Both Amazon and Walmart are providing you with multiple benefits for new sellers. So making the right choice on which marketplace you want to start selling on becomes very difficult. Amazon and Walmart are both top marketplaces fighting to get the Number 1 position. When deciding between these two marketplaces, you will need to go through all the benefits they provide and see which marketplace is best for you and your business. In this post, we will compare the marketplace fees for both of these selling platforms to decide which marketplace is perfect for you as a new seller.
Amazon Selling Fees vs Walmart Selling Fees
Both Amazon and Walmart are considered the top contenders for e-commerce platforms. As a result, both Amazon and Walmart provide beneficial features for sellers to sell their goods on their marketplace. Each marketplace has its type of benefits that differ from the others. When deciding between these two marketplaces, you will need to go through all the advantages they provide and pick the one that is best for you and your business.
There are various types of fees the marketplace may charge you depending on the types of services you are using. In this blog, we will be going over the different types of service charges that you may need to pay and comparing both FBA and WFS to see who has a lower pricing point. The services that we are going to go over are
✅ Selling Account Fee
✅ Referral Fee
✅ Fulfillment Fee
1. Selling Account Fee
When it comes to comparing Amazon and Walmart seller accounts, we decide to use Amazon’s professional seller account and compare it with Walmart’s seller account. As these two accounts provide the same level of features for you as a seller.
But when it comes to opening an account on Amazon, you will need to pay a monthly fee of 39.99 dollars whereas for Walmart you won’t need to pay a single dime to open an account there.
You can open a Walmart seller account with Zero fees.
For this reason, Walmart undoubtedly wins by a long shot as there isn’t any seller account fee when opening an account!
2. Referral Fees
Every time you sell a product on Amazon or Walmart, you will need to pay them a referral fee. This is a commission that you pay to the marketplace as they helped you get the sale of your product as you use their customer base. The referral fee is mainly calculated as a percentage of your product’s sell price. As a seller, you want to have the lowest referral price percentage as you can have a higher profit margin.
As the referral fee percentage is measured based on the product category, we will need to see which is the best category to sell on that has the lowest referral fees. Here, we will be considering private labelable categories.
For Amazon, the lowest referral fee is 8% for product categories which are Camera & Photo, Cell Phone Devices, and Consumer Electronics. Same way, Walmart has the same referral fee which is 8% for the same product categories which are Camera & Photo, Cell Phone Devices, and Consumer Electronics.
And when it comes to the highest referral fee you need to pay for Amazon is 20% on the Jewelry Product Category. This is also the same for Walmart as they also will charge you a 20% referral fee on the Jewelry Product Category.
For Walmart, the referral fees of selling vary from item category to category. The referral fees of Walmart are 8% to 15%. You can see the below image for a better understanding.
When it comes to the referral fee, both Amazon and Walmart have the same minimum and maximum referral fee percentage when it comes to selling a product on their marketplaces. So, it’s a draw between Amazon and Walmart when it comes to the Referral Fee.
3. Fulfillment Fees
The fulfillment fee is the most important pricing for a seller as this is mainly the charge taken to fulfill your order. For Amazon, Fulfillment By Amazon or FBA is their internal fulfillment service and for Walmart, Walmart Fulfillment Services or WFS is their fulfillment service. Both of these services are the same. For both services, once you send your product inventory to them and a customer buys your product, the designated marketplace will complete the entire picking, packaging, and shipping criteria to get the product to the customer. To do all of these tasks you pay the marketplace a pre-set fee per order.
When calculating the charge of this fee, keep in mind that it is not like a referral fee where they charge you based on your product selling price. To calculate the fulfillment fee, you will only need the product’s size and weight. Here too, you want to have the lowest fulfillment pricing so that you can have a higher profit ratio.
Here, we are calculating the FBA fees for an item, we will also calculate the WFS fees for the same item to compare the fulfillment fees. Here, the FBA fees show as $26.49.
The main difference between FBA and WFS is that WFS adds a 0.25 LBS of packaging weight to your product weight whereas FBA does not add any sort of extra weight to your product.
Now, for the same item, we can see the WFS cost below, which is $9.05.
So we can say that the WFS is still cheaper than the Amazon FBA.
4. Size, Weight, and Dimension-Wise Fees
Packaging weight is the weight that Walmart adds to your product by adding their branding boxing and fillers to keep it the same when shipping. The default packaging weight for WFS is 0.25 LBs. This extra weight will always be added to your product every time it is shipped to a customer. And this extra weight adding is only done on Walmart WFS and Amazon FBA does not do that.
But, Amazon FBA adds a fuel and inflation surcharge fee to the fee whereas Walmart WFS does not charge you for this.
For both of the fulfillment services, you can easily find the product size tier based on product dimension. This is done by measuring your product’s dimensions which are length, width, and height. After you get your correct product dimension, you can easily find the size tier of your product.
After that, you will need to find the shipping weight of your product. Here, both Amazon and Walmart have the same shipping weight calculation. When calculating your shipping weight, you will have to take the greater weight into consideration. There are 2 different ways to calculate your product weight which are:
✅ Unit-Wise Fees
✅ Dimensional-Wise Fees
i) Unit-Wise Fees
The unit weight is the weight of the package that you send to Amazon or Walmart. Keep in mind that this went is not the product weight, it is the complete weight of your product package that you are sending to FBA or WFS. To get this weight, you will need to place your product package on the scale and the weight you get is the unit weight.
ii) Dimensional-Wise Fees
The dimensional or volumetric weight is the weight you calculate by multiplying the length, width, and height of your packaged product. Not your product, but your packaged product that you are going to send to Amazon or Walmart.
Now you have 2 different weights for your product. Here, you will need to take the higher weight when calculating the shipping charge. When calculating the shipping fees, it all boils down to your product sizing. There are different price points available on both Walmart and Amazon for the different levels of the size tier.
For small package sizes, FBA is cheaper than WFS. But for large standard-size packaging, WFS clearly is cheaper than FBA. And finally, for very large product packaging, Walmart WFS is also cheaper than Amazon FBA, but you may not get the product within 2 day shipping period. It may take longer for the item to get shipped.
The overall conclusion to the Fulfillment Service fee is that WFS has lower fulfillment fees over more size tiers than FBA. So, Walmart is also a clear winner here.
Closing Verdict!
In the entire post, we have seen the various selling and fulfillment fees for both Amazon and Walmart. We have compared the marketplace fees for you so that you can understand what amount of fees you will need to pay each marketplace if you’re a potential new seller. If you want to know more about the fulfillment fees of FBA vs FBM vs Prime, this post is just for you.
Please share this post with your friends and the eCommerce community if you find this post useful and informative. You can also write down your opinions in this post’s comment section. Happy has a good business week.
