Selling on Walmart vs. Amazon: Fees, Differences & Profitability

Deciding where to sell your products can be a game-changer for your business. With Amazon’s massive customer base and Walmart’s rapidly growing marketplace, each platform offers unique advantages—but also comes with its own challenges.

In this article, we will examine two platforms that dominate the ecommerce space, Amazon and Walmart, highlighting their fees, competition levels, and profitability considerations. This detailed analysis will help you compare and contrast these two giants and make an informed choice between them.

Main Takeaways From This Article:

• Amazon offers a broader reach with a more saturated marketplace, which could lead to stiffer competition for sellers compared to Walmart.
• Both platforms have unique pricing structures that include different fee categories, impacting the overall cost of selling.
• Marketing opportunities differ, with Amazon providing robust advertising options, whereas Walmart is a growing field with unique chances to capture new customer segments.
• Automated pricing tools, like Informed Repricer, enable sellers to leverage AI-driven repricing tactics to optimize profitability and stay competitive on both platforms.

Walmart Marketplace Overview

The Walmart Marketplace, which debuted in 2009, now allows third-party vendors to place products directly alongside Walmart's own offerings, opening up a great opportunity for sellers seeking to tap into a vast and loyal customer base. 

This marketplace is an increasingly important part of Walmart's online retail empire, which has about 255 million customers and members visiting its stores and websites each week. This is a testament to the fact that selling on Walmart's Marketplace can offer unparalleled exposure for any seller's products to a value-conscious audience eager to discover new product options. 

Selling on Walmart Marketplace also means that sellers and businesses can leverage Walmart's established reputation and expansive reach to accelerate their growth and build a sustainable online presence.

Amazon Marketplace Overview

Amazon Marketplace, the world's largest ecommerce platform, was launched in November 2000 and was ranked the most trusted brand by US consumers in 2023, making it the go-to destination for online shoppers worldwide. This platform offers a wide variety of products from countless sellers, who can use the platform's massive resources, from advanced fulfillment options to sophisticated advertising tools, to their advantage. 

Amazon's vast marketplace makes it an essential platform for consumers seeking convenience and selection, while its reach and resources make it an attractive opportunity for sellers looking to scale their business and connect with a global audience of motivated buyers.

Walmart vs. Amazon: Key Differences Between Online Retail Giants

While both platforms offer access to millions of customers, they greatly differ in several key aspects, such as:

Marketplace Reach and Competition

• Walmart: With over 10,500 store locations worldwide, Walmart offers a vast physical presence. However, its online marketplace is still growing. While competition exists, it's generally less intense than on Amazon. Walmart's rapid growth through its online marketplace provides an opportunity for sellers to gain visibility more easily, especially in niche markets. However, this also means the overall customer base is smaller than Amazon's. 
• Amazon: Amazon boasts a massive global reach and a highly competitive marketplace. Millions of sellers vie for customer attention, making it challenging for newcomers to stand out. Success on Amazon often requires significant investment in advertising and optimization. The sheer volume of potential customers is a major draw, but it also means navigating a crowded marketplace.

Consumer Base and Buyer Behavior

• Walmart: Walmart's customer base is more price-sensitive, with a focus on everyday low prices. They are frequently seeking deals and discounts. Brand loyalty can be less pronounced than on Amazon, with price being a primary driver of purchasing decisions. This necessitates competitive pricing strategies for sellers on Walmart.
• Amazon: Amazon attracts a broader demographic, including convenience-seekers, brand loyalists, and those looking for a vast product selection. While Amazon shoppers are often willing to pay more for premium products and services, they also value factors like fast shipping, product reviews, and personalized online shopping experiences. 

Seller Approval and Account Setup

• Walmart: Walmart Marketplace requires sellers to meet specific eligibility criteria before approval. Businesses must provide a valid Business Tax ID or Business License Number, along with supporting documents to verify their identity.  While Walmart's application process may take longer than Amazon’s, it helps maintain a high-quality marketplace.
• Amazon: Setting up an Amazon Seller Central account is generally more accessible, allowing a wider range of businesses to join. Sellers can register as individuals or businesses, with fewer initial requirements than Walmart. However, maintaining strong performance metrics—such as on-time shipping, order defect rate, and customer feedback—is crucial to avoid account suspension. While easier to join, sellers must actively manage their performance to stay in good standing.

Pricing and Buy Box Competition

• Walmart: While competitive pricing is important, it's not the sole determinant for Walmart's ecommerce sales, which allows sellers to differentiate themselves through other means. Winning the Buy Box on Walmart is influenced by several factors, including price, product quality, seller performance, and shipping speed. 
• Amazon: Amazon's Buy Box algorithm heavily emphasizes price, along with fulfillment speed (especially through FBA) and seller rating. Competition for the Buy Box is fierce and often drives prices down. This can lead to a "race to the bottom" in some product categories.

Marketing and Advertising Strategies

• Walmart Connect: Walmart offers its own advertising platform, Walmart Connect, enabling sellers to promote products through sponsored listings and banner ads. While still developing, it provides a direct way to reach Walmart shoppers.
• Amazon Advertising: Amazon Advertising is a mature and robust platform, offering a wide range of advertising options, including sponsored products, sponsored brands, and display ads. It allows for highly targeted campaigns but can also be complex and expensive.

Fulfillment and Shipping Services

• Walmart Fulfillment Services: WFS allows sellers to leverage Walmart's fulfillment network for storage, packing, and shipping. It aims to provide a similar service to Amazon FBA.
• Amazon Fulfillment Services: Amazon FBA is a widely used service where sellers send inventory to Amazon's fulfillment centers, and Amazon handles storage, packing, shipping, and customer service. It's known for its speed and efficiency.

Customer Support

• Walmart: Walmart's customer service on their marketplace offers robust support, focusing on resolving seller and buyer inquiries efficiently. They provide a dedicated seller support team and extensive resources to assist with any issues that arise. Walmart's emphasis on customer satisfaction ensures that sellers receive help to navigate the marketplace, enhancing both buyer experience and seller operations.
• Amazon: Amazon's customer service is renowned for its efficiency and availability. Offering 24/7 support, the platform ensures customer queries and issues are swiftly addressed. This dedication to customer satisfaction enhances buyers’ trust and loyalty, ultimately benefiting sellers through increased positive reviews and consistent sales. Their return processes are fast and hassle-free.

Monthly Subscription Fees

• Walmart Plus: Walmart+ members expect fast, free shipping, which influences purchasing behavior. Sellers who use Walmart Fulfillment Services (WFS) are more likely to appeal to these buyers, as WFS enables free two-day shipping that aligns with Walmart+ benefits. This can help sellers increase visibility and conversions in a marketplace where speed and cost matter.
• Amazon Prime: Amazon Prime has a massive influence on buyer behavior, with members actively seeking Prime-eligible products for fast, free shipping. Sellers who use Fulfillment by Amazon (FBA) gain an advantage, as their products qualify for Prime shipping, making them more competitive and increasing the likelihood of winning the Buy Box.

Selling Fees and Cost Breakdown

Understanding the cost structure associated with selling on Amazon and Walmart is crucial for maximizing profitability. Here's a breakdown of the key fees and costs sellers should consider:

Referral Fees and Commissions

Both Amazon and Walmart charge referral fees, which are essentially commissions paid for each sale. These fees are typically a percentage of the selling price and vary depending on the product category.

• Walmart Referral Fees: Walmart’s referral fees vary by product category and are generally competitive with Amazon’s, often falling within a similar range between 8% and 15%. Sellers should review Walmart’s fee schedule to determine the exact percentage for their specific products.
• Amazon Referral Fees: Amazon's referral fees typically also range from 8% to 15%, though some categories may have higher rates up to 45%. It's crucial to consult Amazon's fee schedule for the most up-to-date information on your specific product category.

Fulfillment and Storage Costs

If you use fulfillment services like FBA (Amazon) or WFS (Walmart), you'll incur fees for storage and order fulfillment.

• Walmart Fulfillment Services Fees: WFS fees are structured similarly to Amazon FBA fees, taking into account product dimensions, weight, and storage duration. The storage fees for items vary based on the duration of storage and the time of year. 
• Amazon FBA Fees: Amazon FBA fees are calculated based on the size and weight of your products, as well as the storage time. These fees cover the monthly storage fees for your inventory in Amazon's fulfillment centers, picking and packing orders, and shipping them to customers along with potential fees for long-term storage, removal, disposal, and returns processing. 

Subscription and Listing Fees

Depending on your selling plan, you might encounter subscription or listing fees.

• Walmart Seller Fees: Walmart does not currently charge a monthly subscription fee for sellers. This can be a significant cost saving compared to Amazon's Professional plan.
• Amazon Seller Plans: Amazon offers two seller plans: Individual and Professional. The Individual plan charges $0.99 per sale and is suitable for sellers who sell fewer than 40 items per month. The Professional plan, which charges a monthly subscription fee of $39.99, is ideal for higher-volume sellers and unlocks additional features.

Other Costs to Consider

Beyond the core fees mentioned above, other costs can impact your overall profitability.

• Returns and Refund Fees: Both platforms have policies regarding returns and refunds, which can lead to costs for sellers. These costs may include return shipping fees, restocking fees, or the cost of the product itself if it's damaged or unsellable. Walmart charges no return fees if items are returned within 90 days of purchase. Amazon, however, may charge return fees depending on the product category and fulfillment method.
• Advertising and PPC Costs: If you choose to advertise your products on Amazon or Walmart, you'll incur advertising costs. These costs can vary depending on your campaign strategy, target keywords, and the competitiveness of your product category. On Amazon, you can expect to pay anywhere between $0.15 and $6 per click; on Walmart, you may need to pay between $0.30 and $1.50 per click.

Where Do Sellers Make More Money?

While both platforms offer great online sales potential, the profitability of selling on Walmart versus Amazon depends on various factors.

Marketplace Sales Volume and Conversion Rates

Amazon's vast market reach and high sales volumes make it an attractive option for sellers with high-demand products. Walmart's more competitive pricing environment may limit profit margins, but its growing retail market share and price-conscious customer base can still provide opportunities for sellers with everyday low prices.

Customer Behavior and Price Sensitivity

Walmart shoppers prioritize price over additional features, making it an ideal platform for sellers with everyday low prices. Amazon shoppers are more willing to pay premium prices for additional features and services, making it a better option for sellers with high-demand products offering premium experiences.

Profit Margins by Product Type

Walmart's price-sensitive customer base tends to prioritize price over product quality, which can result in lower profit margins for sellers offering lower-cost products. Amazon's customer base, on the other hand, is more willing to pay premium prices for high-quality products, resulting in higher profit margins for sellers offering premium products.

How Informed Repricer Helps Amazon and Walmart Marketplace Sellers

Optimizing pricing is crucial for success on both Amazon and Walmart. Informed Repricer empowers sellers to automate their pricing strategies and maximize profitability across both platforms. 

Automated Pricing Adjustments

Informed Repricer's AI-powered engine automatically adjusts prices in real time based on competitor pricing, Buy Box competition, inventory levels, and pre-set minimum and maximum price thresholds. This dynamic pricing automation ensures sellers remain competitive without constantly monitoring the market and can focus on other aspects of growing their business.

Winning the Buy Box

As mentioned earlier, winning the Buy Box is essential for maximizing sales on both Amazon and Walmart. Informed Repricer helps sellers increase their chances of winning the Buy Box by dynamically adjusting prices. The platform considers the various factors that influence the Buy Box algorithm on each platform, ensuring that pricing strategies are optimized for both Amazon and Walmart's specific requirements.

Maximizing Profit Margins With Smart Pricing

Informed Repricer's smart pricing algorithms go beyond simply matching the lowest price. They consider various data points, including costs, historical sales data, and market trends, to identify optimal pricing strategies that maximize profit margins. By setting appropriate minimum and maximum prices, sellers can ensure they're not sacrificing profits in the pursuit of sales volume.

Easily Manage Amazon and Walmart Pricing With Informed Repricer

Both Amazon and Walmart offer unique opportunities for sellers, but their differences in fees, competition, fulfillment, and buyer behavior mean that pricing strategies must be tailored to each platform. Choosing where to sell—or selling on both—requires careful consideration and strategy to maximize profitability.

That’s where Informed Repricer comes in. Instead of manually adjusting prices across two marketplaces, you can automate and optimize pricing strategies in one centralized platform. With custom repricing rules, real-time monitoring, and an intuitive dashboard, Informed Repricer helps you stay ahead of the competition while saving time and reducing costly errors.

Start your free trial today and take the first step toward optimized pricing and maximum profitability on both Walmart and Amazon marketplaces.