Amazon Handmade puts retailers at a disadvantage: 7 hard facts you should know

Table of contents

1. Introduction — Why handmade sellers on Amazon should be alarmed
2. Disadvantage in the ranking system
3. Unfair fees and commissions
4. Hardly any support for small providers
5. Product deletions & category issues
6. Marketplace competition is becoming more unfair
7. Revenue losses and business risks
8. What handmade retailers should do now
9. Conclusion: Does Amazon need a fair handmade update?
10. FAQ — Frequently asked questions on the topic
11. Conclusion & summary

1. Introduction — Why handmade sellers on Amazon should be alarmed

Amazon Handmade puts retailers at a disadvantage — this headline is making the rounds in the community. And not without reason. More and more artisans, micro-entrepreneurs and manufacturers report sudden loss of visibility, slumps in sales and questionable platform policies.

Imagine investing your heart and soul in handmade products only to be pushed digitally offside by an algorithm. That is exactly what is happening to many handmade retailers on Amazon right now. In this article, you'll find out why it is, what you can do about it — and what alternatives are available.

2. Disadvantage in the ranking system

Amazon algorithm favors FBA products

Amazon optimizes for revenue. Products that are shipped via FBA (Fulfilled by Amazon) receive preferential visibility. Handmade retailers, who usually ship their goods themselves, are slipping down in the ranking as a result. And this is despite the fact that they often produce with heart, hand and a great deal of quality.

Why is that so? The algorithm favors everything that is fast: Prime shipping, warehouse availability, delivery times. Handwork? Bad news. This rarely fits into the system.

Loss of visibility despite good reviews

Many handmade retailers report: Despite consistently positive reviews, their products are barely displayed anymore. According to a study by Marketplace Pulse, this is due to the one-sided focus on shipping logistics. Quality fades into the background — and with it many excellent providers.

3. Unfair fees and commissions

Comparison: Handmade vs. FBA or FBM

Handmade sellers pay around 15% sales commission, plus advertising costs and, if applicable, listing fees. Although FBA providers have more fees, they get significantly more reach in return.

The result? Handmade retailers pay too, but barely get anything back. Anyone who doesn't deliver Prime often ends up at the bottom of the search results.

High costs despite manual work — is it worth it?

An example: A manufacturer of handmade accessories sometimes pays over 20% of its turnover to Amazon. With small margins, this quickly leads to the negative. And: Scaling is difficult in the handmade sector anyway.

4. Hardly any support for small providers

Slow response times & lack of protection

Anyone hoping for help from Amazon Handmade is often disappointed. Standard answers, long waiting times, no point of contact — that's everyday life. Especially when products are deleted without giving reasons.

Case studies of affected retailers

A female dealer was blocked due to alleged mass production. Despite evidence of manual work and fair production, the lock remained in place. Such cases affect many people — and feel like a slap in the face for those affected.

5. Product deletions & category issues

Unexpected deactivations in the handmade area

Handmade sellers repeatedly report that products disappear out of the blue. Or they suddenly appear in completely wrong categories. A handmade candle holder under “garden accessories”? Not an isolated case.

Why Amazon categorizations look manipulated

The assumption is obvious: Amazon wants to make handmade offers comparable with mass-produced products. This lowers the price and promotes scale—but it destroys the core of handmade. Namely individuality.

6. Marketplace competition is becoming more unfair

Mass-produced goods replace manual work

Amazon Handmade should actually be a safe haven for creative people. But more and more vendors there are allegedly selling “handmade goods” that actually come from the Far East. Control? Bad news.

Private labels and cheap imports dominate

Amazon specifically promotes private labels with high margins. If you produce in the Far East, you can advertise more, deliver faster — and win the game. A fatal signal for real handmade producers.

7. Revenue losses and business risks

Sales declines due to ranking shifts

A look at the figures is appalling: Many handmade retailers report sales declines of up to 70% in just a few months. And that while maintaining quality and customer satisfaction.

Example: A jewelry designer from Berlin lost almost three quarters of her turnover in 2024 — despite 4.9 stars and over 400 reviews.

Dependence on Amazon as a business model

Many small sellers depend on Amazon for 90%. It's risky. One Target group analysis for sales optimization helps to open up new channels and to broaden your profile.

8. What handmade retailers should do now

Strategies for visibility outside of Amazon

• Building your own online shop with Shopify or WooCommerce
• Using alternative platforms such as Etsy or Avocadostore
• use of Retargeting strategies in e-commerceto attract repeat buyers

Alternatives to Amazon Handmade

• Etsy offers better visibility and real handmade focus
• Regional pop-up stores and markets promote direct sales
• Collaborations with concept stores can stabilize sales

Legal & policy measures

• Exchange with professional associations, trade unions or chambers of commerce
• Reporting unfair practices to consumer centres
• Involvement in Criticism and petitions against platform abuse

9. Conclusion: Does Amazon need a fair handmade update?

Amazon Handmade puts retailers at a disadvantage — and that on several levels. Visibility, support, competition: Anyone who is small and manufactures with passion quickly gets under the wheel.

There is an urgent need for fairness, transparency and a clear line against mass-produced goods under a handmade label. Otherwise, there is a risk of losing an entire craft culture in the digital space.

10. FAQ — Frequently asked questions on the subject

Is Amazon Handmade really meant for handmade products?
Yes, officially. In practice, however, suppliers of industrial goods also sell there.

Why are handmade products less visible?
Because Amazon values shipping logistics (such as Prime) higher than product quality.

What are the fees for handmade retailers?
Approx. 15% sales commission plus advertising fees and, if applicable, storage costs.

Can I use FBA as a handmade retailer?
Yes, but it is often difficult to implement and contradictory to handicraft logic.

What to do in case of illegal product deletion?
Contact support, submit evidence — unfortunately often without a quick response.

What alternatives to Amazon Handmade are there?
Etsy, regional markets, own shops or concept stores.

How do I become more independent of Amazon?
Through multi-channel sales and data-driven campaign optimization with a focus on brand loyalty.

Is Amazon Handmade even worth it anymore?
Only if you combine niche, USP and reach well — otherwise difficult.

11. Conclusion & summary

Amazon Handmade offers opportunities — but also huge risks. If you sell there, you need strong nerves, a Plan B and strategic know-how.

Summary:

• Handmade sellers are disadvantaged in the ranking
• Prime & FBA are preferred — manual work loses visibility
• Support is incomplete, competition unfair
• Many retailers are losing massive sales
• There are alternatives — you just have to use them

Call to action:
Do you want to become more independent, expand your reach and sell in a targeted manner? Then start now with a targeted campaign optimization for your sales success.

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