Ebay & Amazon
Just by way of introduction, back in 2002 upon finishing from a stint as a sales representative for the third FMCG company over a 10 year period having first sold biscuits, then chocolate bars and finally pies & pastries, I embarked on a venture to establish a small foodservice business which quite rapidly grew to a large concern. This project lasted for 17 years having initially focused on selling pies/sausage rolls/pasties as a sole distributor to a full fledged supplier then aimed at providing core products for the typical cafe/restaurants from food, drinks and packaging. The learnings from this experience was a quick realisation of the high turnover but small margins plaguing this foodservice sector with the ongoing challenge to recover money owed and pay existing suppliers. The adage “Cash is King” quickly rang true and many stories of suppliers trying to get paid or had lost money were a regular news theme to the insiders of the industry.
Having been “hitched” somewhere midway of my foodservice venture journey, I decided to design a safety-net as a backup plan just in case the strategy employed was to fall to the wayside and started looking at this new craze – “the internet-thing”. Sure I had heard about people chatting to people within Australia and even the other side of the globe but to buy things and use your own “plastic” or risk your hard-earned was something else. I dabbled firstly at eBay Australia and there was another seeming competitor that had surfaced called Oztion which later was renamed as Quicksales. My first cutting of teeth in these platforms was a buyer (not a good-one I must add) buying an inexpensive mini flashlight on a keyring. I alleged I didn’t get it a couple of times and the seller sent a replacement although it was $1.10. Yes very cheeky of me but I did not think much of the buying/selling website and do not treat this seriously and dismissed it. This was until I stumbled onto a cake maker who kept telling me how cheap my Cadbury Chocolate Baking Buttons were. Natalia kept raving on to my wife “how cheap” my prices were which led to a “light bulb” moment and thought to myself “What would happen if I put some these chocolate buttons for sale on eBay”. Did they sell? You betcha they did! Tried 3 kilos first of Dark ones, then Milk and finally White. Then progressed to 5kg lots and it did not stop there. How about if we sold chocolates like Lindt Lindor balls “by the kilo”? Nobody can’t just walk into Coles or Woollies (Safeway back then) and by 1 kilo lots? It quickly dawned on me, why should we think chocolate? How about other items I can access my spices, nuts etc. Do you think people might want to buy citric acid in bulk and how about bicarb? 5KG lots were soon rolled out and mixed up variations of these. Nuts, seeds, spices quickly followed, and organic food items too. Boy did well sell a significant amount of Black Chia Seeds and then White Chia Seeds. And the competition? What competition? Competitors were slowly emerging but spent quite a lot of time “ruling the roost” and making many eBay buyers happy at the same time.
Enter 20 years later on eBay and now Amazon. The short version of this story is “the landscape” has changed and the conditions a much harder to make a quid so to speak. The eBays and Amazons of the world have ramped up their fees and one if their main focuses is not to concentrate on how to sell more on their platforms but how to squeeze more out of their sellers instead.
To the newbies in this space, it should be highlighted as a contrast, eBay does not compete with their sellers. That is, eBay does not sell its own stock/inventory against the existing sellers. On the other hand Amazon does. You can bet your bottom dollar, if you are able to identify a winner, give it time until Amazon analyses your sales and in no time, they will either compete against you using inventory from other Amazon websites or they will source your line directly from the manufacturer and organise to have it in-house to sell directly from their warehouse. Case in point, I was first to place the Maldon Sea Salt bucket 1.4KG as a FBA (Fulfilled by Amazon) item, only to see down the track, Amazon competing against me offering the same product cheaper than me at $5 clear product per item sending it all the way from Amazon UK cheaper than I could from Amazon Australia to Aussie buyers. In a word, “ruthless”. Don’t trust Amazon as they will chew you and spit you out in no time.
On the other side of the ledger, you have the online beast called eBay. The goliath of the online selling world in Australia which has been reported as the go-to site for 1 out of 3 adult buyers in Australia conservatively-speaking.
And the biggest secret tarnishing this brand is the never-ending countless sellers that are not in Australia but mainly operating from China that falsely represent themselves as either trading from Sydney or Darwin yet have the audacity to send items with long lead times from mainland China with China Mail tracking. Other strategies include drop-shipping within Australia but do not physically own any if the stock sold on eBay.
Further it should not be a surprise to many readers the tarnished image eBay has tried valiantly to rectify over the years. How to curtail or stamp-out the ongoing “fakes” sold on the platform from sneakers, to designer brand clothing and leather items which are not real leather but synthetic. Hence, the eBay Guarantee of “Get the item purchased or your money back”. And this is where the new issues stem for current and/incumbent sellers.
By mothering/fathering buyers, eBay acts to cradle buyers offering all sorts of privileges such as easy refunds and options to return merchandise/stock with much ease. Not mentioning the feedback system that is very much one way, offering all the power for buyers to solicit any view – true or not packaged as “how they felt” about the purchase. Your cries and grovelling will only go so far and more than likely your opinion will be dismissed 9 out of 10 times. eBay Customer Support will always be greeted using a well-scripted template which begins with “I note you have been on eBay Australia for X number of years and thank you for your custom etc etc”. A strategy of just “empathising” will be used and “paraphrasing” your view but in the end expect to get zilch in return. They will make ridiculous suggestions for you to reach out to the buyer, so you can somehow miraculously convince them to agree to mutually agree to remove the unfavourable feedback. In my book of psychology, never read the chapter how to appeal to an irrational deranged spoilt brat.
Amazon is no different but more scripted and much more incompetence displayed by the so called Customer Service Agents. Low levels of comprehension by the same and you will find it frustrating in many fronts. It will be common occurrence the agent will not understand your true issue and you may have to repeat yourself 2-3 times. Secondly, as the whole process of the running the business is turn-key based, all the procedures/policies would be found in the “How to run Amazon Customer Service” bible given to all employees when they join either as a hard copy or digital one. Employees are trained to refer to the correct paragraph and cut & paste as applicable to the incumbents’ inquiries. Their aim is to keep to same sort of standard and to make it as simple as a monkey to learn. Not trained to think or be empowered but simply “bums on seats” and to give the sellers mainly the mirage of being helpful.
And god-forbid if you wish to pursue a claim of the A to Z Guarantee offered by Amazon. Buyers are at liberty to claim their money back if an item is not received by a certain date. This includes if an item has been sitting in the local Post Office. Amazon in the Claims Dept will willy-nilly issue a full refund and after informing the buyer of its whereabouts, the buyers not only score the merchandise but they receive their money back. Then you have the unduly task of appealing the decision which may take you 2-3 emails because the Claims Dept appears to be an Ivory Tower were common Amazon staff have no direct communication other that email.
So after 20 years operating online here is what it boils down to. It is your choice to be at the mercy of the giants of the industry such as eBay and Amazon. Sure there are virtues but there also vices which have been highlighted above using some snippets. As an opinion and that’s all it is a budding entrepreneur will gain more satisfaction/happiness, control and financial rewards running your own websites using resources available such as Google Ads, Facebook, Instagram, Etsy and other new or emerging social media tools.
In hindsight, if I was to start again, although the experience has been valuable with many lessons learnt during the way, I would steer away from the eBays and Amazons in preference of plotting my own path.
I trust sharing my views will act as a vehicle to “bring to the table” the challenges, frustrations and realities of dealing with the online industry heavy-weights. Perhaps you can share your thoughts/opinions and maybe this will assist us all operating in this space.
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