5 Downsides to Amazon Business Account

Amazon has a lot of great benefits, but there are some potential downsides to using an Amazon Business account. Find out more.

5 Downsides to Amazon Business Account

Amazon Business account is a direct source for sellers to connect with customers. The eCommerce platform increases global business owner sales by more than $10 billion. It has been noted that selling through Amazon creates massive revenue for small businesses. Apart from these, sellers have fierce competition to reach new customers. 


The distribution of products could be uneven, and also start-ups experience 6% -15% fee expenditure while creating the Amazon business account. Customer loyalty is also a factor that can decline for companies running through this platform. 


Let us look at some of the factors that bring down the business account. 


1. Retaining the Customers

Several B2B businesses operate on the platform at once with the same product. Therefore, it gives customers a wide variety of choices and price distribution; sellers can not record customers who purchased their items. This closes the gap between targeting new clients and retaining the patrons affecting the buyer-seller relationship in the long term. 

Related: How to Use Order Fulfillment to Get Repeat Customers

2. Difficult Algorithm and Business Control 

Like any other eCommerce marketplace, a product listed by a particular seller can see a drastic reduction in sales due to the internal decisions made by the eCommerce giant. Amazon also works on a specific algorithm that lists only popular products or sponsored ones on the top priority for the buyers. This means sellers will have to spend an equal amount on marketing their products to new buyers. Also, the business account is subjected to Amazon rules and policies that leave no personal control for businesses. If the seller violates any terms and conditions, they can be instantaneously kicked out of the platform. Amazon is notorious for abruptly removing sellers' accounts and products for policy violations.

3. Ignorance of the Sellers 

Amazon is a customer-based eCommerce company that makes profits through sales. But most often, it doesn't protect the sellers' rights on the business account platform. Customers can get free items from the sellers complaining about their products. Sellers are not appropriately reimbursed for the returned products; the business account tools only promote the products but do not make optimum sales. Third-party vendors do not have grievance cells to address their business account concerns. 

4. Shipping charges and additional fees

Amazon platform caters to business owners with four shipping categories: Free-same day delivery with Amazon Prime benefits that allow customers to get their orders within a day. This is only possible if there are $35 of free goods the same day in the shopping cart when checking out. Companies that supply large or small-margin products cannot sell them with this facility. As a result, it is difficult for the vendor to draw a margin from his accounts. In addition, the following fees must be incurred by business owners when opening an Amazon business account: monthly membership fees, commissions, and reference fees. 

Related: Amazon FBA Fees-a Complete Guide

5. Competition at Peak

How can a brand distinguish itself in a sea of companies with the same management tools and functionalities? The answer is: there is virtually nothing to do with a virtual presence among prospective customers with the same products offered by different vendors. Business owners cannot expect that sales will increase even with high demand. Customers will be drawn to a wide choice before purchasing the product.

Related: eBay Vs. Amazon - A Complete Comparison Guide


Conclusion

Before you make the switch to an Amazon Business account, be sure to weigh the pros and cons. Keep in mind that there may be some hidden costs or downsides that you're not aware of. And if you're looking for a more complete solution that can help with your Amazon FBA prep needs, Simpl is here to help. Contact us today to learn more about our services and how we can help streamline your business operations!

Recommended: Is Amazon FBA Worth It?

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