Shopify VS Amazon FBA: Which Will Give You The Most Success?
Both Shopify and Amazon provide eCommerce solutions for small business, but the best one for you may depend on how and what you sell online.
|Shopify is a shopping cart platform that lets users build independent online stores.||Amazon FBA is a vast marketplace users can join.|
|Shopify charges transaction fees between 0.5% and 2%.||Amazon FBA includes transaction fees of 15% or more, plus fulfillment fees.|
|Shopify users build and maintain their own storefront.||Amazon FBA lets you add your products to an existing marketplace.|
|Shopify sellers have direct contact with customers.||Amazon FBA sellers leave customer service to Amazon.|
|Shopify lets sellers link social media channels.||Amazon FBA users can use Amazon’s Multi-Channel Fulfillment to sell on marketplaces outside Amazon.|
|Shopify allows you to customize your store’s looks, feel, and function.||Amazon FBA does not let users build a customized storefront.|
High-volume sellers and those who hope to hit that status soon have a choice when they’re ready to jump into online selling or beef up their online presence. Should they create their own website and sell independently? Or is it better to join an established marketplace and take advantage of all it has to offer?
That choice may lead searchers to a comparison of two behemoths of eCommerce: Shopify VS Amazon FBA. From the outside, Amazon VS Shopify seems like a comparison of two very different things. And there are important differences between them, like how sellers reach their audience, how they fulfill their orders, and how much of a hit the platform takes from their bottom line.
In fact, while Shopify and Amazon are very different, each has equally stellar qualities to tempt you into joining the many merchants who have found eCommerce success there. Which is right for your sales strategy? Let’s dig in and find out!
Table of Contents
- Shopify VS Amazon FBA
- Shopify VS Amazon FBA Pricing
- The Key Differences Between Shopify & Amazon FBA
- Which Is Best For My Business Needs: Shopify OR Amazon FBA?
- Shopify VS Amazon FBA Features
- Shopify VS Amazon FBA Ease of Use
- Customer Service & Support
- Reviews & Complaints
- Shopify VS Amazon FBA Comparison: The Final Verdict
- Amazon FBA VS Shopify: FAQs
Shopify VS Amazon FBA
Shopify and Amazon FBA both can be great choices for high-volume online selling, though they’re very different. Shopify puts the seller in the driver’s seat, and that comes with a lot of work. Amazon does much of that work, at a price. The one that’s best for you may depend a lot on how you do business.
Shopify VS Amazon FBA Pricing
Looking at the pricing of Shopify VS Amazon, keep an eye on three types of costs, because they can affect your business’s bottom line: the monthly membership or subscription total, transaction fees, and the costs associated with filling customers’ orders. Amazon and Shopify take different approaches to each of these.
For starters, Shopify charges its users a monthly subscription fee that ranges from $9/month to $299/month. The $9 subscription is for Shopify Lite, a pared-down eCommerce option that does not include a full online store. For a full storefront, you’ll need Basic Shopify ($29/month), Shopify ($79/month), or Advanced Shopify ($229/month). Shopify also offers an enterprise-level plan, Shopify Plus, that includes custom pricing starting at around $2,000/month and is aimed at businesses doing more than $500,000 per year in sales. All Shopify plans have increasing levels of features as the subscription price rises.
Shopify charges users transaction fees that also vary by subscription level. In addition to payment processing fees that are matched industry standards, expect to pay transaction fees between 0.5% and 2.0% of each sale you make through your Shopify store. The only way to avoid these fees is to use the in-house payment processor Shopify Payments exclusively. Sellers who use Shopify Payments do not pay any transaction fees, although they can’t escape the payment processing fees that are almost unavoidable no matter where you sell.
If you choose to use Shopify Fulfillment Network, expect to receive a custom price quote based on your business needs. You’ll be charged for storage, pick and pack services, delivery charges, and special projects. Charges for Shopify Fulfillment Network services will be added to your Shopify subscription, so you won’t have to pay a separate bill.
Now, what about Amazon? How does the cost of using Amazon FBA compare to Shopify’s cost? Let’s start with the subscription cost. The first step toward selling on Amazon is signing up for an Amazon Seller Account; the Professional will cost you $39.99/month. Of course, signing up is not a one-click process, like it is with Shopify. You’ll need to apply to become an Amazon seller, provide some detailed information about your business, including income, and wait a couple of weeks for approval. Amazon also offers an Individual seller account aimed at sellers moving fewer than 40 products per month, with no fixed monthly charge but a $0.99 fee for every item sold.
Amazon also charges a “referral fee” on every item you sell. This transaction fee varies by product category, but most categories include a 15% fee. You will pay fees on the total transaction amount, including the item’s price, shipping, gift wrap, and any additional charges, such as personalization. If you use Amazon’s fulfillment service, Amazon FBA, you can expect to pay per-item fees as well. Of course, you could sell on Amazon without using FBA. However, using FBA allows you some nice perks, such as access to Amazon’s famous two-day free shipping offer and a better shot at standing out better in Amazon customers’ Prime-filtered searches. For that reason alone, we recommend using FBA if your sales plans include Amazon.
The Key Differences Between Shopify & Amazon FBA
In this post, we’ll go into detail about the Shopify VS Amazon FBA comparison, including how easy each is to use, how their customer support options stand up, and what users have to say about each. If you’re already familiar with both, here’s a quick “cheat sheet” you can use to see some of the major differences between Amazon FBA and Shopify:
- Fees: Shopify takes a portion of every sale you make on the platform, with fees ranging from 0.5% to 2.0% — unless you use Shopify Payments as your payment gateway. In that case, you’ll avoid transaction fees entirely, and pay only the normal credit-card processing fees. Not so for Amazon FBA, where most users can expect to hand over a hefty 15% of every transaction, including shipping, gift wrap, and the like.
- DIY: Are you the kind of business owner who looks forward to building and maintaining your own online store? If not, do you have someone on staff or the means to hire someone who will do it for you? To be sure, as a platform Shopify is known for being easy to use, with no serious technical skills or coding knowledge required. However, it can’t compare to using Amazon FBA, where the marketplace is already built and all you need to do is list your products.
- Traffic: When you use Shopify to build an online store, you also take responsibility for bringing customers to shop there. You’ll find all kinds of Shopify tools that can help you do that, such as email marketing and social media integrations. Compare that to Amazon, the go-to site for online shopping for millions of customers each day. Of course, the flip side to that is that on Amazon you’ll be competing in a crowded field, where not everyone is interested in your products and low price and free shipping are a major advantage.
- Branding: Amazon prohibits sellers from contacting customers outside of Amazon channels, and if you sell on Amazon you won’t be able to ship products in branded packaging or include your own marketing materials in the shipments. You won’t have an online storefront that fits with your brand, either. If establishing and marketing your brand is important to you, you’ll find a much greater opportunity with an independently operated Shopify store. For example, you can include your logo, use your brand colors, link to your blog or other pages, suggest add-on purchases, market directly to shoppers, and include special offers or other promotional materials in shipments.
- Customer Contact: When customers buy, say, a T-shirt from Amazon, you may be the one supplying the shirt they buy, but in their mind, they are buying it “from” Amazon. So whether the transaction goes right or wrong, it’s Amazon that gets the credit or the blame. Contrast that to the customer who navigates to your Shopify store at www.YourTshirtStore.com and buys your products. Yours is the face of that sale. It’s your brand and your reputation driving the transaction and the customer’s satisfaction. With an Amazon FBA sale, customers contact Amazon when problems arise, and Amazon makes it right. That may be a benefit to you or not, depending on your business priorities and goals.
- Easy To Join: If you want to sign up for Shopify and build a store, there’s nothing to it. You don’t even have to have a business name or products to sell before you can create a store. It’s even possible to have a store up and running in a day, if you put your mind to it. Things are a little more complicated when it comes to starting an Amazon store. For one thing, you need to apply to join the global marketplace. For another, the approval process can take a couple of weeks, after you provide the required information and documents to establish your identity, verify your location, and prove you’re running a valid business.
- Local Reach: Not every eCommerce business is 100% online. Do you plan to incorporate a brick-and-mortar storefront or any local events into your sales plans? If so, you may be able to build your local presence more easily on Shopify VS Amazon FBA. That’s because Shopify lets you link your store to other resources, like a blog, and communicate more freely with your customers.
- Payment Options: Both Shopify and Amazon offer proprietary payment services— Shop Pay and Amazon Pay, respectively — that allow customers to store their payment and billing information. That’s good for a variety of reasons, as outlined in this post about Shop Pay. Both also offer a buy-now-pay-later (BNPSL) financing option that allows customers to spread out the cost of purchases over time. There’s a difference, though. Shopify offers more BNPL options, because in addition to the in-house partnership with BNPL partner Affirm, Shopify users can add integrations with other BNPL options like Klarna. So for example, if your products are expensive, offering more payment options could be beneficial to your bottom line.
- Free Trial: Only Shopify lets you test drive the software, set up a store, and see how it works before you become a paid subscriber. With Amazon, you’ll need to set up your Amazon Seller account and pay once your application is approved.
- Restricted Products: Amazon is extremely choosy about what types of products it allows to be sold on its marketplace, with a long list of restricted products. So if your products are likely to be excluded from Amazon, Shopify is a better bet for your business. Shopify does have some exclusion, such as firearms, financial services, and health products. If you intend to use Shopify Payments (remember, that’s the only way to avoid Shopify transaction fees!), you’ll also need to comply with Stripe’s guidelines, since Shopify Payments is powered by Stripe.
Which Is Best For My Business Needs: Shopify OR Amazon FBA?
Though they have their differences, a Shopify VS Amazon FBA comparison clearly shows that they’re both top options. One or the other may hold a stronger appeal a different type of business. Here are a few examples:
Choose Shopify If …
- You who want the option of selling in-person, at a traditional store or local events.
- You want to maintain control of your marketing and customer communication.
- You want to keep the biggest share of profits possible.
- You’re just getting started.
- The products you sell are likely to show up on a restricted list.
Choose Amazon FBA If …
- You don’t need/want to cultivate a local customer base.
- You’re fine letting someone else handle customer service.
- Your profit margins can handle paying Amazon a bigger share of each sale.
- Your eCommerce business has an established reputation and business history.
Maybe you have read enough already, and you feel ready to make your decision. If you want more information, you can head to our website and read our full review of Shopify or our in-depth guide to selling on Amazon FBA. If you’d like a snapshot view of both, keep reading here.
Shopify is a fully hosted eCommerce platform that’s reasonably priced, with a variety of subscription levels to match users’ needs. It comes with a solid set of features out of the box, and you’ll find a fully stocked app store where you can add on just about any integration you can think of to customize your store’s front end or back end. Some advanced users may feel that Shopify lacks the features they want for their online stores, meaning that for many users add-ons are not just a bonus but instead an unwelcome extra expense.
Overall, Shopify is one of the shopping carts we most frequently recommend, and we feel it fully deserves our five-star ranking. That starts with a generous two-week free trial period, where new users can noodle around with setting up a store, adding products, and more without having to pull out a credit card. You won’t need to hire a designer to do that work for you, though you certainly can if you want to. Shopify is meant to be easy to use and the software mostly lives up to that promise. We particularly like that Shopify offers subscription plans at different price levels and with increasing levels of features, up to an enterprise-level plan, so that it’s truly a platform that can grow with your business.
Another area where Shopify shines is web design. You’ll find more than 100 themes available, all mobile responsive, so they always look their best to your customers. Eight of these themes are free and fully supported by Shopify, and the rest are priced between $140-$180 and supported by their respective developers. You can search Shopify’s themes using filters to find the best look for your store, and most themes have user ratings and reviews. In both form and function, most of the available themes are professional and elegant. Users with coding know-how can build or customize their own themes using HTML, CSS, and Shopify’s proprietary template language, Liquid.
Should you run into problems setting up or running your Shopify store, you’re in luck, with ample support options to choose from. From phone, email, and live chat support to forums, a help center, free training courses, developer documentation, and more, Shopify has you covered. Although users are split on how helpful Shopify’s live support options really are, the platform overall garners excellent although not perfect reviews. (More on that in the Reviews & Complaints section below.)
- Easy to use
- Attractive templates
- Free trial available
- Advanced design tools
- Full control over your store
- Additional fees
- Variable customer support
- Expensive add-ons often required
- Build your own customer base
Amazon FBA Overview
If you’re thinking about selling on Amazon, you probably already know that it’s the world’s largest retailer, accounting for more than a third of all online purchases in the US. Despite its size and global reach, Amazon’s success lies in part in its partnerships with vendors of all sizes, meaning even “the little guys” can benefit from Amazon’s vast marketplace. So whether you’re already selling successfully on your own or looking to launch an online business, Amazon FBA could be just what you need.
Of course, it’s possible to sell on Amazon without using the in-house fulfillment option, Fulfillment By Amazon, or Amazon FBA. The advantages to using FBA are important to understand before you rule it out. For one thing, your products will automatically become eligible for free Prime two-day shipping. And being able to guarantee fast, free shipping is a key to success on Amazon. Whether the costs of using a fulfillment service make it worth doing is a decision only the business owner can make.
Using Amazon FBA places some additional restrictions on what you can sell and how it must be purchased. For example, all items must have a unique barcode, to allow inventory tracking in the Amazon warehouse. If you’re reselling items, you might run into unique packaging requirements, too. For example, dietary supplements must be placed in approved packaging by the manufacturer.
Because Amazon FBA sellers operate in a crowded field, they need to work hard to attract customers and make the sale. That means paying a little extra attention to price. It’s no secret that Amazon shoppers often make buying decisions based on price. With Amazon FBA, high volume sales are the goal, so make sure you know what your products cost you, what you’ll pay Amazon in fees, and how much you need to sell them for in order to make your business profitable. If you’re asking a higher price for similar products than your Amazon competitors list, you probably won’t get the sale.
- Easy fulfillment
- Access to Amazon’s huge customer base
- Eligibility for Prime shipping
- Appropriate for high-volume sellers
- International sales supported
- Fees can decrease your profits
- Highly competitive
- Stock tied up in warehouse
- Not cost-effective for large or heavy items
- Limited contact with customers
Shopify VS Amazon FBA Features
|Automatic Shipping and Tax||✔||✔|
|Abandoned Cart Recovery||✔||X|
Both Shopify and Amazon have ample features, giving you enough out of the box to build your online store. That doesn’t mean they’re identical, though. Here are some important differences to consider as you weigh your choices in the Shopify VS Amazon FBA comparison:
With more than 100 themes to choose from, you’ll be able to build a Shopify store that looks the way you want it to. When you sell via Amazon FBA, you won’t be able to customize your look at all.
All of Shopify’s paid plans allow users to sell on Instagram, Facebook, Amazon, via Messenger, and with Buy buttons. Some themes include built-in social media buttons. Amazon requires FBA sellers to Multi-Channel Fulfillment (MCF), an Amazon-run fulfillment service for those who sell on marketplaces outside Amazon. When your customers buy something outside of Amazon, the Amazon warehouse processes and ships your products directly to the customers. MCF supports standard, two-day, and one-day shipping and usually ends up being more expensive than FBA.
Shopify also includes a number of tools and tips for multi-channel sales, including posts on the Shopify blog.
While Shopify allows shoppers to make their purchases as guests, without logging in, Amazon does not allow purchases by shoppers who do not have an Amazon account. Shopify allows guest checkout as an option. When I log in to my Amazon account, I count no fewer than three uses of my name as well as recommendations based on past purchases, recently viewed items, and links to my Prime Video account.
Shopify includes abandoned cart recovery tools that let you know when a customer leaves items in a cart without purchasing. Those tools allow you to send automatic emails, for example, to encourage them to complete their purchase. Amazon FBA does not include abandoned cart tools. This is in line with Amazon’s policy of discouraging contact between Amazon sellers and customers.
Shopify allows unlimited items in your catalog. And in theory, you can add any number of products to your Amazon seller account. However, if you’re using Amazon FBA, your account may be subject to storage limits at Amazon’s physical warehouse. Storage limits are calculated by your sales volume, your historic Inventory Performance Index (IPI) scores, and available warehouse capacity.
Shopify VS Amazon FBA Ease of Use
Starting to sell with Amazon FBA is a simple process, once your application to sell has been approved. Pick a free, prebuilt Amazon template, add your logo, then add your text and photos. Those are your only options for customizing your store. You won’t need any coding or design know-how, thanks to Amazon’s drag-and-drop format.
By comparison, starting a Shopify store is quite a bit more complicated. That doesn’t mean it’s hard to do, though, and the payoff is substantial. Shopify gives you significant customization options, and you’ll be setting up a complete independent storefront using the software. If you test Shopify’s admin during your free trial period, you’ll probably quickly become comfortable with the user interface. Shopify doesn’t have a video tutorial or setup wizard to guide you through store setup, but you will see suggestions that help you add products, customize your theme, and add your domain. All in all, most users find both Amazon and Shopify easy to use and don’t encounter significant roadblocks.
Customer Service & Support
Shopify’s customer support garners mixed reviews from sellers. Some say it’s wonderful, and others say it’s all but useless. Again, you’d be wise to test out the service during your free trial period, to see for yourself. Fortunately, you’ll find a plethora of self-help options available as well, in addition to phone, email, and live chat options. That includes forums, a help center, free training courses and guides, developer docs, webinars, a podcast, a blog, and more.
If you sell on Amazon FBA, you can find free resources in Amazon’s Seller Central, including Seller University. That includes videos, PDF, online training, recorded webinars, and more. New sellers can download a beginner’s guide to selling on Amazon, and you can always access help content and self-service tools through Amazon Seller Central or through the seller forums. What you won’t find is a direct phone number or any easy way to contact Amazon customer support. The best way to find personal support is to log in to your seller account and request it.
Reviews & Complaints
Like any service with enough users, Shopify and Amazon FBA have satisfied customers and some with complaints. Amazon FBA users say that the marketplace is oversaturated and that Prime customers’ expectations of quick shipping — combined with low prices — make it hard to turn a profit these days. It’s hard to find fans of Amazon FBA fees, too. Although the fulfillment process generally works smoothly, and Amazon service reps receive high marks from customers, Amazon FBA sellers pay a steep price for that convenience. Between the fulfillment costs, seller subscription cost, and transaction fees, it can be hard to balance customers’ low-price expectations with the need to make money.
What about Shopify? Users complain about the added transaction fees, which are avoidable only if you qualify for and use Shopify Payments as your processor. Some say it can be difficult to be accepted into Shopify Payments and, once there, problems with vendors’ payments can occur. While many users appreciate how easy Shopify is to use, high-volume sellers dislike that they need to add on expensive integrations to beef up their stores’ functionality. On the other hand, that extendibility and high degree of customization, combined with Shopify’s reasonable base pricing, makes it an affordable option for creating a fully customized store.
Shopify’s app store contains 3,500+ add-ons, so it’s a safe bet that you can find whatever you’re looking for to customize the way your Shopify store will look and feel. Keep in mind that most Shopify users not only want integrations but also need them, and budget accordingly. Some integrations you’ll find in Shopify’s app store are free, while others require a one-time purchase or a monthly subscription. We recommend starting with a few essentials and adding on as needed once you’ve seen what you can do with the built-in features.
If your sales journey runs through Amazon FBA, the most interesting integrations are between Amazon and a number of major shopping cart platforms. That means you can build your own online store and integrate it with your listings on Amazon and essentially have the best of both worlds. You can even add a module that lets you integrate your Shopify store with Amazon, giving you perhaps the best of both worlds, combining the biggest marketplace with one of the best online shopping cart software.
Shopify VS Amazon FBA Comparison: The Final Verdict
Whenever you compare two platforms that are at the top of their respective games, it’s hard to declare an absolute winner. The best choice for you depends entirely on your sales goals and chosen strategy. While it’s fair to say that we think Shopify provides greater flexibility, even allowing you to build an online store and link it to an Amazon FBA strategy, your business model might be better suited to the relative ease and convenience of using a fulfillment center and linking your sales to the world’s biggest online marketplace.
In general, Amazon FBA is best suited for those selling small, lightweight products. That’s because Amazon in general and FBA in particular favors quick sales and high volume. If your business plans involve moving a lot of inexpensive products quickly, using Amazon FBA can be a smart strategy.
On the other hand, if you are looking to develop a different kind of business and want to maintain control over your customer base and your marketing efforts, take a long look at Shopify. Although it takes a little more time and effort to build a Shopify store, the tradeoff is worth it, in our opinion, especially if you’re selling unique products that might not stand out on Amazon, where speed and price are key to sales success.
Remember, if you build an independent store on Shopify’s platform, you can link you store to many other sales channels and to the marketplaces, like Amazon FBA, that you might want to join now or in the future. That’s not necessarily true for Amazon FBA. For example, you can link a Shopify store to Walmart Marketplace and greatly extend your reach. That’s something Amazon won’t allow. And while it’s possible to use Amazon FBA if you plan to set up a dropshipping business, you’ll find more dropshipping options with Shopify.
Whichever route your sales strategy takes you, let us know how it goes by leaving us a comment below. Good luck, and happy selling!