Riverbend Consulting

Having problems with Amazon? Let us solve them.

  • Home
  • Suspensions
    • Account Suspension
    • ASIN Suspension
  • Account Services
    • Account Health Check-Up
    • Seller Account Protection
    • Account Management
    • Reimbursements
    • Amazon Editorial Recommendations
  • Our Blog
  • About
    • About Us
    • Our Team
    • Testimonials
    • Referral Program

(877) 289-1017 Contact Us

+44-161-8508-269

MENU

Inventory Flips

Should new Amazon Sellers be flipping products from deal sites?

August 5, 2019 1 Comment

Flipping products such as cheap or free inventory is tempting, but carries significant risk

By Lesley Hensell

 

It seemed like the ideal way to get started selling on Amazon – flipping deeply discounted or free products purchased right on Amazon itself! But this tempting method of sourcing can lead to disaster.

buying or flipping product graphic text

 

“I went to those deal sites online,” my client said during our intake call about his account suspension. “They have huge discounts for products listed on Amazon. So, I would buy the items and then flip them. The margins were amazing. Some stuff I bought had a discount of 90 percent or was even free.”

My client visited sites like Vipon, JumpSend and SnagShout, where Amazon private-label (PL) sellers post deals to drive sales and improve their Best Seller Rank. After buying the goods (or getting them for free), he listed them on Amazon.

As one might imagine, this had the immediate effect of angering the affected PL sellers. These PL sellers had brand registry, and they had also filed IP complaints. Lots of them. My seller ended up suspended.

In other cases, I’ve seen PL sellers perform test buys and claim the products are counterfeit, inauthentic, or used sold as new. They have left terrible, sticky feedback and complained to Amazon endlessly.

Try to understand the situation from the PL sellers’ perspectives.
They sell at huge discounts to launch their products – not to create competition on their very own listings! (We are talking about how such massive discounts violate Amazon policy, but that’s a topic for another day.)

As a result, the old phrase “too good to be true” comes to mind. These “deals” are too good to be true, if you’re planning to resell them on Amazon.

What should a new Amazon seller do instead? Every sourcing method carries expense and risk, but there are many alternatives that are safer – if not as profitable. Buy from wholesalers, distributors or local manufacturers. Even retail arbitrage and online arbitrage – which carry quite a bit of risk and are not a great long-term strategy – are less risky than buying from deal sites and incurring the wrath of PL sellers.

Have questions about the health of your account? Call Riverbend Consulting 877-289-1017.

Lesley is Partner at Riverbend Consulting, she offers practical know-how to improve retail performance. Lesley’s  experience with Amazon compliance gets accounts back up fast.

Filed Under: Account Health, Amazon, General, Inventory Sourcing, Private Label, Quality Control, Seller Performance, Vendor Tagged With: Amazon, Amazon Account Reinstatement, Amazon Account Suspension, Inventory, Inventory Flips

Q4 Headaches: The Wrong Way to Drop Ship

November 16, 2017 1 Comment

 
By Lesley Hensell

 

Babies R Us advertises a bouncer on Black Friday for a mere $29. On Amazon, it’s selling for $98. It’s an amazing flip.

Your local store is out of inventory, but there is plenty available on the Babies R Us web site. Just create an Amazon MFN listing, and have Babies R Us send the product to your buyer, right?

Wrong. The temptation may be tremendous. But don’t turn your Black Friday into a bust with dangerous drop-shipping.

Does Amazon allow drop-shipping?

First, let’s clarify what drop-shipping means. Drop-shipping is a fulfillment method where a third-party seller never sees nor touches the inventory. The third-party seller accepts an order from a customer, and then it triggers another company to fulfill the order.

Amazon allows certain kinds of drop-shipping. A third-party seller can establish a relationship with a vendor such as a manufacturer or distributor. That manufacturer or distributor can then drop-ship on behalf of the third-party seller. Amazon is totally cool with this arrangement, but only if your shipping statistics remain in the green.

There is another kind of drop-shipping that is specifically prohibited by Amazon. It’s called casual drop-shipping. Meaning, no real vendor relationship exists between the third-party seller and the shipper.

Consider the Babies R Us situation above. To fulfill that order, a third-party Amazon seller would put their buyer’s name in the “ship to” section of an order on the Babies R Us web site. The item would ship from the Babies R Us warehouse directly to the end-buyer.

Why informal drop-shipping can be dangerous:

  1. The item arrives in a Babies R Us box. Or it comes in a box from Target, Walmart or another retailer that competes with Amazon. This makes customers unhappy.
  2. The item typically includes an invoice with the actual price paid to Babies R Us. This makes customers angry, since they probably paid between two and four times that amount.
  3. The seller has absolutely no way of controlling product quality. Amazon expects you to ensure that the items you sell meet its stringent product quality standards. If you never see the inventory and have no formal relationship with the vendor, you have no say in quality.
  4. Larger items are often shipped without an outer carton. Shipping stickers are placed directly on the box, which is beaten up by the time it arrives. This does not live up to Amazon’s standards for third-party sellers.

What about doing drop-shipping the right way?

Drop-shipping with formal vendor arrangements can be an excellent sourcing method for some sellers. But just like anything else, it requires careful management and monitoring:

  1. Have a discussion with your vendor about product quality. Ensure they are only sending your customers items in gift-giving condition.
  2. Find out about your vendor’s packing protocols. If items need to be in a box, make sure they aren’t being shipped out in a padded envelope.
  3. Establish rules for fulfillment times. Carefully monitor your orders and make sure they are going out on time- every time.
  4. Require timely uploading of tracking numbers for each and every shipment.
  5. Whenever possible, automate the entire process, from order transmission to tracking number upload. This greatly reduces human error.

Have questions about establishing a successful drop-shipping relationship? Call on Riverbend Consulting.

image credit: eranicle/Shutterstock

Filed Under: Amazon, Fulfillment, Inventory Sourcing Tagged With: Drop-shipping, Inventory Flips, Online Arbitrage, Product quality, Tracking Numbers

Categories We Serve

Automotive Parts & Accessories

Appliances

Baby

Beauty & Personal Care

Books

Cell Phones & Accessories

Clothing, Shoes & Jewelry

Computer

Electronics

Garden & Outdoor

Health, Household & Baby Care

Home & Kitchen

Luggage and Travel Gear

Luxury Beauty

Office Products

Pet Supplies

Sports and Outdoors

Tools & Home Improvement

Toys & Games

Video Games

(877) 289-1017

+44-161-8508-269

New Jersey • Texas

© Riverbend Consulting 2021 | Privacy Policy | Site Map |

Digital Marketing by Paid Search Consulting

  • Home
  • Suspensions
    • Account Suspension
    • ASIN Suspension
    • Back
  • Account Services
    • Account Health Check-Up
    • Seller Account Protection
    • Account Management
    • Reimbursements
    • Amazon Editorial Recommendations
    • Back
  • Our Blog
  • About
    • About Us
    • Our Team
    • Testimonials
    • Referral Program
    • Back