These commissions, combined with the low amount they reimburse for shipping charges (our products are heavy) make it a losing proposition for us.

Same here. Not enough profit as it is already!

This is a major issue. That client of mine goes from a handful of errros to several hundred all the time. I don't know why Amazon can't sort things out? But they have no problem picking up the phone and getting help though. I wonder if they have a direct line to a tech that is good at fixing things? I know it was difficult for them at first, but now they have no problem getting help.

The other "game'" they play is that they have software (as do lots of others) that scans their items and see where their price is in relation to the other sellers. If they are not the lowest, they can lower it to compete. Many will play the "penny" game... he does to some extent, but usually goes way lower and just solves the problem as it were. His books are all new, but he buys them at such great deals that he can sell low too.

I have a similar problem. I cannot list anything higher than the Amazon price which is usually much lower than suggested retail for the products in my industry. I looked into this several months ago and I would actually lose money on any sale.

Me, too.

They already have some of them on their site - at a discount. If I were to sell for the same price, and eat the extra shipping, and pay their commissions, I'd lose money. I did the math a few months ago, and it just didn't make sense to do the extra work if I wasn't going to get anything back.

The way they are adding categories...you never know.

Probably so.

Steph,

Can you give us a little info on exactly what type of integration we are talking about.

Is it a simple export or a live integration? Is inventory kept live with inventory?

Any details may help out with client input.

Hi -- my name is Mitch and I've been working with Stephanie to evaluate this Amazon opportunity.

I think you need to be careful to be sure you are comparing "apples to apples" with respect to the gross margin that Amazon keeps -- it is not directly comparable to the margins you achieve with other channels because Amazon bears the cost of:

- handling the "front end" of the sale, including credit card processing (and thus Amazon is incurring the "bad debt" risk, not the merchant)

- Marketing the site to bring the traffic (over 41 million registered users!) to your products -- and allowing you to leverage the Amazon brand -- one of the strongest on the planet -- in so doing!

- Maintaining one of the most feature-rich e-commerce platforms that has demonstrated the ability to scale without flaw so far!

....so, to fairly evaluate whether the Merchants@Amazon.com platform is right for you, it is necessary to "net out" some of these costs that you don't have to bear when comparing with other channels.

Hi, Mitch again -- as I said in a prior post, I am working with Stephanie to evaluate the applicability of this pre-packaged Amazon integration for MonsterCommerce's customers.....

this is an excellent question. The solution that is evaluating is built on world-class integration technology that is in use at over 2000 companies for a broad spectrum of real-time integration challenges.

The specific Merchants@Amazon offering features:

- Pre-packaged “mapping” to and from the Amazon data formats

- A simple graphical user interface for point and click enrichment of catalog data to match Amazon’s product categories and keywords

- Point and click mapping of order status, order management, and settlement data coming from Amazon

Historically, the challenges in integrating with Amazon have been due to:

- Different "types" of integration that Amazon supports, specifically, Comma-Separated Flat Files and XML. The solution that is evaluating seamlessly handles both types of integration with Amazon.

- Amazon's "Feeds" can become quite complex due to the need to A) provide the inputs to Amazon in exactly the order Amazon requires, while ensuring that the first file processed correctly before sending the next one, and C) respecting sparsely documented batch size requirements imposed by Amazon. The proposed solution has all of these constraints addressed "out of the box".

- Amazon's catalog data is organized in very specific "taxonomies" that frequently do not match up well with the merchant's existing categorization of SKU's. Amazon also has mandatory fields and various specifications for valid values of individual fields that rarely match up directly with the merchant's existing systems. The proposed solution includes an easy to use Product Information Management component that allows you to match the Amazon taxonomies and "enrich" your catalog data to meet Amazon's requirements without having to re-organize your existing SKU categorizations and without having to customize your business systems to support "Amazon-only" fields.

...so, basically, what we are talking about is taking the way you currently "feed" product data, pricing, inventory information, etc. to , feed that into the solution so that it is automatically "transformed" as required and delivered to Amazon. The same is true with the Order and Fulfillment data coming back from Amazon....the solution "translates" that data into either an XML or Flat File form that you can use within your business.

Sorry that got a little "long-winded", I hope that answers the question.....

That is an excellent point.

Hi Mitch,

Thanks for the info. These are exactly my points. Ive made my living in the wholesale world of plants by opening myself up as much as possible to broker networks, where commissions run up 23, or even 25%. Not so scary when you think of all the costs you are not incurring to gather those sales.

Ive paid more than 15% in advertising just to get a sale. If someone told me Ill bring you x number of sales a day at 15% of cost with no added expense to you...that is a no-brainer.

Not at all...thanks for all the information!

I'll cross my fingers this thing goes through.

A product that I carry has a retail value of $24.95. Amazon carries this product for $16.97. I would have to offer this same product for $16.97 or less. My discount from the publisher is based on the retail value ($14.97).

$16.97 - 14.97 = 2.

If Amazon takes conservatively 8%, doesn't give me enough to cover the shipping, plus the cost of the shipping supplies (and this comparison doesn't take into consideration my time or any other incidentals associated with this sale), it is still a loser for me. I'd be lucky if I broke even.

Amazon is branching out from media and that's a benefit to other sellers. They started with media and have grown into this huge company that sells millions of dollars of different types of media, so I'm sure publishers and suppliers are discounting their products heavily. That's why it doesn't work for sellers like me. No sweat. I didn't mean to come off sounding like it sucked for everyone, but the comment about not comparing apples to apples kind of rubbed me the wrong way. I'm sure nothing nasty was intended...maybe I'm tired...I need to party this weekend!

It's definitely a wonderful thing for manufacturers - another way to get your product out there. And I bet that resellers of products that Amazon has never carried or has just gotten into would benefit as well. I hope it all works out for you. Anything to get a break in the market is a-ok with me!

LOL...Don't worry, not taken that way.

Its good to hear everyone's viewpoints. I sure hope that doesnt build something that doesnt offer the opportunity to opt in/out of. I think that is how most of their services should be handled.

I do see where this can be a threatening thing on the internet. Big Box stores and consolidation have changed the face of b&m retail stores, could the same happen on the internet? It is an area though where the playing ground is really leveled. The person next door can have as grand a store as an $80 mil company.

LOL...

Dont we all!!!

I just had a rip-roaring evening of movies with the kids...Popcorn, SpongeBob and Scooby Doo, what could be better! Talk about letting loose...LOL.

You can always make it up in volume (just kidding!)

This whole thread reminds me of something: I had signed up with a PPC shopping site - won't mention it here, great people, service etc. But I found that I was competing with them in the search engines for my very own products/keywords!

At 20 cents per click, and search engine listings for me and them with MY SAME PRODUCT listed right next to each other (say, #2 and #3) I was paying 20 cents if someone liked the shopping site listing better than mine FOR THE SAME PRODUCT! Sometimes, I even saw these paid listings surpass my own pages in the search engines. Hope I've explained this clearly.

It's bad enough competing with competitors for listings, I don't wanna compete with my own paid listings!

I also saw a rise in customer queries for out-of-stock products (sometimes months after the listing had been removed) because their servers kept those pages around for some reason. Nothing more irritating than getting daily phone calls for a product that isn't even manufactured anymore.

Would this happen with Amazon listings?

Let's see. If I make 20 cents per book that normally retails for $24.95 and sell 1,000 of them....let's see, I only had to shell out $14,970 to stock the 1,000 but I made $200. Woo Hoo!!

Seriously, if I could convert them to repeat customers directly at my store it would be worth it. But, I really don't have confidence that someone who is an Amazon customer wouldn't continue to shop there. Although, I do carry many products that Amazon doesn't and I suppose I could make up a little promo thingee to put in the package.

Okay, you have me thinking now. Still just seems like alot of work that would be better spent on something else - like the visitors that come directly to the store.

No kidding! This is horrible!

Well said.

Thank you, thank you very much...
Ya know, after a while ya just get tired of folks screwin' things up...
How about let's ALL try to make some money for a change!?!

Here is a copy of an e-mail that I sent to someone asking about price guarantees:

The Question:

Sent: Monday, July 26, 2004 9:31 PM
To: sales@aawsales.com
Subject: Price guarentee question

What guarantees does your organization offer should find the exact product cheaper within 60 days?


My Answer:

Hello,

Thank you for contacting us with a great question.

What item(s) are you looking for?

We actually do not have a formal "lowest price guarantee" in place, (nor do we want one), because in my opinion if you look hard enough, you will be able find ANYTHING cheaper. Unfortunately, there are companies out there that actually lose money on many transactions, and we are not one of them. We are a legitimate wholesale/retail company. There are many companies out there that sell USED merchandise. We are not one of them either.
We also never claimed to have the lowest prices on any particular item, because of what I stated earlier.
We do not want to get caught up in pricing wars with other merchants.

We honestly believe that our low prices, free shipping policy, free gift policy, and top notch customer service are more than fair, and go way above what most other merchants offer.

Regards,

Ben N.

Sales Staff

http://www.AAWSALES.com/

(Above All Wholesalers, Inc.)

Hey Mitch,
Are you kidding me or what?
OK so they absorb the "whopping" 2.39% + 30¢ per transaction, and they market to millions of people.
But that STILL doesn't help us merchants, when we'll have to be selling products at close to cost or even lose money on a sale.
Remember: You can't make up a loss of $$$ in volume!
Just my 2¢ worth...
Ben N

My book client gets new customers all the time from Amazon. Now he probably has 3,000 items on Amazon, and he gets such good deals that he can compete on price, but he gets a TON of orders from Amazon. And several times a week, that we know about, he gets an order on his site where they say they were referred from Amazon.

Yes, when he emails the customer to say their order is being shipped, he certainly says "hey, we have a web site... and there are less items there, but the prices are cheaper and the shipping is a lot cheaper to." (He only sells deep quantity items on his site.)

But, I can totally understand when you only get 40 or sometimes 50% off on books how this just makes no sense to sellers. Books are very hard to make money on. If you can't even keystone, how do you make money? You can't! That's why retailers buy books from him to resell - since his prices start at 50% and go to 85% off, for 1,000 books, or just 1.

Ben,

Ill not take this personally, but just assume youve had some bad WalMart experience or something...maybe some bad semi-boneless spaghetti in their cafeteria.

I do think you have to be realistic about todays retail world. Branding is a fact...consolidation is a fact..and the customer out there wants the bottom line price for everything.

I agree, it must be very difficult for re-sellers out there and I know you have to work pretty darn hard to squeeze a profit. In a marketing scheme where the middleman is dissappearing, its getting harder to find a spot in the chain to fit into.

Most of the talk in this thread seems to concern books and media sales. Personnaly, im looking at Amazon's garden department, which is really driven by about a dozen or so of the strongest nursery providers in the industry, which I have worked really hard to become one of. Price is driven by these competitors, not by Amazon. Im talking about using Amazons marketing tools and market reach to sell my products at my cost. Im not sure what is so unsettling about that.

If I sold surfboards, id try to get my items listed in Amazon's sporting section as fast as I could. If I sold ski jackets, Id do the same! If I sold any products competing with Amazon's own pricing structure...I wouldnt even be bothering to read this thread.

IMHO

Hi SRG,
While I truly DO respect your business savvy, I must ask "am I missing something here"? Why would someone want to sell something at cost? Are these vehicles like Amazon going to be used simply to promote a "lost leader" to drive up traffic to your site?
Please correct me, if I missed something.
I am trying hard to understand the rationale behind something like this.
Thx much,
Ben N

Did you buy them from Amazon itself, or from one of the other sellers... as some of us could become? Amazon knows how to lose money, so maybe it was from them. They just seem to figure that if they sell a gazillion of something, somehow they will make money on it eventually.

I'm not sure about other categories, but I can tell you as far as books go, that many items listed as "used" are indeed new. Sure, some are used, but most of it is all brand spanking new, or never read and just not 100% perfect. Read the descriptions, not the category and you will see that most are actually new.

Let's just say that if you know where to buy the books (in bulk, of course) that you can get a book that retails for $12-30 on avg. (even $50) for just $2, or often much less. Though that is pointless when it's listed by 100 people for 1 cent each... which is why Amazon is a good place to research before buying some items.

From Amazon. We dont typically sell books, but it is a good item to offer at our trade show booth, so we didnt look for a wholesaler. Amazon had them marked at wholesale pricing.