Losing money every day, a large number of sellers are fleeing Amazon!

Amazon’s bonus period has not yet passed, but Amazon’s threshold is indeed getting higher and higher!

Cross-border e-commerce exports continue to be hot, and Amazon sellers appear in front of the public from various story angles.

Getting rich overnight, thousands of orders a day, super high net profits without money pressure ...all these beautiful words are labels that some outsiders have forcibly attached to the Amazon platform.

False prosperity, thrilling step by step, prosperous on the surface but full of holes on the inside, I am engaged in a great charity ... and other helpless jokes are the summary of Amazon sellers on their own careers.

In the cross-border circle where there are bad news every year, this year, there are indeed more sellers crying out: There is no industry worse off than foreign trade this year. The editor dug deep and found that on the Amazon platform, many people seem to have embarked on the path of losing money.

When making money has become a luxury and staying alive is equally difficult, how are a group of Amazon sellers who are struggling on the line between life and death being besieged by reality step by step?

Seller: Amazon has become "Ya Duo Duo", Amazon is the first choice for charity!

More and more people are beginning to pay attention to cross-border e-commerce, which is both an opportunity and a challenge for the industry. As the first choice for cross-border e-commerce exports, competition on the Amazon platform is intensifying.

Some sellers who have been working on the Amazon platform for many years have long lost their initial thirst for knowledge and learning ability. As time goes by, the goals of these Amazon people have gradually become humble:

10 million dollars a year , thousands of orders a day - goods can be smoothly delivered to the shelves - no loss in advertising fees - orders must be placed even if no profit is made - orders must be placed even if a loss is made - goods can be smoothly delivered - goods can be smoothly disposed of !

There is a sharp contrast between the past high spirits and the current dullness. A large number of sellers have stated that the main theme this year is not to rush forward, but to survive steadily.

The editor found that in this year's cross-border circle, badmouthing has almost become the most frequently used word for sellers to complain about in their daily lives ↓↓↓

Am I the only one who thinks this year is actually harder than ever?

The sorrow of Amazon people is always the same : they work as hard as a tiger, but the profit is only two dollars and fifty cents .

Amazon becomes "Ya Duo Duo", when it comes to charity, Amazon is the first choice !

Oh, selling at a loss, when will it end?

…

High procurement costs, expensive logistics, large off-site discounts, falling exchange rates, reduced inventory capacity, difficulty in finding differentiated products, and rapidly changing Amazon rules ... There are too many uncertainties this year. Big sellers' accounts have died one after another, and the survival of small and medium-sized sellers is even more precarious.

A seller said that Amazon's profit point is getting lower and lower. Amazon's commission + delivery fee is about 35%-40%, minus the VAT fee of 20%, the first-leg freight fee of 17%-20%, the procurement cost of 15%-20%, the operating cost of 5%, and the advertising cost of 5%. The product profit margin must reach at least 130%, otherwise it will be a waste of money in the end.

Although costs have soared, many sellers cannot raise prices to "save their lives." Take this year's Membership Day as an example. Amazon sellers are all clearing out their inventory at rock-bottom prices. The more they sell, the more they lose, and the less they sell, the more they lose … Millions of Amazon employees have made selfless contributions, consolidating the Amazon platform's position as the global superpower.

As the price war continues, Amazon sellers have gained a new identity - cross-border philanthropists.

"Philanthropist" plan: price cuts - strategic losses - explosive growth in orders - crazy replenishment - compressed purchase prices - increased profits - later price increases, and the product will be successful!

Actual result: price cut - other sellers follow suit - big sellers cut prices - you still can’t sell - advertising bids soar - advertising losses - factories ignore you - losses on shipping and restocking - products become obsolete, and profits in the entire category decline.

An Amazon seller joked: I am engaged in charity work. I purchase and ship goods every day, pay freight forwarders, trademark service providers, and VAT service providers. I work for everyone every day, and I have to use the money I earn from my work to subsidize Amazon's advertising department. It's too difficult.

The lucky period has passed and sellers are stuck with inventory

Due to too many uncertainties this year, many sellers are suffering from losses every month in 2021. What’s worse is that many sellers are losing money every day.

“People who haven’t tried it think that Amazon is like picking up money. Only after trying it do they realize that it is like flax, deep as the ocean. From then on, cash is a passerby. If my relatives and friends in Luoyang ask me, I’m dying of inventory pressure ! ” It is reported that Amazon sellers are generally troubled by problems such as inventory pressure and stock out.

In fact, Amazon is already an asset-intensive industry, which puts a huge test on sellers’ profits and cash flow . Many small and medium-sized sellers are basically out of money after paying their salaries .

Under the heavy pressure, one seller said that he could not hold on any longer and was ready to go back home. He obviously found that it was getting harder and harder to do business on Amazon. This year, Amazon was even harder to conquer than ever before. He was now using credit cards to buy goods and borrowing money to pay for shipping, rent, labor and other expenses . In the past two years, he was not as well off as those working in companies. Even so, he could not even make 60,000 yuan a year !

Under the siege of reality, a group of sellers are fleeing Amazon!

Some factory sellers were dragged down by FBA before they had time to actively escape from Amazon . An insider said that five factory owners he knew started to enter Amazon this year, but not only did they fail to build Amazon stores, but their factories also went bankrupt. The reason for their failure was all related to FBA logistics !

As the saying goes, the harder this year is, the happier last year was.

Many people say that 2020 is the first year of cross-border e-commerce, and 2021 is the last year of cross-border e-commerce.

At the end of last year, rumors were rife that all the houses at Shenzhen Bay One had been bought by Amazon !

A joke went viral in the cross-border circle during this year’s Membership Day : All the bottles at Shenzhen Bay One were picked up by people working for Amazon!

In just over half a year, the status of Amazon sellers has undergone a 180-degree change. Behind this change is the fact that the living conditions of cross-border sellers have changed dramatically.

In April this year , many sellers compared their own environments:

Last year, the factory on the first floor was 35 yuan/square meter , but now it starts at 45 yuan/square meter ;

Last year, the lowest price for air freight was 20 yuan/kg , but this year it has risen to 60 yuan/kg and is still rising ;

Last year, the sea freight rate was 6 yuan/kg , but now it starts at 9 yuan/kg .

Last year, it was easy to order a product , but now I have been waiting in line for a month or two and still can’t get it ;

Last year, the ad bidding price was less than $0.4, but this year it has soared to $0.7, which is not enough ;

Last year, there was a category that was easy to do, but this year, it has become unprofitable ...

Last year, the COVID-19 pandemic swept the world, and the “stay-at-home economy” exploded. A large number of Amazon sellers benefited from the pandemic and made a fortune. In fact, this was just Amazon giving them a free ride.

" You think the problem is that the business is developing too fast and the team can't keep up, but in fact it's because past success relied on dividends and there is no path planning for future growth ." After a seller's sales soared in the second half of 2020, he felt very awesome at first, but when he calmed down, he realized that it was all just luck, so he withdrew his battle line as soon as possible, preserved his cash flow, and let the team concentrate on doing a good job on each SKU.

Unfortunately, there are still too many sellers who mistake luck for strength and are actively stocking up this year based on their performance during last year's epidemic. However, as the epidemic dissipates, the economies of European and American countries have gradually returned to normal, and as a result, they are directly trapped by inventory or even dragged down.

It is understood that a seller of indoor fitness equipment, blinded by last year's success, rashly prepared 4 cabinets with 2,000 products in an overseas warehouse in a European country. Currently, the average daily transaction is 2 orders, and about half of the goods have exceeded the free storage lease period of the overseas warehouse...

There are many sellers who have similar experiences. Industry insiders said that many sellers of office furniture not only have dozens of cabinets in Amazon warehouses, but also store more cabinets in factories ... These Amazon people who hold large amounts of inventory are as happy as they were last year!

Is the Amazon market completely saturated?

Elimination is part of the cross-border ecosystem.

Data shows that on the Amazon platform, some sellers are leaving (reasons: stopped selling, suspended, or dozens of other reasons), but the rate of seller loss is slower than the rate at which new sellers join. The expanding overall market GMV allows new sellers to grow without reducing the sales of existing sellers.

In addition, an increasing number of sales on the Amazon marketplace come from established sellers, with more than half of sales generated by sellers who joined in 2017 or earlier . At the same time, new sellers are finding opportunities and bringing incremental growth to the market.

"Money doesn't come in a hurry. On the Amazon platform, most people who make money are actually working hard. Few people can always seize the bonus period. Behind some seemingly sudden wealth, there is a long period of accumulation and sedimentation." A seller who is still holding on to the Amazon platform said that the Amazon market is not yet saturated. Heroes have emerged in troubled times since ancient times, and this year is no exception! Some "pseudo-big sellers" who got the early traffic dividends and started with black technology are now in the most difficult time. "When a whale falls, all things come to life." For small and medium-sized sellers, this is also an opportunity...

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