Archive for the ‘Marketplaces’ Category

Selling on Amazon: Another True Cautionary Tale

Thursday, July 23rd, 2009

Once again I want to apologize for the delays and technical issues, and state of the blog in general over the past week or so. It’s been crazy around here, and I appreciate your patience. I’ve actually got a post for you today, just a quick one to let you know I haven’t completely abandoned you.

It’s time to talk once more about the possible pitfalls and perils of selling on Amazon.

Admittedly, selling on Amazon can be time consuming and even frustrating. If you are a casual seller with a few books rather than a professional you might be better off figuring out how to sell your books online the easy way.

I know we’ve covered this before in various ways, but this time I’m not talking about myself. There is a colleague of mine, another bookseller who’s about a quarter my size. He sells around a couple hundred books a day.

At least he did, until he recently got his account suspended by Amazon.

That’s right, it happened. The thing we all dread – suspension. He told me that he was advised in the morning that he needed to get the situation rectified, and by that same evening his account had been suspended.

He knows why it happened. He simply hadn’t been doing what he was supposed to be doing. He had been shipping books late, he didn’t have good customer service, and he didn’t reply customer inquiries in anything approaching a timely manner, if at all. Amazon, of course, doesn’t take too kindly to (more…)

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Selling Books On Amazon: Handling Policy Violations

Tuesday, July 7th, 2009

I’ve warned you about selling on Amazon, and how important knowing the rules is. Nothing brings that point into sharp relief quite like getting a notice from Amazon that you are in violation of their policies. That’s exactly what happened to me recently. Failing to comply with Amazon’s policies can mean serious penalties up to and including losing your seller account, which is, quite frankly a terrifying prospect for anyone who makes their living selling used books online.

In this case, the violation had to do with my confirmation emails. I am in the practice of sending out an email whenever I ship a book, just to let the customer know that their books are on their way. It’s good customer service and doesn’t take much time once you develop a boilerplate message to send out. The issue was that in the signature of my email was the URL of my own website.

Now, these emails are only sent after the transaction is complete. I would never try and divert a customer from buying a book I had listed on Amazon to buy it from my own site instead. That is pretty much Amazon’s cardinal sin and if you get caught doing it, you can pretty much expect instant expulsion. The way I justified what I was doing was that the customer had already bought the book and Amazon had already got their cut. What was wrong with letting the customer know I also had an independent site after the sale was complete?

A lot.

(more…)

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More Tips for Selling Books on Amazon

Wednesday, June 17th, 2009

Selling books online these days means knowing how to sell on Amazon. I’d estimate they’ve got about 70% share of the market for online used book selling. If you want to give yourself the best chance for success, you need to know the ins and outs of the different marketplaces, especially Amazon. A lot of newbie booksellers start out having only ever sold on Ebay. Get ready to repeat after me, because here comes today’s mantra:

Selling on Amazon is not the same as selling on Ebay.

Learn it, love it, live it.

As I’ve discussed in a previous post, Amazon is a stickler for their rules. It’s easy to understand why, once you realize that, unlike Ebay for instance, they are on the hook to the customer should anything go wrong. I’ve said it before, and I’ll say it again: know the rules. It’ll save you from having to deal with headaches and consequenses up to and including losing your Amazon account.

Here’s a few ways that Amazon is different than Ebay:

Multiple Accounts

On Ebay, a lot of people will recommend that you have different accounts for different things. Ebay doesn’t care how many accounts you have. You can have as many accounts as you can open free checking accounts and email addresses. As far as Ebay is concerned, you can have an account for every day of the month and another one for holidays and special occasions. Amazon is different. You cannot have more than one Marketplace Seller account. Not only do they have a policy against multiple accounts, they actually check. They have several ways of trying to find people skirting this rule, and if you get caught, you could be looking at being permanently banned from Amazon.

That being said, you may see some sellers that do have more than one account. There are some megasellers who get exceptions to the rules. This doesn’t mean you can do it. They have special approval from Amazon. You don’t. Often times these different accounts represent separate locations, separate operations, completely different segments of a corporate structure, etc. The point is, it doesn’t apply to you.

Returns

On Ebay, you’re the selling company and you get to set up whatever kind of return policy you want. A better return policy may make you more successful, but ultimately it’s up to you. Once again, Amazon is different. Amazon considers you to be little more than a dropshipper. From their point of view, they are the public face, the company, and they will set the return policy. Read the rules here. The bottom line is that you’re probably going to have to take any returns made within 30 days. You’re free to take returns beyond that 30-day window, if you so choose, but you cannot have a shorter return window. Personally, I’ve been contacted by Amazon to issue a return on a sale that was 40 days old. I refunded the order. It’s just not worth it to take on Amazon on these issues. Don’t take my word for it though, read and learn the rules in their entirety for yourself.

Blocking Buyers

You can’t. On Ebay you can create “blocked bidder” lists to weed out any undesirables. Not on Amazon. As long as their money is green, Amazon wants them as a customer. This goes for anyone who’s considered a “domestic” customer, including APO/AFO, Hawaii, Alaska, Puerto Rico and Guam. You can opt not to ship internationally, but that’s about it. Some sellers that specialize in selling used textbooks complain that certain buyers are actually other sellers who turn around and resell their books to students or textbook stores. Well, tough. There’s no way to block any buyer from buying any book. And as far as I’m concerned, if someone is reselling the books you’re selling, there’s no point in getting mad at them. It’s your own fault for pricing your books to low.

Anyway, these are just a few of the differences between selling on Ebay and selling on Amazon. As always feel free to ask me any questions you might have, and I’ll try and answer them in a future post.

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Paying Taxes on Online Book Sales

Thursday, June 11th, 2009

**DISCLAIMER** The following is based on my own experience, yours may vary. I am not claiming to provide professional financial advice, legal advice, or tax advice. Find out for yourself what the laws are where you live, and consult a professional before making important decisions.

Sales tax can be a sticky subject in the world of online bookselling. If you sell on Amazon, you’ve agreed to Amazon’s Participation Agreement (whether you know it or not). One of the terms of that agreement reads as follows:

Sales, Use, or Similar Taxes. You agree that it is the Seller’s responsibility to determine whether sales, use, or similar taxes apply to the transactions and to collect, report, and remit the correct tax to the appropriate tax authority. You also agree that Amazon is not obligated to determine whether sales, use, or similar taxes apply and is not responsible to collect, report, or remit any sales, use, or similar taxes arising from any transaction.

Basically this means that Amazon will not collect taxes for you. There is also no mechanism for you to collect taxes through Amazon. This means that whatever taxes you owe, you have to take directly out of your profit. In my opinion, since Amazon is the one collecting payment, they should really should be the one to collect the taxes. But the fact of the matter is that they don’t.

The good news is that for now, sales tax generally only applies to sales made within your state. I have heard rumblings that in the future internet sales tax could apply to all states, collected either by the state or even federal government.

If you look around on sellers’ forums you’ll find people doing all kinds of armchair lawyering, talking about this loophole or that loophole. For example, I’ve seen people claiming that you don’t have to pay taxes on Amazon sales in a certain state because Amazon is considered a “virtual consignment shop”. Be smart. Don’t take legal advice from anonymous people on the internet. They won’t be there to turn to when the taxman comes knocking. Find out for yourself what the laws are in your state. If you think you don’t have to pay taxes for any reason, you’d better get it directly from the government and you’d better get it in writing.

I also hear about sellers who just try to “fly under the radar”, not paying sales tax, not reporting their income when they know full well that they are legally obligated to do so. Don’t do it. It’s a huge risk, and it’s just not worth it.

Personally, I pay my sales tax, and in when it comes to Amazon, I pay it out of my profit. I may not like it, but not paying is just not worth the risk. My business is a corporation, which provides certain benefits, especially since I have employees, etc. It’s works out better than being a sole proprietor, LLC, or partnership for me. I’ve made all these decisions with the assistance of professional advisers. I always consult my accountant, my attorney and my banker. They are experts. I’m not, and you probably aren’t either.

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Selling Books on Amazon: Know the Rules

Wednesday, June 10th, 2009

amazonSelling books on Amazon is just about mandatory for anyone wanting to get into online bookselling these days. You can make a lot of money there if you’re smart and you follow the rules. Amazon is in business to make money, and if allowing you to make some money along the way benefits their bottom line, they’re all for it. But never forget that it’s their playground and you have to play by their rules.

Most of the rules are in place to protect Amazon’s reputation. Amazon is the brand, they want you to be almost invisible to the customer, and that’s fine. But the second you start threatening the strength of their reputation, you become a liability and they will not hesitate to give you the boot. Don’t kid yourself; there are a billion other sellers out there climbing over each other to sell on Amazon. Amazon will not miss you. But if you can’t sell on Amazon you will miss that income.

Become familiar with “A-to-z” claims. If a buyer files one against you, you’re being accused of violating the terms of Amazon’s A-to-z guarantee, and you’d better hope you’ve dotted all your i’s and crossed all your t’s. Know the rules and follow them to the letter. I cannot stress this enough.

If you do not comply with Amazon’s condition guidelines you will lose the claim. If you list a book as “Like New” and Amazon considers it “Very Good” or “Good”, you are in the wrong. It doesn’t matter what arguments you can make for listing it as “Like New”, you will lose. Do yourself a favor and err on the side of safety, list your books’ conditions on the low side. It’s just not worth losing money or even your account over.

Similarly, if you don’t comply with Amazon’s shipping policies you will lose the claim. You need to be able to show you’ve shipped items within 2 days of purchase. There are different timeframes for standard, expedited, and international shipping. They don’t regulate how you have to ship it, you can use the post office, you can use UPS, you can have your brother-in-law drive it over in his ’83 El Camino. Amazon doesn’t care how it gets there, but it better get there on time.

I don’t mean to frighten you away from Amazon altogether. If you play by the rules you’ll be just fine, and like I said, there is definitely money to be made there. Just always keep in mind that Amazon will prioritize covering their own you-know-what.

Another example of one of the ways that Amazon protects itself is by putting a hold on funds for new sellers. This has pretty much become their standard operating procedure these days. They’ll put you on a “review” status, and you won’t get paid for up to 4-5 weeks. This is basically to weed out fly-by-night scammers who try to collect payment and never ship what they promise. It can be tough to wait out this review period, but it’s definitely worth it.

Not all of Amazon’s policies are restrictive, either. While they do put a hold on new sellers’ funds, one nice thing is that you can get paid early if you need the money. Typically you get your funds deposited every two weeks. However if for whatever reason you need the money sooner, you can request deposit of your balance before the two weeks is up. This is a nice perk not offered by others like Half or Alibris.

It may seem like a lot to remember, but I’ve really barely scratched the surface. Do you have any questions about selling books on Amazon? Let me know and I’ll try and answer them in a future post, along with more Amazon-related tips.

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