Episode 40: How to Avoid Amazon Suspensions with Chris McCabe
Hello this is Grant Chen bringing you today’s episode. Today we talk with Chris McCabe of eCommerce Chris. Chris helps Amazon FBA sellers who have been suspended, blacklisted, or are under investigation by Amazon.
Amazon has created a complex system which is supposed to weed out the bad apples and protect the customers and reputable sellers. The problem is there are policy issues and Standard Operation Procedures that can keep a seller from using their account. Chris is a former Amazon employee and has inside understanding of Amazon’s process. He teaches people how to cooperate with Amazon and regain control of their accounts.
If you're in the Seattle area and need to get unsuspended or just want to be proactive on dealing with Amazon, Chris will be a speaker at SCOE this August 25 and 27th at the Sheraton. You can sign up via that link and can also get a discount to SCOE as well.
Today’s points:
- What eCommerce Chris does for Amazon Sellers
- Chris’s background with Amazon
- The issues Chris helps with for sellers
- Amazon’s stricter policies
- Why many sellers need to change their business models
- Why a seller shouldn’t rely on closeout sales and liquidations and the death of Amazon retail arbitrage
- How to produce good supply documentation
- Chris’s plans for SCOE Conference
- Common mistakes sellers make with Amazon
- The 4 main infractions
- How to be proactive with a suspension case
- How not to be passive
- How to think like an investigator
- Amazon vs. eBay
- Why Chris only hires former Amazon Sellers
Today’s Resources:
If you have any questions or anything you’d like us to discuss on the podcast please go to ecomcrew.com and fill out the contact form. Also we would really appreciate if you would leave us a review on iTunes. Thanks for listening!
Full Audio Transcript
Grant: Hi, everybody. This is Grant with EcomCrew on your next installment of our podcast. Mike is out today and he is in San Diego for an ecommerce conference, but today we have a special guest, Chris McCabe and he is from ecommerceChris. And the reason why we’ve brought Chris onto this show today is that Chris is an Amazon specialist that is an expert in getting your Amazon suspension removed, which is, to me, quite magical. We’ve always talked about, on this show, some of the pitfalls and scary situations that you can get in putting your eggs in one basket. So Chris is actually a former Amazonian. He’s been there for five years, he was working in the merchant risk processing area, so Chris knows all about Amazon, kind of how they think and how they manage to suspend you. So we’ve brought on Chris today so I want to introduce Chris real quick. So, hey, Chris, how’s it going?
Chris: Pretty good. Glad to be here. How are you?
Grant: Good. Thank you for being in our show and I really appreciate you coming on. And so, first off, I was hoping, Chris, if you could just kind of introduce yourself, maybe tell us a bit about what you do, your company, and kind of how you got to be the founder of ecommerceChris.
Chris: Sure, yeah. I did work at Amazon for several years, mostly merchant risk, some people know it as seller performance, mostly performance and policy teams. That’s my primary area of expertise because those are the teams I worked on when I was there. Since then, I’ve been consulting independently, helping sellers communicate with Amazon, decide why they’re getting certain kinds of messaging from Amazon, how to respond to them, so independent client consultation work and now kind of moving into not just providing services, but providing products as well. And it was just living in Seattle for several years, deciding to move back to the Northeast, where I’m from, and taking things from there.
Grant: Oh boy. So, from Seattle weather to Boston. I don’t know. Which one do you think has worse weather?
Chris: There’s a little bit too much snow in Boston sometimes, but I try to make sure that I’m maybe gone for the winter and I go back in the spring, and the fall’s pretty nice too so…
Grant: Oh. Okay. Well, as long as you’re still rooting for the Seahawks, I’m still a fan of yours then. So when it comes to what you’re doing on Amazon, it sounds like what a lot of our viewers would probably be interested in is kind of how to stay out of trouble essentially. And it sounds like what you’re doing with doing suspension kind of adjustments and whatnot – and that’s probably not even the technical term. I mean you can educate us all – is how people kind of get in trouble on Amazon. Because I know, for myself, I’m always terrified that I’m going to do the wrong thing and I always try to play in the rules, but you always hear these crazy stories out there of people just getting suspended for reasons that they’re not even sure of. Can you kind of go into how you essentially get people out of trouble and how you would recommend people to not even get there to begin with?
Chris: Right. I mean, yeah, I can give a detailed, lengthy answer to that but just to start off, I wanted to say that we also work with people just answering their warnings, their notifications, their policy warnings, not even necessarily account suspensions. Some people just have listings suspended and we help them get those [inaudible 04:33] reinstated. If they lose access to, you know, their top-selling product, they don’t understand why, they don’t know what Amazon wants them to provide, we help them understand what Amazon’s asking for and I’ll help them also kind of put together what they need to give as a response. So it could just be response to warnings. We help them kind of compose that messaging and communicate in the very narrow, specific way that Amazon seems to want sellers to communicate with them, without necessarily guiding you into that process. So that’s – yeah.
Grant: Now, I’m curious because I’ve definitely been one of those guys that have read over like almost every single piece of the Amazon knowledge base and I’ve never actually found anything that tells me how I’m supposed to talk to Amazon regarding this. Does that actually exist or is that just something that you only know if you’re in the know?
Chris: Right. I mean I guess you could say it’s the bedrock and founding principle of my company, for starters, because I worked there reading this messaging from sellers and sending out some of, you know, Amazon’s pre-written messaging but also modifying it as needed. So this was something I grasped fully and I understand very well and I wanted to share with people who were struggling, losing money from lost sales, frustrated with Amazon, trying to figure out what resources were out there, and as we all know, the seller forums have very mixed information at best. There’s a lot of bad information that I see on there and other places. Sometimes people kind of get information from other consultants who didn’t work at the company, they run it by me, it doesn’t ring true for me. So these are things that I sort of guide them through myself because I’ve been there and I want them to understand everything, you know, what tools they need to kind of put into place to resolve problems when they have them, but also to understand how to prevent those problems from every cropping up.
Grant: Got it.
Chris: Which probably speaks a bit more to your question of how do Amazon sellers get into trouble and what can they avoid before they even need to hire somebody like me or what they can do to kind of head things off at the pass. And I can give you so many examples in terms of – I guess by this point I’ve seen everything. It could be bad invoices. Amazon frequently asks people who have received item quality complaints or inauthentic item complaints to show invoicing that shows supply chain documentation, to submit verifiable links to their suppliers, so on and so forth. And even in mid-2016, you’d think that a lot of people have a heavy understanding of that ecommerce need for information and a lot of people are still sort of doing business over the phone or sometimes even submitting handwritten invoices or just invoices that have almost no information on them and that simply won’t work anymore. Maybe two, three years ago, some of that was still being accepted by internal teams, policy teams, but they’ve grown increasingly strict.
Grant: Yeah, if you could actually expand on that, because I’ve actually gotten one of those from Amazon before where they message me and they say, “Hey, we need you to submit an invoice to an item that you’re selling.” And I mean, for me, I had bought it from the manufacturer, so I said sure.
Chris: Right.
Grant: But I actually know a seller who specializes in liquidation. So they buy stuff in bulk and he gets it from a container and he got I think just an incredible amount of pillows I think it was from a container shipment. He didn’t even know what it was because it’s a liquidation. And then he put it on Amazon and they asked him for an invoice and he just said, “Um… here’s an invoice.” It just says “Container of clothing goods” and they said, “Not good enough,” and he says, “I don’t know what I’m supposed to do about that.
Chris: Right. Lot sales, liquidation closeouts, there’s a lot I could say about this. I’ll try to find the best concise way of explaining it. But more or less, your future business model has to change if you want to sell a lot on Amazon and you want to do business using closeouts and liquidations. Their practices in terms of policy team, scrutiny of documentation, of invoices, their decision to handle item quality complaints the way they have does not leave really much room for people who are doing business with that lack of documentation.
Grant: Wow.
Chris: If you’re selling things – and maybe that’s a scandalous thing to say but I’m sorry, that’s 100% accurate according to everything I’ve been seeing trending over the last several months to a year to more than a year, they’re trying to get aging inventory off the site. Well, how does that show up in your messaging? They keep asking for invoices from the last 180 days, right? So that’s sort of a side way of addressing the fact that they won’t want product that’s purchased annually, like a liquidation closeout type sale, showing up in the marketplace. They’re completely aware that those items tend to draw more complaints from buyers. Amazon can’t really, you know, inspect your inventory at the drop of a hat. I mean buyer complaints are one of the tools they’re using to assess your item quality; are there complaints about item condition or authenticity? You know, if you’re listing all your closeout items as new and there’s some shelf wear associated with the packaging or if the item has even been opened perhaps and resealed and returned to a Costco or a Best Buy and you’re still selling that item as new, does that meet Amazon’s criteria and definition for a new item? Which, in my experience, it does not.
Grant: Mm-hmm.
Chris: And by definition, it does not. They have a very tight, restrictive definition for what you can list as new. So there are a lot of downfalls to basing your business model on liquidations, closeouts, retail arbitrage. Eventually it’ll get to the point where, if you’re yellowing prices on receipts and you’re not showing a relationship to a supplier who’s an authorized reseller or at least an established distributor and well-known company that they can verify online in a search, they’re going to be rejecting that documentation from you. If you get a compliant against that [inaudible 11:50] and you can’t provide good documentation, long story short, they’ll send you a general denial and tell you that you can’t list that item again, pull your inventory out of FBA, so on and do forth, delete the listing. Yeah.
Grant: Wow. Well that is a pretty big statement, I have to say, coming onto the show and immediate drops the hammer, Chris. Yeah, that’s a –
Chris: It’s [crosstalk 12:33]. I have a lot of evidence in my daily work. Part of what we’re doing is messaging Amazon, you know, helping people create messaging to respond to policy warnings for item quality complaints as I was saying, whether it’s item condition, whether it’s not as described, not as advertised items. Authenticity is often something that comes up. You need good supply chain documentation to defend your inventory. So the short way of saying it would be if you have “indefensible inventory” as I call it, such as just the receipt or, like you said, the lot sale type information, that’s not inventory you can defend. If no one ever complains about your items, then of course, you can source them wherever you want. If you get complaints, you won’t be able to defend them and won’t be able to get that listing back if they take it away.
Grant: Yeah. Sounds very true. And I know that with Amazon, as you know, the retail arbitrage industry is quite huge –
Chris: Sure.
Grant: And there’s an entire subset of Amazon business model regarding the arbitrage and so I think that’ll be a very interesting playout in the future if that’s what Amazon is essentially telegraphing because I know there’s a huge amount of FBA sellers that that’s all they do and –
Chris: Right.
Grant: I’ve never personally liked it myself because I felt like it was not a true business. Not taking away from people that do that, but I just don’t see how it’s a long-term viable model but this –
Chris: It’s not.
Grant: Yeah. This definitely puts the nail in the coffin, for sure.
Chris: Yeah. When I see how aggressive these policy teams are, how much they’re tightening the restrictions, everything I see every day with three out of four, four out of five clients, indicates the same message over and over and I like that you used the word “telegraphing” because they’re not necessarily, you know, blanketing the site with, “Hey, do not use a retail arbitrage,” but how are they acting? What’s their behavior around these item quality complaints and these kinds of products? Well, we all understand Amazon selling is not easy and the margins are thin, but in a sense, they are looking for, “Well, which sellers do we want to have and which ones don’t we?”
Grant: Mm-hmm.
Chris: If you’re getting a lot of complaints for item quality, if they’re not liking your invoices, they don’t like your suppliers, I mean you’re kind of heading in the direction you don’t want to be going. So it’s a good idea, even now, for like the peak holiday coming in a few months, whatever changes you need to make to your supply chin, if you need to establish new relationships with suppliers who have great web presence, great documentation to show you, now’s the time to do it because Amazon’s not going to necessarily spell all this out for you and spend a lot of time communicating with you even effectively or in any kind of detail. If they don’t like your invoices, they might just send you a general canned response saying, “You can’t list this anymore,” without even telling you that it’s your invoice or, you know, and talk about what a plan of action is too, of course. But you might be prompted to submit one. They might not like your plan of action or your invoice, but the bottom line is they think you’re doing business in a way that’s not coinciding with the way they want to see marketplace sales go.
Grant: Yeah, I’ve actually had to submit a plan of action myself and when they asked me for a plan of action, I mean it was like deer in the headlights. I said, “Plan of what? Is this something I missed in business school or something?” And eventually, I did get reinstated on my one listing and, again, it’s probably due to what you said. I had actual inventory, purchase orders –
Chris: Right.
Grant: From legitimate sources and directly from the manufacturer and it was fairly indisputable and I just said, “I’m going to ensure that I take care of my inventory and do a double CQ essentially because people are complaining about some product quality,” and I got reinstated. But I can imagine that a lot of people have trouble. Now, maybe you can talk about very common situations you see where sellers end up getting suspended and how you would recommend for them not even to be in that situation to begin with.
Chris: Right. And one thing I wanted to add was we’re doing a workshop called Frustration-Free Amazon at the SCOE conference in Seattle, which is between August 25th and the 27th. I’ve got two breakout sessions there two different nights and we’ve got two separate groups coming for each of those nights to explain – you know, just getting back to the idea of what does Amazon tell you? What do they indicate that you need to give them? Some of this takes explaining, right? And if they’re not going to do it, we’re more than happy to fill the gap and make it clearer what kind of information you need in terms of how do they want you to correspond with them, what kind of documentation they’re actually looking for, whatever makes it easier for you to sort of give them what they need, get your listings or account reinstated, and get back to selling.
Grant: Mm-hmm.
Chris: So I mean that’s kind of our approach, to clean up communication. If anyone’s giving them extraneous information in their, like you were saying, plan of action, information that doesn’t really help you, it’s just kind of wasting space on the page, you know, we kind of lead people through that process of how to clean that up, get that stuff out of there, and focus on the facts, the information that they’re really looking for. It saves you a lot of time and money too.
Grant: Okay, so it sounds like you’re saying sellers, when they talk to Amazon, they don’t really know what they’re doing correctly. And in your experience, is it usually like a product quality issue that gets people suspended? Is it buyer complaints? If you were to list the top three of why sellers get given the boot, what would they be?
Chris: Well, I mean I guess we could start with the obvious one, which is performance metric [inaudible 19:36]. I would say, at this point, again, mid-2016, if you’re going to sell on Amazon, you should do everything in your power, everything you have to operationally to make sure that you’re meeting all these targets. Because at this point, it’s a given or it’s expected that you will meet those performance targets. If you’re having problems with performance metrics and product quality type things, then you’re probably not going to last very long anyway, so you supposed it becomes a moot point. But so, primarily, performance metrics also, like you said, product quality warnings, a lot of people are sort of missing or not responding to those warnings or they’re just, you know, [handering? 20:30] for a few days, not sure how to respond to them, not sure what to do about them, and sort of hope that they’ll go away.
You get too many policy warnings or product quality’s paying too much attention to you on this or that [inaudible 20:44], then you tend to generate an account review for yourself and that’s sort of the anything-goes time where you have somebody, an investigator, actually looking at your account, looking at your listings, looking at your account history, anything they really need to find out what’s going on in terms of product quality with your item quality problems. If you’re having a lot of buyer complaints indicating that whatever they’re holding in their hands is not what you advertised on Amazon or it’s not new like you advertised it on Amazon, then you’ve got a problem because any account review is a manual investigation that can result in anything up until suspension. So you have –
Grant: Gees. Well, that sounds about as enjoyable as an IRS audit from the sounds of it, right?
Chris: Or other types of exams that you don’t want to have to go through.
Grant: I see you’ve been through TSA as well. Frequent traveler over here.
Chris: Exactly. So it’s good to just be ready for this stuff. I guess one word of advice I have is be ahead of the curve, be ready to defend your inventory if we’re talking about item quality issues or policy warnings. Certainly if you have a pricing error and you sell a bunch of items and you think first, “Well, we’ve got to cancel all these orders,” you know, think about the risk to your metrics. Think about how they will view it versus the monetary loss you might face by just fulfilling those orders and chalking it up to experience. When it comes to policy warnings, you might have a great deal from a supplier who your buddy told you about. Do you due diligence. Find out who these guys are, where they get their products. If they won’t tell you, maybe you don’t want to do business with them. Maybe that risk is too high if they’re playing it too close to their vest and they don’t want to talk about whether or not they got items from the brand themselves or from an authorized reseller.
So those are the things to think about because, otherwise, you’re playing catch-up. Once they start sending you these warnings, you’re reacting, right? You’re not really being proactive at that point anymore. You’re maybe considering ditching a supplier that sold you some bad product after some damage has already been done. I mean maybe now is a good time of year to look at some of those warnings and address some of those concerns with the supplier and make that decision before you get to the point where you have to sort of defend yourself so a company like Amazon that may or may not be paying attention to the documents and the materials that you submit. So that’s kind of what I’m advocating these days. You know, think your way around that corner a little bit. Anticipate what they expect to see from you because they’re always asking for more. It’s only going to get trickier when it comes to invoices, supply chain documentation, information about your supplier. Make sure you’ve looked at your listings. Are the product detail pages accurately reflecting what you’re selling or is it kind of sort of the same thing? If there’s any different legitimate complaint from a buyer, Amazon’s going to side with that buyer.
Grant: Yup.
Chris: And often, they side with the buyer either way.
Grant: Given your time at Amazon, you’d been there five and a half years, and now that you’ve been doing your own business for helping sellers, what are some – if you can publicly say – quote/unquote “good stories” that you might have had from this time? And I mean “good” as in some epic stories where maybe somebody was just doing a phenomenal business and they just got side-swiped by Amazon? I mean, like you said, in the seller forums on the Amazon site, you hear all these crazy things about some guy doing maybe almost half a million in sales per month, and then suddenly, without any notice, he gets completely blown out of the water. And I’m curious to know if there’s any truth to that or if those guys were actually angle shooting or anything like that.
Chris: I mean some sellers are overly charitable with the tightness of their operations and their lack of warnings. And I mean I hear some of those stories on the phone and then if I’m looking around in their account, I find otherwise. So some of that might be – I don’t know if you’d call it denial or just sort of being overly positive in how they represent their Amazon account but, that being said, there are several sellers who have become victims of I guess what I call “over-enforcement” or “overly aggressive enforcement,” which is, you know, performance and policy teams only have so much headcount. They have standard operating procedures, SOPs. Are they necessarily being followed every time in every investigation? Well, that could be more hit or miss. It could be more luck of the draw.
And, let’s remember, the investigators at Amazon have time limits on how much – they call it investigations per hour, IPH. They’re motivated to keep things moving, in short. So that’s why it’s all the more important to make sure that when you correspond with them and you show them the information they want, you do it very crisply, cleanly, stick to the facts, make it readable. I mean a lot of people just writing these POAs aren’t even using a good layout and format, something that’s easy to read or they’re using strange wording that doesn’t make sense on the first read and you might only get one read. So I just wanted to point that out. You’re kind of dealing with teams that might not have more than a few minutes to look at your material, so it’s a good idea to make that space count and that time count.
But in terms of the feel-good stories, yeah. I mean the most rewarding part of doing this, as opposed to when I was at Amazon sending warnings and suspending accounts all day, was helping people get back on the site, right? People who are a good business, they might’ve had a couple of minor infractions or a few policies they didn’t understand, they might’ve made certain mistakes, which anybody can make mistakes on something fairly complex and stressful and big like this. It happens, right? The question is how can you prove to Amazon that it won’t happen again and that you’ve fixed the problem? Again, this is sort of the cornerstone of my Frustration-Free Amazon workshop in Seattle at the SCOE conference.
And so why is this so important? Well, you might only have a few cracks at it and I’ve had people come to me, of course, who have taken a few stabs at it and it didn’t quite work out. Those are the best stories for me when I get involved and I’m able to turn things around for them. And the best stories within that subset, of course, are the people who write to me and tell me about all the people they were able to re-employ once their got their account reinstated. So those are my favorite moments. Yeah.
Grant: Yeah, that must actually be quite a nice change of pace, going from being from one side where you’re hitting the big red button to going to the other side to actually letting people through the gate for a change. So that –
Chris: Yeah. I had a client in L.A. and I think that was the best story. They wrote it up that they were heading to a conference room to tell their employees that they weren’t going to be able to employ them until this was resolved, and on the way between the office and the conference room, they got the message from reinstatement from Amazon based on the work we were doing on their plan of action. So I mean those are the most rewarding moments for me and it makes it all worthwhile.
Grant: Yeah. Yeah, that’s got to make you feel a lot better about your job I imagine. I can’t imagine even the most ardent Amazon supporter necessarily wants to go in and just do a police type action all day of just banning rogue accounts.
Chris: Right.
Grant: That said, I am curious because I always bring up the China factor and Mike always laughs at me but –
Chris: Right.
Grant: I always just see the Chinese coming in so hard on Amazon, so I always am very curious about that side coming in. Have you ever had during your time just any cases where there was just a complete 100% counterfeiting operation that were just trying to do their [darndest? 30:40] to go and just spam out Amazon with a whole bunch of bad product and was succeeding for a while or do those guys usually just fly in and just get shot down immediately?
Chris: Yeah. Yeah, I mean there’s a couple ways to answer that. I mean definitely that’s just a normal part of ecommerce and a normal part of any site that has open registration. Some people will register their accounts in bad faith, right? They have no intention of providing good product other than trying to look for loop holes and game the system. So that’s king of a normal state of affairs anytime you’re going to be selling online. And of course that’s one reason that I and other people I worked with were hired, right? Part of our job was fraud investigation and to shut people down who did not belong selling on Amazon in any way, shape, or form because they were simply there in bad faith. Now, part of what I was saying about overly aggressive enforcement is that there are sellers like that, but then if you’re kind of throwing a giant net out into the ocean and then reeling it in, you’re going to be picking up all kinds of fish, right? You’re going to have some bad fish like that but you’re going to be picking up some good ones too.
So the essence of my work, it turns to, you know, “How do we separate those guys out? If Amazon’s not separating them, how can we show them that we’re working with good fish?” And we’re not here to help people evade the tools or evade policy or evade Amazon’s detection systems. We’re here to get people to play the game the way Amazon wants it to be played to show Amazon that they are playing it that way and to put those tools to succeed right in their hands so that they can do it themselves. You know, even if they don’t need to do it today, they know how to do these things for tomorrow in case trouble’s around the corner.
Grant: Okay. Now, let’s talk about maybe something else and let’s talk about the mindset of Amazon and why they do things the way that they do. And we’ve kind of explored this topic a little bit so far.
Chris: Right.
Grant: I mean you kind of talked about how Amazon telegraphs instead of really comes out and says, “This is why we’re doing it this way,” and for example, talking about retail arbitrage and that’s a completely new idea to me that Amazon might be telegraphing that they’re no longer going to be very welcoming to that type of business model.
Chris: Right.
Grant: Why is Amazon almost kind of cloak and dagger about the way they do it? Is it just to prevent more people from committing fraud against them or trying to take advantage of the Amazon platform or are they just so big that it just takes so much time for it to kind of trickle down?
Chris: Kind of both, right? I mean they want to keep certain things vague on purpose. It’s by design so they can reserve the right so change their minds basically. It’s their marketplace, it’s their platform and they don’t need hundreds or thousands of sellers pointing to, “Well, you posted this policy change and that one on such and such a date and now you’re doing something different and how do you reconcile those two?” I mean some things are purposely vague for that reason. They’re testing things, they want to see if what they’re doing is working, they reserve the right to improve things in a different way or change their minds and that’s one of the reasons they’re going to do it.
But secondly, I mean yeah, it’s hard to scale this work without hiring hundreds of thousands of new people to do tons and tons of manual investigations. You’re going to have to algorithmically approach this work somehow. And you’re also going to rely on bits and pieces of information from maybe less obvious or less expected sources, like the buyers themselves. The buyers of your products – not your products, Grant, but I mean you as a seller – might not be experts in what they’re buying but they might report problems to Amazon as if they are experts, right?
Grant: Right.
Chris: So if Amazon takes them at their word, is it because their wording of the complaint indicates to Amazon that this buyer really knows what they’re talking about or is it because they need to use these buyer complaints to scale the work in order to figure out which sellers to investigate? You know, it’s their kind of a lead into, “Well, who do we pick to investigate and who don’t we? Well, we’re going to start with whoever complains.” Because otherwise, they’re looking at every seller all the time, 24 hours a day, millions of listings. They can’t do that, right?
Grant: Yeah, of course.
Chris: So they have to find a way to make it work.
Grant: I mean with how big it is. I just got an email this morning about the free FBA removal again, which to me, just immediately screams Amazon saying, “Our warehouses are full. Please take your crap off so that we can actually go and sell more product that’s making money.”
Chris: Yeah.
Grant: So I simply expect probably in the next six months for another warehouse storage rate to increase or for them to drop long-term storage down to a three-month limit or something. I mean…
Chris: You mean Q4 fees? The increase in Q4 fees? Yeah.
Grant: Yeah. I know with the Christmastime, yeah, the Q4 fees are coming up, but yeah, this is the second free warehouse removal that they’ve done ever that I know of. So it sounds like they’re really just trying to get people to take their stuff off their warehouses right now.
Chris: Yeah. Well, yeah, I think it’s a good thing in a lot of ways. I mean the increases in fees that are already pretty high for some people isn’t a great experience or a great thing for a lot of people, but it’s also kind of, you know, forcing people or teaching people to manage their inventory a little bit better, which is a good thing for pretty much everybody in terms of do you know what you sell through and how quickly you sell it?” You know what your top selling [inaudible 37:41] are, sure, but do you know, in terms of inventory management? Because it’s going to cost you a little bit more if you don’t spend the time to analyze that data. Do you know what you’re going to sell and how quickly you’re going to sell it, especially around the holidays, right? Or do you want to just sort of push everything into an FBA warehouse and hope it sells but not really know if it will sell quickly or not?
Grant: Mm-hmm.
Chris: So I think it’s a good kind of – it might be a harsh education tool but it’s going to be a good thing in the long run because it teaches people. You know, whether it’s inventory automation or data analysis, it kind of takes the people that aren’t really doing it the Amazon way just yet and almost forces them to do it.
Grant: Yeah, I definitely think it’s raising the bar and forcing people to adapt. And, to me, one of the things that Amazon has taken away from that, and this might just be my own personal interpretation, but coming from somebody that does both retail and business sales (being that I sell cutting boards), I know that with Amazon, as everybody knows, holiday sales are just a huge factor of any retail operation. And for a company that does more business sales, generally it’s a little bit more level throughout the year because business sales aren’t really – you know, nobody buys somebody else notepads are Sharpie pens for Christmas unless I guess you’re kind of square or something like that. But office supplies generally don’t have a spike during seasonal type fluctuations or cyclical as consumer goods.
Chris: Yup.
Grant: So consumer goods are going to probably do okay because they’ll sell through during the holiday. But for people who are doing more business-to-business type sales, now they’re paying four times as much for warehousing during the holidays. So to me, it almost seems like Amazon is telegraphing via, “Hey, we’re consumer-oriented. If you do business sales, I guess you’re just going to pay a little bit extra during the holidays. Too bad. Maybe pull your stuff off and then put it back on.” So…
Chris: Right. I mean another answer to your previous question is kind of, “When will Amazon make things easier for sellers?” I mean never. I hate to say it. It’s going to keep getting tighter and more restrictive and the guys who have their acts together are going to have an easier time of it. You know, it’s almost like, well, how much friction do you want? How much risk can you tolerate? Well, if you can tolerate a lot of risk and maybe you’re selling on multi-channel, you’re not just selling on Amazon, maybe your Amazon account means a little bit less to you than it does to somebody else. If you haven’t diversified and your Amazon account is where your entire livelihood sits, then you have to take it seriously in ways that you might not have in the past because Amazon’s perspective is unfortunately, to be blunt about it, if you’re not selling something 100% that they don’t sell themselves or that a lot of other sellers aren’t selling, you might be more replaceable than you realize you are. And that’s why they expect some movement, a lot of movement, toward private label and away from just sort of piggybacking on already-created listings that were selling before and have good reviews.
You know, the future is going to be a different landscape in terms of how many people are selling on some of these hot items and how many used to sell there but then have to kind of change things around and maybe sell something else or source from somebody else and have less of a margin there. It’s just kind of getting increasingly tight. And they’re aware of that but they’ve got the best buyer experience to maintain pretty much at all costs. So you have to fit into their vision for what’s selling. What it will be next year might be different from what it was last year. I mean I see a lot of changes that make life harder for sellers. I mean selling is not easy; it never has been. I see the direction things are going. It’s going to be tougher. You have to have your act together 100% of the time, right?
Grant: Yeah, and I completely agree and I’m really glad you mentioned that, Chris, because what me and Mike do on this podcast, we essentially are trying to tell people always to be upping your game and that if you’re not on multiple channels, if you’re putting your eggs in one basket, it’s really a bit of a liability. And what you said, you know, if you do nothing but Amazon, it should be very serious, not just,” Oh, I’m just going to kind of half-ass my way over here and just kind of do this on the side.” I mean it might – go ahead.
Chris: Well, I mean the concept of, “I’m just winding this up and letting it go,” or – God, I hate the phrase “passive income.” I hope nobody every uses that phrase anywhere near their Amazon account. I mean I can speak from years of experience with performance and policy teams: they are not the people to be passive with. I would be active and responsive when it comes to policy warnings. If you’ve got I mean even some of the new metrics that are kind of still in beta, whether it’s customer service, satisfaction, or return, dissatisfaction rate, so on and so forth, take all of this stuff seriously. If they’re giving you any hint that you have a problem with an item, inspect it, research it, do whatever due diligence you have to do to even decide if you want to sell it or not. Because even if you think your risk tolerance is kind of high and you’ve had some problems in the past and you’ve always weathered the storm before, you could be only as good as your last [inaudible 43:17] warning, or imagine you’re kind of putting the fate of your business in the hands of an account investigator who might not be a well-seasoned or even a well-audited investigator for Amazon. I mean there’s some luck of the draw involved.
Now, of course, if things go sideways and there’s a mistake, you can escalate things and, you know, I teach people how to do that. It’s one of the reasons I created the workshop up in Seattle is to teach people how to escalate and how to get around this sort of canned response that you’re receiving over and over. But I mean consider your audience when you’re sending in that information to Amazon. You’ve got an investigator who’s maybe read 13 emails just like yours in a row. Maybe you’re not sticking out against the people that they just denied, you know, 7 of those 13. So it becomes important to just think like they do as much as possible. Put yourself in their shoes, think about what kind of information is already annotated on your account most likely so that you can think about what they’re looking at while they’re reading your email.
This is kind of like, “Where are things headed? What’s the future at Amazon going to be like? How can I think ahead and improve?” I mean everyone can improve, right? There’s always something that you could be doing better, just like with me and my consulting work, sellers on Amazon, anybody. And that’s what Amazon demands all [crosstalk 46:05].
Grant: Yeah, you’re going to make me every more paranoid now, Chris, because when I was over in Vietnam, I was getting a few messages from my Amazon account saying “A buyer had messaged you” and whatnot. And I know it was most likely just an auto-reply because I have one of those feedback programs that will ask somebody for feedback and when it hits an auto-reply, it starts – you know, I feel like, in my head, that a bomb starts ticking because, “Uh-oh. It’s going to get past 24 hours if I don’t just even –” I don’t have to reply to the message but just mark it as not needing a reply because that affects my seller performance. So…
Chris: Oh, well… yeah. Some people mark those as Reply Not Needed when they shouldn’t be, which is the only real cause for concern. If you don’t need to reply to it, then of course, you can mark it as Reply Not Needed if it’s an out-of-office reply or something like that. I’m not saying you need to sweat every single notification they ever send to you; I’m saying you should at least pay attention to it, decide the gravity of it, and decide if it’s something you need to respond to or not because I see a lot of sellers who have several performance notifications and I know they’re from product quality and they should be at least taking some action to find out what went wrong. It might not need a plan of action every time, but they need to come up with some sort of response, whether it’s an internal response on how they’re going to tweak their operations or if they even want to list that item again, or an external response that goes out to Amazon explaining exactly the steps they’ve taken that will prevent a bad buyer experience, such as this might have been from happening in the future. Ultimately, Amazon’s interested in not so much what happened in the past, because if you’re already troubleshooting customer service –
Grant: Right.
Chris: It’s already behind you. They want to see what proactive steps you’re taking to avoid trouble in the future, not just for yourself, but it means they don’t need to spend resources and energy and time looking at your account because, ideally, they don’t want to look at your account any more than you want to surface on their radar. So I mean that’s what I spend a lot of time teaching people.
Grant: Yeah. Now, in terms of sellers, I want to kind of talk about why maybe some sellers act the way they do toward Amazon and, like you were saying, you were mentioning that people that just don’t take it seriously enough are getting canned left and right. And, having talked to a lot of different sellers and being on forums and whatnot, and you hear sellers that obviously are doing Amazon full-time and they have what they think is a large account and they’ll say, “I’m selling X amount.”
Chris: Right.
Grant: Let’s just say, $1 million to $2 million a year and they go, “How can they possibly do this to me? Does Amazon not care about money?” And I always kind of laugh and me and Mike kind of joke about this, but we say, “$1 million to $2 million? Do you think that means anything to Amazon? Like that’s a drop in the bucket, if that.” But we’ve always kind of said that off the cuff.
Chris: Right.
Grant: And I’m curious if there actually is an actual number that, at some point, maybe Amazon says, “You know what? You’re actually kind of important to us,” because to me – and this is just me speaking off a complete wild guess, but is that number like above $20 million or something? Higher, lower? Or does that number even exist?
Chris: They have these invitation-only events, right? They had one in early June, they invited like 300 sellers, of course all of them showed up (probably late). And those guys are all – I mean I know some of them. Some of them are my clients. They’re all high-revenue people. And they don’t necessarily send invitations to people that are going to do $1 million or $2 million for a reason, right? Revenue has a lot to do with it. Also, if you’re attending events like that, you probably have the opportunity to rub elbows with a few VPs who might be able to help you down the road if you have a problem. Yeah, there are going to be certain perks and privileges to being a large seller like that. Some of the larger sellers are the ones who got invited to the account manager pilot. A lot of people contacted me asking, you know, “Well, I’m selling $5 million or $6 million. Why didn’t they come and talk to me?” I mean $5 million or $6 million is on the lower end, right? So that’s one reason. I’m not saying it’s the sole reason because I’m sure some people might’ve had a connection, they might’ve emailed an account manager who said, “Yeah, maybe we can get you into this pilot,” and it might’ve happened but they have a limited number of spaces for it.
So size means something but it doesn’t mean everything because I’ve also helped people get reinstated from suspension who were selling, $23 million, $25 million, $28 million a year. So it won’t immunize you from that kind of an action because policy teams, if they think you’re selling something you shouldn’t be selling, if they think you’re doing something wrong, they need to get in your way and stop you from doing it until you can correct that and stop creating that problem for them and also that bad buyer experience that, naturally, your buyers would be receiving an item other than what you said you were selling in the case of policy teams, or even an item that you don’t have the legal right to list and sell. That’s an even bigger kind of liability issue. There are some sellers who are selling items that are now considered restricted products because Amazon’s probably gotten too many complaints from them or they consider the item as not safe, they’ve received reports and complaints of damage or health hazards. You know, the new thing seems to be, “You’ve had a safety incident with one of your items.” That’s one of the newer warnings that they’re sending out.
But the point being anybody can be suspended, right? No matter how many years you’ve been on there, no matter how big you are. It doesn’t necessarily mean that it’s going to be as difficult to get reinstated as it would for somebody in a category where they’re selling everything and everything they’re selling is being covered by other people. And it also depends on how many times you’ve been suspended before. There are a lot of factors that go into it, but unless you have a direct contact with the VP or a relationship with your category manager, size isn’t really going to be the definitive factor there.
Grant: Okay. So a good takeaway from that is that even if you’re selling $28 million, don’t do anything bad. And…
Chris: Yeah, I mean imagine if you’re – not matter how much you’re selling, if you’re selling items that are badly described on the site and everyone thinks they’re getting something other than what – you know, what a terrible buyer experience that is. You could argue if you’re that much larger, than your creating more bad buyer experiences based on your orders.
Grant: Right.
Chris: The number of sales you have of those items that weren’t adequately described or were not the same quality that you said they were. That’s what product quality’s all about. That’s why that team came into being. So people can argue about whether or not these teams are effective in their mission statements but the bottom line is you need to do what you have to to please them and you need to convince them that you’ve doing everything that you’re supposed to be doing as a seller on Amazon because the standard is going to be higher than perhaps a marketplace that’s a bit more relaxed.
Grant: Mm-hmm. Yeah, it’s interesting because I recently got my top-rated seller status on eBay, that other platform, and I remember talking to the guy on the phone because they gave me a call to kind of congratulate me and I said, “Oh, great. Do I get an account manager?” He kind of laughed at me and says, “Well, you know maybe –”
Chris: Yeah.
Grant: “Maybe when you’ve got some higher volume we can talk about that.” And I kind of said, “What’s high volume for you guys?” and he said, “Well, you know, maybe $5 million to $6 million.”
Chris: Wow.
Grant: So it’s interesting because when you mentioned $5 million to $6 million for Amazon, that’s kind of on the low end. So [inaudible 55:58].
Chris: And I’m not saying that an insignificant number either to me or in terms of sales annually, but it’s just, you know, keeping it in context, right? Yeah.
Grant: Right. Yeah, no. Exactly. And to me, it just kind of signals how different of a game ecommerce is and how big of a game Amazon is and eBay and the fact that –
Chris: Right.
Grant: Just given the value of how much you need to be selling to have an account manager, you can almost kind of extrapolate Amazon’s four times more significant than eBay just because they can start allocating resources to you at X amount and whatnot.
Chris: Right. And if it makes anyone feel any better, which it probably won’t, keep in mind that they’re very demanding metric-wise and measurement-wise with their own sellers and their seller’s performance metrics. They’re also tough on each other and on their own employees and that’s also something that won’t be changing anytime soon.
Grant: Oh yeah. Being in Seattle, I know that all too well. I’ve got many, many friends at Amazon. I’ve got a cousin over there and if there’s one thing I know it’s essentially the endless stack-ranking. Somebody’s always at the bottom of the pile and you don’t want to be that guy. So…
Chris: Right. It can be fairly unforgiving. I mean, on the one hand, they measure them on their speed and their metrics; on the other hands, if you nail all your metrics and you’re kind of in the top of your team in terms of how quickly you work, then they’re going to talk about your quality scores or they’ll bring up anecdotal examples of times you could’ve done a better investigation. So a lot of those people feel like they’re damned either way unfortunately.
Grant: Oh my gosh.
Chris: [To tell you the truth? 58:54], yeah, I’m not complaining about it because if there’re people who leave those teams, of course I like to have a conversation with them about helping me help sellers from the other side of that fence. It’s what I did and I know that those are the people with the right skills and background. It’s why I’m only hiring former Amazonians for all my client based work.
Grant: Yeah, you mentioned that before the call. You had said that with your company, and you’ve been growing pretty fast at this point, because of all the – well, I mean Amazon’s growing so obviously your business is doing well.
Chris: Right.
Grant: And you only hire Amazon people. Is that correct?
Chris: Yeah, I mean for direct client consultation work, I have only ex-Amazonians that I either worked with myself so I know their work personally or they worked on a tangentially-related team – people who understand the internal culture because that’s an essential piece to understanding how they process information, how they read and review documents you send them and also correspondence you send them. And those are the types of people I think who appreciate how to format things, how to style language and what to do, how to escalate things. I mean that’s already in their heads as it was for me. You know, I think a lot of sellers think, “Well, I’ll just spend six hours on my plan of action and maybe I’ll make it three or four pages. It might be too long, but I’ll make sure everything’s in there.” I mean it doesn’t really work like that. You kind of need the proper mindset, you need to understand your audience on the inside. And so, obviously, if I’ve got people I’ve hired who are helping sellers with that kind of composition, they understand from the get-go how it’ll be received on the other end.
Grant: Yeah, it almost sounds like you are like the Amazon lobbyist in a way because when I get my accounting done, my accountant used to have a little stint in the IRS and I always see that as a leg up because, you know, from the other side, if you’re used to the guy being the police, then it helps when you’re on the other side because you understand what they look for, just like a criminal defense attorney that might have used to have been a prosecutor. You see that all the time because they know exactly how it works –
Chris: Right.
Grant: And I think it gives you a huge leg up.
Chris: Right.
Grant: Now –
Chris: Being a lawyer almost – I mean I’m the child of a criminal defense attorney so…
Grant: Oh, there you go. Perfect.
Chris: I understand the perspective of you know – yeah, unfortunately, Amazon can sometimes be a guilty until proven innocent system, which is not what our court system is about, but you have nothing to really worry about as long as you can prove to them that they’re wrong about what they think might be going wrong with your account. So if you have proof, then it’s really not as much to worry about as it sounds like. It’s not necessarily always lightning striking. I mean you mentioned the seller forums and scary things you read. Yeah, I mean some of that’s just because mistakes happen and sometimes somebody’s reading your material too quickly or not reading it all. But it’s not always about lightning striking. I mean there are often reasons why they’re looking at your account, reasons that are legitimate or reasonable, let’s say, and as long as you have – it’s kind of like, you know, if you’re lying, of course it’s hard to remember a lie. If you’re telling the truth, you remember it all very clearly.
Grant: Yeah.
Chris: Right? So that’s kind of one approach to take to it.
Grant: Okay. Well, we’re getting close to the end of our episode, so in order to wrap this up, I’m just going to talk about where our readers or our listeners can get ahold of you in case lightning does strike. So they can reach you at ecommerceChris.com and, Chris, you’re also going to be in Seattle on August 25th and 27th for SCOE, which is a very well-known ecommerce and online entrepreneur forum that’s going to be in Seattle at the Four Seasons. If they want to register for your workshop, they can go to ecommerceChris.clickfunnels.com/frustration-free.
Chris: Right.
Grant: And we’ll be putting a link to that in our post because that’s a pretty long URL. And so – yeah, yeah. Go for it.
Chris: Can I give you another one? ecommerceChris.com/frustration-free. That’s the URL they can go to.
Grant: Okay, that makes it even easier. So a lot more easy to remember for our listeners.
Chris: Right. I can give you a rundown of the main points of what we’re going to cover if we have time.
Grant: Go ahead. Go for it.
Chris: Yeah. So basically, we’re teaching people how to find the information they need to respond to policy warnings, you know, blocked listings, suspended accounts, whether it’s inside your Seller Central account or outside of it, helping people format appeals so that it actually gets read and properly reviewed, certainly the difference between explaining how something went wrong and making an excuse for why it went wrong, and like we said earlier, plans of action: how to format one, how to create the right information to go into one that’ll get a good response from Amazon, also motivates them to handle your POA properly as opposed to asking you endlessly for additional pieces of information that you may or may not have already provided. That’s a big emphasis of how to break through the communication log jam or email thread loop that you have going with them. And then finally, how to deal with escalations. And you escalate properly within performance and policy teams if you feel like you’ve given them everything they want and they’re still not listening or, for whatever reason, are not reinstating you, you have to start thinking about appealing to other teams, like executive seller relationships and writing emails to Jeff Bezos, which are always fun.
Grant: Oh yeah.
Chris: So yeah, we’re looking forward to it. We’re going to have some great sellers there to work with. It’s going to be very one-on-one, hands-on stuff and then after SCOE is over, we’re going to have launches of digital products and other products. I’m always doing services as a client consultant, but we’re going to be getting much more involved in products in addition to services this fall.
Grant: So there you go. If you are an Amazon seller and you’ve been suspended, you definitely want to make sure that you go talk to Chris in Seattle or maybe even sooner to save yourself from a heart attack. So, Chris, thank you so much for being on the show and hopefully we can catch up when you’re in Seattle. That’d be great as well to meet you in person, and we can decide if we’re going to root for Boston or Seattle while you’re here over a beer. So it’ll be good times.
Chris: We don’t need to talk about the Patriots-Seahawks Superbowl, but we should talk about Vietnam. I want to hear about your trip there. That sounds interesting and that’s a place I’m planning to go next year, so…
Grant: Oh yeah. Awesome, so…
Chris: Looking forward to it, Grant. Thank you for having me.
Grant: Yeah, thank you, Chris. And until next week, everybody. And again, if you could leave us a review on our podcast, we would really appreciate it for EcomCrew, and if you have any questions or comments, you can leave them below in our post and we will reply as soon as we can. Okay. Take care everybody, and thank you.
Chris: Thanks.
