I don’t believe there is one sure-fire method to growing your business. What worked for one person to grow a business may not work for you or me. A system to grow your business to XX dollars in XX time is a system that worked for that person with certain education, experiences, and personality. Will you see the same results? Perhaps. That said, I am concerned about the number of businesses jumping on the Amazon bandwagon.
Selling on Amazon may give your business access to millions of customers, subscribe and save, and Prime Members who want their free two-day shipping. Is selling on Amazon all it’s cracked up to be? With thousands of sellers on Amazon with hundreds selling items similar to what you sell, how do you stand out?
I’m the first to admit that I detest shopping and crowds. And driving. Especially in overcrowded Colorado. If routine purchases can show up at my door without setting foot in my car or a store, I’m all for it. I don’t want or need the aggravation.
Face it, shopping on Amazon is about price and convenience. Quality probably factors in there somewhere, but notice quality doesn’t rank in the top two reasons for shopping on Amazon.
As a seller, Amazon charges a fee for everything. If you are using Amazon’s fulfilment services, there’s a fee to add your inventory to their shelf, take it off the shelf to pack it to ship out to a customer, and more. There’s another fee to collect sales tax on your behalf, a fee to have your seller account, a fee to store your inventory, fees to buy advertising.
At hot topic is Amazon and sales tax. StatesĀ are grabbing for revenue anywhere they can find it and they collectively decided Amazon has the revenue they want. If the states have their way, Amazon will provide a list of the sellers in each state so the state can contact you about the sales tax they think you should have collected. South Carolina thinks Amazon should collect sales tax on behalf of its sellers. What if Amazon suddenly told you that in order to be a seller, you had to register in the 20+ states where Amazon has fulfilment centers?
It’s not just about sales tax. Once you are registered to collect sales tax in a state, you are usually also obligated to pay income taxes on sales shipped to that state and pay another fee to register with the secretary of state. Quite honestly, selling on Amazon can be the path to tax hell.
So how do you get the attention of millions of Amazon shoppers? Do you start a price war that robs you of profit and selling at unsustainably low prices?
What if you chose to grow your business locally by sharing your story? You started your business because you are passionate about your product and there’s a story behind its creation. What if you attended networking and other business events and maybe farmers markets to tell your story and sell your product? What if customers bought your product not because it’s the cheapest, but because your story resonates with them and your product solves the same problem for them as it did for you when you created it.
How do you keep your business simple? By deliberately planning what you are going to sell to whom and how. Go into selling on Amazon (and other marketplaces) with your eyes wide open and not regretting charging in without doing your homework.