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eCommerce: If you were given a product to sell on Amazon for a traditional retail company, what percentage of sales would you charge?
DF
DF
David Favor, Fractional CTO answered:

My suggestion is %/sale, rather than %/profit... as %/sale is way easier to track + manage.

Amount can be complex to calculate.

Relates to many factors + funnel stop product sale relates to + also LTV of customer.

Best to book phone calls with people on Clarity who understand this process, to assist.

And... Once you switch to using Amazon you lose all metrics + ability to add riders to outgoing boxes.

All physical product I ship in my businesses is handled by in house staff, because for me, having real metrics + ability to toss an rider in any box produces highest profits.

Also... sigh... Amazon will still your product + you clients, as follows.

1) If your product sells well.

2) If Amazon can figure out where you have it made or they can contract with a Chinese company to under cut you...

Well... They will...

Example...

Recently one of my client got $10K worth of sales over a weekend for a gizmo he was selling on Amazon.

He quickly shipped product to Amazon to fulfill all orders.

As soon as product arrived....

Amazon contacted him + told him they would no longer honor orders for his product, because they had recently gone into the same business...

And they would be fulfilling customer orders out of their inventory.

Then they offered him one cent on the dollar to purchase his inventory or he could pay shipping + pull prices to Amazon to return all his product.

Lesson - Unless you really understand how to cloak product arriving at Amazon to be sold, best not to use Amazon, because they'll steal you blind.

You must only ship product from your facility + hide sources of all components or ingredients to produce your product.

Seriously good idea for you to talk with people who have lots of experience with Amazon... before you pitch a client to sell their product on Amazon.

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