In today’s post I want to take a deeper dive into the question of what would happen if you were for some reason banned from selling on amazon and/or eBay. I am not trying to scare anyone away, but I want everyone to at least consider what would happen if they no longer had the ability to sell on amazon or eBay. This could happen due to poor seller performance, or due to no fault of sellers own, and amazon/eBay no longer allowing people to sell on their platform. I don’t think this is likely, but no one ever thinks they are going to get fired or laid off from their jobs either.
So why did I decide to write this post today? There are 3 reasons, and I will cover each of them as we go through this post.
The first reason is that amazon has recently required new sellers to obtain approval to sell in the Grocery, Beauty, and Health and Personal Care categories. Sellers who had already been selling in these categories who had the proper performance metrics were “grandfathered in” and were automatically approved to sell in these 3 categories. This essentially meant no change for sellers currently selling in these categories, but for new sellers this is a fairly significant hurdle to jump over to obtain the approval before selling in any of the 3 categories. If a sellers metrics falls below a certain level in these categories it is also possible that they will not maintain their approval to sell in these categories. The point here is that amazon makes the rules, can change them at any time, and we have to play by their rules. What if they had banned third party sellers from these categories altogether? This would have affected my business negatively, as well as the businesses of many other sellers. If you are unsure of if you are now approved in these categories, or want to learn how to apply, Jessica Larrew covered this on her blog last week. HERE is a link if you want to check it out.
The second reason for this post today is that amazon recently temporarily restricted 3rd party sellers from selling many items related to the recent Disney movie Frozen. If you were selling or had sold any Frozen items in the past few months it is likely that you received an email that looked like this (click to enlarge): This email proceeded to list all of the items that were removed and are temporarily not available for sale. Some sellers had significant amounts of money tied up into Frozen merchandise and for now it is sitting in limbo as amazon investigates. The reason for the investigation is that many customers have been receiving fake knock off versions that sellers are trying to pass off as authentic merchandise. It makes sense why amazon is doing this, but it is no fun for sellers who now have items that they are unable to sell on amazon. After amazon concludes their investigation these items will go back to active status and available for purchase, but for now they are stranded. If you are looking for more information about the removal of the Frozen listings, Stephen from the blog Full-Time FBA wrote a great post HERE discussing more on why this happened and potential implications/options for affected sellers.
The 3rd and final reason that I am writing this post today is that I have been receiving many emails from people who tell me they too have a goal of selling online full time. I think this is great! Selling online allows me to live the lifestyle I want, and be on my own terms, and I hope many others are able to experience this as well.
With that said, I feel some degree of responsibility to provide some food for thought before one decides to take this leap into selling full time.
I will begin with my personal situation at the time I quit my job, 24 years old, single, and no financial problems. At the time, and I still do, live in a duplex that I purchased and I rent out the other half. I also rent out a room in my unit to a roommate. The rent I receive from the other half of the duplex and my roommate more than cover my monthly mortgage payment. My car was, and still is, a 15 year old car that gets the job done and lets me avoid a monthly car payment. I did, and still do, have about $300 a month in student loan payments. I never carry a balance on my credit cards, so my only debt was student loans and the mortgage that is paid through the rent I am bringing in. In addition to having the duplex, I am a 50% owner of a textbooks business that provides some income in August and January each year. At the time I quit my job, I was receiving around $6,000-$7,000 per year in profits from this business. Definitely not enough to live on, but a significant enough amount to factor into the decision. In addition to this, I was making about $1,000 per month in profits for several months in a row from selling online.
So when I made my decision, I knew I would only be affecting myself if this went poorly, I knew my living costs were extremely low, I had virtually no debt, I had some proven income from my textbooks business, I was having reasonable success selling online part time, and I had a dream of being completely self-employed. Weighing all these factors into consideration I decided to go for it, and I haven’t looked back. My very first post further explains my decision to sell online full time, in case you have never read it, HERE is a link.
There was risk involved in my decision, as I didn’t know with certainty this was going to work, and the income streams I had developed at the time were a far cry from the salary I was leaving behind.
Now, onto the question of if I was banned from selling online. At the present time, the vast majority of my eggs are in the amazon basket. I make almost all of my money from selling online, which is risky, but I have evaluated these risks and I am ok with them for now. If I was to lose my ability to sell online today, my first option would be to sell on the other online platform (amazon or eBay) assuming I didn’t get banned from both. If that didn’t succeed, option 2 would be to go out and get another job in the accounting field. I left the company I was working for on good terms and they told me to let me know if I ever decided I wanted to come back. I would likely call them and see if there is still a place for me. If not, I am confident I could find another position in a short amount of time as I have had several recruiters reach out to me to see if I would be interested in positions they have available. I would prefer not to have to go this route of back to a “normal” job, but it is my backup plan if I lose my ability to sell online completely.
I am working to diversify my income streams as well so that I can have fall back plans that do not involve going to get a job. I plan to continue to invest in real estate and plan to buy another duplex within the next year. In addition, I am constantly looking for new business opportunities and income sources to complement my income from selling online. My goal is to get to a point of having several income sources, and if any one of them was suddenly wiped out, that I would not have to drastically change my life (i.e. go back and get a job).
Now, I want you to think about your personal situation. Are you married? do you have kids? Do you have debt? What income level do you need? How long could you live off of savings? Could you go back to your job if needed? Depending on your answers to these questions, it might complicate matters a bit if you want to sell online full time. By no means am I trying to stop you, I just want you to sit back and think about these things. I am all for pursuing your dreams whether that be selling online, or anything else. I absolutely think that if there is something you want, you should do what it takes to make it happen. If there are other people involved or any other complicating factors, just make sure you are going to be able to sleep at night and not be up worrying about if enough items are going to sell this month to pay the mortgage.
My final point for today, is that selling on amazon is a privilege, and not a right. We need to realize this and do everything we can to make sure that we maintain our open invitations to sell product on amazon. I am very grateful for the ability to sell on amazon and the lifestyle it allows me to live. I am also very aware that I am playing in amazon’s playground and that they could kick me out if they so choose. My plan is to play fair, play nice, and play hard, for as long as my invitation to sell on amazon stands.
So we’ll wrap this up with a few questions, and I would love to hear your thoughts in the comments below! What if you were banned from selling online? What would you do instead? Does this risk factor into your decision of potentially wanting to sell online full time? Any other thoughts or questions?