So, you have been selling products on the Amazon Marketplace for a while and think you have figured out everything about the platform. The good news is, in case you have made it out during your first holiday season, you are doing well.

However, there are still many aspects that even long-term or large sellers on Amazon don’t know. When it comes to online sellers, it’s not all rainbows and butterflies. Before you reach your target profit margin, be prepared to face challenges. So, if you only start selling on Amazon or thinking of becoming a seller, below are some of the common Amazon Vendor Central problems you can experience with the marketplace.

Barriers to Entering the Market

To begin with, it is becoming increasingly complicated just to enter the Amazon Marketplace and begin selling. As it cooperates with new merchants who may skip the rules, the platform needs to turn more careful in allowing what products can be offered, who can sell them, and how.

Users who want to sell such things as handbags, clothing, shoes, automotive goods, and many other kinds of inventory on Amazon should get approval. And the complete list of such categories that require Amazon approval keeps increasing. Besides, it’s not that simple to get approved sometimes. Fortunately, Amazon sellers enjoy automatic acceptance to operate in several categories once they create the selling accounts.

Amazon Sellers Get Paid Only n a Biweekly Basis

If you sell products on Amazon, the payment is processed by direct transfer to your account every two weeks, unless you belong to the number of favored users who still can avail of an opportunity to request credit card payments every day.

Furthermore, Amazon doesn’t accept PayPal transfers from its buyers. It can be an issue if you invest the profits from your selling made on other websites to buy more inventory for the business. Sure thing, there are some options to side-step the 14-day payment system. However, you should apply and get approval from Amazon.

Competition in the Market is Harsh

Many small business owners on Amazon don’t offer their unique goods. Usually, they just resell products they have bought from suppliers or wholesalers in bulk. In the same ways as any retail shop or other store does. When you can purchase the items in bulk, many other Amazon users can do it as well. As a result, it creates an excellent level of market competition for similar products.

This has caused many Amazon sellers to create unique goods by applying to specific companies that put a brand name of a seller on a particular item and make minor adaptations to the products, for example, small fabric, color, or formulation customizations. These are called white-label or private-label goods. They are an intermediate point between creating your items from scratch and reselling goods.

The Amazon Marketplace has also conducted experiments with various instruments to help merchants outperform the competition. It includes adding the option to promptly reprice the goods, remove aged inventory, or optimize your product listings with search keywords.

With many Amazon sellers leveraging repricing tools to adapt their rates to be competitive automatically, once one merchant beats the competitor’s prices, it notifies all the other sellers’ repricing instruments. That’s how the pricing spiral with a downward trend starts. In this case, Amazon shoppers who get products at a meager cost are the only winners.

It Takes Some Time to Develop a Positive Reputation

Have you heard that eBay clients are not so good about leaving their feedback? The thing is, Amazon shoppers are even worse. According to research, only one buyer out of 25-30 Amazon customers (compared to every third customer on eBay) share reviews on Amazon. Thus, you need to sell plenty of items to develop your client feedback. Fortunately, the review is not as crucial on Amazon as it is on eBay.

Anyway, there is a quick and straightforward way on how to improve these statistics. SageMailer helps Amazon users track, manage, and boost their seller ratings and get more reviews from customers. The customer service instrument automatically sends polite requests to your clients, asking them to share feedback and product testimonials on your behalf. Such requests are based on templates approved by Amazon and are fully compliant with the platform’s Terms of Service. It also allows you to respond to shoppers and address possible Amazon seller issues with orders in advance.

Get More Product Reviews and Improve Your Amazon Seller Rating 4

Your Goods Can Become Unsellable or Restricted at Any Moment

Amazon cooperates closely with many established brands and large manufacturers. However, this is the point where problems selling on Amazon may occur. 

It means that only the brand owner is entitled to sell the goods with Amazon. While it may seem completely negative, the platform has developed its brand registry or other protections to help brand owners sell more efficiently.

Thus, Amazon sellers won’t have to compete with users who get their goods through unethical means or liquidators or try to counterfeit their products.

The Platform Is Expensive and Complicated

It is particularly true when you sell via the FBA system. However, the platform has a lot of written content and videos with in-depth guidelines on how to operate with FBA and similar Amazon programs. Besides, if you opt to use Amazon FBA to run your business in Germany or any other European country, Amazon will help you get in touch with its account specialists. They will assist you in getting set up and addressing any Amazon seller problems you may face.

With the Amazon platform, fulfillment occurs when you deliver your products to one of the Amazon warehouses, and they are kept there until customers buy them. Then, as soon as the item is sold, the platform packs it and ships it to the client.

Studying all the aspects of the preparation system for delivering goods into the warehouses has complicated details. For example, something can go wrong with lost items, damaged items, or other warehouse problems.

In addition, Amazon doesn’t always receive compensation for client returns or full payment for products damaged or lost in the warehouse.

In addition, Amazon’s commission is about 30% of the whole product price. It does not include the $39.99 monthly fee and the constantly increasing fees on warehouse storage. Also, Amazon periodically provides an option to lower the expense the platform charges on each sale if you drop your item sales price. Such limited-time opportunities don’t usually leave any room for profit. However, they can help you to get rid of slow-moving stocks. Despite certain pitfalls, many still prefer Amazon to its competitors. For starters, sellers are more familiar with the Amazon platform, so it does feel like home.

Bottom Line: How to Avoid Amazon Selling Pitfalls?

Especially if you are a novice on the Amazon platform, feel free to use the following three tricks that will help make your selling process easier and much more profitable.

  1. Sales tax payments: Once you open the seller account, you need to choose between the options of tax collection existing in your state. The Amazon platform tends to collect state duties for you at some small fee if you don’t belong to one of the eight specific states where Amazon serves as a Marketplace facilitator. However, every Amazon seller can decide from which state they want Amazon to remit a tax. 
  1. Profitability: It is not strange that many Amazon sellers are concerned with top-notch sales numbers instead of bottom-line profits. Although the platform has started to offer dedicated account executives for big merchants who can assist in optimizing business, there are still a few long-term advantages to being a prominent seller. 

For many users, it’s much more beneficial to think of a bottom-line increase and consider all the costs upfront. Also, operate following the experience of the actual revenue level of your business on Amazon. Sellers who work to cut costs and increase their bottom-line revenues every year faster than their top-line sales usually fare better.

  1. Optimization of product listings: Feel free to use all the sources of information provided in Amazon’s Seller Central dashboard to boost the product listing quality of your items and win the Buy Box. You first need to try using Sponsored Product Ad campaign reports. If you check these statistics periodically, you will find some search keywords that lead to sales that you never thought were effective.

Don’t forget to be attentive to some potential Amazon third-party seller problems working in the marketplace. eBay or similar e-commerce platforms are not developed for everyone. Neither is the Amazon platform. So, you need to determine which one suits your business model better.