Friday 30 December 2016

4 Tips for Handling Amazon FBA Taxes


By Stephen


Before you hit the snooze button and move on to a more exciting post, let me acknowledge up front that taxes aren’t the most glamorous topic out there. Unless you’re a CPA or tax professional. In which case I don’t mean any offense by saying that taxes are boring.
Is anyone still with me at this point in this blog post? I hope so – because the topic of taxes, while potentially a snoozer, is of great importance to the success of your Amazon FBA business. If handled incorrectly, your business taxes could negatively impact your success at FBA – but taxes don’t have to be something that holds you back from making progress as an Amazon seller.
We at Full-Time FBA are not tax professionals or CPAs, and we do not intend to give advice for preparing your taxes in this blog post. We also do not give advice in our Facebook group, so if you ask tax questions there we will give you the same disclaimer and point you towards the services of someone qualified to give that type of advice.
Which leads us nicely to our first tip out of four for handling taxes for your Amazon FBA business…
1. Find a good CPA. 
Our biggest piece of advice for you when it comes to handling your taxes is to find a good CPA who can take care of all the nitty gritty details for you. We are greatly indebted to our own CPA for her help throughout the year and at tax time in keeping our business running smoothly and above board with our taxes. A good CPA will know all the ins and outs of the rules related to business taxes (both federal and state, depending on where you live), and a good CPA is worth every penny you pay for their services.
When I say you need to find a “good CPA” I mean a couple of things by it. First, you don’t want to just pick the first person who pops up in a Google search for CPAs in your area. You need to find someone who has the heart of a teacher, who is willing to help you understand the tax rules and how to be compliant. It might take time to find this person and to ask questions to make sure you’re a good fit with each other.
Note: Please do not go to a bunch of different CPAs and ask questions under the pretense of “seeing if you’re a good fit.” For a service professional, nothing is worse than being taken advantage of by someone looking for free advice. Be respectful of your potential CPA’s time and pay them well.
The second thing you need to look for in a CPA is someone who understands taxes as related to ecommerce, Amazon FBA, self-employment, an LLC, or whatever particular situation your business is in. Be sure to ask questions up front to make sure the person you hire has the relevant experience to best assist you in preparing your taxes.
2. Keep good records throughout the year.
Keeping good records is crucial to preparing your taxes and protecting yourself in case of audit. Your records should include (but aren’t limited to) receipts for inventory, receipts for supplies, receipts for any other business expenses, records of your disbursements or other income, any business-related fees, any payments for business-related services, etc.
We use Inventory Lab to track inventory-related financial information, and we have our CPA do our bookkeeping every month throughout the year. We have a simple system for filing our receipts by month, and we use Evernote and email folders to track online receipts.
Whether you already have a good system in place for keeping good records or not, nothing is stopping you from keeping your records organized from this point forward. You can’t change the past, but you can make a difference in the future. Don’t get overwhelmed with your receipts, take it one step at a time, and make the most of the year ahead by knowing your numbers, organizing your receipts, and paying attention to business reports in Seller Central, Inventory Lab, or whatever program you are using.
3. Run the right reports for your CPA.
In order to prepare your taxes, your CPA (or whoever is preparing your taxes) will need to know the money you have coming in, the money you have going out, the amount of inventory you have in stock that hasn’t been sold, etc. Talk with this individual to be sure exactly what they need.
As a good starting point you can check out this blog post with instructions for how to run the most useful year end reports within Seller Central. We like to run reports for our CPA on our year end inventory, our monthly inventory history, and our received inventory.
Note: It’s best to run your year end inventory report as close to December 31 or January 1 as possible, to give your CPA the most accurate picture of the inventory you had in FBA warehouses at year’s end.
4. When it comes to sales tax, look into services like TaxJar to automate the process for you.
We like to point our readers to the TaxJar website when it comes to handling sales tax. TaxJar has a wealth of free information and links on their website to point you in the right direction for knowing the sales tax regulations in each state. When you’re ready to automate the process of dealing with sales tax, TaxJar can help you get set up.
Dealing with taxes definitely isn’t the most fun part of running your own business – we would all rather be out sourcing and finding treasure and making big profits than talking about taxes, right? But getting your business set up to handle taxes correctly is an important component of business success. You really want to do things the right way as quickly as you can, so that you won’t have to pay penalties or fines later. You can take a few simple steps today to set yourself up for the year ahead and make the most of your Amazon FBA opportunities.

8 Tips for Making this Your Best Year Yet for Amazon FBA Sales


By Karon Thackston



Stephen Smotherman truly is a success story worth following. You’ve probably seen his guest posts (#1 and #2) on the Marketing Words blog before. I’ve invited him back once again to answer some questions and provide you with a bucket load of solid info to take you into the new year. Welcome Stephen!
STEPHEN: Thanks, Karon, for asking me to do this interview with you. Before I get into the answers, I wanted to say thank you for all that you do for the Amazon seller community. Your blog posts, resources, and products are all top-notch and I enjoy recommending them to anyone who sells on Amazon. Every email I get on your mailing list is filled with an actionable tip that helps me often. So, thank you for all you do. Ok, let’s get into the interview.
KARON: Thanks! I appreciate that. OK, as the fourth quarter rush comes to an end what are the top three tasks you recommend for Amazon sellers so they can start the new year on the right foot?
STEPHEN: I love this question because most people just assume they will start their new year focus on January 1 when the calendar turns. But those who succeed view the coming year like a marathon. Marathons require training and preparation… so thinking and planning ahead right now is a great way to use your time. The top three tasks to make sure you start 2017 off right are:
  1. Goal setting – Many of us have goals, but a goal without a plan is just a dream. Make sure your goals are specific, measurable, actionable, realistic, and time bound. A weak goal is “I will make more money in 2017 than last year.” A great goal is “I will average sales of 200 units per month by July 2017 by reinvesting as much capital back into more inventory as possible.”
  2. Long-Term Storage Fee Repricing – On February 15, Amazon will charge a long-term storage fee for every item you have stored in Amazon warehouses for over 6 months. It’s a good idea now to try and reprice your inventory that will cause the bulk of your long-term storage fees (I have walkthroughs on my blog and in the YFBA book that show in detail how to do this).
  3. Get your books in order – If you’ve been lazy about keeping track of receipts, profits, losses, sales, etc. then now is a great time to start fresh. It’s important to know your numbers so that you can see what items, stores, categories, etc. are the most profitable for your Amazon business. Maybe you thought selling grocery items was worth the time and money, but do you really know? Keeping good track of your numbers will show you in more details how well you’re doing (or not doing). Plus, keeping good records will also help you out come tax time.
KARON: You are so right! So then, tell me… once the three things above are taken care of, what are two vital tasks every Amazon seller should do on a monthly basis?
STEPHEN:
  1. Reassess inventory possibilities – When it comes to RA and OA, it seems like most stores have waves of when it’s profitable to source there for inventory. Some weeks one store is great while another may dry up. Ride the waves as long as you can but when a store dries up, look for other stores to see if a profit wave is forming.
  2. Improve your product listings – Sometimes this means repricing your item to be more competitive. Check CamelCamelCamel or Keepa to see if you can still expect to get the prices you originally set. Other times it might mean improving the product pages of inventory you have multiples of in stock but they aren’t selling.
You asked for 2, but I’m giving you 3 because it relates back to your first question:
  1. Go back and review your goals and action steps. If you set goals in January and don’t revisit them monthly, you’re just wasting your time. Review your goals and see if your current actions are causing you to get closer to or move further from accomplishing them. Adjust your actions if necessary.
KARON: Thanks for the bonus J Now, let’s move from monthly to special occasions. What is your approach to planning for various holidays throughout the year?
STEPHEN: It’s smart to plan ahead to take advantage of both major and minor holidays, but I wouldn’t jump on board every holiday opportunity at first. Just pick a few holidays this year and try to be in stock for those few holidays at least 3 months in advance. It might feel weird preparing for Halloween in July, but if you wait until September to start, you’ll lose out on tons of sales and might even end up with unsold inventory. People start buying holiday-related items earlier and earlier each year, so be sure you are in stock for those customers and that you’re sold out before everyone else frantically drops their prices right before the holiday. To make quality holiday-themed purchases, check CamelCamelCamel and Keepa to see what prices and sales velocity you could expect for those items.
KARON: Do you have specific strategies related to the four seasons?
STEPHEN: When it comes to buying clothing and shoes, I only source for the season we are currently in. Clothing and shoes are usually more of a long-tail item (it takes longer to sell than other categories). It might be tempting to buy sandals during end of summer clearance sales, but it’s not likely that you’ll get the sale of that shoe until next summer. I don’t want to have too many shoes that don’t sell quickly because that shoe is currently out of season and then have to pay monthly storage fees as well as larger long-term storage fees.
KARON: Are there particular times of the year you find it easier or more profitable to source inventory?
STEPHEN: The easiest time to source for profitable inventory is during Q4 (the last 3 months of the year). It’s possible to find hundreds of items you can make a quick 50% up to 200+% ROI… even when buying full price at retail stores.
Another great time of the year to source for inventory is during August clearance sales. So many stores (RA and OA) are clearing out items to make room for all the new products that will be featured in their holiday sales push. This is especially true when it comes to toys. The “old” 2016 toys are clearanced out to make room on the shelves for the “new” 2017 toys that will be in all the sales ads come November and December.
KARON: Do you find that lowering or raising prices in general tend to happen at certain points every year?
STEPHEN: From my experience, it really depends on the category. But overall, I see most prices on Amazon begin to fall in late January and early February. This might be because of the February 15 long-term storage fee. I see the same trend around late July and early August (again, possibly because of the August 15 long-term storage fee). As for prices going up, the times I see that most is the first two weeks of December. This is when the supply of items on Amazon are going down and the prices go up.
KARON: That makes sense. During all the years you’ve been selling through FBA, where have you found unexpected income in your Amazon sales business?
STEPHEN: It’s technically not income, but it surprises me how often Amazon “forgets” to reimburse me for items that they lose or damage… or items a customer forgets to return. Following up on these items and asking for forgotten reimbursements can add up to some large dollar amounts.
As for real income surprises this year, I actually had a book replen that was sold almost 300 times in 2016. A replen is an item that sells so often that inventory continually needs to be replenished. Most replens are consumable items like grocery or health & beauty items, but I would buy the book in cases from my source, and it would just continually sell for great ROI. That was a nice surprise.
KARON: Wow! Good for you! So, to wrap this up, what advice can you give to sellers to help them get and stay organized with their Amazon businesses?
STEPHEN: Don’t try to organize everything on your own. Use free and paid tools like Evernote and Inventory Lab to keep your ideas, plans, goals, numbers, profits, etc. organized. Also, when things get to be too much for you, hiring help to do some of the simple aspects of your business will free you up to do more of the most important aspects, including keeping everything organized.
KARON: Thanks Stephen. As usual, you’ve provided lots of practical, usable tips that sellers can use to help create a significantly more successful new year.
STEPHEN: It was a lot of fun and I hope your readers will get a lot of actionable content from it.

Thursday 29 December 2016

Amazon FBA Profits in Q1 - Tips for Starting the Year



In this Amazon FBA training video, Stephen gives tips for starting the new year off right and making big profits in Q1. 

Mastering Business In 2017 - Homemade Entrepreneurs Plan



Mastering business in 2017 is not difficult as long as you have a plan. I have a plan, I have goals, and I have the work ethic to make something of 2017. Do you?

Wednesday 28 December 2016

Amazon's 'Record-Setting' Holiday Season: Which Numbers Are Worth Paying Attention To



Like eggnog, mistletoe and Rudolph, lengthy Amazon (AMZN) press releases extolling how popular the e-commerce giant's goods and services were between Thanksgiving and Christmas have become a staple of the holiday season. And in line with the spirit of the season, the announcements mix a fair amount of hype and theatrics with items their intended audience -- Amazon investors, merchants and business partners -- should genuinely be impressed by.
Altogether, Amazon's 2016 holiday press release contains over 100 bullet points sharing "fun facts" about its seasonal performance. Some are clearly fluff meant to inform/remind readers that a particular Amazon service exists, or to drive home the scale of Amazon's operations -- for example, noting that Home Alone and Elf were the holiday movies most frequently requested via the Alexa voice assistant, or that customers "purchased the weight of a grizzly bear in gold."
And others, such as lists of holiday bestsellers for three dozen categories, seem meant to inform merchants about what's in demand and remind everyone about the breadth of Amazon's retail offerings.
But in between all of this, Amazon also includes a number of points highlighting how much Amazon's operations and customer base have grown in recent years. Some of these are more impressive than others.
Here's a run-down of the most noteworthy holiday season sales, subscription and usage figures included in this year's press release, and just how meaningful each datapoint is.
1. "Millions" of Alexa devices were sold.
Ultimately, this isn't very surprising. Amazon discounted its Alexa-powered Echo and Fire TV devices during the holiday season, and research firm CIRP estimated in November Amazon sold 2 million Echo units alone during the first 9 months of 2016. As usual, Amazon declines to provide specific hardware sales data.
2. Echo sales were up over 9x relative to last year's holiday season.
This is more impressive, and shows how the early-2016 launches of the less costly Echo Dot and Tap speakers/voice assistants have expanded the Echo line's addressable market. Amazon's figure is backed up by the fact the iOS Alexa app made it to #4 on the App Store's free download chart on Christmas Day. Once again, though, a precise sales figure would be nice.
3. Over one billion items were shipped worldwide via Prime and Fulfillment by Amazon (FBA).
This is impressive on a standalone basis, and it's worth noting that Amazon didn't provide a similar number in last year's holiday press release. Prime and FBA have both seen tremendous growth over the last few years, and there's a lot of evidence showing both that Prime members spend much more on Amazon than other customers, and that many merchants are adopting FBA to make their goods Prime-eligible. But in the absence of data about the average selling price of Prime/FBA-shipped goods and their share of total Amazon shipments, this stat doesn't tell us much about whether a company expected to do fourth-quarter sales of $44.7 billion will meet its numbers.
4. More people tried Prime this holiday season than in any previous year.
No surprise, given Prime is still clearly seeing robust growth. Citing survey data, Cowen estimated that the number of U.S. Prime subscribers grew by 23% annually in October to 49.5 million; the launch of a monthly payment option in April may have helped. Amazon still isn't providing data on the overall number of Prime subscribers it has, however.

Our Story. How do we make money online to travel the world? �� Amazon FBA...



Check out what selling on Amazon FBA does for these two lads!

Tuesday 27 December 2016

Amazon Seller Feedback: The Essential Guide

by Chris Dunne


You’re probably aware that Amazon recently updated its product review guidelines, meaning buyers who haven’t made purchases worth $5 cannot leave a review. The ecommerce giant is strongly focused on removing fake product reviews and has recently taken legal action against a number of websites selling non-genuine reviews and against sellers themselves.

Product reviews are getting all the attention of late, but what about seller feedback? The two are completely separate, but often confused. This post is all about seller feedback: what it is and why it’s so important, how to deal with negative feedback, and how to improve your feedback rating.

The Importance of Feedback on Amazon
What matters most to Amazon? Customer satisfaction and loyalty.

So when it comes to deciding which sellers to award the Buy Box to, your Amazon seller feedback – submitted directly by Amazon’s customers – has a big impact.

In ecommerce, an unhappy customer is more likely to leave feedback than a happy one.
If you can create happy customers then you’ve accomplished a major part of selling on Amazon. Conversely, if you create negative customer experiences, your business can start going downhill very quickly.

In ecommerce, an unhappy customer is more likely to leave feedback than a happy one. However, receiving negative feedback doesn’t always have to be a bad thing. It could be an opportunity for you to improve an area of your business where you are weak and provide a better customer experience. Good sellers try to do a good job. Great sellers are never content with just doing a good job, and always try and find some way to improve.

Amazon calculates your seller feedback rating based on the feedback received over the last 12 months. If you have a feedback rating of over 95% (ideally over 98%), you’ll improve your chances of getting a share of the mysterious Buy Box. If your feedback rating is less than 90%, then you may want to review your selling practices – it’s likely to be having a detrimental affect on your sales, profits and Buy Box percentage.

I encourage all sellers to become familiar with Amazon’s feedback guidelines. Asking for feedback (and product reviews) is allowed within Amazon’s guidelines.

With so many things going on including sourcing and shipping, it’s understandable that some sellers neglect feedback management. Whether you choose to do it manually or through an automated software solution, I encourage ALL sellers to have a process for collecting and managing feedback – even long-term sellers should continue to monitor their feedback. After all, it’s your rolling 12-month rating that counts. If service standards slip, your feedback will too.

The Difference Between Product Reviews and Seller Feedback
When you search for a product on Amazon, you’ll notice a number of gold stars and a number indicating how many product reviews it has received. Here’s an example of a 1-star product review of the new Harry Potter book on Amazon.

According to an eConsultancy study, 61% of customers read online reviews before making a purchase decision. If you’re a private label seller, you’ll be very determined to gain 4 and 5 star reviews for your products – as you receive more product reviews, your product visibility on Amazon will improve.

Seller feedback is a bit more difficult to find. Here’s an example of an Amazon seller called Clyde Parks, who pride themselves on providing the “highest standard of customer service”. You’ll notice from their seller profile below, they’ve received 6,788 feedback ratings in total and have a perfect score of 100% over the last 12 months.

Some buyers will leave feedback on your business that is actually a product review. If this happens, you can ask Amazon to remove it. I’ll show you how below.

Strategies for Dealing With Negative Feedback
If you sell on Amazon, it’s somewhat inevitable that eventually you’ll get negative feedback – it even happens to top-rated sellers. If the inevitable happens and you get left negative (or neutral) feedback, don’t ignore it. Even a handful of bad feedback ratings can affect your Amazon business.

Tip: Neutral or 3-star feedback is also considered negative by Amazon, so treat it in the same way as 1-star and 2-star feedback.

One thing to note, Amazon’s feedback isn’t cast in stone. If you receive disappointing feedback, you can work with the customer to see if there’s any way you can improve their experience and satisfaction level. An unsatisfied customer can upgrade or remove their feedback within 60 days of leaving their review.

Let’s look at the three main ways you can deal with negative feedback on Amazon.

1. Get Amazon to remove it
In the first instance, check to see if feedback complies with Amazon’s guidelines – if it doesn’t, they’ll remove it for you quickly. The effort required for this is pretty low. Just visit Seller Central and send a message to Amazon stating the reason why you think the feedback infringes their guidelines.

Here’s an example of a message you might send:

I’ve received a comment from [buyer’s name] on [order number] and feel it is more suited to the product reviews section. Can you remove this from my feedback profile?

Here is the comment in question, [insert comment].
Amazon will remove negative feedback if:

The feedback includes obscene language.
The feedback includes personally identifiable information.
The entire feedback comment is a product review.
The entire feedback comment is regarding fulfillment or customer service for an order Fulfilled by Amazon (FBA).
Here’s an example of the latter taken directly from Amazon:

“The way it was forced through my letter box was appalling. Damaged the packaging I’m not happy about that at all”

Message from Amazon: “This item was fulfilled by Amazon, and we take responsibility for this fulfillment experience.”
But if the feedback complies with the guidelines, it’s pretty unlikely that Amazon will actually remove the comment – the comment would have to be unusually harsh or dishonest.

2. Get the customer to revise or remove their feedback
The most effective and permanent way to deal with negative feedback is to eliminate it. For this, you’ll need to communicate with your buyer about any misunderstandings. Email them and ask exactly what they weren’t happy with, and try and clear up any issues they may have.

This is going to take a lot of effort to make yourself quickly and constantly available to just one buyer, and focus a lot of energy for just one piece of feedback. But it’s worth it, if you can bump up your score and keep your reputation stellar.

3. Respond to the negative feedback
Okay, so maybe the first two strategies didn’t work. What you’re left with is damage control. It’s like how on TripAdvisor you might come across a review from a disgruntled customer only for the restaurant manager to respond, addressing the person’s concerns. You won’t actually be able to remove the negative feedback, but at least you’ve got an opportunity to explain your side of the story.

Sometimes it’s necessary to take one on the chin and move on – the important thing is that you addressed the issue (if there was one) in a professional manner.

With time, the feedback will fall off the first page and after 12 months, it won’t count towards your seller feedback rating at all. Just make sure that 95% of the feedback you receive is of a positive nature, meaning you need to get 19 positive ratings for every one bad one.

How to Improve Your Seller Feedback Rating
Many customers do not understand the importance of feedback. You may need to educate them, so they understand how important it is to your business. You would be surprised at how many customers don’t realize they are buying from a third-party seller and not Amazon themselves!

With statistics showing that only 10% of people leave feedback on Amazon, that makes it vitally important to increase your quantity of positive feedback and deal with any negative feedback quickly.

1. Put a note in the package
Successful sellers have developed clever ways to encourage positive feedback. The most obvious way to get more feedback is straightforward, ask for it (at the right times)! You can encourage your customers to leave feedback through the inclusion of a note in your packages.

The more personal, the more likely they will see you as an individual – resulting in better feedback! Sellers can include a thank you and a reminder to leave a review but are not allowed to include incentives or discounts for doing so.

2. Ask for feedback by email
You can also email your buyers asking how you’ve performed as a seller and if they are happy with your service, remind them of the importance of feedback to your business. To make it easier for them (and increase the likelihood of them actually taking the time to leave feedback), you can include a link in the email for them to click on and rate the transaction.

Here’s a good example of a feedback email l received recently from a third-party seller:

Hello from [seller name],

We contacted you recently to make sure you received your package, and to ensure that your expectations were met for your order with [seller name] on Amazon [order number] placed on 19 July 2016 for the following:

Here are the details for your order:

[product name]
Our goal is for you to be completely satisfied with this transaction. Since we have not heard from you, it appears we have met your expectations. However, if you do have any concerns, we would appreciate it if you would give us a chance to address your concerns before leaving feedback. If you’ve had a positive buying experience, we would be grateful if you would leave us positive feedback. The following link will take you directly to the feedback page on Amazon:

Leave Seller Feedback [link]

Note: If for some reason the above link does not work, please copy and paste this URL into your web browser:

https://www.amazon.co.uk/gp/feedback/leave-customer-feedback.html

If you have already left feedback, thank you very much. If you have any questions or concerns regarding your order, please reply to this email, and we will get back to you as soon as possible.

Thank you!

[seller name]
When the customer receives a request for feedback and clicks on the link, they will be asked to leave seller feedback from one to five stars based on their experience. They will also be presented with a series of yes/no questions covering shipping date, item description and service. As sellers, you should be doing everything in your powers to ensure, that when a customer arrives on this page, they’re going to give you a four or five star rating and three yes votes!



Feedback on Amazon is scored as follows:

5 stars = Excellent
4 stars = Good
3 stars = Fair
2 stars = Poor
1 star = Awful
It’s worthwhile informing your customers of these metrics as a 3-star rating (neutral), will actually count against your business and bring your seller rating down. Without knowing the ratings, a customer could think a 3-stars rating is average (positive), when it is in fact, fair (negative).

3. More feedback tips
Stephen Smotherman is one of my favorite FBA bloggers and always willing to help others based on his vast experience. He has kindly shared his five tips for helping to maintain a 100% seller feedback rating.

When choosing the condition of a product, round down, not up.
Think twice about selling an item in acceptable condition.
When you get an unfair negative feedback on Amazon (and you will), act quickly.
When you get a legitimate negative feedback (and you will), act quickly, apologetically, and generously.
Use automated Amazon feedback software.
I’m going to add a further two tips to Stephen’s list, that could help you prevent negative feedback and product returns.

Providing better product descriptions and images.
Ensure you ship your items on time and respond to customers within a timely manner.
You should aim to respond to any messages you receive from customers within 24 hours and ideally as soon as possible, which brings us nicely onto feedback mistakes you’ll want to avoid.

Feedback Mistakes You Should Avoid
1. Taking too long to respond to buyers’ feedback
Amazon grants you a 24-hour period to respond to customers. If you’re out and about a lot, then installing the Amazon seller app on your smartphone could help you respond to customers in a more timely manner.

2. Not marking messages as “no response needed”
Sometimes you’ll get a message that doesn’t require a response. In these instances, you should mark the message as “no response needed” so it doesn’t appear to Amazon that you have not replied.

3. Not asking for feedback
As recommended previously, all sellers should spend time on feedback management. Send your buyers an email asking them to leave their feedback. But remember, offering incentives for positive feedback is against Amazon’s policies.

4. Not using automated software
Many sellers like to save time and take the hassle out of feedback management by outsourcing this part of their business to automated software like my company FeedbackExpress. If you’re just starting out on Amazon, you may prefer to manage this side of your business manually.

5. Not dealing with negative feedback
Negative feedback is part of doing business. It’s impossible to please all of the people, all of the time. If you think that feedback you have received is against Amazon’s guidelines (like a product review submitted as seller feedback) you can contact Amazon and ask them to remove it. If a customer has a genuine issue with their order, try to resolve any neutral or negative feedback directly with them – this is encouraged by Amazon.

6. Allowing too much time for a customer to cool down
If someone is annoyed about poor service or feels let down, it’s advisable to give them some time to reflect and take the emotion out of the situation. That said, don’t forget to resolve the situation within 60 days, as after this period, feedback can no longer be altered or removed.

Conclusion

Chris Dunne
Whether you source stock from manufacturers, distributors or retail arbitrage; or are a private label seller selling your own products on Amazon, protecting or improving your seller rating is crucial to Buy Box eligibility and product visibility in search results.

Putting a system in place (whether manually or automatically) to increase your positive feedback and product reviews, as well as helping you react to negative feedback, is vital to long-term sales and success.

The real icing on the cake with improved seller metrics is the double-whammy of both higher sales and increased profits. You’ll win the Buy Box more often, and win it with more of your profit margin intact.



11 Things to do Before you Start Selling on Amazon FBA



- Want to be an Amazon FBA seller in 2017? Here's what you need to do!

Monday 26 December 2016

How to Decipher Your Amazon Suspension and Write a Compelling Appeal

By Conner Gillivan




Were you recently suspended from selling on the Amazon Marketplace? Or has it happened in the past? Thousands of Amazon sellers are suspended each month and Amazon has an entire team that is dedicated to reading the suspension letters that are submitted.

If you’re familiar with the suspension process, the Amazon Seller Performance team sends you a performance notification that states that your selling permissions have been temporarily suspended because of reason XYZ. The non-descriptive letter encourages you to appeal the suspension by following their Plan of Action guidelines and then you just hope for the best.

At my company we’ve become experts at understanding how the Amazon Marketplace functions. Over the years, I have researched and learned a tremendous amount about the suspension process. Its mysterious characteristics intrigued me to dig deeper and to really understand what Amazon is saying when they send out their suspension letters.

In this article, I will provide practical advice on:

How to decipher why you were suspended.
How to structure your formal appeal letter.
How to escalate your appeal letter to the next level if you aren’t getting a proper response from the Seller Performance team.

Want to grow your Amazon business?
Automate pricing, request feedback and reviews, improve your marketing & SEO and a lot more. Amazon consultants help with difficult issues like suspension, or help grow your business. All in the Web Retailer directory.
View Amazon Selling Tools Now
Why Sellers Get Suspended
As I said above, all Amazon suspension letters arrive in a similar template that dryly outlines that fact that your business has been temporarily shut down. In every situation, Amazon has identified a way in which you, as a seller, have failed to comply by the standards and expectations that they hold for their sellers.

The majority of the situations stem from two areas. The first is from a failure to follow one of the Seller Policies that you agree to when you create your seller account. For example: selling inauthentic products or drop shipping from retailers. The second is from one of your seller metrics going above the allowed maximums that Amazon holds all of its sellers to. For example: order defect rate, late shipment rate, refund rate, etc.

Amazon’s main goal as a marketplace is to provide their users with a positive shopping experience. When a seller fails to uphold their expectations, it creates a situation that could lead to a poor customer experience. Amazon will provide you with Performance Notifications and fair warnings that your actions may lead to a suspension, but they can only do it for so long. If you are unable to fix your account quickly, it can lead to you receiving the dreaded Amazon suspension letter.

Part One: How to Decipher Your Amazon Suspension Letter
The one good thing about Amazon’s templated suspension letter is that it is easy to find the place where they communicate why they are suspending you. Most of the time, the reason for your suspension will appear in the first two sentences of the notification. It reads something like this:

You currently may not sell on Amazon any longer because…[reason]
As you can tell, the difficult part is not necessarily finding where Amazon communicates what you have been suspended for. Rather, the difficult task is understanding what their reason actually means with regards to your seller account. To help you in your efforts, I have provided a list of the 5 most common reasons for suspension and a short explanation of each.

1. Inauthentic product complaints
This means that there has been a complaint about a product that you sold to a customer. It is the most open-ended reason that Amazon provides for suspended accounts and can boil down to a handful of issues that you may have as a seller.

Sellers may receive this reason because:

Someone complained that the product they received was not the same as that described on the Amazon product listing.
Someone complained that they received their order in damaged or used condition when they purchased it as new.
Someone complained that the product they received is counterfeit.
To decipher this particular reason, you should go to the Performance Notifications center in your seller account and look for past warnings from Amazon regarding such possible issues. If you find similar warnings, look further into the order, ASINs, and customer to determine if there could have been an issue with the order.

If you cannot find similar warnings in your dashboard, go to where you manage your Amazon customer emails and search keywords like “used”, “inauthentic”, “counterfeit”, etc. If you find any emails that bring back these keywords, look into what the customer is saying and how you handled the situation. Sometimes customers will immediately complain to Amazon instead of contacting the seller because they don’t understand the difference between the two.

When you go to write your suspension appeal letter, Amazon wants to see that you fully understand where the complaint came from and how you could have handled it better. Diving into your records to find what could have been the issue is a key first step to getting reinstated.

2. Rights owner notice of infringement
This means that there was a complaint directly from the brand owner of a given product that you were selling through your store. In most situations, the rights owner is complaining that you, as the seller, do not have the rights to sell their product through your store because you do not have an authorized reselling relationship with them.

With the growth of the internet and ecommerce, it has become much more difficult to monitor who is selling your products online. Amazon receives a lot of negative feedback from brands because of the number of sellers that are reselling their products without authorization directly from the brand.

In some instances, the seller is blatantly going around the rights owner to sell the product. In other situations, there is a misunderstanding because the seller received rights to sell the product through a distributor, and the distributor did not communicate the seller’s name to the rights owner of the product.

No matter what the situation, Amazon will always request that you submit invoices directly from your supplier and contact information for your supplier. In the case that you do not have invoices, your case to get reinstated will become more difficult.

3. Order defect rate
This means that your Order Defect Rate has most likely gone above the allowed maximum of 1.0% within the past 30 or 90 days. The Order Defect Rate can be found in your seller metrics by navigating to Performance and then clicking on Account Health. On this page, you will find the main metrics that Amazon tracks for all of its sellers.

As defined by Amazon:

An order has a defect if it incurs a negative feedback, an A-to-z Guarantee claim that is not denied, or a service credit card chargeback. Your order defect rate is defined as the number of orders with a defect divided by the number of orders in the time period of interest. Order defect rate is the key measure of your ability to provide a good customer experience.
Again, it is a key measure to make sure that you are providing a positive customer experience.

The best way to understand your Order Defect Rate is to compile a list of all the negative feedback, A-to-z claims, and credit card chargebacks that you’ve received within those given time frames where your ODR is over 1.0%. Look at how you handled the order and find where you fell short as a seller. That reason is what Amazon wants to hear you explain in your appeal letter.

4. Late shipment rate
This means that your Late Shipment Rate has gone above the maximum allowed level of 4.0%. Each Amazon order has an expected ship date associated with it that is built off of the lead time to ship that you associate with your products. In your account, you have the ability to change the lead time for each product, but it starts as 1-2 days by default. If you do not mark your order as shipped and add a valid tracking number by the end of that assigned lead time, Amazon’s system will mark the order as a late shipment.

Here is an example to better understand:

You have a popular product that you sell on a daily basis.
The lead time associated with this product is 1-2 days.
You sell one of the products on Monday.
Amazon’s expected ship date is going to be Wednesday.
If you do not mark the product as shipped with tracking information before the end of Wednesday, your order will be considered late and it will go against your Late Shipment Rate.

When appealing a Late Shipment Rate suspension, you want to look into each order that went late, determine how it happened, and create a plan to adjust your operations to make sure that it does not happen again. Most of the time, it is better increasing your lead times or adjusting your fulfillment operations.

5. Cancellation rate
This means that your pre-fulfillment Cancellation Rate went above the maximum level of 2.5%. As defined by Amazon:

[This] metric measures your in-stock rate for seller-fulfilled items sold on Amazon.
When you sell a product from your store that you do not have in stock, you have to cancel the order and notify the customer. Amazon does not like it when this happens because it creates a poor customer experience. Cancelling orders is held against you and can lead to a suspension if you go above Amazon’s threshold.

When appealing a Cancellation Rate suspension, you want to compile a list of all the orders that you had to cancel within the given time frame that your cancellation rate went above 2.5%.

Next, you want to look into each order and understand why you were cancelling so many orders. The biggest reason that sellers go over 2.5% is that their inventory management is very poor, and they are selling a lot of items that are not in stock at the time that a customer makes a purchase.

If you can explain how you are improving your inventory management practices, you should be able to create a good case for unsuspension to Amazon.

Part Two: How to Structure and Write your Amazon Suspension Appeal Letter
Now that you know why you were suspended from selling on Amazon, it’s time to outline your appeal letter so that it meets Amazon’s expectations and clearly explains how you are going to make this situation right.

In every suspension appeal, Amazon wants to see three things:

Acknowledgement of where you messed up and a clear understanding of what exact actions led to your suspension.
Action steps that you’ve already taken in the time that you were suspended and that you are submitting your suspension appeal.
Action steps that you will take in the near future if you are to be reinstated.
If you can successfully communicate those three details in an organized fashion, you have an amazing chance of being unsuspended. When you don’t address these three areas that Amazon wants to see, your chances of being reinstated go significantly down.

Below is an example format that you may use to organize your suspension letter to focus on these three areas.

1. Introduction
State who you are, the name of your seller account, and the reason that you were suspended. Write a paragraph about your situation and what you’ve learned from the process of being suspended.

2. The Main Issues that Lead to Your Suspension
State the main reason that you were suspended from being an Amazon seller. Explain how you determined this to be the main issue and what actions led to this happening on your account. Take responsibility for your actions and express that you messed up.

If there is more than one issue that you identified, be sure to add a bullet point for it as well.

3. The Action Steps You Have Taken Since Being Suspended
State the action steps that you have taken since being suspended to address the main issues that you outlined above. Go into the detail of what you and your team have done, to show how you understand what the issue was and how you are making changes so that it won’t happen again.

Make it as easy as possible to read. State the main issue and then add bullet points underneath it so that it matches fluently with the top section. There is a team that reads hundreds of these each day. They need an organized document that they can read efficiently.

4. The Action Steps You Will Take When Unsuspended
State the action steps that you and your team will take once reinstated. Focus on how you will change your operations to ensure that this issue does not happen again.

5. Summary
Provide an overall summary of the action steps that you have taken and will take to ensure this problem does not happen again with your seller account.

Call to Action: write a clear sentence asking for your seller account to be reinstated.

The structure of your appeal letter is almost as important as the content within it. It is important that you make your appeal letter focused on the three main areas that I outlined above and that it is easy for someone to identify those core areas upon reading through.

If the Amazon employee reading your appeal letter has to search for the three core areas of content that they are looking for, there is a better chance that they will reject your appeal letter and ask for more information.

Bonus: How to Escalate Your Appeal Letter Past Seller Performance
Amazon is a massive company and despite their rigid organization, they do make mistakes when handling seller suspensions and appeal submissions.

I’ve witnessed sellers who have submitted their appeal letters and never received a response. I’ve seen sellers submit multiple responses and be advised each time that Amazon needs more information regarding their suspension issue. And in the worst cases, I’ve seen sellers reinstated based on the appeal letter they submitted, then immediately suspended again by the Seller Performance team.

It’s impossible to fully understand what is going on at Amazon as they are reviewing hundreds of seller suspension letters each month. The good news is that you can escalate your situation to the next level in the case that something wonky occurs.

Here’s the secret… email Jeff Bezos. That’s right… email the CEO and founder of Amazon explaining your situation with a copy of your appeal letter attached to the email.

Anyone can send Jeff Bezos an email by emailing Jeff@Amazon.com. We return to a theme that has been present throughout this entire article: Amazon’s number one priority is creating a positive customer experience. If customers don’t feel that they are being treated correctly, they can email Jeff and he will take care of it. The same goes for Amazon sellers.

I’ve seen this method work and I’m sure that it has helped hundreds of Amazon sellers circumnavigate the odd situations that sometimes occur when communicating with the Seller Performance team with suspension appeals. If your email is convincing enough and your appeal letter clearly addresses the three main points that I outlined above, “Jeff” will forward the email along to Seller Performance and urge them to make the situation right.

Conclusion
I hope that this article helps you navigate the muddy waters of Amazon seller suspensions.

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