Since last year, I, along with others, have been scratching our heads on what to do about Amazon … the Advantage program has been on hold since last May — it was the single, easiest way to get the non-POD version of a book up on Amazon and start the marketing process. With the suspension of it, Amazon Seller was the portal for an author to become a “vendor” and have books available for shipping. Those who used the POD method of printing had KDP or IngramSpark.
Breathe.
Then, Amazon Seller started having hiccups. What’s an author to do? One of my favorite resources for warehousing books and moving them to Amazon (disclaimer—I’ve been on Advantage for years) is Bret Ridgway and Ship Your Books (SYB is also a member of the AuthorYOU community). They fulfill all my book orders for and to Amazon when they come in.
I’ve asked Bret to roll up his sleeves and calculate what the costs are as of THIS WEEK for those who do a print run and sell via Amazon — comparing what a warehousing cost would be using his company vs. storing your books with Amazon under its fulfillment option. When appropriate, I’ve added my own comments. There’s no free lunch—both have costs.
A Comparison of Ship Your Books vs. Fulfillment by Amazon
Is One Right for You?
Choosing how you are going to fulfill your books is a tricky question. There are pros and cons to every option and ultimately, only you can decide which is going to be best for you. The first question you need to ask yourself even before you decide the fulfillment side of things is how you want to utilize Amazon in the selling of your book.
Should you be on Amazon? Absolutely! With its millions of buyers, it’s usually the first place potential buyers will search if they’ve heard about and are looking for your book. But you’ll need to decide if Amazon is where you want to drive all traffic for purchasing your book. You’ll make considerably less as an author on any type of Amazon sale than if you had sold it directly yourself. In all likelihood, you’ll get more sales using Amazon even if it’s at a lower profit margin.
Amazon offers two primary programs through which you can sell your book on their platform. The first is Amazon Advantage. As of this writing, it is currently unavailable to new authors–this is the portal that was suspended to new authors in May of 2019. The buzz is that there is a “reformatting” of the option—but no changes have been seen, yet. Amazon Seller Central (also called Amazon Marketplace) is the other. With Amazon Advantage, you pay a $99 annual fee to belong and you pay to ship your books to an Amazon Warehouse, and they fulfill customer orders for your book from the inventory you’ve supplied them. You DO NOT get the customer information (they are Amazon’s customer, not yours). You receive 45% of the list price of your book on each sale regardless of the price at which Amazon sells it which is paid out monthly. So, for a $20 book, you get $9.
The other seller program, Amazon Seller Central gives the option of signing up as either an Individual or a Professional seller. As a professional seller you pay a $39.99 per month subscription fee but you eliminate a $.99 per sale closing fee from your costs. Bottom line, if you think you’ll have 41 or more sales per month than go Professional. If you think you’ll have less, go Individual.
Suggestion: begin the process and claim your status as Professional … when approved, immediately transition to “Individual.” Your $39.99 will be eliminated. Why? We are finding significant hiccups with the Seller Central process. Authors are discovering a better “acceptance” if they start as Professional and then doing the switch. Amazon also appears to be sensitive to what emails and phone numbers are used for contact information. We suggest that you use the ones that you are “known” on your Amazon accounts.
There are a few more costs. Whether you’re an Individual seller or Professional seller in addition to the possible 99 cents closing fee you also have a 15% Referral Fee on your list price. So, for a $20 book the Referral Fee would be $3.00. You also have what they call a Variable Closing Fee of $1.80 per book sold.
The Amazon charges for a $20 book sale using Amazon Seller Central are .99 + 3.00 + 1.80 = $5.79. You’d receive $14.21 per sale vs. the $9 under Amazon Advantage. There will be more.
Getting Your Books into Your Buyer’s Hands
There are additional costs as well. You’ve got to get your books into your customers’ hands. Whether you’re selling via Amazon Advantage or Amazon Seller Central or via your own website, the next critical question to ask is how am I going to get my orders shipped to my customers?
With Amazon Advantage, they’re filling those orders themselves to the buyers out of the inventory you’ve supplied them. With Amazon Seller Central, the order is shipped directly to the end customer either by 1- you, 2- a 3rd party fulfillment center such as Ship Your Books or 3- by Fulfillment by Amazon.
Remember, if the sale is made on Amazon the customer is theirs, not yours. So, you CANNOT do follow-up marketing to the buyers, even if you know who they are, or Amazon can kick you out of the program. If you’re trying to build your own platform (let’s say you’re a speaker) you will be better served driving them to your own website to purchase books vs. Amazon. You’ll make considerably more per sale and you’ll also capture that all-important customer data so you can sell higher-priced products and/or services to your book buyers.
Chances are Amazon will be selling your book for a lower price than you will be selling it on your own. Plus, if they are a Prime member, there’s always the free shipping perk. That’s why we suggest you come up with book bonuses only available through purchases made directly from you via your website. These can be “digital” bonuses so you’re not out of pocket anymore.
Sales made through your own website and fulfilled either by you or a company such as Ship Your Books (SYB) also give you the ability to include extra items in your outgoing shipments such as thank you letters, upsell sheets, bookmarks, etc. At Ship Your Books, you can include up to two additional inserts into an outgoing book shipment for no additional fulfillment fee—a nice feature for cross-marketing or for speakers.
Let’s dive a bit more into the fulfillment side of the equation. Which is a better option – Ship Your Books or Fulfillment by Amazon? The answer depends upon your situation. There are certainly advantages to using Fulfillment by Amazon (FBA) but you might also see higher costs in many cases.
First, if you’re using FBA, your book will be eligible for free Amazon Prime shipping for Prime members. At our latest report, 62% of shoppers on Amazon are Prime members and the attraction of free shipping is a factor to consider. That also means 38% of their buyers aren’t Prime members and they will likely have to pay shipping costs.
You’re also more likely to be able to get the “Buy Now” button if you’re using FBA for your order fulfillment, which can result in more sales. You’ll may see some other people selling your book on Amazon, but competition should be minimal if it’s a new book. Only you can decide how important this is to you. If you’re driving all traffic to Amazon to buy your book it could be quite important. As an aside, it’s important to pay attention to pricing—you can be the “low bidder”, but if you are selling books via the POD method and you offer a large discount for retailers, the online sellers may scoop them up offering to resell them to the public of a few pennies less than you do. Alas, they become the low bidder. With that said, if you’re driving the traffic to your own website for sales, it’s far less important.
So, let’s look at the costs associated with fulfillment between the two options of SYB and FBA. This is an examination of the fulfillment costs only, not the selling costs we discussed earlier with Amazon Advantage or Amazon Seller Central.
Fulfillment Charge for Ship Your Books (weight of book doesn’t matter)
Order of 1 book – $2.00
Order of from 2 – 5 books – $3.00
Order of 6 or more books – $4.00 per box shipped
Looking at this on a per book basis for Ship Your Books this breaks down as follows:
1 – $2.00 2 – $1.50 3 – $1.00 4 – $.75 5 – $.60 10 – $.40 25 – $.16 50 – $.08
Fulfillment Charge for Fulfillment by Amazon (assumes book weighs between 10 and 16 oz.)
Order of 1 book – $2.63
Order of 2 books – $5.26
Order of 3 books – $7.89
Order of 4 books – $10.52
Order of 5 books – $13.15
Order of 10 books – $26.30
Order of 25 books – $65.75
Order of 50 books – $131.50
Looking at this on a per book basis it’s $2.63 per book at any quantity level.
Postage Costs
Most people ship books via Media Mail, which is currently $2.80 for books weighing up to one pound. In most cases, this is a pass along cost to your customers. However, if you’re using SYB you will have this $2.80 cost to consider. If you’re using FBA, you do not have this $2.80 cost if the buyer is an Amazon Prime member or they’re ordering $25 or more in “eligible” products. Eligible means any item with “FREE Shipping” messaging on the product detail page that is fulfilled and shipped by Amazon is eligible and contributes to your $25 free shipping order minimum.
Storage Costs
Typically, you will pay considerably more for book storage if you’re using FBA than with SYB. A typical pallet measures around 40” x 44” x 48” which equals right about 49 cubic feet.
Ship Your Books Storage Charge
$15 per pallet per month. SYB allows you to “mix” titles if you have more than one—this is a plus for many authors. If you have multiple, your charge is whatever it takes to full a pallet (my experience it is approximately 1,000 books). On a cubic foot basis this breaks down to 30 ½ cents per cubic foot which is going to be somewhere around 24 copies of a typical book. Even if you’re only using half of that 40” x 44” x 48” full pallet dimension you’re paying 61 cents per cubic foot. There are no long-term storage surcharges.
Fulfillment by Amazon Storage Charges
FBA charges different amounts for storage depending upon the time of the year. If you have more than one title, there is a separate charge for each based on how much cubic feet are needed. From January through September the current charge is 75 cents per cubic foot. From October through December this jumps to $2.40 per cubic foot.
The amount of inventory you store in an FBA warehouse will dramatically impact your overall costs. If you have a full pallet of books stored your monthly cost is 49 (cubic feet) x .75 = $36.75 from January through September or 49 x 2.40 = $117.50 for October through December. This compares to the $15 per pallet any time of the year using SYB. If you have two or more titles, the amounts will increase significantly.
Strong Suggestion: create a “dummy” space equivalent to the space you are considering for storage and then cost it out. What is the dimension of your book? Width, height, and spine. A cubic foot is 12” x 12” x 12”. How many books can you realistic get in there? And, consider the “accessibility factor”. I’ve been on site of a large Amazon warehouse. It’s not as tidy as you would think. Amazon does “random” storage, so don’t expect a perfect stacking of anything or that your books will be tightly retained in the storage box you send them in. They are usually pulled and placed in a gathering cart as a “picker” fills an order that could consist of multiple items.
Long Term Storage Fee Surcharges
Ship Your Books
None.
Fulfillment by Amazon
Additional surcharge of $6.90 per cubic foot or 15 cents per unit (whichever is greater) per month can be applied after inventory has set unmoved from their warehouse after 365 days. So, if you have 500 books sitting in their warehouse over a year, they can access you an additional $75 per month in storage charges above and beyond your normal monthly storage charges.
Customer Service
With SYB, you can pick up the phone and talk with a real person, including the company co-founder during normal business hours. With Amazon, who knows? Some have reported good customer service and others have reported nothing but nightmares.
Summing Up
Each option certainly has its pros and cons and again, only you can decide what is best for you. You can typically expect to pay higher costs for fulfillment and storage with Fulfillment by Amazon, but the advantage of Prime shipping is attractive and may be a determining factor for you. We’re happy at SYB to be of service to you if it makes sense for you. And if it doesn’t, we wish you nothing but the best. If you just have one book, FBA may work out just fine; if multiple, it could get pricey.
There you have it. For me, we use to store and personally fulfill all book orders from my offices. Our friendly UPS person came out several times a week. Then I did a shift 10 years ago. Ship Your Books has been my answer forward and many of my clients are quite happy with the relationship. Fulfillment by Amazon didn’t exist at my shift time. It’s a convenience thing for me—I don’t have to think about checking Amazon daily for orders and getting books there promptly. And, I don’t want to, nor have time to be the shipper dudette. SYB does it for me. I’m notified of any shipments, as well as all costs. No surprises.
It’s your turn … crunch your numbers. And, I think it’s important to put a value on your time in your calculations. The choice, as always, s
should be yours.
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Dr. Judith Briles is a book publishing expert and author of 37 multi-award books. She’s guided over 1,000 authors in creating their books, earned in excess of $3,000,000 in speaking fees based on her books and gathered over $2,000,000 in onsite book sales at her speaking gigs. Her book, How to Create a $1,000,000 Speech flips a difficult topic into a simple and easily comprehensible plan. If you want to get into speaking, this is the guide that will be the game-changer to success. And, if you want to know more about Judith’s life, her book of “hope” is When God Says NO-Revealing the YES When Adversity and Loss Are Present. You can get it HERE.
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