Relying on one or two platforms for ecommerce revenue is risky. It is relatively easy to build a business on Amazon and eBay. Both marketplaces can present your merchandise to millions of potential customers. But the tradeoff is becoming vulnerable to their foibles.
For example, one or both could suspend you for any reason. Such a suspension could cripple your business or even close it down. Many businesses think just poor customer feedback or A-Z claims can result in a suspension. But there is a growing threat from unscrupulous competitors.
Both Amazon and eBay want to maintain a good reputation with their customers. As such they try to ensure that the goods on their platforms match the description. They also monitor for counterfeits, which is an immense task. Both rely on consumers reporting “fakes.”
It is relatively easy to build a business on Amazon and eBay.
Amazon monitors feedback and, I suspect, messages, looking for keywords that may indicate a product is counterfeit. The first level of action would be to suspend the item for sale. The second level would be to suspend the seller. The final level is canceling the seller’s account.
No seller wants any of this. That’s why sellers should not rely entirely on third parties for sales. It is good practice to have sales outside Amazon, eBay, or any other channel. It’s also a good practice to have a range of goods and suppliers so there is no single point of failure that could significantly damage your business.
Bulletproof, or not
What should an Amazon or eBay seller do?
First is preparation. Respectable businesses have no intention of selling fake goods. So make sure your stock comes from a reputable supplier. Keep the invoices to prove legitimacy. Get the supplier’s approval in writing for you to sell on Amazon and eBay. And, as a final check, make sure the supplier has the manufacturer’s permission for you to sell in this manner. If the product you are selling provides a significant income stream, make sure it can be defended.
Second is due diligence and being over cautious. Is the product likely to have counterfeits? Does the manufacturer protect its sellers? Gauge the risk of being challenged.
Third, consider avoiding Fulfillment by Amazon. When you send goods to an Amazon fulfillment center, it stores your items in the same bin as (hopefully) identical items from other sellers. When you sell one item, Amazon will pick one item out of the bin. It isn’t necessarily one of the ones you sent in. It could be a fake. The customer could then sue you for selling a fake. If you are very unlucky, you could end up being sued by the manufacturer and getting a huge fine.
In short, do all you can to protect your business and your goods. If you are accused of selling counterfeit goods, all of your preparation, receipts, and agreements can help prove your innocence to Amazon or eBay.
A better option?
However, there is growing feedback that Amazon does not pay much attention to evidence. Instead, Amazon seems to take the easy option suspending a listing and then saying something like “The supplier/manufacturer has complained that you have no right to sell the product. Get them to withdraw the complaint and we will re-start your listings.” In other words, the fox is eating all the chickens, just ask him to stop. But why would a competitor on Amazon withdraw a complaint and let your listings return?
Thus, unless it’s critical for your business, stop wasting your time. You would be much better off promoting your business to attract buyers to your own website.