Shopify vs Amazon: Which is the best choice for you?

Panna Kemenes

05.12.22 (updated more than 1 year ago)

6 minute read

If you want to enter the eCommerce space as a seller, there are various options that make the process straightforward. Two of those are Amazon and Shopify, both popular seller platforms.

Amazon is an online retailer, whereas Shopify is a hub for eCommerce businesses. The former provides a marketplace for buying and selling, whereas the latter lets businesses set up an online storefront and manage sales.

The question is - should you sell on Amazon vs Shopify?

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Table of Contents
Shopify vs Amazon: Quick comparison Amazon vs Shopify key features compared Shopify vs Amazon seller fees Pros and cons of selling on Shopify vs Amazon Final verdict: Should you use Shopify or Amazon?

Shopify vs Amazon: Quick comparison

Before exploring each option in depth, here’s a snapshot of Shopify vs Amazon when it comes to main features and price points:

	🟢 Shopify	🟠 Amazon
Platform cost ¹²	Starter - $5/month Basic - $29/month Shopify - $79/month Advanced - $299/month ShopifyPlus - $2000/month	Individual - $0.99 per item sold Professional - $39.99/month
Transaction fee ³⁴	0% with Shopify Payments, otherwise: Basic - 2% Shopify - 1% Advanced - 0.5%	Amazon product category referral fee applies
Platform type	eCommerce	eCommerce
Customer service	Chat Email Phone	Amazon Seller Support
Trustpilot rating ⁵⁶	1.7/5 from 1,359 users	1.6/5 from 21,504 users

Amazon vs Shopify key features compared

To examine the value of being a seller on Amazon vs Shopify, it’s worth considering the key features each platform offers.

Here are some of the most important factors for Amazon vs Shopify for sellers:

Ease of use

If it isn’t easy to sell online with a platform, then it adds more to your workload and increases the amount of time you’ll spend using it.

🟢 Shopify may sound more complicated to use since it offers sellers the option to create their own digital storefront from the ground up. However, to make the platform accessible to all sellers, Shopify has a wide range of pre-made templates users can choose from. There are also built-in features to help merchants market their products.

Shopify gives sellers the tools to customize their online store to attract buyers. Unlike Amazon, which offers a more typical retail experience.

🟠 Amazon generally offers a more straightforward seller experience whereby users can start selling straight away with its extensive marketplace of buyers. As such, Amazon is easier to use for individual sellers and those who don’t care so much about creating a strong brand identity online.

Payment options

Generally speaking, the more payment options supported by the platform, the better it will be for your customers as they can pay how they prefer.

🟢 Shopify offers many payment options, and integrates with 100+ payment gateways around the world. It also offers its own payment option, Shopify Payments, which provides the seller with a discounted transaction fee when used.

Shopify’s payment options extend to cryptocurrency and buy-now-pay-later (BNPL) payment plans.

🟠 Amazon offers most of the conventional payment options, from credit cards to debit cards. It also offers Amazon vouchers as a payment option.

Marketing resources

Before you can sell anything, you’ll want to leverage the seller platform you choose to market your products and get them in front of customers’ eyes. Both Shopify and Amazon offer marketing resources to support you in your attempts to raise awareness of your products.

🟢 With Shopify, you’ll have a centralized storefront you can direct customers to using the platforms’ content marketing and SEO tools. You’ll also be able to carry out wide-reaching marketing campaigns, promoting products you have listed on your store.

🟠 With Amazon, you can use Amazon Advertising to create sponsored ads and draw attention to your products listed on the platform. The ability to set up ads is included as part of Amazon’s New Seller Initiatives, and you can get up to $50 in free clicks when you sign up.

Fulfilment options

You’ve set up your seller profile or storefront and promoted your products, now the question is now you fulfil your orders and get them to your customers.

🟢 Shopify has a fulfilment network that you’ll have access to the moment you sign up and create your storefront. Once you’re part of this network, you’ll be able to do the following:⁷

Offer two-day delivery
Use transparent pricing which includes free storage and inventory management
Offer returns for a flat rate
Outsource your end-to-end fulfilment to Shopify

🟠 Amazon offers Fulfilment By Amazon (FBA), a service which lets you outsource fulfilment to the platform.

Here’s how FBA works in simple steps:

Send your products to an Amazon fulfilment center
The fulfilment center will pack and ship each order
Amazon will handle customer service and process any returns

Through the New Seller Initiatives program, you qualify for free shipping to the Amazon fulfilment centers.⁸

🔍 Find out more about Amazon FBA
What is FBA? Definition & how it works How to start an Amazon FBA business (successfully!) 2022

Dropshipping on Amazon vs Shopify

If you’re looking for an alternative order fulfilment process, you can try dropshipping through Shopify or Amazon. With dropshipping, you don’t have to concern yourself with managing inventory, packaging, or the shipping process.

🟢 Shopify lets you cut down on inventory costs and time spent organizing logistics as you can connect with dropshipper suppliers to handle the process for you. The Shopify app can help you find the right suppliers, so you can focus on branding and other aspects of your business.

🟠 Amazon doesn’t offer dropshipping in the fullest sense of the word. Instead, it offers FBA, so if you have products in your inventory, Amazon can handle the packaging and shipping for you.

🔍 Not sure which option is best? You can read the guide to compare Amazon FBA vs Dropshipping

Shopify vs Amazon seller fees

Finally on to the question of fees, how much will it set you back to use either of the platforms for selling?

🟢 Shopify offers five payment plans to sellers:¹
Starter - $5/month Basic - $29/month Shopify - $79/month Advanced - $299/month ShopifyPlus - $2000/month

Transaction fees don’t apply if customers use Shopify payments, but there are fees for third-party payment providers. The fees are as follows:

Basic - 2%
Shopify - 1%
Advanced - 0.5%

🟠 Amazon offers two payment plans:²
Individual - $0.99 per item sold Professional - $39.99/month

With Amazon, each sale incurs a referral fee based on the product category.

Bear in mind that international fees will also apply for both platforms. If, for example, you receive payment from a UK customer and they pay in GBP to your USD bank account, you’ll face unfavorable exchange rates.

💡 If you sell on multiple Amazon marketplaces, you can withdraw your different currency earnings directly into your Wise Business account. This way, you’ll avoid paying high currency conversion fees.

Receive global payments with ease: Try Wise Business

When you set up an eCommerce store, it’s important to consider how you receive your payments. Choosing the right business account can help you boost your bottom line as you can save a lot of money on fees.

Wise Business connects to Amazon so you, as a seller, can withdraw different currency earnings into your Wise Business account without conversion fees.

Shopify sellers can use Wise Business provided the currency is GBP, EUR, AUD, and USD and their account is direct debit enabled. USD customers will need to provide their ACH routing number.

You can receive payments using ten major account details ranging from EUR and USD to AUD and CAD. If a customer from the UK pays you in GBP you’ll receive that money in your GBP balance. You can then convert it to USD at the real mid-market rate.

Open a Wise Business account today

Pros and cons of selling on Shopify vs Amazon

✅ Pros

🟢 Shopify	🟠 Amazon
Set up a storefront with easy-to-use templates Accept various payment options and save with Shopify Payments Robust security measures Lots of integrations	Tap into huge online marketplace Use sponsored ads to find customers Use FBA to outsource packaging and shipping Offer option to pay with gift cards

❌ Cons

🟢 Shopify	🟠 Amazon
Transaction fees Monthly subscription fees More initial work required to set up storefront	Only allows for the sale of physical products Less opportunity to develop brand identity Competition in the marketplace

Final verdict: Should you use Shopify or Amazon?

As you can see from the key shopify vs amazon differences outlined in this guide, both platforms serve different business needs. As a result, it’s best to make your decision based on the key features that work best with your business.

For example, if you’re looking for a fully customizable storefront then Shopify is the best option for you. If, instead, you want access to a large marketplace of buyers who you can sell to straight away then Amazon can be the better choice.

🔍 You can also check the Wise guide to Stripe vs Shopify.

Sources:

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