Selling on amazon

[moustachebandit]

Wonder if anyone has some useful insight - maybe I am missing something.

I have noticed a few retailers who sell through amazon, pricing their products so low I can’t see how they make any profit.

For example I know of a product that can be bought from one distributor and the buy price is fixed for everyone they distribute too. Yet people are selling this product for a few pounds more than what they have bought it for. With free shipping and their fees they have to be loosing money on each sale.

So the question is, am I missing something? Are they just bad at business. Is there some clever trick of selling through amazon I am missing. Or has some pricing algorithm gone out of control and they haven’t realised. I had assumed they maybe closing out stock but the product they are selling isn’t an product lines.

Interested to know peoples views on what might be going on here.

[coffeebreath]

It would be helpful to know your product in question.

moustachebandit said:

For example I know of a product that can be bought from one distributor and the buy price is fixed for everyone they distribute too.

Is there some clever trick of selling through amazon I am missing.

Is your distributor in the UK? I'm not sure how much you know about Amazon from your post, but the short of it is most sellers on Amazon (& eBay) are buying bulk direct from factories instead of distributors. Most products on Amazon are private label chinese tat bought on Alibaba (but without the marketing budget for the private label tat sold on by bigger brands like Tesco and other large retailers).

If it is not bulk goods from factory, it is dropshipped/"Fulfilled by Amazon" and therefore the seller has no storage/transit overheads?

I also think price wars are a massive problem for sellers on Amazon/eBay, and some sellers are definitely using automated bot checks (maybe Amazon offers this to large accounts) to reset their prices when "match lowest" option is available.

[Ean218]

Check out Babz Media - They didn't bother paying the Post Office and shafted their suppliers.

[DSLiverpool]

If you can’t compete then bundle.
People don’t play fair, don’t buy loads of stock you can’t sell, test the market first.

Edited by DSLiverpool on Monday 25th February 18:12

[anonymous-user]

And look at www.vatfraud.org

Not all overseas sellers are fully on board with treating part of their sales revenue as output tax

[moustachebandit]

Thanks for the responses they have been really helpful.

The main distributor is UK based and doesn't offer drop shipping. It seems that these 2 retailers are locked in a race to the bottom and probably have automated bots adjusting the price to be the lowest. I suspect they probably don't know they are losing money on each sale.

[mickytruelove]

is the product newly added to Amazon? another thing sellers will do is sell at cost or even a loss for so many units for a new product to get ranked in search and also to get reviews. Reviews have a huge impact to products on Amazon, once they have a good few 5 star reviews they then increase the price.

Might not be whats happening here but it happens.

[moustachebandit]

Interesting view - but all the products are well rated so its not that.

Interested to know what price tracking software companies use to keep an eye on competitor pricing - is there a go to solution?