A few days ago I was browsing my YouTube reccomendations list and came across a few rants and complaints from other fulfilment by Amazon sellers who complained of too many people now coming into online selling to make a fast buck.
Their major complaint was that these people make it harder to find items at good (low) prices and that they drive down prices on Amazon.
I do agree that there are a lot of people now taking up selling on Amazon. I see new sellers everytime I log in. It is also true that prices are falling in some categories. I notice books which once sold on F.B.A. for a minimum of $6.00 selling at $3.99.
But the complainers forget several things.
1. Every seller is different. I could guarantee that we could both go into a thrift store and come out with a very different selection of items. Even if we scoured the same bookshelves your selection of books would be different from mine.
2. I cannot buy all of the supply of saleable items in an area, and the same applies to you. Even if you or I were as rich as Bill Gates and Warren Buffet combined. The world is full of resellable goods.
3. Falling prices mean lower margins. A seller who sells at the lowest margins will eventually run out of cash. Amazon's costs are rising and they are passing on some of the cost to sellers. The prices of storage and handling at Amazon Fulfilment Centers rose on February 18, 2014. Though the rise was only pennies, it still costs more to sell via FBA. A seller chasing the lowest price will make less money per sale. So needs to fface economic reality. Set profitable prices or fail.
4. There is an old saying, "Mind your own business." Basically you can only control your own actions, you know your costs, you know your goals and you know your own risk assessment. Set your prices to suit your business and let the competition do the same.
5. "Never interrupt an opponent when he is making a mistake." This saying is sometimes attributed to Napoleon Bonaparte. If you see your opposition making decisions to cut their own throat, let them do it. Don't worry that they are probably saying that you are pricing too high. You will get a sale on your terms, at your profit margins. You may have to wait awhile but you will get the sale, unless you look to sell a $1 mass market paperback for $5,000, then you may have to wait a very long time.
6. The resale market is a "Free-Market," It exists because of market inefficiencies in all areas. If I see a book on the History of Maine on sale in California I realisze this books market in a store in California is limited. I buy it and send it to Amazon. In the end I may sell it to a buyer anywhere in the world but the probability is high the buyer might live in Maine.
To be serious that scenario actually did occur. I bought a book in California on anther states history and sold it within days to a person living in that very state.
7. Some people come to the business seeing it as a way to make easy money. In some ways it is easy money. Buy something, post it online and send the item when it sells or send it to an FBA center. Kerrching.
But behind the easy money, doing the job properly is hard work. Accounts to keep, managing taxes, finding supplies of stock. That is a lot of hours for what may be a dollar or two of profit, if you are chasing a low price.
Don't forgeet that if you do begin to make money in a serious way, you will come under the scrutiny of the Internal Revenue Service and State authorities. Amazon is bound by law to inform of your activities and Amazon is not in the business of breaking the law.
When the "Fast Buck" folks realize the I.R.S. is wanting a piece of the action, many will no longer see onlinne selling in quite a rosey light.
8. A market needs a constant supply of new blood in the shape of both buyers and sellers. Saying I don't want competition is foolish, competition is a fact of life. In a stagnent market with no new sellers there is no choice for the buyer and so quality falls and prices at least stay the same or rise, see the old Communist centrally controlled markets. Capatalist markets demand competition on quality and price, we want the best quality for a reasonable price.
What is a "Reasonable Price"? Who knows it is a price where you as a buyer see the cost of ownership[ as being more valuable to you than the cost to you of losing the item of transaction.
You may see two items almost identical one new for $10 the other in Good condition for $5. For you used and good may be of great enough value to convince you to buy. Another person may only want a new item and would pay the $10 happily.
In conclusion. I do not think that we should rant and complain of people who come to selling online. Those who are out for a "Quick Buck" will soon fall away. Those looking for "Easy Money" will do likewise. Business has always seen these people. It is human nature to follow the rumors. "There's gold in them thar hills!" but when most get to the hills they find the gold is buried and it takes some damned hard work to dig it out.
The shirkers and lazy folk go home, to be replaced by another batch of wide eyed speculators. Some will stay but why waste time worrying about the many who won't be around next week. I for one have stock to buy, books to list and accounts to file.
Do you have any thoughts on this matter?
Their major complaint was that these people make it harder to find items at good (low) prices and that they drive down prices on Amazon.
I do agree that there are a lot of people now taking up selling on Amazon. I see new sellers everytime I log in. It is also true that prices are falling in some categories. I notice books which once sold on F.B.A. for a minimum of $6.00 selling at $3.99.
But the complainers forget several things.
1. Every seller is different. I could guarantee that we could both go into a thrift store and come out with a very different selection of items. Even if we scoured the same bookshelves your selection of books would be different from mine.
2. I cannot buy all of the supply of saleable items in an area, and the same applies to you. Even if you or I were as rich as Bill Gates and Warren Buffet combined. The world is full of resellable goods.
3. Falling prices mean lower margins. A seller who sells at the lowest margins will eventually run out of cash. Amazon's costs are rising and they are passing on some of the cost to sellers. The prices of storage and handling at Amazon Fulfilment Centers rose on February 18, 2014. Though the rise was only pennies, it still costs more to sell via FBA. A seller chasing the lowest price will make less money per sale. So needs to fface economic reality. Set profitable prices or fail.
4. There is an old saying, "Mind your own business." Basically you can only control your own actions, you know your costs, you know your goals and you know your own risk assessment. Set your prices to suit your business and let the competition do the same.
5. "Never interrupt an opponent when he is making a mistake." This saying is sometimes attributed to Napoleon Bonaparte. If you see your opposition making decisions to cut their own throat, let them do it. Don't worry that they are probably saying that you are pricing too high. You will get a sale on your terms, at your profit margins. You may have to wait awhile but you will get the sale, unless you look to sell a $1 mass market paperback for $5,000, then you may have to wait a very long time.
6. The resale market is a "Free-Market," It exists because of market inefficiencies in all areas. If I see a book on the History of Maine on sale in California I realisze this books market in a store in California is limited. I buy it and send it to Amazon. In the end I may sell it to a buyer anywhere in the world but the probability is high the buyer might live in Maine.
To be serious that scenario actually did occur. I bought a book in California on anther states history and sold it within days to a person living in that very state.
7. Some people come to the business seeing it as a way to make easy money. In some ways it is easy money. Buy something, post it online and send the item when it sells or send it to an FBA center. Kerrching.
But behind the easy money, doing the job properly is hard work. Accounts to keep, managing taxes, finding supplies of stock. That is a lot of hours for what may be a dollar or two of profit, if you are chasing a low price.
Don't forgeet that if you do begin to make money in a serious way, you will come under the scrutiny of the Internal Revenue Service and State authorities. Amazon is bound by law to inform of your activities and Amazon is not in the business of breaking the law.
When the "Fast Buck" folks realize the I.R.S. is wanting a piece of the action, many will no longer see onlinne selling in quite a rosey light.
8. A market needs a constant supply of new blood in the shape of both buyers and sellers. Saying I don't want competition is foolish, competition is a fact of life. In a stagnent market with no new sellers there is no choice for the buyer and so quality falls and prices at least stay the same or rise, see the old Communist centrally controlled markets. Capatalist markets demand competition on quality and price, we want the best quality for a reasonable price.
What is a "Reasonable Price"? Who knows it is a price where you as a buyer see the cost of ownership[ as being more valuable to you than the cost to you of losing the item of transaction.
You may see two items almost identical one new for $10 the other in Good condition for $5. For you used and good may be of great enough value to convince you to buy. Another person may only want a new item and would pay the $10 happily.
In conclusion. I do not think that we should rant and complain of people who come to selling online. Those who are out for a "Quick Buck" will soon fall away. Those looking for "Easy Money" will do likewise. Business has always seen these people. It is human nature to follow the rumors. "There's gold in them thar hills!" but when most get to the hills they find the gold is buried and it takes some damned hard work to dig it out.
The shirkers and lazy folk go home, to be replaced by another batch of wide eyed speculators. Some will stay but why waste time worrying about the many who won't be around next week. I for one have stock to buy, books to list and accounts to file.
Do you have any thoughts on this matter?
No comments:
Post a Comment