Take advantage of these resources to ensure you're making the most of your Amazon Handmade selling experience.

Streamlining Your Amazon Handmade Accounting with Link My Books

Managing the financial aspects of selling handmade products on Amazon Handmade can be streamlined with the help of Link My Books, an eCommerce accounting software designed to simplify bookkeeping for online sellers.

By integrating your Amazon Seller Central account with Link My Books, you can effortlessly track sales, Handmade at Amazon fees, and expenses in one centralized platform.

Link My Books automatically imports your Amazon Handmade transactions and calculates your profits, taking into account the referral and payment processing fees, and any other associated costs.

This seamless integration saves time and ensures accurate financial records, allowing you to focus on growing your handmade business.

Here's a step-by-step guide to setting up Link My Books with your Amazon Handmade seller account:

  1. Sign up for a Link My Books account at 14 day trial
  2. Connect your Amazon Seller Central account by providing your login credentials.
  3. Link My Books will securely import your transaction data, including sales, Handmade at Amazon fees, and expenses.
  4. Set up your chart of accounts and customize your financial categories to match your business needs.
  5. Review your imported data for accuracy and make any necessary adjustments.
  6. Generate financial reports, such as profit and loss statements and sales tax summaries, with just a few clicks.

By leveraging Link My Books' automation and reporting features, Amazon Handmade sellers can save valuable time and gain deeper insights into their business's financial health. This integration empowers artisans to make informed decisions, optimize their pricing strategies, and maximize profitability on the platform.

Wrapping Up

Are you ready to take your handmade business to the next level on Amazon Handmade? Don't let the complexities of fees and financials hold you back.

Sign up for a 14-day free trial of Link My Books today and experience the power of streamlined accounting for your Amazon Handmade store.

With automatic transaction imports, customizable financial categories, and insightful reporting, Link My Books empowers you to make informed decisions and maximize your profitability.

Start your journey towards financial clarity and growth on Amazon Handmade – try Link My Books risk-free for 14 days and unlock your store's full potential. Your handcrafted products deserve the best – give them the financial management they need with Link My Books!

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