Discounted gift cards – even legitimate ones – are risky business
By: Lesley Hensell
Discounted gift cards. What’s not to like?
Everything. Because if you’re relying on discounted gift cards to buy your Amazon inventory you can find yourself in a risky situation. In this article we will discuss what is making discounted gift cards such a risky way to buy your inventory.
What makes gift cards risky
Discounted gift cards can come with lots of risks:
- Gift cards could be used for money laundering. Which makes them unappealing to Amazon.
- Sites can offer cards from members of the public. However, there is no way to ensure the validity of these cards, nor their provenance.
- Products that are bought with gift cards rather than a bank card or credit card, the seller cannot give proof of purchase.
Operate like a legitimate business
If you’re addicted to this habit, stop for a moment and think about how large businesses operate.
They pay invoices using debit or credit cards, checks and wire transfers. They do not get inventory using discounted gift cards bought from strangers online.
Amazon doesn’t exist to allow wheeler-dealers to flip stuff. They want third-party sellers to operate like legitimate businesses. With excellent record-keeping, reasonable standards for invoices, payments, and bank accounts.
However it is equally dangerous for third-party sellers to purchase them with a buyer account that is potentially linked to their seller account.
Amazon’s risk management operations see this as a risky behavior that can be related to fraud or, worse, money laundering.
A better way to play with margins
So, instead of risking a seller account for a 2% or 3% discount, look for other ways to game the system and enjoy your selling account. Perhaps the best of these options is to purchase inventory with a debit card or credit card that offers rewards. Some business accounts provide 1% or more cash back. Others offer points for travel rewards, merchandise and more.
Purchasing discounted gift card may sound like a great way to save money. But they really can damage your credibility with Amazon!
Keep you account healthy. Need help? Ask Riverbend Consulting. or give us a call! 877-289-1017
Lesley is co-founder and co-owner of Riverbend Consulting, where she oversees the firm’s client services team. She has personally helped hundreds of third-party sellers get their accounts and ASINs back up and running. Lesley leverages two decades as a small business consultant to advise clients on profitability and operational performance. She has been an Amazon seller for almost a decade, thanks to her boys (18 and 12) who do most of the heavy lifting.