Are you curious about selling on Walmart vs. Amazon? Not sure which marketplace is best for your products? Or maybe you’re wondering whether it’s worth using both platforms?
In the wake of the world’s unprecedented health crisis, people and companies have changed how they live, work, and do business. According to Statista, global retail e-commerce sales are projected to reach $5.7 trillion in 2022, a $2.3 trillion increase from 2019.
The United States had an estimated 230 million digital buyers in 2021. By 2022’s second quarter, internet commerce made up 14.5% of all US retail sales. The sector recorded the highest quarterly revenue in history, from April to June 2022, amounting to $258 billion. E-commerce is booming, online sales are commonplace, and at the forefront of this digital transformation are two retail juggernauts: Amazon and Walmart.
How do you become a seller on either platform, and what’s the easiest option? Is the competition justified? What about shipping, fees, pricing, and product listings? Find answers to all these questions and more as Amazon and Walmart face off in our ultimate comparison guide for e-commerce sellers. But first, here’s a quick overview of each brand.
Table of Contents
Amazon and Walmart: Two Thriving Titans
One’s a trailblazing household name among digital buyers. The other’s a fast-growing franchise with a major physical footprint. They’re both multinational companies with humble beginnings, each formidable in their own right.
Amazon: High-Tech and Happening
Amazon Inc. is Jeff Bezos’ brainchild, born in his Seattle garage circa 1994. It started as an online marketplace for books. Today, it’s the world’s most valuable brand and fifth-largest company by market capitalization.
In the US, it’s the leading e-commerce platform with categories for almost anything, from fashion to electronics. Earning the moniker “The Everything Store,” Amazon is also one of America’s Big Five, alongside Microsoft, Meta, Apple, and Alphabet. It dominates the online space, controlling nearly 40% of the US market. Globally, it’s the biggest e-commerce company by market capitalization.
Amazon has had the online advantage from the get-go, but it’s been expanding its physical footprint since acquiring Whole Foods in 2017. It currently has over 500 brick-and-mortar stores throughout the US, with more opening in 2022. Amazon also owns over 100 companies, including Ring, Twitch, Goodreads, IMDb, and MGM Holdings.
Walmart: The Growing Golden Oldie
Founded by Sam Walton in 1962, Walmart Inc. began as a small, family-owned discount store in Arkansas. It’s now the world’s leading retailer and the fourth most valuable brand.
Walmart also ranks first in the Fortune 500 of 2022, beating Amazon, Apple, and CVS Health. It has the second largest e-commerce market share in the US and boasts 4,700 locations in 50 states. In total, the company owns around 10,500 physical stores under 46 names in 24 countries.
By combining its physical dominance with its e-commerce efforts, Walmart is Amazon’s biggest e-tailer competitor, at least in the US. Thanks to more “shoppable fulfillment centers,” Walmart earned $1 of every $4 spent in the US on click-and-collect orders in 2021.
In 2016, it acquired Jet.com and owns brands like Sam’s Club, Hayneedle, Moosejaw, and Bonobos. The gap is closing on both sides, but how do these retail titans compare from an e-commercer’s perspective? Is selling on Walmart vs. Amazon easier, better, or more profitable? Let’s find out!
Becoming a Seller
A fair amount of legwork is involved before you see those online sales rolling in, but which marketplace can get you there sooner?
Signing up on Amazon
Amazon’s sign-up process is consumer-centric: It’s seamless, easy, and available to sellers within and outside the US. Simply create your seller account and have a few things ready, including:
- Tax information
- A chargeable credit card
- An active bank account
- Contact details
Amazon also has loads of helpful resources, apps, and tools to help your online business grow. With Perfect Launch, beginners can generate six times the first-year revenue of other sellers. Moreover, Amazon’s Seller Central is a one-stop portal where you can manage everything from daily sales and shipping to payments, international selling, metrics, and more.
Signing Up on Walmart
Signing up on Walmart Marketplace is tricky. Compared to Amazon, the prerequisites are a lot more stringent. The company only accepts sellers with proven e-commerce success and a registered business. Other requirements include the following:
- A US Tax ID number (or your business must be incorporated in the UK or Canada).
- Business name and address verification.
- An active bank account.
Once you’ve successfully set up an account, Walmart presents a launch checklist. It consists of tasks like adding information about your business, taxes, bank account, and shipping options. Upon completion, you can start uploading your catalog. While it accepts sellers outside the US, only a handful of countries are listed on Walmart’s sign-up page.
It also has a Seller Center dashboard where users can manage orders, track catalog performance, and view reports. E-commerce entrepreneurs have various resources, APIs, Solutions Providers, and additional services like Walmart Connect at their disposal too.
The Verdict: Amazon
Amazon is the obvious winner in this category. Anyone can become a seller, and you don’t need a professional plan to get started. US-based entrepreneurs can get up and running in as little as four days.
Your catalog is the backbone of your online business, but it can get super technical. One wrong move could spell trouble for sales. Let’s see whether it’s easier to list products on Walmart Marketplace vs. Amazon.
Product Listings on Amazon
Permissible products on Amazon largely depend on the category. Some require prior approval, many are open to all, while others are only available to professional account holders.
You can use the Seller Central portal or an integrated API to list your products on Amazon by:
- Adding a new product listing.
- Creating an individual listing by matching an existing product.
- Uploading bulk listings using Amazon’s inventory templates.
Most items require a product identifier such as a Universal Product Code (UPC). If your product already appears on Amazon, it won’t normally need one. You can also request an exemption in some cases. Restrictions and certain criteria may apply to specific products. Overall, Amazon makes the product listing process as user-friendly as possible. It has assorted videos, tools, and guides to help beginners.
Product Listings on Walmart
On Walmart Marketplace, you can list products using:
- An API: Walmart has a host of APIs to integrate with its e-commerce platform.
- A Solutions Provider: You can use a third-party provider for item setup and inventory management. Full-service and specialty solutions are available.
- The Seller Center: Walmart’s dashboard has options for listing by bulk upload, single item, or matching an existing product.
Unlike Amazon, Walmart requires all products to have a product identifier. You’ll need to obtain one for every item, although you can also apply for exemptions in some cases. However, the process can be tedious, and the criteria strict.
Remember to review Walmart’s Prohibited Products Policy and utilize available resources. Walmart’s Listing Quality Dashboard has various tools to help optimize your listings. Overall, Walmart’s strict approach means listing products can become a bit of a headache. Still, the process is relatively user-friendly, and sellers have access to tools and third-party software solutions.
The Verdict: Amazon
Once again, Amazon wins in this category. It has a wealth of resources and a beginner-friendly interface. More importantly, though, the listing requirements aren’t as stringent
The Selling Fees
It costs money to make money, right? Let’s see what Walmart’s vs. Amazon’s fees are like.
Amazon’s Selling Fees
Amazon has a simple approach with two selling plan options:
- Individual Plan: Ideal for small-time sales with no subscription costs. Instead, Amazon charges $0.99 per item sold, where you can sell up to 40 units a month.
- Professional Plan: Costs $39.99 per month and comes with APIs, in-depth reports, advertising, and unrestricted access to all product categories. You can upgrade to this plan at any time.
Referral fees apply to each product sold, regardless of the selling plan. Amazon charges 8–15% on most items, although the rate is category-specific. It’s calculated on the total price, including shipping costs and gift-wrapping expenses. Shipping fees are based on the weight and dimension of a product and include packing, shipping, handling, returns, and customer service. That’s when using Fulfillment by Amazon (FBA).
For self-fulfilled orders, Amazon charges shipping rates based on the product category and selected shipping service. It then refunds this amount in the form of a shipping credit. Professional sellers can set their own shipping rates, while individuals must use Amazon’s rates. Additional costs like storage, high-volume listing, and refund admin fees may also apply. Expenses for optional programs like advertising, FBA, inventory placement, and premium account services are separate.
Walmart’s Selling Fees
A Walmart Marketplace account is free, with no setup or monthly subscription costs. Referral fees vary by product category, calculated according to product type. On average, you can expect to pay 8–15% of an item’s total cost.
Pricing for Walmart’s Fulfillment Services (WFS) also varies with shipping costs calculated on a unit’s weight and dimensions. The fees include end-to-end fulfillment, though additional expenses may be incurred for prep services, oversized items, apparel, and hazmat products.
The Verdict: Walmart
Walmart wins this round. It has a simple fee structure with no costs for setting up or using a Marketplace account, ever.
Shipping and Fulfillment Services
Reliable and speedy delivery, along with after-sales support, are the cornerstones of a successful e-commerce business. Here’s what to expect when selling on Walmart vs. Amazon:
Fulfillment by Amazon (FBA)
FBA provides sellers with an easy and cost-effective way to outsource storing, packing, and shipping products. It also takes care of exchanges, returns, and customer service. According to Amazon, FBA costs 32% less than the slowest US shipping option.
Besides its established distribution network and inventory management tools, sellers using FBA can also benefit from:
- Becoming a Prime Member with featured listings displaying the Prime logo.
- Free shipping on eligible orders.
- Specialized services, including FBA Small and Light and FBA Subscribe and Save.
- International sales and expansion opportunities with FBA Export and FBA Pan-EU.
- Discounted rates for inbound shipments to Amazon fulfillment centers.
- Multi-channel fulfillment across all sales channels.
Amazon’s New Seller Incentives also offer free shipping, storage, returns, and promotional ad clicks to qualifying sellers.
Fulfillment by Walmart (FBW)
With one of the world’s largest supply chains, Walmart can offer end-to-end fulfillment services at affordable rates. Quickly catching up to Amazon, FBW handles shipping efficiently and offers perks like:
- Low-cost two-day shipping during the off-peak season.
- Customer service and seller support.
- Reduced shipping rates with a preferred carrier.
- Free shipping for customers on eligible items.
- Higher search rankings and better visibility with “Fulfilled by Walmart” and “TwoDay Delivery” tags on featured items.
- Personalized recommendations and access to dashboards and APIs for real-time sales performance.
- Enhanced Returns offering in-store and online returns and Walmart’s Returns Shipping Service (RSS).
Walmart also offers regular promotions for sellers, such as waived storage fees for the peak season.
The Verdict: Amazon
It’s a close call, but Amazon’s international shipping options, versatility, and additional benefits surpass Walmart’s offerings (at least for now).
Pricing, Competition, and Profitability
How does Walmart Marketplace vs. Amazon fare when it comes to pricing and competition? Which e-tailer offers better profitability? Let’s take a look.
The Amazon Marketplace
Third-party sellers make up 58% of Amazon’s sales. It has over 1.9 million selling partners worldwide and more than 500,000 in the US alone. While the brand’s market dominance allows for more conversion opportunities, its platform is still highly saturated.
As such, it can be harder for products to stand out. Pricing is also competitive and may fluctuate. Nonetheless, FBA and self-fulfilled Prime sellers tend to perform better as Amazon can guarantee effective delivery more consistently than fulfilled by merchant (FBM) sellers.
Text matches, reviews, and product availability remain vital ranking factors, along with competitive pricing. Amazon averages 5.3 billion monthly visitors, so leveraging tools like automatic pricing and resources like Seller University can improve success.
The Walmart Marketplace
With its high barriers to entry, Walmart only has around 150,000 sellers. The environment is less competitive, so there’s more potential for product exposure. The company has strict pricing rules, though, which must be followed to avoid delistings.
Two major rules define Walmart’s pricing culture:
- Price Parity: If one of your products is available on a competing website at a lower price (including shipping), Walmart automatically removes your listing.
- Price Leadership: If a customer can buy the same product from any other Walmart seller or competing website at a lower price (including shipping), your listing will be removed.
With less competition, Walmart conversion rates may be higher, but stringent pricing rules could mean lower profit margins. Still, 100 million unique visitors are hard to ignore. You can use the platform’s free repricer tool to manage your listings and stay ahead.
The Verdict: Amazon and Walmart
Sellers on Amazon have more control over pricing, though the market is still highly competitive. That said, the company offers a treasure trove of tools and resources to help nurture success. On the other hand, Walmart’s pricing rules are stricter, but fewer sellers mean less competition. Keep in mind that you can’t list the same item for a better price on Amazon or another website without it getting delisted.
The majority of both Walmart and Amazon searches are unbranded, highlighting the importance of effective brand awareness and advertising. Amazon offers more than 250 tools and services to help its sellers grow, including:
- Brand Registry: A free service with a suite of tools for sellers to manage their brand and protect intellectual property rights.
- Brand Analytics: A tool offering invaluable insights to help e-commerce businesses make strategic advertising and marketing decisions.
- Stores: A free multi-page branded storefront available for sellers to customize and use as a brand destination on Amazon.
Walmart’s Brand Portal also offers intellectual property protection, though it’s more limited than its counterpart. Marketplace sellers have other options, including:
- Sponsored Search Advertising: Product ads and search placement for increased brand visibility.
- Pro Seller Badge: A displayed icon available to top-performing sellers that can boost conversions and increase awareness.
Amazon leads the pack in this category thanks to its vast range of advertising tools and benefits, although Walmart is catching up.
The Ultimate Verdict: Leverage the Best of Both
The stats are in, and one e-commerce platform is the clear winner. Here’s a quick recap:
Becoming a seller
Shipping and fulfillment
Pricing, competition, and profitability
Selling on Amazon is more competitive, and a professional plan costs $39.99. Still, advantages like easy onboarding, less restrictive pricing, and a larger marketplace far outweigh any disadvantages. Amazon’s wealth of tools, services, and resources is another plus.
Selling on Walmart vs. Amazon is less competitive, and an account is free with no subscription costs. Signing up can be difficult, though, and pricing is more restrictive. Nonetheless, Walmart is still Amazon’s major e-commerce competitor. With its seller tools, FBW service, and third-party solutions, the company is catching up. So who says you can’t get the best of both worlds?
By establishing your business on Amazon, you’ll fulfill the experience requirements of Walmart Marketplace. Not only will you have increased online exposure, but you can also apply winning conversion strategies on both platforms. The result? Better sales, access to more services, and increased growth opportunities. It’s truly a win-win. If you need a hand, schedule a free session call with us today. We’ll show you how to increase sales with our customized, results-driven, and multi-channel approach