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WalMart and FBA

The eBay & Amazon Seller's News ~ September 2016 ~ Volume 17, Issue No. 14

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. WalMart and FBA
  2. Retail Arbitrage
  3. Updates on the Internet Sales Tax
  4. Why did WalMart pay so much for Jet?
  5. New Wholesale Sources for eBay and Amazon Sellers

"You can never guarantee you'll be the smartest person in the room, but there is no excuse for not being the most prepared." ~ Brendan Paddick


Musings

As I pointed out in my last issue, I am struggling with a broken arm that makes me type one-handed. Also Iíve been in the hospital recovering from surgery. I hope to get out in about a week.

First of all, thanks to my loyal readers for the prayers and many kind wishes you have sent. There are too many to answer individually, but you should know that I am reading every one and want you to know how grateful I am.

I also want to give some credit where itís due. My website marketer, Marsha Perry and my daughter in law, Lissa, have stepped up to the plate to keep my newsletter going out and my website running. And, of course, my wife Karen handles all the customer service to keep customers happy and all other things humming along.


For a limited time, Amazon is offering 60-minute, personal coaching sessions with an Amazon Associate. During this session, the Amazon expert will guide you through getting the most out of the Amazon Seller Central tools, and you'll have the opportunity to discuss questions related to the covered topics. Additionally, you'll receive a free 30-minute follow-up session to reinforce your knowledge. Learn more about the coaching packages and pricing details: schedule your appointment today. (Note: You need to be logged into Amazon Seller Central for the link to work.)


Getting freaked out by sales tax

Of course you should comply with all state and federal laws, and so on and so on.

But if you're letting internet chatter from other Amazon sellers get you worked up that state sales tax is so scary of a subject that you should be intimidated out of selling with Fulfillment by Amazon, your attention is focused on the wrong thing.

If you're that concerned, hire a professional to sort it out. But this is at worst just another part of doing business on Amazon, not an obstacle


Amazon Releases Its Own Repricer For Sellers - Automate Pricing. As Amazon sellers, price management can be a big deal. Good repricing is not about lowering to keep up with the competition on shared listings but tweaking higher. Click here to read the article.


I've just updated one of my most popular products! It's My Top Ninety-Nine Wholesale Sources For eBay and Amazon Sellers. If you haven't bought this list of wholesale sources, I highly recommend it. It gives you instant access to this specialized list, plus my own wholesale search engine sources for just $4.99 -AND it comes with a money back guarantee if you are not happy with the information.

If you've already purchased this, go back to the download page and you'll find the newest version.


I've got a list of restricted brands on Amazon. If you find something that's not on this list, contact me and let me know. I'll add your finding to the list.


As a Blogger on The Global Internet, What Laws in the World Apply to You? - This article was an eye-opener for me! While it focuses on bloggers, the lessons carry over to online sellers too.


Check out eBay's Fall Seller Update. One thing to note is that Turbo Lister will no longer be supported after June of 2017. Seller Hub will now take over that functionality. eBay states, "While the experience will be different, we will ensure all key functionality in Turbo Lister will be available in Seller Hub. This includes extending our new feed platform to enable offline editing with tools such as Microsoft Excel."


The more things change, the more they stay the same. I was reminded of this when I happened to notice this article that I wrote ages ago, 10 Tips to Starting and Running a Successful Online Business. I'm happy to say that all 10 tips are still true today.


Here's something that I use to prep my Amazon shipments. It's the SAGA 360 LB X 0.2 s DIGITAL POSTAL SCALE . I don't typically send things that weigh 300 pounds, but I like knowing that I'm prepared for anything. I also like the fact that this scale has a separate reader. On many scales the box is larger than the scale and you have to bend down to read the weight. On this one, just pull the cord away from the scale and you can read it.


Lets get started with this monthís articles:

[top]

1. WalMart and FBA

Wal-Mart is making a major play into the online marketplace again with the purchase of Jet.com (see article 4 for more information about that acquisition). So as an online seller, what do you need to know? Well, the biggest thing is it is not an open market. Amazon may require approval to sell in certain categories, but Wal-Mart requires ALL sellers to be prior-approved. This invitation-only model is designed to attract only the experienced sellers with proven track records. So this may not be the venue for all of my readers. However, you can apply to sell on Walmart.com and expect a lot of marketing in the coming months that would benefit your sales.

As of this writing, sellers are reporting that Wal-Mart will not allow you to use Amazon FBA for order fulfillment. They are major competitors and this is a hard "no" that has been reported by numerous sellers. It makes sense- Wal-Mart is competing for Amazon customers (and sellers to some extent). They don't want sellers relying on Amazon for their order fulfillment. This does make it a little more tricky since Wal-Mart does not have their own FBA-type program or (it appears) shipping discounts for sellers, but again, Wal-Mart is not looking for small sellers. They are looking for established sellers who already have shipping and distribution handled. The marketplace website states, "Our sellers are selected based on reputation, sales projections and alignment with Walmart's values." Right now, they are picking and choosing. It remains to be seen if that will continue after the leadership change of their ecommerce division. Stay tuned.

[top]

2. Retail Arbitrage

There has been some speculation about Amazon banning retail arbitrage and no longer accepting store receipts as proof of authenticity. Yes, arbitrage is legal however, Amazon does not have to allow you to sell it on their platform. There is an extensive list of restricted categories and many "unofficial" lists of restricted brands (Amazon is yet to provide a comprehensive list of restricted brands and some are product or ASIN specific which makes it harder for resellers).

You might wonder why they would ban RA, given it doesn't affect them where you get the item or how much you paid. Well, it does in a way. Amazon is all about protecting its own reputation of having excellent customer service and products. A lot of people who use RA are looking in clearance sections, outlets, etc. Why were these retail items discounted? Maybe the box is damaged, it had been sitting dusty for a while, it is missing a piece. This all goes against Amazon's idea of "new" items, even though they are precisely that. More returns come from OA and RA. More A-Z Guarantee claims. More dissatisfaction for buyers who then might not return for another item because of the condition in which this one arrived.

Also, Amazon has agreed to protect some brands. RA and OA sellers may have to take down the listing when this happens because Amazon's robots often do not catch it. Some brands have exclusive distribution with other locations and don't want that by-passed by resellers on Amazon. Others complain about counterfeit. Or simply just want to control their brand and those they approve as authorized sellers.

The speculation states this ban on RA would be happening in October, right before the holiday selling season. I don't think this is going to be the case- especially with Wal-Mart's recent purchase of Jet.com and rebranding their own marketplace. The last thing Amazon wants to do is send sellers to a major competitor right before the 4th Quarter.

If this does occur, don't panic. I anticipate a huge influx of sellers moving back from Amazon to eBay. eBay doesn't have these restrictions and makes it much easier to identify the item condition than Amazon does. But, if you do have to pull your listings from Amazon, be aware that you cannot then continue to use Amazon FBA to fulfill those orders to eBay buyers. You will have to handle the shipping yourself.

Buyers will migrate where the products and prices are best. Retail arbitrage works because of accessibility to products. If those products disappear from Amazon, buyers will look elsewhere.

Amazon would be very foolish to make a change this big in October, but we might see an announcement about it. It certainly would make their customer service side easier. But I wonder if it is really worth the cost to them. Amazon does tend to make changes quietly without formal announcement though, so I will make sure to update with any information I get as we move forward into the latter part of the year.

[top]

3. Updates on the Internet Sales Tax

Internet Sales Tax UpdteCongress returns from summer recess today with a newly proposed Internet Sales Tax bill, released by House Judiciary Chairman Bob Goodlatte. This is the third possible iteration of an online sales tax we have seen proposed and Congress may vote on it after the election. If elected, Trump says he will block the bill, but Hillary says she is all for it (according to eBay government relations).

The Online Sales Simplification Act (OSSA) would have states set one sales tax rate for online sales to customers in their state. The rules about what items are taxable would be based on the seller's state's rules. So it isn't as bad as some of the other bills.

It gets more complicated with regards to distribution of those funds to the states based on if they sign up for the "clearinghouse" or not, and there are rules about how to handle sales with the five states that do not charge sales tax. If you do not favor this bill, eBay says there is still time to block it by contacting your congressperson.

Will an IST affect your sales? No, but it will affect your workload. For this reason most sellers are against it. If you want details, visit eBayís government relations page. Unlike Amazon, eBay has been fighting this. About the only good thing I can say about this bill, is that it is less intrusive than the other bills.

[top]

4. Why did WalMart pay so much for Jet?

Walmart is widely recognized as the "go-to" bricks and mortar store for pretty much anything under the sun. Their model is lots of "stuff" and affordable prices. No frills, nothing complicated. They have attempted to move into the ecommerce world before and not seen a whole lot of success despite billions of dollars invested and distribution centers set up, etc. Most people aren't even aware of Wal-Mart's "2 day Shipping Pass" (their rival to Amazon Prime) offered at half the cost. Wal-Mart just hasn't made headway in the ecommerce side of its business.

This is what the Jet.com purchase is all about. It may not be profitable yet, but with Wal-Mart marketing Jet.com could breathe new life into Wal-Mart's ecommerce offerings. With the acquisition comes Jet.com founder, Marc Lore who will be taking over all of Wal-Mart's online business. He has experience and a drive to succeed. He is one of the names behind Diapers.com and other successful online sites. He knows the market and he worked at Amazon for two years.

Jet.com has a network, a building customer base, a distribution system, and an API that third-party sellers must use (which weeds out a lot of smaller sellers). Wal-Mart never really got its own third party seller network to the level Jet.com already has. Their AI enables them to match buyers with sellers local to them (so shipping is quicker) and shows them the cheapest prices which makes it desirable to buyers.

Their target market is the clearly Amazon shoppers- people who want quality customer service, decent products and decent prices. And they don't want to wait 7-10 days to get an item (the common preconceived expectation for Walmart.com).

Was it worth $3 billion? That remains to be seen. But we are talking about Wal-Mart and ecommerce in the same sentence for the first time in a long time, so maybe this is just what they need. We will wait and see how this will work out for third-party sellers, and if they can attract the loyal seller and customer base Amazon has acquired, but this appears to be the first step in the right direction for Wal-Mart to become a serious player in the online marketplace.

[top]

5. New Wholesale Sources for eBay and Amazon Sellers

Premium Wood Designs offers over 700 different wooden models. The models include airplanes, helicopters, cars, motorcycles and more.

Funsparks Wireless Speakers - These work with all smartphones and are water resistant.

Fun Express carries toys, novelties, party favors and decorations. Be sure to check out their line of coloring books for adults.

Cottonman.com has an interesting line of cotton-themed jewelry.

DWK provides collectibles, figurines, miniatures, giftware and home decoration accessories. They've got salt and pepper sets, wine holders, lamps, knives clocks and more.

Jane Berenard Aromatics has scented gifts and related items. We're talking essential oils, home aroma sprays, incense holders, massage oils and more.

Parade Street Products offers fashion accessories as well as gift items. They also offer some really cute impulse items.

rwoodstudio.com has a luscious line of pottery bowls, plates, mugs and more.

Pretty Hunter has a unique and very popular line of jewelry, hair accessories, belts, buckles and more.

Sempli offers an interesting brand of glassware, lighting and accessories. They endeavor to combine functionality with style and elegance.

Thatís it for now. See you again next time.

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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