Today we are going to look at the top myths that may be preventing you from growing your FBA business and meeting your goals. These myths range from the serious to the trivial, but if you’re believing these lies, then you’re not only missing out on more profits, but you’re also ruining your success potential.
I’ve been selling on Amazon since 2011 and these are the most common misconceptions I’ve heard over the years from both long-time and new sellers alike, so tune in to learn about the top Amazon myths you need to stop believing.
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Key points from episode 36:
The myth that might be causing you to lack confidence in your inventory sourcing. - Everyone says that Amazon does not do this one thing… but they actually do!
- The myth that your friends or spouse might bring up when they hear you’re selling on Amazon and how you can respond with the truth.
- A buy box myth that is so wrong it’s actually hurting your profits.
- The myth that every current or former eBay seller needs to hear and how it impacts your Amazon business.
- How to respond to these myths with truth.
- And more!
Links and resources mentioned in this episode:
- How to Win the Buy Box – podcast episode 2
- Understanding the Amazon Buy Box
- Amazon Guidelines
- Is Amazon FBA a get rich quick scheme?
- Full-Time FBA on Instagram
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With this course, you’ll make more confident sourcing decisions, better pricing decisions, and you’ll grow your Amazon business to the next level by selling your inventory faster and at higher prices!
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Episode 36 Transcript:
[INTRODUCTION]
[0:00:01.8] ANNOUNCER: Welcome to The Full-Time FBA Show. In each episode, it’s our goal to help you turn part time hours into a full-time income, selling almost anything on Amazon. Now, your hosts of the show, Stephen and Rebecca Smotherman.
[INTERVIEW]
[0:00:21.3] REBECCA: Hello there and welcome to this episode of the Full-Time FBA show. Today we’re going to be talking about Amazon FBA myths that you need to stop believing, this is the opposite of don’t stop believing.
[0:00:34.4] STEPHEN: Yes, you should not stop – what?
[0:00:36.0] REBECCA: Definitely stop believing.
[0:00:37.3] STEPHEN: Definitely stop believing. Definitely stop, believing.
[0:00:41.6] REBECCA: Didn’t mean to throw you off there. Apparently I didn’t throw you off, you already had a song ready, okay.
[0:00:46.4] STEPHEN: Absolutely, I don’t know if that’s copyright infringement or I’m just awesome.
[0:00:49.4] REBECCA: Let’s just stop right there.
[0:00:50.7] STEPHEN: Okay.
[0:00:55.2] REBECCA: All right Stephen. We have today, seven myths. These are seven things about selling through Amazon FBA that some people think are true but they’re myths. They’re not true and we really think that other sellers need to stop believing these myths.
[0:01:09.9] STEPHEN: Absolutely right and some of these myths are going to stop you from — if you believe them — stop you from growing your business, stop you from finding success, and they’re just going to stand in your way of meeting your goals when it comes to your Amazon FBA business.
[0:01:23.3] REBECCA: That’s right. And so, the first one that we’re going to talk about is the myth that arbitrage is illegal.
[0:01:31.2] STEPHEN: Yeah, you would think that people who are selling on Amazon would not believe this myth but there are actually people out there who do sell on Amazon and they think they’re doing something illegal — and they just feel really bad about it. Arbitrage is not illegal so if you’re considering selling on Amazon and you hear about people saying, “I bought it for five bucks at this one store and sold it for 20 bucks on Amazon”, that’s not illegal.
Arbitrage — the process of buying at one price at one place, selling at another price and at another place — is totally legal and it’s something that a lot of people do and can find a lot of success with.
[0:02:06.6] REBECCA: I think that part of the reason why people think that arbitrage is illegal is because they’re confusing the concept of arbitrage with the concept of price gouging. The difference between those two is that arbitrage is buying an item at a low price to sell it at a high price. But price gouging is when you’re taking advantage of an emergency situation, when there’s a declared emergency either in the nation or your state or county. And all of this is decided at the state level, what is considered as price gouging. Buying an item and reselling it for a higher price is not illegal. It’s if you’re selling an essential item for an extravagantly high price during an emergency situation. Now, that is illegal.
[0:02:51.8] STEPHEN: If you think about it, when you look at Walmart, they’re doing arbitrage. They’re buying at a lower price so they can sell it to you at a higher price — so that they can make money and pay their employees. That’s not illegal, it’s the ones who are taking advantage of certain situations, emergency situations, getting those prices hiked up really high. Those are the times when it’s illegal but the simple process of arbitrage is not illegal.
[0:03:17.1] REBECCA: Okay, the second thing that we’re going to talk about — another myth — is that you can’t use retail receipts to prove authenticity. So, what do you mean when you say that you can’t use receipts to prove authenticity when it comes to Amazon FBA?
[0:03:32.2] STEPHEN: Well, I think this myth is birthed from confusion and mixing up two different Amazon guidelines or rules. When it comes to getting ungated or approved to sell a particular brand, if your seller metrics do not get you approved, Amazon asks for a wholesale invoice to help you prove that you have a wholesale relationship with a particular brand. And that brand is okay with you selling their items on Amazon.
A lot of times, we hear that you can’t get approved to sell a particular brand by submitting a retail receipt or an online receipt. That’s not going to work. But, if you do happen to be in that situation where you are accused by a customer or Amazon’s robot algorithm of being involved in counterfeiting or selling inauthentic items, you can use a receipt to prove the authenticity.
Now, you want to make sure that the receipt includes the product name, the UPC. There are some stores out there that offer receipts that maybe just have a store code and a price and there’s no real obvious connection that the item that you’re purchasing is related to that receipt. You want to make sure that when you do have receipts — that you are submitting to Amazon to prove your authenticity — that they have that product name. That UPC information. Amazon is perfectly fine with accepting retail receipts, online receipts for proving authenticity.
[0:04:57.9] REBECCA: I would say this myth boils down to — sometimes you’ll hear Amazon sellers say that Amazon doesn’t accept retail receipts. I’ve heard it said that way before but what they’re talking about is that you cannot use retail receipts to get ungated. The truth is that you can use retail receipts as long as you’re trying to prove authenticity, if there’s a counterfeit claim, if your account has been suspended, those types of things. Amazon does accept retail receipts as a proof of authenticity and as proof that you actually purchased that item.
[0:05:31.5] STEPHEN: Right. People who believe this myth sometimes think, “Well that just crosses retail arbitrage and online arbitrage off the list completely because if I can’t use retail or online receipts to prove authenticity, then I’m not going to source that way.” But that’s not the case at all. You can use, as of recording this right now, retail receipts, online arbitrage receipts to prove authenticity as long as you have the UPC or at least the name of the item that you are purchasing that matches item that you’ve been accused of selling inauthentically.
[0:06:01.9] REBECCA: All right, the third item on our list is that Amazon is a quick way to get rich. Amazon is a get rich quick scheme. That’s a myth, talk to us about that.
[0:06:12.1] STEPHEN: Basically, the people who are sharing this myth are people who are trying to sell you something. They’re selling you something, you know, they’re trying to sell you. Selling on Amazon, you don’t barely have to do any work, you just have to find an item and sell it for more on Amazon and it’s so easy, you can do this in your sleep.
With selling on Amazon, it’s not just an immediate success, there is a chance for you to grow your business over time but it’s not something that is overnight. You don’t just all of a sudden start right off the bat, making $15,000 a month selling on Amazon without working up to it. Selling on Amazon is a marathon mindset. You need to understand that you’re in this for the long haul and you grow over time. It is possible to be rich, whatever rich means to you, I guess.
But it’s not something that’s going to happen quickly and it’s not a scheme either. It’s not something that’s trying to trick you into anything, you can put the hard work in and when you do, you do it the right way, you get to see the results.
[0:07:08.6] REBECCA: I think another way of saying some of this too is when I’ve heard people describe Amazon FBA as a way to start growing passive income — and it’s definitely not passive. It’s not like you set it up and then ‘you don’t have to touch it again’ type of passive income. It is not ‘do the work’ once and then you’re done. You have to continue to work at it.
[0:07:29.7] STEPHEN: Absolutely. It’s outsourcing doing FBA, allowing Amazon to do part of the work for you but there’s still tons of work that you need to put in yourself. Get involved in and make sure that you do it the right way. Which seems kind of contradictory then to come to number four which we have on our list — Is selling on Amazon really hard?
[0:07:48.3] REBECCA: Yeah, that’s another myth that’s out there. Most of the time, the people who say this myth are the people who are giving up. The fact is that Amazon is not really hard. Amazon just requires hard work. There are processes that are out there, there’s step walkthroughs, there’s a lot of things that are out there to help you grow your Amazon business but it takes time.
It takes hard work but the work that you do is not technically hard. You need to have certain skills that you learn over time and that you improve upon. It’s something that you can definitely accomplish and so selling on Amazon is possible. It’s just that those who are giving up too soon who might say that it’s really hard.
[0:08:30.3] STEPHEN: I want to say, not even just giving up too soon. Not necessarily just too soon as far as time is concerned but too soon as far as the learning process is concerned.
[0:08:40.1] REBECCA: Some people come into it thinking that this is going to be really easy. All you have to do is list your items and sell them and they don’t understand that there’s a learning curve. There are things involved that take time to understand — that there are nuances to different categories and all of that. They give up before they’ve really had enough time to dig into what those different nuances are and what the different factors involved in buying decisions are, and what happens from season to season on Amazon even.
[0:09:11.3] STEPHEN: A lot of times, the people who are saying that Amazon is really hard are the same people who bought the myth that Amazon is a quick way to get rich.
[0:09:18.4] REBECCA: Right, they start off thinking, “Oh this is going to be easy, this is going to be quick” and then they end up quitting. We see this with the people that work with us, our students, and then our Facebook group. You see these people coming and going in waves because they didn’t understand when they got started — this is not going to be a ‘get-rich-quick’ and then all of a sudden, it turns into, “Oh Amazon is too hard. I can’t do this.”
[0:09:42.1] STEPHEN: And so, if you just take the time, you commit to sticking with this, following a proven plan whether it is a course that you are taking or whether it is going through Amazon YouTube videos type of thing but when you commit to it and you go through that learning curve, then you can find the success that you are looking for.
[0:09:58.2] REBECCA: All right, so number five on our list, this is another myth that we hear a lot — that Amazon is just like eBay.
[0:10:05.1] STEPHEN: Yeah. No, just because they are both websites that sell things to customers, I mean, I think that is the only thing that they have in common.
[0:10:14.1] REBECCA: There you go. Amazon is just like eBay because it is a website where you buy things.
[0:10:18.2] STEPHEN: Right, so that makes Amazon like Walmart and anyway, there are so many differences. I would look at eBay more as an online garage sale — anything goes in garage sales — whereas Amazon is more like a nice retail store. It is a lot more organized and has a lot more opportunities to be able to sell things at a respectable price but there are a lot of differences, especially when it comes to feedback.
With eBay you are going to get feedback a lot more often than you do as an Amazon seller, so that’s why it is important to maybe automate your feedback and try to use emails to request feedback from your customers. We can put a link in the show notes that shows you a little bit more about that. Amazon and eBay are totally different. They require two completely different mindsets. So if you happen to start selling on Amazon and you came from eBay, you need to totally flush everything about eBay. You just can’t use that information on Amazon. Start from scratch and you will be better off for it.
[0:11:15.0] REBECCA: Yeah and one other thing that comes to mind as you are talking about those differences is the difference in how the listing is set up — and that is something that I think is really crucial to understand is that Amazon does not have a listing for every offer. The offers are all on one product page and that is super important for people to understand. You can tell when somebody is coming from an eBay background when they say things like ‘they want to create their own offer page’. Or how do they do ‘my listing’ and things like that. It is not your listing unless you are the brand owner and you created that product page.
[0:11:52.4] STEPHEN: For Amazon.
[0:11:53.2] REBECCA: For Amazon. Then that page is not yours and it belongs to Amazon and you are just listing your offer on that product page — and you can see this then if people try to set up the title in all caps or they don’t follow the same rules that Amazon wants everybody to follow as far as what’s included in the title. And the order that they want it in, all sorts of different regulations that go along with creating a product page. You can really see if people are coming from an eBay background without that type of understanding.
[0:12:24.2] STEPHEN: If you are coming from an eBay background and you are wanting to sell on Amazon, I highly recommend that you read through Amazon’s guidelines. It is a boring read but it is an essential read. If you check it out at fulltimefba.com/guidelines because yeah, I have seen a lot of eBay sellers come to Amazon. And Amazon’s rules, when it comes to selling an item in new condition, are a lot different than eBay’s. You can sell an item on eBay if it’s new but the package has been unwrapped and there is a little ding in the corner of the box — that is still okay to sell it as new on eBay but not on Amazon. Amazon wants it brand new and factory sealed and again, we could do a whole episode on this but we are not going to. They are just totally different websites.
[0:13:05.0] REBECCA: All right, so number six on our list, here is another myth that we have heard before when it comes to selling on Amazon FBA. “I have to buy from China or make a new product in order to be able to be successful on Amazon.”
[0:13:19.1] STEPHEN: I heard this as well and it’s definitely not true. Again, this goes back to the whole arbitrage method of buying and selling on Amazon. So retail arbitrage, online arbitrage, wholesale items, those are ways that you can make money on Amazon. There is a strategy called private label that is creating a product or finding a product overseas and then importing it and maybe putting your own twist on that product or your own label on that product and selling it via private label.
But that’s not the only strategy. The strategy of retail arbitrage, online arbitrage, wholesale is alive and well and is a really great way to sell on Amazon. I actually listen to a few private label podcasts and it is funny how they actually equate FBA to mean private label but FBA stands for fulfillment by Amazon. It just means the way that the products are stored and fulfilled and shipped to the customer, not about private label. That is a whole different strategy.
But you can sell retail arbitrage, online arbitrage, wholesale on Amazon and make really good money and a really good living in doing so.
[0:14:22.8] REBECCA: That’s right. So that brings us to our last point here. Number seven on our list, you need to have the lowest price for your offer in order to get the next sale.
[0:14:33.3] STEPHEN: Yeah, this is something that comes up a lot, especially with new people. They think that they need to have the lowest price in order to get the next sale but that is not how it works. You might have heard about the ‘buy box’ before — we have talked about it on this podcast. We actually did a whole episode. If you look at episode two, fulltimefba.com/2, we go into the whole thing about the buy box but that is not true.
The buy box is a little box in the corner of a product page where over 80% of the sales come from when it comes to Amazon customers buying a particular product. So even though there are maybe 10, 15, 20, 30 different competitors trying to sell that particular product, well the person who is going to get the sale most of the time, over 80% of the time, is the one who gets the buy box and the buy box does not always go to the lowest price.
There are a whole bunch of different reasons. In fact we have a whole blog post about it — fulltimefba.com/thebuybox is how you can get more information about that — but the buy box rotates between different sellers who are all priced competitively together. The buy box is geographical because a buy box might be different from you than someone in another state because the item that the person is looking for in another state is closer to them to be able to get there faster. And a bunch of other reasons but the lowest price does not always get the next sale.
The only thing the lowest price does and lowering the price by a penny or whatever is just starts to raise to the bottom where the prices just begin to tank and so pricing and matching the buy box or even a small percentage above the buy box, you’re still going to get time in the rotation of the buy box as long as your seller metrics are good and a bunch of other reasons which I outline in the buy box blog post at fulltimefba.com/thebuybox.
[0:16:14.4] REBECCA: All right. So that about wraps it up for the myths that we need to stop believing. I think that covers a handful of things that we hear on a regular basis from Amazon sellers — whether they are new sellers or even some sellers who have been around for a while or just not super clear on certain aspects of selling on Amazon FBA. So if you want to check out the show notes for this episode and see any of the links that we have mentioned, be sure to check out fulltimefba.com/36 and you will find all of that there for you.
[0:16:44.7] STEPHEN: And if you have any myths that you’ve heard that we haven’t talked about then leave a comment on that show notes page. We’d love to do another episode because I have some more myths that I want to talk about but we want to break these up into smaller episodes so that you have time to listen. But if you know of a myth that we haven’t talked about let us know at fulltimefba.com/36.
[END OF INTERVIEW]
[0:17:05.5] REBECCA: Okay, well it’s been really great being with you this week. We look forward to next week’s episode.
[0:17:16.1] STEPHEN: Yeah, we’ll be talking about overcoming your fears of selling on Amazon. For those who are just starting, or have recently started, there are probably some fears holding you back from finding the success you’re looking for. Your fears are holding you back and we’ll talk about how we can overcome those fears in our next episode. So thanks so much for hanging out with us today of the Full-Time FBA show. We’ll see you next week on the show. Have a great day and God bless.
[OUTRO]
[0:17:35.0] ANNOUNCER: That is all for this episode of The Full-Time FBA Show. So head over to fulltimefba.com/podcast, where you will find the show notes and links from this episode. While you’re there, subscribe to our newsletter, where you’ll get several free downloads of our popular and helpful Amazon FBA resources. Now, take action on what you have learned today so you can find success at turning part time hours into a full time income with Amazon FBA.
[END]
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