In an excellent series of blogs, Stephen Smotherman from Full-Time FBA discusses how he overcame some of the biggest selling fears of Amazon FBA. Some of the fears covered in the series so far include getting suspended, pricing, paying for services, selling used items, moving into new categories and negotiating a better price.
1. “Tanking” Prices
Stephen advises that although prices will always be fluid, sellers can reduce the chances of their competition lowering their prices, through “making better sourcing decisions“.
When the demand for a product outweighs the supply, prices will increase. This is particularly true in November and December, where parents will pay over-inflated prices, to get their hands on the must-have toy in time for Christmas.
Repricing software can help manage your prices—ensuring you maximise your profits in situations where your competition sells out (p.s. here’s a handy tip for checking your competitors’ stock levels).
One of the biggest myths of selling on Amazon is that having the lowest price will mean you get the much-coveted Buy Box. This is simply not true; Amazon’s Buy Box formula is much more sophisticated and spread across a range of different seller metrics including feedback.
2. Getting Suspended
One of the biggest seller fears currently is getting suspended by Amazon. Suspension can occur for two main reasons—performance and violation.
If your performance on Amazon slips, they may suspend you, in an attempt to keep the service levels extremely high across its marketplaces.
As a seller on Amazon, you’re a guest in their house—and this means you need to abide by their rules and regulations, the ones you agreed to when you signed up. If not, you may land yourself in hot water.
Stephen has offered nine ways to increase your chances of not getting suspended. However, if you do find yourself faced with this nightmare seller scenario, you’ll want to know how to appeal and get your selling account reinstated ASAP.
3. Paying for Services
Whether it be repricing, feedback removal, or scanning apps, many sellers view paying for services as extras that eat into their profit margins.
Unless it is a task you enjoy, you should “consider outsourcing various aspects of your business”, to save time whilst potentially increasing sales and profits.
Whilst sellers can spend a few hours each day manually repricing, couldn’t this be time better spent on other areas of your business or with family and friends. And, even if you attempt to manually reprice, there’s no way you can do it as quickly and effectively 24/7, like many repricing solutions. See more reasons why FBA sellers should use Amazon repricing software from FBA seller, Jeff Roth.
Most services offer free trials. RepricerExpress, for example, offers a no-obligation free 15-day trial for sellers to experiment with our software and see if it is right for them.
4. Selling Used Items on Amazon
By not selling used items, many merchants are essentially “leaving money on the table”. Although new items will make up the majority of most sellers’ stock, selling used items can be profitable, if done the right way.
In his examples of successful reselling of used items, Stephen purchased a board game for $2, which he sold for $40. Later, he purchased a box of used books, which he then sold individually for a tidy profit.
Reminder: If you’re selling used items on Amazon, they should be complete and in working order.
5. Branching Out into New Categories
Many FBA sellers will start out selling books or toys before thoughts of expansion enter into their minds. Should l sell in the new “hot” Amazon category? What profits will l make?
Diversifying your inventory can help your ecommerce business—as the saying goes, don’t put all your eggs in one basket. You may lack experience of selling in a new category and will no doubt learn some lessons on-the-job from trial and error.
However, by arming yourself with knowledge of these new selling categories through ebooks, guides, Facebook groups, blogs and forums, you can put yourself in a stronger position.
6. Negotiating a Better Deal
Most (if not all) sellers are in the ecommerce world to make money. One way you can increase your Return on Investment (ROI) and profits is by negotiating a better deal with your suppliers.
Stephen discusses four common seller fears in negotiation scenarios and offers some helpful advice to help you overcome your fears. You should be friendly and approachable and when presenting your offer, show how it will benefit the customer.
Finally, don’t forget to leave your contact information, you never know when they might call or email with a great deal.