Amazon Training ‘Get Rich Quick’ scheme under investigation
From time to time we get asked if the many Amazon training courses that are heavily advertised are worthwhile. Many promise that after spending a significant sum on their course that you’ll be an Amazon expert and nothing will stop you from turning over millions and making a significant income from selling on Amazon. Most of them are only interested in your money and in the US the Federal Trade Commission and the State of Minnesota have charged one such company with running a large business opportunity scheme. A federal court temporarily halted the operation pending resolution of the case.
We would like to make it clear that there are many companies who genuinely offer Amazon training and consultancy who are reputable. You’ll easily be able to distinguish these from the way that their offers are presented and the fact the don’t try to upsell you to ever more expensive training programs until they’ve rinsed your bank account.
Scam companies will make promises that you’ll make large sums of money and if they have further training options which will cost you thousands then it’s likely to be a scam. If they promise to set you up with products to sell and provide everything you need for success it’s likely to be a scam. Ask yourself why they are wasting their time selling courses costing thousands instead of making millions themselves.
“The FTC and the Minnesota Attorney General’s Office allege that Sellers Playbook lured consumers into buying its expensive “system” by claiming that purchasers were likely to earn thousands of dollars per month selling products on Amazon. The company used false and unsubstantiated claims, such as make“$20,000 a month” and “Potential Net Profit: $1,287,463.38.” Few, if any, consumers achieved these results, and most lost money.
The defendants are charged with violating the FTC Act, the Business Opportunity Rule, the Minnesota Prevention of Consumer Fraud Act, and the Minnesota Uniform Deceptive Trade Practices Act. They are also charged with violating the Consumer Review Fairness Act through contracts that improperly sought to restrict consumers’ right to review the products and services they purchased.”
– Federal Trade Commission
Our advice, if you’re thinking of setting up a business selling on Amazon, is to do what millions of other successful sellers have done, simply start small and get to learn the Amazon website. The Amazon forums are a rich source of information as are sites like Tamebay where you can ask fellow sellers for help and advice. There are plenty of free (or very low cost) events that you can attend and reputable paid for events such as Internet Retailing Expo, Linnworks LinnAcademy, ChannelAdvisor Catalyst, Lengow Day and others throughout the year where you can hear directly from Amazon and learn how to scale your Amazon business.
Most important of all, if you’re considering a training course take a long hard look at the cost. If you’re about to embark on a program with the potential to spend thousands on training then in all likelihood you’re about to waste your money.
In my 12 years experience as a seller on Amazon – there’s only one thing to learn : You have to sell things at a higher price than you buy them. Again, in my experience, at least 42% gross higher. However, this simple rule is the toughest to achieve – especially if you factor in my advice about minimum gross profit. This year my business should pass €1,000,000 in sales value but it is still really hard to find products which are literally “going to do the business”
Really hard to find products which are literally “going to do the business”, selling on Amazon is easy, but your right finding those products is NOT, there is not the margin.
Last years fee rises in our sector knocked us and just about everyone else out of that sector.
TBH we are making more margin this year keeping away from Amazon and eBay to a working with more niche platforms. Amazon is not good for our business.
“Last years fee rises in our sector knocked us and just about everyone else out of that sector.”
What sector was that?
Are you in the media category by any chance? With the additional final fee that was added last year, that has knocked us on Amazon and has made it hard to make profit on the majority of our range.
Only thing i can see happening on Amazon is price inflation, prices are being inflated by sellers to cover costs of doing business on Amazon and more often than not it seems you can find better prices elsewhere, but customers are hooked on next day delivery and value convenience over price alot.
When your profits are slashed in half or less than half by a fee increase it becomes impossible to justify bothering to sell on Amazon, our selling volumes whilst a little higher on Amazon do not make up for poor margins, it is not like we sell hundreds of the same product each day, a good product on Amazon might do 40 or more units per day average but not many will ever enter the hundreds per day unless we are in peak season, but that is only two months of the year.
I would just rather not sell an item if we are only going to make £0.20p out of it, you will not even clear £0.20p when you start looking at the additional costs of doing business on Amazon.
Only way forwards we see is to build products that fit into the inflated price model that Amazon has created and sell £10 plus products, customers may not want such a big pack or all the products in a bundle but because of prime they still seem to go with it alot of the time.
The bubble will surely burst at some point as prices cannot simply keep going up to cover Amazon costs, and sellers cannot continue to work on ever shrinking margins and swallow costs.
You, should always ask yourself, if someone says that they have genuinely found or developed a system that will makes millions, why aren’t they simply following their own system to make money, rather than selling training courses about it????
Because they’re so damn rich, and so damn succesful, and so damn generous, that they no longer have to work, they just want the sheer joy of seeing your smiling face as they set you on your journey to success.
though apparently still need to charge an arm and leg for said training.
Yeah, all those courses sound like a waste of time – it’s crazy how many people still fall into get-rich-quick traps even though there’s mountains of evidence that shows that they’re total scams.
That being said, I promise that if you take any of these 4 steps, you’re setting yourself up for long-term success – I made $15 last year, and if you if you follow all 4 steps you’re almost guaranteed to get just as rich as me..!
Well, I think the saying is true for a reason – a fool and his money are easily parted! Personally, I’ve found the best approach with learning ANYTHING these days is to read about it online first – or watch the millions of videos YouTube has to offer – You can become proficient in almost anything without needing to pay for it, with a little research and enough practice.
Like you say – the best approach is to start small, find what works for your business and don’t just limit yourself to selling on Amazon. There are so many other platforms, both inside and outside the UK, that are easy to capitalise on that I wonder why people think Amazon success is the only way to succeed in eCommerce. The most obvious solution isn’t necessarily the most successful for each and every business, just like running isn’t the perfect answer for every person who needs to get fit.
Well as a 8 figures seller on Amazon respecting the TOCs, i can ensure you that in China the training to sell on Amazon are simply next level:
– How to get hundred of paid reviews on your product (illegaly of course – easy with all the Facebook groups…)?
– How to hack the SEO ranking of Amazon?
– How to avoid the customs fees and set up shell companies?
– How to have a backup account ready to take over when you first account goes down or that VAT offices are coming to you?
Unfortunately especially in Europe, the cheater are the winner…
Have a great day and good luck.
I find it easy to buy products to sell that have sufficient margin.
As I don’t aspire to be the cheapest seller on amazon.
Sure the cheapest seller may outsell me a hundred to one. As I’m selling for a price I set and not outsourcing my price to competitors then I can sell an item at £20 that I purchased for £7.
Or even sell it at £25 if I purchased it at discount.