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The Biggest Mistakes Amazon Resellers Make

When it comes to e-commerce, is there a bigger name than Amazon? The online juggernaut, which began as a bookstore, is now the place to go for countless items. Essentially, if you can buy it, there’s a good chance that you’ll find it on Amazon, too.

Part of the reason for Amazon’s growth is the increasing number of small resellers who offer their wares to customers. For a small monthly fee, you can place unlimited listings on Amazon and reach the millions of shoppers who search the site every day. Placing your items on Amazon is the ideal complement to your own e-commerce site, but if you don’t plan and manage your Amazon presence properly, you could be flushing your money down the toilet.

When you’re planning your foray into the world of a professional Amazon reseller, take note of these common mistakes. Avoiding them will help minimize your costs while maximizing your profits.

Be Smart About Pricing

When you’re adding items to the online store, don’t be tempted to undercut Amazon or other sellers that offer the same items. Price your items fairly, taking into account your costs and time. If Amazon has the same item in its inventory, it will always sell it for a lower price, and chances are, the shipping will be free. Other sellers will also compete with you; some even have their items set up for automatic price reductions. If another seller lists the same item, the system will instantly lower the price to lower than yours. When you start getting into price wars, your profits will decrease as a result.

Use Amazon’s Fulfillment Service Wisely

Amazon offers a handy “Fulfilled by Amazon” service that allows you to box up your items and send them to the warehouse, where Amazon handles all of the sales and shipping and pays you the proceeds after taking out its fee. While this can be convenient, you might also lose money. Items that are heavy or bulky, but sell for low prices, will cut into your profits because Amazon will charge you more in postage fees than the items are worth. In that case, you are better off selling the items yourself and using an affordable online postage provider to ship the items.

Be a Responsible Shipper

We’ve all purchased items online, only to realize that the shipping costs the seller charges are equal to, or greater than, the cost of the items themselves. This is a good way to lose business. Shoppers are looking for bargains, and even if your price happens to be competitive with Amazon’s or another seller’s, if your shipping is exorbitant, you’ll lose sales. Don’t try to earn more money on shipping charges; use the nearest flat rate for that item and keep your customers satisfied.

Watch Your Seller Ratings

Unlike other online stores, once your Amazon seller account is suspended, you can’t get it back. That’s why it’s important to monitor your seller ratings and address issues as soon as they appear. Don’t sell items you don’t have in stock; when the order is cancelled, your rating will suffer. Ship items quickly, and follow up to make sure they were received and that the customer is happy. Taking those extra steps will keep your rating high, drawing in both new and repeat customers.

Get Help When You Need It

The most successful Amazon sellers are not one-man shows. They have others, whether friends and family or hired help, working behind the scenes, adding to inventory, writing descriptions, managing shipping and more. As your business grows, you will need support. Don’t be afraid to ask for advice on how to more effectively run your business as well; successful sellers and marketing experts will often share tips — and their mistakes — so you can learn from them.

Becoming a successful Amazon seller is not going to happen overnight. It requires attention to detail, good merchandise, fair prices and policies, plus a commitment to the business. Start by avoiding these common mistakes, and you’ll be well on your way.

About the Author:

Jason Todd sells toys and games through a number of online retailers, including Amazon. After losing more than $10,000 in his first online business venture, he learned from his mistakes and now earns in the six-figures each year selling online.

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  • Spencer

    I haven’t sold anything on Amazon yet but I’m about to get rid of my Dean Koontz collection, so I’ll keep these in mind for when I do.

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