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Amazon Introduces Customer Dissatisfaction Metric

The eBay & Amazon Seller's News, March 2016 - Volume 17, Issue No. 5

Tips, Tools, News and Resources for eBay, Amazon and Independent Online Sellers
by: Skip McGrath

In This Issue:

Musings from and about eBay, Amazon and The World Wide Web

  1. Amazon Introduces Customer Dissatisfaction Metric
  2. Sourcing From China Basics
  3. Timing Your Sourcing to Take Advantage of Holidays and Seasons
  4. New Wholesale Sources for eBay and Amazon Sellers

"If you don't build your dream, someone else will hire you to help them build theirs." ~ Dhirubhai Ambani

Musings

Feedvisor ran a really good webinar on Private Labeling last week. Here is a link to view the webinar.


Canadian Readers - If you want to learn how to sell on Amazon.com (USA) from Canada, Canadian Amazon seller Duncan Macphearson has written an eBook on how to do this. he is also offering it at a low introductory price that will go up soon. You can read about it here.


Just a reminder - The new eBay seller standards kicked in last week. eBay is strressing shipping on time and sellers not cancelling orders. The new eBay seller standards also require sellers to use UPC codes in certain categories and they want you to fill out item specifics on all listings. Not doing so will hurt your placement in search.

eBay is also making some changes to its Feedback system that removed some issues that were unpopular with sellers. You can read the full story here.


The Amazon Seller University is a great resource for new sellers. It features video tutorials designed to help you gain insight into the Selling on Amazon platform, tools and policies for sellers, and the products and services that can help you swiftly grow your business. Here is the link to access. NOTE - You need to be signed into Seller Central to access the link.


Check your listings on Amazon to make sure the weight is correct. One of the Amazon FBA fees is a weight based handling fee. Last week I was looking at one of my items on Amazon and the listing said the weight was 5.5 pounds. Amazon was charging me a weight-based handling fee of over $5.00. However, this particular item actuually weighted less than one pound. So I had to open a ticket with Amazon and they sent someone to the warehouse to weight the item. When they discovered it weighed only 12 ounces they adjusted the fees on my item. Then I checked my orders over the past year. It turned out I had sold 73 units of that item. I sent that info to Amazon and they refunded me the over payment for the entire amount. The refund was close to $300!


Adding information to Existing Amazon Listings - When you list an item on Amazon under an existing listing - often the listing description or photos are of poor quality. A few days ago I found a listing of mine like this. The photos were OK, but there was only one bullet and a one sentence description. When you open an existing listing on your Manage Inventory page, all the fields are blank, but even though this is not your original listing you can still enter info. I added three more bullets and completely rewrote the descripton. A few days later I got an ASIN change notification from Amazon and when I checked the listing,

Amazon had revised it to include my additional information. The change worked, because the item had not been selling and within 2 days of my new information going live, the item started to sell about one every other day.


Lets get started with this month's articles:

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1. Amazon Introduces Customer Dissatisfaction Metric

Amazon has just introduced a new customer service metric to measure your account. The new metric is called The Customer Dissatisfaction Metric and measures how you respond to customers who email you.

Whenever a customer emails you, they will get a message from Amazon asking if you solved their problem. If the customer answers "No", that will count against your account. If the total of your No responses exceeds 25%, your account will be in danger of suspension.

This really puts a burden on sellers to go out of their way -perhaps even above and beyond to make customers happy. What are some of the things you can do to keep your metric high?

Whenever I get a product complaint (or a negative feedback) from a customer, if the product is fairly low cost (under $25), I first apologize, then process a full refund and tell them it is NOT necessary to return the product. If the product is more expensive, then I ask them to return the item (if I think it's in sellable condition) and send them a $10 Amazon gift card by way of apology. If their complaint is that the product is totally broken and I believe them that it's not in sellable condition, then I will process the refund anyway and again, not require them to return it.

That may sound like an expensive way to handle complaints, but compare that to the cost of having your account suspended or cancelled.

Another thing - we all know that when a customer is upset, they often write in a rude or impolite way. Do not react to that! Make sure you apologize (even if it's not your fault) and keep your email very understanding and businesslike.

One of the dangers of this new policy is scammers. We all know that although the percentage of buyers who are scammers is tiny, I think there will be buyers who make spurious complaints just to get free merchandise. It's really too bad, but I don't think there is anything you can do about that situation. It's sort of like a storeowner having to put up with shoplifting. No matter how careful they are, or how good their security is, they still lose some amount to shoplifters.

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2. Sourcing From China Basics

Sourcing from China can be highly risky and it's not something I would recommend to beginners. But if you have been selling on eBay and/or Amazon for a while, it is something you may wish to try. Here are a few tips to get you started.

  • Be extremely careful that you don't source fake merchandise. Selling fake goods on eBay or Amazon is one of the things that can get your account permanently cancelled. And it's easy to get stuck.

    If you are on sites like Alibaba.com or Global Sources and you see products selling with famous brand names, I can almost guarantee that the goods are fake. Why? Because famous name brands import directly and only sell through their master distributors. They do not allow their manufacturer's to sell directly.

  • Generic products can be fake as well. Another thing some of the Chinese manufacturer's do is copy brand name products (including many Apple products) and sell them under a generic brand name. The problem is many of these items are patented products, and when you start selling them under your own private label you can get in trouble with an intellectual property complaint filed against you.

    The trick to avoiding this is when you find a product you want to sell, spend a lot of time searching Amazon and the web for similar products, and look to see if you can find the same item under an existing brand name. Another way to avoid this is to select products that are made by many companies. Here is an example:

    This is a set of Spring Scoops I found. Spring scoops are made by a lot of companies and I suspect the patent has long expired, so you don't have to worry about products like these.

  • Hire a local agent. A local agent (who is honest) can help you stay out of trouble. My agent company provides several services for me. I can send him a sample of a product I am looking for, and he can source the product for me and negotiate a good price. He can also receive the goods and inspect them to make sure I am getting what I paid for.

    My agent also helps me with my private labeling. He works with local designers to design boxes for my products and get them printed, and then packages my goods in them. Here is a photo of one of my packages for a PL product I sell that he had designed and made with my logo on it.

    The Smart Kitchen is one of my Private Label Brands

    My agent is Bruce Wang. His email is bruce@winwin-tech.com. I have been working with him for over two years. He is completely honest and has never let me down. Please don't email him until you are completely ready to start importing. His company is quite small and I don't want to overwhelm him with emails from this newsletter.

  • Never buy an item without getting samples first. One of the ways I work, is with a website owned by Alibaba - www.aliexpress.com. Aliexpress is similar to Alibaba, but you can purchase items in small quantities such as just one or two at a time.

    The method I use is to buy a small quantity of items on Aliexpress. I examine the quality. If the quality is good, I list the item online and try to sell them. If they sell, then I send a sample to my agent and ask him to source them and negotiate a price. (He can almost always get me a better price than the manufacturer offers me by email). Then I work with him to design the packaging, place the order and ship it when it's ready.

  • Watch your price points. It's nice to buy cheap, but you want items that will sell for over $25. Why is that? If you sell on Amazon through FBA, they have two fixed fees of $1.00 and $1.04 for standard size items. If you are selling a product for $10, then those two fees represent 20% of your margin. But if you item is selling for $25, then those two fees represent only 8.2% of your margin.

  • Try and source smaller and lighter weight items. Large heavy goods are expensive to ship and must usually be shipped by sea. Whereas small, lightweight items can be shipped by air at reasonable rates. And smaller items cost you less in Amazon fees for storage and weight-based handling.

  • Use a freight forwarder and a customs broker to import your goods. A freight forwarder is a company that compares shipping rates and finds the lowest method to ship your goods then handles all the shipping arrangements.

    A customs broker receives your goods and handles transshipment to you or your warehouse and also takes care of all the importing paperwork and pays the duties. I use a company called www.universalcargo.com. They are both a freight forwarder and customs broker all under one roof, so when I do a shipment I am only dealing with one person.

So there you have it. I can't guarantee everything will go 100% perfectly when you import, but follow these tips to reduce your risk.

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3. Timing Your Sourcing to Take Advantage of Holidays and Seasons

I meet sellers all the time who don't understand the realities of sourcing goods on time. They tend to wait way too late to take advantage of holidays including Christmas, Valentine's Day as well as Mother's and Father's Days.

If you are selling through Amazon FBA, there are two things that are important to remember. One is that you may get your items to Amazon in time for the holiday, but often Amazon initially does not send goods to the warehouse where your items are stored. They send them to a different warehouse and when that happens they are out of stock for up to two weeks while they are reshipped, received and restocked. The other reason is Amazon gets really busy right before important holidays and can become shorthanded. This means it just takes longer to receive and stock goods.

The other factor is that many shoppers start shopping far earlier than you think they might. They do this because they know that the closer you get to the holiday; prices tend to go up. (I raise many of my prices right before major holidays). It is not unusual for people shopping for Christmas to start buying as early as September. And for Mother's Day (which is May 8th this year) people start shopping as early as February or March.

My rule of thumb for the Christmas season is to get my goods to Amazon no later than October 1st which gives me about 82 days of exposure. For other holidays I shoot for at least 60 days of exposure from the time my products arrive until the last selling date.

The same thing is true for seasonal selling. When you go into a store aren't you often surprised to see how early things are put out for the coming season. It's not unusual to see summertime goods on sale in a department store as early as March. The same thing is true to a lesser extent online. My goal for seasonal goods is to get them into Amazon about 75 days before the start of the season.

Besides shipping time to Amazon you also need to factor in your sourcing time. There are manufacturers who have cutoff dates for Christmas ordering as early as April 1st. The reason for this is some manufacturers cannot predict how many items to make so they have an early cutoff date and only manufacturer the exact amount that were ordered. So if you miss the cutoff date, you miss having the product. (I often buy a lot of Christmas Candy and my candy distributor has a cutoff date for Christmas candy in August).

For products with no cutoff dates, I also find that companies really start getting busy with orders in August or September. During these months it can take them longer to get your order out and then by October UPS and FedEx (and the post office to a lesser extent) tend to get so busy that it takes longer to get your goods shipped to you. This is another reason you want to do your shopping for the holidays much sooner than you would normally think.

I had one hot selling product I was trying to buy a large quantity for Christmas. I contacted my supplier in September and he was already sold out.

The worst thing that can happen is for you to run out of a top selling highly profitable product too soon, so this is one of those cases where it pays to err on the side of being early -rather than late.

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4. New Wholesale Sources for eBay and Amazon Sellers

Fireside Coffee Co. sells a complete line of coffee, teas and cocoas. They also sell pre-mixed mocha mixes.

First Jewelry sells a lovely and very complete line of charms and fashion jewelry

Kiss Me in The Garden has a nice line of women's beauty and personal care products and they have plenty of items for men too. (Father's Day is June 19th this year so you may want to order soon.) They will also private label many of their products.

Candles & Quotes sells a lovely line of candles with inspirational quotes on them. Mention this newsletter and get a 10% discount on any orders placed before the end of March.

RoomMates are removable, repositionable, and reusable wall decals. Check out their peel and stick borders, murals, laptop skins and other interesting products.

Mazama Wares sells a line of stoneware bottles, cups and other items.

Ocean Laguna creates ocean inspired bath and body products made with a blend of essential and fragrance oils.

Haute Couture makes and sells hand embroidered high end accessories and jewelry, including hairbands, bracelets, necklaces, earrings and belts. Earrings are $4-$8 US delivered.

PackIt is a bag that keeps food and drinks cool for up to 10 hours-no ice packs needed. Its secret sauce? A patented freezable gel that's built into the walls of the bag.

Enreverie sells a line of earrings made from bullet casings that have actually been fired. And they offer free shipping on every order.

That's all for now - See you again in about two weeks.

Skip McGrath
The eBay & Amazon Seller's News

P.S. If you missed the last issue, click here to read it.


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