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Apple, Steam, Google et al. charge 30% on *digital* goods. With Amazon you get <50% for physical goods. If anything that's impressive.
by belval 4y ago
Apple, Steam, Google et al. charge 30% on *digital* goods. With Amazon you get <50% for physical goods. If anything that's impressive.
- shanebellone 4y ago"If anything that's impressive." I'm conflicted about this statement. On one hand, it's almost passive revenue for the seller. On the other hand, Amazon offloads the risk of carrying inventory and takes half the revenue. I'd argue that it's impressive with one caveat: the "partnership" heavily favors the house.
- deleted 4y ago[deleted]
- Closi 4y agoImportant to note that plenty of other companies will carry the inventory and ship goods out for you (Amazon did not invent the concept of third party logistics) - however if you go to a third party warehouse it is difficult to get certified as 'Prime'. (Seller Fulfilled Prime is a thing, but in reality is currently closed for sign-up and is really only for the large sellers)
- votepaunchy 4y agoApple, Google, maybe others charge 15% on up to $1 million or the first $1 million in digital sales. Or less when negotiated. Does Amazon offer reduced rates to small businesses or low volume sellers?
- nobu-mori 4y agoDigital goods have very low marginal unit costs compared to physical goods.
- shanebellone 4y agoEdit: I was wrong :)
- deleted 4y ago[deleted]
- Closi 4y agoYou are misunderstanding the concept of marginal unit costs if you disagree on that basis. AAA software is wildly expensive, but each incremental copy sold is not wildly expensive. With a tea kettle, each incremental copy still costs you metal, heating elements and plugs, so the unit margins are smaller.
- shanebellone 4y agoOh! That I failed to recall. You are absolutely correct.
- JohnFen 4y agoIt tells me that the fee on digital goods is insanely high.