What Happened When We Listed Our Handmade Products on Amazon
This article is a guest post for our Skill Share series from artisan Walnut Studiolo, a husband-and-wife leathercrafting business based in Oregon. This is the third post in a five-post series. Read the others here.
To diversify our income from Etsy, we decided to post a few of our items on Amazon in 2014. We had started our Etsy shop in 2009 and our own website in 2012. Amazon, with its critical mass of shoppers, we hoped would be the stabilizing “third leg” of our stool.
But were they the right shoppers for our business? In this post, we’ll share what it was like for us to post our handmade products on Amazon over a period of four years, from 2014-2018.
From the first moments we got to work on our Amazon store, we felt like salmon swimming upstream. Amazon is a site designed for re-sellers and established products, like books. Existing products have already-registered listings with SKUs and ISBNs. For many resellers, it’s easy enough to just input the SKU of the existing product and you’re on your way.
But for a creative, handmade seller with a unique product, registering a new product on the mammoth site was a nightmare. Just to post our products, we had to download a massive .CSV spreadsheet and refer to a similarly-massive manual on how to use the spreadsheet.
Our first few attempts failed. We kept getting frustrating error messages. It felt insurmountably difficult, so finally in defeat, we hired a consultant to list our products for us.
Between paying the consultant a couple hundred dollars and paying Amazon $30/month, just getting started on the platform was pricey.
Once the products were up, managing the products was harder than Etsy: the backend was less intuitive and not user-friendly. It was designed for people who specialized in Amazon, who would put up with anything because of their critical access to market.
But, after a while, with some perseverance and patience, a couple of our products got good reviews, and then they gained traction, and did okay. At its peak, Amazon became 15% of our gross annual sales.
You Don’t Build a Business on Amazon: You Sell Stuff
Once our sales got underway on Amazon, we noticed big differences from Etsy:
- The customers were Amazon’s, not ours. We couldn’t develop relationships with them, tell them our story, contact them or try to build our business with them, send them follow-up coupons or thank you’s. The way most Amazon vendors try to “capture” customers is to put notes in the delivery boxes with offers and coupons to encourage them to go to their websites. (This is of course not an option with Prime.)
- We were mostly invisible as independent sellers. Most Amazon customers didn’t actually know they were buying from us, they thought they were buying from Amazon (which is increasingly the case on Etsy these days, too). They weren’t particularly interested in who we were and whether our product was handmade or not. They were also a lot less patient, understanding, and honest with us than customers from our website or Etsy.
- We dealt with a much higher percentage of “bad” sales: false return reasons, customers who hadn’t read the product description, etc.
- The returns process was demoralizing for someone carefully making a handcrafted product. The item is treated as landfill fodder as soon as a customer doesn’t want it.
- Dishonest returns were expensive: as any Amazon customer knows, if you simply select “inaccurate website description” as the reason for the return, and make up any sort of story as to why it was inaccurate, then the seller has to pay for return shipping. (Etsy sellers beware: the new Etsy Purchase Protection Program lists ‘inaccurate website description’ as one of the criteria. This may be used to justify refunding customers at your expense, too.)
- Amazon was the final arbiter of all customer disputes, and nearly all disputes were settled in the customer’s favor, sometimes unfairly. They did have an appeals process, called SAFE-T but the rare times we were able to appeal, we were denied.
Prime Was a Nightmare
Nonetheless, Amazon did deliver some sales. Our sales grew incrementally on the site over a couple years. Then we decided to try Prime to increase our sales. At the time (circa 2016) Prime was the leading edge for sales. We individually wrapped each of our products in plastic as required (something we don’t do normally and hated doing for environmental reasons), attached labels to them, shipped them to warehouses, and paid warehousing fees each month.
In the warehouses, our carefully handmade inventory went missing. Amazon was in complete control of returns, and most returns were listed as damaged, destroyed or disappeared. They kept increasing warehousing fees. Then they increased the number of warehouses had to ship to, which increased our shipping costs and warehouse fees. With each order, Amazon’s fulfillment and packing fees ate into each sale’s profits even more.
When finally we decided to end the experiment and pay to have our inventory returned to us, only about half of our expected inventory was returned and much of it was damaged.
Getting our products directly from Amazon could not have been a good unboxing experience for our customers. It was not representative of our careful, handmade brand. And it was expensive and risky for makers who care about what they do.
You Don’t Own or Control Your Product Listings
At that point, we decided the whole experience of running an Amazon business was taking up too much of our time for such a small percentage of profit. We decided to try Amazon middlemen to reduce the amount of time we spent on it.
These middlemen approached us constantly – and still do – asking to rep our products on Amazon. Finally we agreed to one who met our minimum requirements: they paid for product up-front and agreed to list all of the products we wanted them to list.
We didn’t realize the implications of what we’d done: the new business changed and updated the product listings, and now, since the product was being sold by more than one company, we no longer owned our own listings.
Now, Amazon seems to own them, and they won’t let us edit them or delete them from their catalog: our own product creations, written by us, featuring our photos that even show our own hands and fingers in the photos.
Even though we quit Amazon years ago, some of our products are still on Amazon’s pages today. Customers reach out to us every once in a while to complain to us because they got a counterfeit on Amazon.
We have no control over it. We tried to talk to Amazon customer service and get them to close and shut down the listings, but after hours spent and weeks passed trying and getting passed along from person to person without any consistency, we got nowhere, and we decided to just abandon our efforts.
We have no idea what is being sold on Amazon right now under our name as our product – all we know is that it’s not ours.
Amazon’s “New Features” Will Destroy You More
Surprise, surprise: the middleman wholesaler we worked with did not work out well: they never listed all the products we wanted them to list, and then they started buying less and less from us each quarter, and then said we needed to lower the price or they wouldn’t carry us any more. That’s when we ceased business with them, and at that vulnerable moment we were “tricked” into a new Amazon wholesale program.
Throughout the time with the middlemen, we did still sell directly to customers on Amazon (although no longer on Prime: the middleman sold on Prime). So we were an alternative to Prime, and of those few sales, we made a higher profit but had to deal with the customer service directly.
The whole marketplace is so complex that it’s hard to wrap your head around all the things they do and ways they make money. For the new program, I simply had to list how many items I had available for Amazon in a very easy form – too easy.
I don’t know what I thought I was signing up for, but I soon realized what it was: we had agreed to wholesale to Amazon as dropshippers, so they listed our own product for sale, with Amazon as the seller for a lower price than our retail but higher than our wholesale. When they made the sale (because the price was lower), we then had to ship it.
In other words, we got to do all the work and make less money. And in the end, Amazon’s product listing price undercut our own website’s, competing against ourselves. No way. We quickly changed the available units to zero and abandoned it.
Much Ado About Nothing: Amazon Handmade
Around this time, Amazon created a new module called Amazon Handmade. At first, we were encouraged by the news, because by then we were losing interest in the marketplace entirely for selling our unique, handmade goods.
We had to apply to Amazon Handmade to be accepted, sharing our handmade process information, but when they accepted us, they waived our $30 monthly seller fee. That actually kept us on the platform longer than we might have.
Amazon Handmade gave us a reprieve on the fees, but as time passed, it ultimately resulted in zero sales. Amazon Handmade was a nothingburger.
The Last Straw: Using Your Sales Data to Solicit Counterfeits and Competition
The last straw came when we received a message in my inbox from Amazon, written to sellers. They send these from time to time, letting sellers know what products are selling well, and seeking out more sellers to carry those products, presumably to create more competition and thus better pricing for customers.
This email featured one of our products. They were telling other Amazon sellers that our product was selling well, and they should sell it, too. Only problem is, it’s our original design and we’re the only ones that make it. We aren’t selling it to anybody to wholesale on Amazon.
We received even more solicitations to be middlemen for our products, which we refused. And yet available units for our product surged: people must have been selling either counterfeits, or outright scams.
That was the last straw for us: not only was Amazon not bringing in needed income, it had become a hydra of headaches, and now, it was an existential threat. It was actively marketing against us. We abandoned ship and never looked back.
Amazon was not the only Etsy alternative marketplace we tried that didn’t work out, and in our next posts, we’ll go through some of the others: drop-shipping sites and other marketplaces.
Skill Share Series
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