Major problems with selling on amazon and advice for new sellers electricity 2015

This begs the question, if you can buy it in bulk, then any number of other people can too, so why engage in so much competition for the same items? Also, Amazon sellers use automated repricing software so their prices are continually adjusted to be the lowest price. With many sellers using re-pricers, as soon as one seller out-prices another, it sets off everyone’s re-pricers and a downward pricing spiral begins. The only winner is the Amazon buyer who gets items at a very low cost. It is Difficult and Time-consuming to Build a Positive Feedback Profile

If you think eBay customers are bad about leaving feedback, Amazon customers are worse. Only about 1-in-30 buyers leave feedback on Amazon, so you have to sell a lot of products to build up your feedback. About 1-in-3 eBay customers leave feedback. Your Products Can Become Restricted and Unsellable at Any Time

Amazon works closely with manufacturers and brands. If a brand decides they don’t want third-party sellers listing items on Amazon, they can deem them restricted at any time. I experienced this numerous times on Amazon. For example, I was selling Dunkin Donuts coffee that I was purchasing at grocery stores and Target. I had about 40 bags in a Fulfillment by Amazon (FBA) warehouse.

This is especially true if you sell on the FBA program. With Amazon, fulfillment is when you send your items to a warehouse and they sit there until a customer buys them. After that, Amazon ships the item. The problem is, learning the prep system isn’t easy, and a lot can go wrong with damaged items, lost items, and other warehouse issues. Amazon fees are about 1/3 of the sale price of the item, which doesn’t include the monthly fee of $39.99, and the ever-increasing warehouse storage fees. eBay is approximately 15 percent of the sale price, which is about half as Amazon.

Despite the pitfalls, many people prefer Amazon to the competition. For starters, they are familiar with Amazon, so it feels like home. In addition to the issues above, there are a number of things that even large or long-term Amazon sellers haven’t figured out. The good news is, I can help with that.

It’s a little shocking how many sellers never set up state tax collection options on Amazon, thinking that Amazon somehow automatically takes care of all sales tax issues from sales on the Amazon marketplace.It turns out nothing could be further from the truth.

While Amazon is happy to collect state sales tax for you (for a small fee), it’s up to every seller to indicate from which state it wants Amazon to collect tax, and to manage the remittance of the taxes to the appropriate tax jurisdictions across the country.

However, there’s little long-term benefit to being a big seller on Amazon. It’s much smarter to focus on bottom growth and account for all costs upfront. Sellers who grow their bottom-line profits year-over-year faster than their top-line sales tend to fare better.This typically requires an SKU-level understanding of profitability, incorporating overhead, and incurring some indirect costs into each SKU’s profit calculation.

You can’t average everything out and look only at your overall sales numbers and margins. You need to think about every SKU you sell on Amazon as having its own P&L, its own market forces, and its own level and types of competitions. Listing Optimization

You can use a number of sources of data available within Seller Central to improve the listing quality of your catalog. For many sellers, the process of building and optimizing listings is a one-time deal, as they understandably turn their focus to other operational matters. The first thing you want to do is use Amazon’s Sponsored Product Ad campaign reports. A significant opportunity, however, lies in using the reports from the Sponsored Product ad campaigns. In these reports, you can see the exact keywords that were connected to Amazon customers buying your products.

By examining these reports periodically (specifically for automatic targeting campaigns), you’ll find some keywords leading to sales that you never anticipated being effective. Lifting those terms directly into your generic keywords will improve the SEO discoverability of your listings. I suggest repeating this process every three months to make sure customers’ behavior specific to certain words haven’t changed.

As someone who has sold on eBay since 2003, and on Amazon since 2009, eBay is a better fit for me. However, if you’re an Amazon fan, be sure to pay attention to the potential problems. eBay isn’t for everyone, neither is Amazon. It is just a matter of determining which is a better fit for your particular business.