Amazon is deep in controversy!
At the time of the traditional peak sales season, Xiao Zhang (pseudonym) was not happy because he said that the company almost ushered in a "devastating blow".
As early as 2018, he joined the Amazon authorized brand project, using Amazon authorized brands to sell products. This is a project that the platform has been actively promoting, and Xiao Zhang has devoted a lot of energy to it.
According to the investment manager, many Chinese sellers have already joined. There is also news that the well-known billion-level sales have also entered the game. According to the seller's feedback, joining this project requires a strict review and a relatively long reporting cycle. The time cost and various certifications in the early stage have already cost a lot of manpower and material resources.
In the early hours of November 17th, sellers who joined Amazon ’s authorized brand program suddenly received a notice from the platform saying that Amazon will stop the authorized brand program for Amazon’s third-party sales partners. After March 31, 2023, sellers will not be able to sell authorized brands. Products, which involves all the seller's selection of authorized brand items that are on sale and under development.
Amazon suddenly wants to cut this project, and only gives less than 4 months to clear the inventory, which is undoubtedly a bolt from the blue for them. Voices such as "Amazon unilaterally announced the cancellation of this project without any communication, and it is unreasonable to do so" are also gradually rising.
It is understood that many sellers have stocking quantities ranging from hundreds of thousands to several million. It is conservatively estimated that the total inventory involved can easily reach hundreds of millions. Some people speculate that the inventory of all sellers may eventually reach several billion or more. high. How to clean up these "hot potatoes" within a limited time is a hassle. To make matters worse, since Amazon sent out mass notifications, many sellers have clearly felt that product rankings and traffic have dropped particularly sharply. "According to the current trend, my inventory may not be cleared for 40 months." Xiao Zhang said helplessly.
Sellers generally hope that Amazon can actively and properly handle the follow-up matters, and reduce the negative impact on them caused by the cancellation of the project. "Expecting the Amazon platform to "extend the sales time, retain sales links, and open advertising permissions" has become the three most popular appeals. Amazon's investment manager claimed that the seller's opinions have been fed back to the headquarters, and there may be a reply next week.
A large number of Chinese sellers suddenly suffered bad news, Amazon cut off the authorized brand project!
The Amazon authorized brand project means that Amazon authorizes the four major brands of Amazon – Umi, Eono, Hikaro and Find to sell to sellers. A certain commission for the platform, in addition to the sales commission charged by the platform itself, the seller also needs to take an additional 10% of sales as project commission.
Xiao Zhang is an old seller on the Amazon platform. In 2018, he came into contact with the Amazon authorized brand plan through the investment manager. After in-depth understanding, he believed that since this is an Amazon brand, with platform support and protection, the security of the project is naturally high, and Amazon also has a series of advertising support, so the company abandoned the original link and project, and instead invested a lot of manpower, money and time on the project.
It is understood that the Amazon authorized brand program has been launched in Europe, Japan, the United States, India and other countries /markets around the world. By the end of 2019, more than 3,500 products have been launched, including 3C electronics, home furnishing, sports and outdoor, clothing, pet products and other popular categories. Under Amazon's vigorous publicity, until this year, many Chinese sellers have joined the plan one after another.
Amazon stated that the launch of this project aims to help sellers with deep experience in foreign trade supply chains and manufacturing-oriented sellers use Amazon authorized brands to sell products, enjoy Amazon's brand effect, give full play to their manufacturing qualities, broaden their business development, and achieve business growth.
To a certain extent, the sellers who can get admission tickets can almost be described as "selecting the best from the best".
In the early morning of November 17, 2022, sellers who joined this project were suddenly notified that Amazon would cancel the authorized brand project!
Email content display ↓↓↓
At Amazon, we continually evaluate programs, products, and services to better meet the needs of consumers and third-party selling partners . After careful evaluation, Amazon will stop the authorized brand project for Amazon 's third-party sales partners , which involves all the seller's selection of authorized brand projects that are on sale and under development.
We understand that this decision will have an impact on your business and you will have questions. Please know :
From now on, please stop the development and production of all third-party authorized brand products.
For existing inventory of third-party authorized brand products, sellers can continue to sell normally until March 31, 2023 . And the Amazon FBA warehouse will continue to receive inbound shipments created before December 1, 2022.
Beginning December 1, 2022, Amazon will stop charging program fees for third-party licensed brand programs.
From now until March 31, 2023, sellers can continue to enjoy the existing project rights of third-party authorized brand projects, and carry out inventory sales of existing selected products.
After March 31, 2023, Amazon will terminate the third-party authorized brand project, including its operation and project rights.
This email, like a "depth bomb", caused countless waves in the seller's circle, and the seller's complaints came out one after another.
According to the seller's feedback, it takes a lot of manpower and material resources to successfully join this project.
Xiao Zhang said in detail that to launch a product in the Amazon authorized brand project, they need to undergo various very strict audits by the project team, and the factory qualification audit and product qualification audit are the top priorities. After the above process goes down, the product launch cycle is greatly lengthened.
In terms of factory qualification review ( seller launch), the seller must first pass the social responsibility inspection, such as BSCI, SMETA, etc., and then pass the project inspection (FQA). The Amazon team will conduct all aspects of the factory from procurement, production, and quality inspection. Scoring, only if the overall score exceeds 70 points, it will be considered as passing the review.
In terms of product qualification review ( ASIN launch), the time cost of product compliance review is 2 months, and the time cost of product patent review is 2 months. If it is a high-risk product, the seller also needs to provide a high-risk product test report (such as LFGB, CE, etc.), the product must not only meet the local requirements, but also meet the special requirements of the European Union. The cost ranges from tens of thousands to hundreds of thousands.
After all the above processes are completed, it will take about 6-15 months before Amazon will allow the ASIN to be listed.
In 2020, Amazon seller Xiao Wang (pseudonym) planned to join this project. Since the process was not smooth, it took them more than a year to successfully pass the review. "When we were preparing to join this project the year before last, we didn't expect it to be so troublesome. Whether it was a social responsibility report or internal approval, it was very time-consuming, and it was not officially launched on the Amazon platform until around June this year."
However, less than half a year after it was launched, the project suddenly stopped.
At least hundreds of millions of inventories need to be sold urgently, and Chinese sellers are in a difficult situation
There was no sign before this project was cut off. Even in October this year, Amazon’s investment managers were still vigorously attracting investment. After the incident, many investment managers even knew the news later than the seller.
According to a person familiar with the matter, the investment manager said that this project involved a number of Chinese sellers. The multiple investment managers in charge of this project may resign on December 1, and there may be only a few who can stay and transfer . In this regard, Amazon officially responded that the rumor that the investment manager was laid off was false.
After the project was confirmed to be canceled, the sellers fell into a series of troubles such as inventory crisis and decline in flow orders.
Xiao Wang , who joined the project with great difficulty , did not even get his money back until now . " In the early preparations, not counting the investment of relevant personnel, the hard costs of negotiating with the factory alone cost more than 100,000 yuan. This is not bad for us. Some sellers sell products that require more processes and cost more. High. ” Xiao Wang said that on the one hand, it was a lot of manpower and financial resources to join the project, and on the other hand, the large amount of inventory piled up has also become a key problem. Inventory, the factory has already prepared the inventory of products that are about to be sent out, and there is also a large amount of inventory that has prepared raw materials and is currently producing. However, Amazon only gave about 4 months to clear the goods. Such a short period of time cannot solve the problem at all.
Xiao Zhang also believes that Amazon's sudden decision to cut off the authorized brand project has caused them a lot of inventory pressure, and a large number of products stocked for this project cannot be sold out in a short time.
"Maybe some small sellers can clear their inventory quickly, but for those sellers with large-scale investment projects, it may take 6-8 months or even longer. What should we do if the inventory that cannot be cleared by then What to do?" Xiao Zhang said that many of the products he sells, including the packaging box, have already printed the Amazon brand logo. Faced with a certain risk of infringement, because at that time Amazon had already taken back the right to use the brand.
Xiao Wang also said that each of his products has a brand logo printed on it, so these products cannot be sold with other brands on them like other ordinary products, which means that if the products themselves are not sold within a limited time , In the end, it may be a pile of dead inventory.
The top priority is for sellers to work through inventory as quickly as possible.
The method of "big sale at fracture price" has become their first choice. " Recently , the investment manager is helping us report the following promotional activities, just to clear the inventory. " A seller said.
What is certain is that with such a low price, the seller's profit will be greatly reduced, and some products will even lose money.
An Amazon seller said that his new product had just been delivered to the Amazon warehouse, and he was notified by Amazon when he was about to promote the product . will increase; if you do not promote the product, there will be no reviews for the new product, and the possibility of selling it is even lower. After thinking about it, you can only abandon it in the end .
It is understood that in addition to many small and medium-sized sellers, well-known cross-border billion-level sellers have also joined this project. An industry insider guessed that overall, the inventory affected by this incident is at least hundreds of millions, or even billions or more. High is also possible.
Xiao Zhang believes that one of the important reasons why he originally planned to join this project was that Amazon can help to advertise and promote products. Now Amazon is going to kill the project. He said on the surface that the project will not be completely terminated until March next year, but he is worried that with the The employees in charge of this project are gradually losing, and in the next few months, Amazon's investment and promotion of this project may decrease. "Personally, the flow of my products has dropped significantly. According to this trend, my goods can't be sold out in 4 months, let alone 40 months."
This situation is not an isolated case. Many sellers have found that product rankings and traffic have dropped dramatically.
In the past 2 days, many sellers even gave feedback: Eono, Umi and other brand advertising spaces seem to have disappeared.
"Amazon issued a notice, which directly brought a devastating blow to our company." Xiao Zhang said that in addition to the Amazon project, other sellers may have many other businesses in hand to hedge against the losses caused by the project being cut. However, I am different. In the past two years, he has devoted too much energy to this project. After the expired link is taken back, it is equivalent to all the link weights and comments accumulated on the platform that have been worked hard and legally compliant in the past few years . do …
The sellers concentrated on making appeals, and the investment manager: there may be a reply next week
In Xiao Zhang's view, Amazon's unilateral announcement to cut this project is unreasonable and disrespectful to Chinese sellers. " Different from those sellers who play black hat operations, we are a pure white hat operation, and the cost we pay is much higher than that of ordinary accounts . If it is said that it is because of brushing orders, I also admit it. The key is that there is no violation now. Amazon Unilaterally terminating the contract without any negotiation is against the spirit of the contract, and Amazon has no reason to do so. ”
Another seller also expressed anger, "For me, the money is not the main reason, the main reason is that I can't swallow this breath. Amazon's doing this is really unfair to the seller."
Xiao Wang said that he understands Amazon's existing practices, but he still hopes that Amazon can correct all its plans. When making a certain decision, it will not disappoint the trust of the sellers and reasonably consider the actual situation for the sellers on the platform, because behind every store They all represent a family, not to mention that there are not many Chinese sellers affected by this incident.
There are not a few who hold similar views with the above three sellers.
Based on the opinions of many sellers, the reason why they are willing to invest a lot of time and energy to do various certifications to join this project is nothing more than to recognize the Amazon brand, believe in the credibility of Amazon, and believe that the security and stability of this project are higher. That’s why, without any deposit, I made a lot of goods for the Amazon brand at my own expense. Now that this project is gone, Amazon’s considerations are naturally behind the decision, but it has brought a lot to sellers who trust the platform . "Trouble" means that they will have to bear various pressures such as inventory and funds in the future, and Amazon needs to provide a proper follow-up solution for the majority of sellers.
Combined with the demands of sellers, "reserving sales links, opening up advertising permissions, and extending sales time" have become the three most popular demands at present .
Xiao Wang said that according to Amazon 's current policy, after March 31 next year , sellers will not be allowed to sell links , so all the previous accumulation of sellers will be gone. As we all know , the cultivation cycle of a link is not short, and many products are being promoted. In the early stage, I was basically in a state of losing money, and I started to make money slowly in the later stage. I put too much effort into a link. If Amazon takes back the link at that time, all the efforts of the seller will be in vain. So now the core appeal of the sellers is, It is hoped that the platform can finally leave the link to the seller.
At the same time, opening up advertising permissions and extending the sales time are also two important demands. The reason mentioned above is that Amazon only gives less than 4 months of sales time. It is impossible to sell all existing products within this time period. In addition, many sellers now Discovering that product traffic is already dwindling means it will be harder for them to sell all their inventory as quickly as possible.
Judging from the communication between the seller and the investment manager, some sellers said that the investment manager no longer responds to private messages, but there are also many sellers who communicate smoothly with the investment manager.
One of the sellers received a reply from the investment manager: the time for entering the warehouse and stopping sales may be delayed, and the headquarters received feedback from the seller, saying that the delay is under consideration.
There are also many investment managers who actively communicate with the sellers, ask the sellers' needs, and say that they will count the specific demands and try their best to help the sellers.
In response to the feedback from the majority of sellers, Amazon responded two days ago that the cancellation of brand authorization is an adjustment made by Amazon in terms of business. Amazon is also discussing relevant measures within Amazon to ensure the rights and interests of Chinese sellers.
To sum up, from November 17th to the present, for nearly a week, Amazon’s investment manager only told the seller that they would feed back their appeal to the United States. Until now, the seller has not received any formal feedback .
Sellers may not hear back from Amazon until next week, the people familiar with the matter said.
This answer obviously does not reassure all sellers!
"What if there is no definitive answer next week?" one of the sellers said. Now, Amazon sellers are making multiple preparations and in the process of waiting for the platform’s reply, they have also fed back the specific situation to the Bureau of Commerce and relevant associations, etc. Some people even claim that if the follow-up goes bad, the possibility of a lawsuit cannot be ruled out.
"Sellers and the platform understand each other and understand each other so that they can develop together." An Amazon seller said that he doesn't want things to worsen, and now he only hopes that Amazon will come up with a reasonable solution next week.