Amazon still has a ways to go to catch to Walmart, which had sales of $485.9 billion last year. Still the seller market is gambling on Amazon’s long term control with an estimated market cap of $700 billion in comparison with $310 billion for Walmart.
Let’s review some of the cons of using Amazon Marketplace.
Con: Competitive market
Many believe SMBs must get on board Amazon or get left behind. “Not only would I recommend becoming an Amazon Marketplace Partner to small businesses, I would argue that becoming established as an Amazon Marketplace Partner is imperative to the future success of any small business. Amazon only continues to grow and the propensity of global consumers to look to Amazon to make purchases only continues to grow. Amazon is the future (if not the present), and businesses will either adapt to it or get left behind.” Nate Masterson, marketing manager for Maple Holistics.
Con: Unscrupulous sellers can steal your listings
Apers gained market share on Amazon by listing imitation products under legit ASIN (item number), thus using all of Amazon’s marketing to attract attention of their products. Although Amazon is doing their diligence in handling these hijackers and counterfeiters through the Brand Central registry it is still not enough to protect the brand owner. The legit SMB will still suffer from poor customer reviews from the counterfeiters products, which will show up on the legit product.
Con: Amazon dominates the customer market
For SMBs selling their products through Amazon marketplace is a risk. Many have abandoned
the site because of its hefty commissions and demands for free delivery cut into profit margins. Amazons unwelcomed competition itself is forcing sellers to market down their prices even further. Resulting in little or no profit in the end.
For many SMB’s found that selling on Amazon just wasn’t operating in their favor. Taking hold and launching their own e-commerce website was the best way for them to stay afloat. That way they could manage their brands and all other aspects of their store.
Now that you have read this blog on why should not sell on Amazon. Read ‘Why You Should Sell on Amazon’