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Is selling on Amazon now a losing battle?

Today is nothing special—except that the much-awaited total solar eclipse is set to sweep North America, Mexico, and Canada!

Astrologically speaking, solar eclipses symbolize breakthroughs. But you know what will materialize those breakthroughs for your business? Watching (out for) the current updates in the ecommerce universe.

POST OF THE WEEK

BLACK MARKET

Selling on Amazon has always been considered a surefire way to make money… but is it still?

Recent discussions among sellers reveal that many find it harder to make a profit on the platform lately.

What other sellers are saying

One seller testified to such a dilemma, voicing out frustration on Seller Central. According to him, instead of making a profit, they're losing money because of the high fees on Amazon.

🗨️ Other sellers agreed and also shared their sentiments, including:

  • Profit concerns. Some say they can no longer turn a profit on Amazon due to various seller fees, including inbound transportation costs and other charges.
  • Impact on small sellers. Others shared that Amazon's fee structure hurt small sellers more, making it harder for them to compete with other sellers.
  • Frustration with platform changes. Sellers are annoyed with sudden policy changes, increased advertising costs, and difficulties in winning the Buy Box.

What should you do if these happen to you?

If you find yourself facing losses while selling on Amazon, here are some things you can try:

  • Review your expenses. Analyze your costs, including product costs, shipping fees, and Amazon's selling fees.
  • Diversify your selling channels. Consider entering alternative platforms or developing your ecommerce website.
  • Reassess your products. Make sure you’re selling what your customers want and at the right prices. 💲
  • Optimize your operations. You can try using Fulfillment by Merchant (FBM) to reduce costs and increase your control over the fulfillment process.
  • Engage with other sellers. Join forums to get insights and strategies for navigating challenges on Amazon. 

Although challenges exist, selling on Amazon isn’t necessarily a total loss for everyone. To succeed, you need to be flexible, smart, and adaptive to the changes in the ever-evolving world of ecommerce. 🌤️

TOGETHER WITH WALMART MARKETPLACE

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*Source: Walmart first-party data, 2021-22

**Conditions apply.

BITES OF THE WEEK

HOT TOPIC

Amazon pauses the rollout of its controversial low-inventory fee

Amazon pauses the rollout of its controversial low-inventory fee

Remember that looming low-inventory fee that had sellers on edge? Well, Amazon's hitting the pause button on it—sort of.

According to a report by Aol., Amazon will still charge sellers but will then refund them by the end of April. It's essentially a trial run—or a “transition period” as Amazon calls it.

❤️‍🩹 Why the change of heart?

Amazon executive Dharmesh Mehta explained on LinkedIn that they want to give sellers time to wrap their heads around this new fee.

Looks like the uproar from the seller community, which produces 60% of the goods on the platform, was heard loud and clear by the retailer. Not to mention the Federal Trade Commission's (FTC) scrutiny, which adds to the tension.

How did sellers react?

  • Despite the postponement, some sellers are still frustrated with Amazon’s fondness of adding more fees on top of fees, such as inbound placement fees.
  • Seasonal sellers are worried about getting dinged for having off-season stock. Some are pondering price hikes or even bidding FBA farewell—a tough call when Prime shipping is on the line.
  • Others are considering Amazon Warehousing and Distribution (AWD)—allegedly the golden ticket to dodge those pesky fees. 🎫

With profit margins tightening by the day, you may just be all trying to keep your heads above water. Also, who knows what Amazon's got up its sleeve next?

🎧 But there’s one thing you can do to effectively combat these changes: stay informed, smart, and agile.

ACTIONABLE ADVICE

How to ship your way to buyers’ hearts (and pockets)

How to ship your way to buyers’ hearts (and pockets)

Efficient order shipping is one of the major factors that drive sales. Why do you think Amazon’s free and fast shipping promise was effective in winning customers’ hearts?

But how exactly can you make the same promise without the giant fulfillment centers and seemingly endless resources of Amazon? 🤔

According to eCommerce Fastlane, you just have to follow 9 best shipping practices:

  • Plan a shipping strategy. This involves checking your customers’ location to develop an optimal shipping schedule. By optimal, we mean fast and not costly.
  • Set your goals. For example, if you want more people to buy from your site, you can offer free shipping. If your target is increasing the number of orders you deliver yourself, you may have to increase the number of delivery riders or vehicles.
  • Leverage third-party services, especially if you’re just starting and haven’t figured out how to properly pack and label orders (fulfillment). It’s better to get someone to work for you, like FBA or Walmart Fulfillment Services.
  • Offer different shipping options. Some may pay more for same-day delivery.
  • Be upfront about shipping costs.
  • Provide buyers an easy way to track their orders, preferably in real time.
  • Make returns easy.
  • Ship with care. 
  • Monitor your performance.

🍽️ Food for thought:61% of online shoppers are unlikely to shop with a retailer again after a poor delivery experience. So, if you don’t want to get abandoned, step up your shipping game (and post-purchase support, too!) ASAP.

Author : SellerBites
Faith began working on SellerBites in 2021, a weekly newsletter that provides sellers with the latest news and updates in FBA. With first-hand experience in managing various seller and vendor accounts, she understands what sellers face on this platform. Her background led to the conception of SellerBites, which main goal is to help people become better, more informed entrepreneurs in the Amazon marketplace.
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