There are three types of sellers who make it nearly impossible for others to profitably sell products on Amazon. Let me break down these three groups for you.
The first group consists of credit card sellers, who I didn’t know much about until I attended an Amazon Seller conference. At the conference, I learned that these sellers were buying and selling extremely low sales rank items without making a profit, just so they could accumulate credit card points to travel. They were selling hundreds of units a day, without worrying about profit. While I believe they were likely showing a small amount of profit on their tax returns so they could claim expenses and deductions on their taxes, they were not concerned with making any real profit on Amazon. This made it difficult for other sellers to compete with them on certain listings, as they were not concerned with making money. If you are on a listing and can’t figure out how the other sellers are making money, this might be the reason especially if it has a very low sales rank.
The second group is couponers.
Many couponers have a very low cost of goods, as they are often able to get products for free or at a steep discount. They are also taught to sell products at half of retail price, which is great for local sales, but not on Amazon. Amazon has fees and shipping costs that must be considered, making it difficult for sellers who purchase products at retail price to compete with couponers. While couponers may make a small amount of profit, other sellers will struggle to compete with them and may not be able to sell the product at a profit. If you see products in couponer groups, you should avoid getting on those listings.
The third group consists of new sellers.
When starting out, many new sellers are afraid that their products won’t sell, and they may read blog posts or watch videos that tell them they won’t be able to sell as a new seller. They may also have family members who are critical of what they’re doing, which adds to their fear. In an attempt to sell quickly and avoid losses, many new sellers sell products at a break-even point or even at a loss. This may be encouraged by gurus who suggest selling at a loss initially to get feedback and be able to sell in the future. This can lead to an oversaturation of certain products, making it difficult for any seller to make a profit. If you see bolos posted in beginner groups, avoid getting on those listings.