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Top 5 Amazon FBA Mistakes That Are Holding Back Your Profits

February 4th, 2022

Whether you’re new to Amazon or an old hand, you might be surprised to find out you’re making a costly mistake on the platform. Amazon keeps its sellers in line to maintain its positive reputation. If you tarnish its reputation with such mistakes, you might face some problems down the road.

Some of these mistakes may result in offenses that may be banned, while others may not hurt your relationship with Amazon but still cost you visibility, resulting in fewer sales and, eventually, less revenue. Thus, in this blog post, we’ll take a look at the most “expensive” Amazon seller mistakes and how to dodge them.

Mistake 1. Insufficient Market Research

When beginners start sourcing, they may not understand what is behind each figure, graph, and how they are connected to each other. Eventually, they end up selling the worst and least promising products.

Before getting started with Amazon FBA, it’s vital to know what sells on Amazon best and the specifics of demand for a particular product in each country where your brand is sold. At launch, it’s better to go with the online arbitrage model – it will help you test demand, find the most popular products, and identify competitors. But in the private label model, sellers may want to work with their own brand and sell what they like without any market analysis.

However, the choice of products for sale shouldn’t be based on “I like it”, but on active demand and niche potential. It’s good if these private label sellers have enough capital, and just want to test their products. That is, they ship 100 items to Amazon and see how well they sell. But they must be prepared for possible financial losses.

Look for categories of products that are already sold on Amazon, analyze demand, the number of reviews and purchases, seasonality. Manual sourcing will be time- and effort-consuming so many sellers make use of analytics tools to facilitate their product research. At this step, Scanscout comes in handy as it’s a top-notch research tool that will retrieve the necessary information for you and show the best products to sell on Amazon. 

Mistake 2. Cooperation with an Unreliable Supplier

A seller should carefully consider the choice of supplier and check their real existence. Often entrepreneurs don’t do this, which they eventually regret. If the supplier’s price is much lower than the market average, think over the reasons for it.

There are numerous ways for you to find a supplier:

  1. Visit major industry exhibitions where suppliers are ready to communicate with potential customers and discuss cooperation conditions;
  2. If you belong to an industry-relation association, you can get valuable inside information about particular products and trends;
  3. Check social media where you can create a post in an industry-related group or search for hashtags;
  4. Buy or subscribe to the industry-related printed and online magazines;
  5. Find the suppliers of your competitors using watermarks, warranty service, quality certificates, or inscriptions on packages.

But pay attention that it’s better to get to know the supplier in person in the workplace before you establish cooperation with them. You can also ask someone to visit and report what they’ve seen, and to control the shipment of products. Face-to-face acquaintance is mandatory for the private label model. And if you start with online arbitrage and buy in small quantities, it’s better to call the supplier, look for reviews about them, visit their website, send them a mail, and see how quickly they respond.

Mistake 3. Poor Listing Optimization

Listing is a card with information about the product, which includes everything except its cost. When creating it, Amazon FBA sellers often make mistakes related to design and promotion within Amazon. For example, a listing may not be SEO-optimized. As a result, few potential customers come to you, and the CPC (cost per click) skyrockets.

To make your listings sell your products, you need unique high-quality photos and a text description of the product. As for the photos, there are many slippery points that sellers should be able to dodge. When there is no chance to touch or see a product in person, photos serve as one of the primary factors for a purchase decision. 

The commonest mistakes include:

  • Rectangular photos that appear cropped when viewing the page. Use only square images;
  • Use of drawings, illustrations, or 3d models of the product instead of real images;
  • Use of advertising text in images. Words such as “sale”, “delivery” and the like are considered by Amazon as a violation;
  • Using stock photos from free resources. They are aesthetic but not functional;
  • Images of low quality, pixelated, too small, or not detailed enough. Customers will pay attention to the seller who can visually display the features and benefits of their product;
  • Displaying several types of goods on one image;
  • The presence of accessories and other things in the photo that aren’t sold with the product;
  • Logos, texts, or watermarks on images.

Mistake 4. Breaking Amazon Rules

Amazon’s main goal is to protect the buyer and the seller from fraudsters. In case of misconduct on your part, Amazon will impose restrictions on the use of tools, block your listing, as well as the right to sell. If Amazon detects that an account is being used for fraud or illegal activity, they have the right to withhold money transfers. To avoid such extreme measures, sellers should not:

Encourage Customers to Visit Other Platforms or Send Marketing Emails

Don’t use marketing ads or messages that encourage or prompt customers to leave the website. The name of your product can’t contain any extension. In rare cases, the seller may send a letter to the customer only if there are difficulties in fulfilling orders. As for letters with any marketing information, this is strictly prohibited!

Abuse the A-to-Z Guarantee

Amazon A-to-Z Guarantee prohibits any abuse of its procedures. If the customer is dissatisfied with the service or product, they have the right to contact the seller to return or replace the product. In turn, Amazon has the right to demand that the seller reimburse the costs if they were made under A-to-Z conditions.

Cheat with Reviews

Frauds with reviews and ratings are under rigorous control. Feedback is designed to help people have an idea of ​​the reputation of the seller. Also, you shouldn’t leave offensive reviews or information about your competitors. The only thing you can do, after the completion of the transaction, is to ask the customer to leave a review about the product.

Forge Documents

Forging documents, invoices and everything connected with an attempt to cheat and grow in dishonest ways can lead to account blocking. When a seller imports a counterfeit product and can’t provide documents, they begin forging – they may write that they made a purchase from some site, some supplier, but in fact, they didn’t. This leads to a 100% blocking of money and products.

Some other actions that lead to imposing restrictions on business activities include:

  • Texting customers via other but Amazon channels;
  • Raising the price of the product after completing the transaction;
  • Mentioning the names of companies that deceive customers;
  • Deliberately deceiving customers by creating duplicate listings.

Mistake 5. Poor Customer Service

Amazon is one of the most customer-oriented companies in the world. When you start working with them as a seller, you must meet their high standards of customer service. Some of the most widespread mistakes made by sellers happen when:

You Delay Responding to Customer Reviews

Amazon gives you 24 hours to respond to a review. If there is a problem, please respond to customer messages immediately. No matter how many responsibilities lie on your shoulders, a day is more than enough to respond to a message.

You Don’t Mark Neutral Reviews

Even if a review doesn’t need you to respond or act, Amazon rules require you to acknowledge that you have seen it.

You Don’t Ask Customers to Leave a Review

Sometimes a customer simply forgets to leave a review, and all you need to do is politely remind them of it. So encourage them to leave feedback that will help improve your product or customer service without insisting on a good review.

You Put Up with Bad Reviews

Some customers will definitely leave a negative review about you or your products, and you must find a way to fix it. And once you do, you can send a message to the buyer asking them to delete the negative review.

You Don’t Seek Help from Amazon

If you’ve done your best to fix the situation, and fixed it, but the customer hasn’t deleted the negative review, it’s time to reach out to Amazon and ask for help. They can remove negative feedback themselves if it falls under the conditions set for such cases. Thus, please read the relevant instructions before sending a support email.

The Takeaway

Starting a new Amazon FBA business requires a lot of time and effort, but if you avoid these mistakes you’ll make the process a lot easier for yourself. With the right knowledge of the market, of your restrictions, responsibilities, and opportunities, there’s no reason why you can’t become a profitable Amazon seller.