For online sellers who rely on their ability to sell on Amazon for their income, a suspension can be devastating. You think you’ve been running a clean and efficient business, and then all of a sudden you receive an email informing you that your account has been suspended. One complaint freezes your account and stops you from doing what you need to do to thrive.
Suspensions are a common occurrence in the online marketplace. Amazon takes customer complaints very seriously, and even minor malpractices can get them into trouble. While a suspension certainly isn’t the end of the road for sellers who play their cards right, avoiding them outright is the best strategy.
If you want to make sure your account stays active so you can stay in business, here are some things you should be doing, according to our experts.
One: If You Can’t Sell it, Don’t List it
It seems like it should be a no-brainer. If you don’t have the product, why would you bother trying to sell it? However, Rosenbaum Famularo, P.C. has seen its fair share of sellers who have gotten suspended for making this very mistake.
“The number one thing that we’ve seen that is super easily avoidable is that if you’re not going to sell something, don’t list it or touch it,” says Sean Law, paralegal at Rosenbaum Famularo, P.C., the firm behind AmazonSellersLawyer.com “We’ve seen people not have inventory for an item, but they list it in case they get a sale or something. They’ll get hit and they’ll have to deal with a whole bunch of headache even though they didn’t do anything. Unless you’re definitely going to sell it, and definitely have inventory, don’t touch it.”
Some sellers may view listing something they don’t want to sell as a fail-safe. They might think that if they get a good offer, maybe you’ll find a way to get the item. Or maybe they just forget to take an item down once they run out of inventory on it. Unfortunately, Amazon sees this practice as unprofessional. The customer expects a listed item to be available to them. If you run out of inventory on an item, take it away from the listings immediately to avoid getting in trouble.
“Any complaint on your account is a mark against you,” Law says. “So you want zero. Amazon’s margin of error if you look at their metrics is usually very slim. They’re usually 1% margins of error. They want 100% satisfaction. So if you have 5 or 10 issues, that’s more than zero and that already is too much for them.”
Amazon Sellers’ Lawyer has seen people suspended for just one complaint in the past, so you truly cannot be careful enough. Check and double-check your inventory before making a listing.
Two: Be Wary When Using Liquidators
Have you been using liquidators with regularity? If you’ve been purchasing your inventory from them, be careful. There are a lot of ways liquidators can be a detriment to you and can get you in trouble with Amazon. Be aware of the risks and the rules before you get involved.
“Using liquidators and auction sources can be a risky venture,” says Travis Stockman, paralegal at Rosenbaum Famularo, P.C. “It’s tempting because the products can be so cheap, but if you’re going to use a liquidator you’ve got to make sure the invoice reflects who actually sourced the product. To avoid inauthentic complaints, if you’re going to use a liquidator source, make sure you avoid it if you can and use the actual supplier.”
Amazon Sellers’ Lawyer has seen a lot of issues lately with sellers who use liquidators to stock their inventory. Multiple paralegals at the firm pointed to liquidation and using proper suppliers as being a prevailing issue among their clients.
“I suppose the short story here is Amazon Sellers really need to do their due diligence before getting into business with a supplier,” says Jason Timchula, paralegal at Rosenbaum Famularo, P.C. “Sellers need to be smarter and most diligent in their research when it comes to validating a supplier before committing to selling their merchandise on Amazon. In a sense sellers should be preparing for the worst-case scenario. If they receive a request for invoices, if they receive a inauthentic or counterfeit claim how confident are they that they will be able to successfully refute that claim?”
Furthermore, no matter who your supplier is, hang onto your invoices. When you get suspended, Amazon is going to request invoices from your last 365 days. Products can change, so they’ll want to make sure you have up-to-date invoices. Hang onto those and be prepared for the worst-case scenario. You really can’t be too careful and detail-oriented when it comes to where you source your products and how organized you are with your receipts and invoices. Keep track of everything.
Three: Research the Products You Want to Sell
To avoid intellectual property complaints, make sure you research the product you’re going to sell. Amazon Sellers’ Lawyer has seen a rash of intellectual property suspensions because sellers didn’t do their homework on items they were listing.
“The biggest thing is to be proactive, research the ASIN you’re going to list against,” Stockman says. “Essentially, for there to be infringement, there needs to be material difference in the product you’re selling versus the product the company is selling.”
Many of the companies who sell these products have specific warranties on their websites that directly address Amazon sellers and whether they’re allowed to sell their products.
Intellectual property suspensions can be tricky to overcome, so be especially careful when you’re selling your products that you aren’t stepping on the toes of other companies. Remember that even one complaint might be enough to get your income frozen.
“Typically, Amazon doesn’t enforce exclusive distribution agreements,” Stockman says. “They aim to control who’s distributing their goods. They do it partially because they want to make sure it’s authentic. Look at the product you’re about to sell. Look at the warranty.”
Do your background research and you could save yourself a lot of trouble. Additionally, do some research into what Amazon considers to be a violation of intellectual property rights. Policies change all of the time and they might be different from the last time you checked them.
Take these three steps and you’ll be at a significantly lessened risk of suspension. While accounts get suspended all the time, it’s a lot easier for everyone if you continue to be in business. Be smart, stay educated, and keep up-to-date on the latest rules and regulations.
If you’ve already been suspended, give Amazon Sellers’ Lawyer a call to find out what steps you need to take to get reinstated. For more legal advice as well as news updates on what is affecting online sellers, check out the Amazon Sellers’ Lawyer blog.