Amazon started as online book store and has grown to be the worlds largest online retailer.
Grace Karin – Lessons from a Fashion Brand selling on Amazon
The Grace Karin team was founded in 2008 and are dedicated to offering high-quality women’s fashion apparel with the principle of ‘simple and stylish’. They strive to provide each customer with well fitted tailoring and a stylish collocation that emphasizes details, which helps to bring a comfortable and refined lifestyle.
The brand name, ‘Grace Karin’ has an inherently English forename but with a touch of elegance coming from the Gaelic Irish surname. It evokes a sense of Britishness and class… a brand that you can trust.
The brand’s hope is that every woman wearing Grace Karin will have a young mindset that can transcend ages. Their style focuses on modern, elegant and simple clothes which are not only suitable for daily use but also for party and work. Building a modern and exquisite image is their aim for customers.
Their photography is top notch and definitely shows their garments at their best. Snagging the fabulous Jessica Kellgren-Fozard to do a YouTube spot hasn’t done Grace Karin any harm either. No one is quite as believable as Jessica to add a touch of British class and present the brand at it’s best.
Whilst Grace Karin have a Shopify website, their clear preference is for customers to purchase on Amazon and they have links to all five Amazon EU sites (UK, DE, FR, IT, ES) as well as Amazon’s US and Japanese marketplace on their website. This is because products are then Fulfilled by Amazon and under Amazon Prime are eligible for free shipping and other Prime benefits such as fast delivery.
It’s only when you dig a little deeper that you may discover that Grace Karin is just a front for a Chinese Amazon merchant. They’re not unusual in having branded themselves in a western fashion and are using Amazon FBA to enable them to fulfil orders around the world.
Perhaps the most surprising thing of all with Grace Karin is that not all of their products even carry their own label. There’s a pretty good chance that having purchased a Grace Karin garment that when it arrives it will be a totally different brand.
There is no attempt to hide the identity of the seller on Amazon, their business information reveals them to be Shenzhen Feimier Garments Co Ltd based in China. They have a UK VAT number again registered to Shenzhen Feimier Garments Co Ltd but this time with a UK address… although they don’t really have UK offices, many hundreds of businesses have used the Manchester holding address that they use.
The lesson for UK sellers is that competition on Amazon is stepping up it’s game and none more so than Chinese sellers. Amazon have started to introduce their own fashion brands, the best known of which is Amazon Find. The only way for sellers to compete over a longer term is to manufacture their own products and set up their own brand. There is of course still money to be made in trading existing brands, but with ever increasing competition as soon as a second merchant has the same products winning the buy box comes down to service (largely irrelevant if you use Amazon FBA) and price.
Setting up a brand may seem prohibitively expensive, but in reality it’s not that difficult. Most Chinese manufacturers will be happy to stitch your brand label into their products and then it’s a case of creating a logo, registering a trademark and starting to sell. More sophisticated operations will involve either designing your own products or getting manufacturers to tweak existing generic garments that they produce to make them unique to you.
Grace Karin is a valuable case study into how to present a successful brand on Amazon sites around the world. They are certainly not unique and we chose to write about them after stumbling upon their listings at random. Thousands, perhaps tens of thousands, of Chinese retailers on Amazon UK are operating similar brands presented to give a reassuringly western look and feel. In this aspect of Amazon trading, Chinese merchants are year’s ahead of many UK merchants and are showing the future strategy that will ultimately lead to success. If Grace Karin can do it why can’t you?
It’s obvious Amazon are aware of the damage they are doing to the western economy by allowing Chinese manufacturers to undercut the very businesses they ( the Chinese) are supplying. It’s a ridiculous situation with no winners other than the Chinese producers and Amazon. Domestic retailers don’t even have local postage as a competitive advantage anymore because Amazon are allowing Chinese manufacturers to offer FBA. I would argue that this strategy is either very shortsighted and stupid or just aggressively greedy. Either way there is clearly no thought for the effect on small business or the western economy.
Direct from manufacturer to customer – that’s where everything is going and Amazon is simply following the path and in most cases – going few steps ahead of everything else.
IF a dress is made by a Chinese manufacturer, why shouldn’t they be allowed to sell it directly on the Amazon? If they’re VAT registered, pay taxes etc. (if not, that’s a totally different story and conversation).
Why it is fine that a UK based middleman imports the dress from China, add a markup
and sells an item on Amazon AND it is NOT ok when a Chinese manufacturer does it directly? Again, I’m not talking about tax evasion here but in general. It’s not only about Chinese manufacturers, but there are also many manufacturers that now sell directly on Amazon that are based in other countries. No one seems to be talking about that.
I don’t like increased competition either but let’s be realistic – globalisation won’t stop and thinking that out-dated retail models will work in future is simply naive.
The golden era of BUY cheap & sell HIGH is almost over! With the internet, customers can connect directly with brands and that’s how it will work. I have always built my own brands, created my own products as I know that this way I have something unique to offer to the marketplace, I have real added value and different ways to connect with my customers.
There are alternatives to Amazon FBA that can offer full fulfilment solutions yet still integrate all your marketplaces and online inventory including Amazon, Ebay, Shopify etc. But there are alternatives – I just don’t know if they have the integration ability? I think its also about establishing a ‘buy direct’ by establishing that all important brand. Happy to help if I can.
In reply Andrew Minalto:
I think that the inherent issue is the supposed manipulation and misdirection that is being applied on Amazon and none more so than on eBay. I have purposely purchased 14 items recently selecting UK based sellers only. 13 of them have come direct from China – not the UK.
Clearly, I have no issue with anyone from any country selling on eBay or Amazon BUT purporting to be based in the UK when you are not is having a damning effect on UK sellers being able to compete and being unfairly pushed down the search rankings.
I want to buy from the UK as I want quick shipping and ease of return if there are issues. I attempted to return 6 items I purchased (on purpose) and was faced with barrages of emails offering me £2.00 off as it would be ‘hassle’ for me to return and suchlike. Where the barrages were absent, I was faced with silence or at best the offer to return at my cost to a PO Box.
No problem with buying cheap direct…if I choose to. As a seller, I want to feel able to compete with other sellers in my region and not those who manipulate the system.
Kind of reminds me when someone would sell an item for 1p with £25.00 postage….just to get to the top of the search.
Completely agree Andy White.
Delibrate market manipulation and frankly blatant exploitation of (lack of) unenforceable trading laws here in UK. There is absolutely no legal jurisdiction for any governing body to address such a catastrophic issue which has annihalated every market / industry.
The Chinese government have made a deal with Royal Mail allowing goods to be sold in UK at postage costs lower than what us domestic UK based VAT and Corporation Tax paying companies are charged.
Unfair competition and fraudulent activities by these culprits from China along with their accomplices The two big marketplaces who facilitate and openly encourage such disgraceful business.
You only need to look at counterfeiting to start with. Try reporting these goods to the marketplaces and any UK trading standards office. The marketplaces have no infrastructure to remove sellers and continue financially benefiting from these products. Trading Standards cannot shut the Chinese conpanies down because they have no physical trading address in UK!
The onus has to be on Ebay and Amazon to stop businesses representing themselves as UK based, when they are not.
This is surely easier than trying to become some sort of global policeman.
There are huge warehouses operating across the UK, some accommodating 70 or more addresses. All of these are used by Chinese firms and are nothing more than accommodation adresses. They can then provide a UK address to satisfy Ebay and Amazon.
I bought an air conditioning unit off Ebay in the summer. The business appeared to be UK based in Bradford. The item arrived quickly (just four days) but had clearly come from China. The unit was also a dud, so a return was initiated. The item was returned but came back to me again as “undeliverable”. The reason being that there were too many businesses at the vague location in Bradford given for it to be returned. I checked online and found a massive list of Chinese businesses registered at that address.
So I still have the dud unit and was unable to be refunded as Ebay said I hadn’t returned it.
Ebay and Amazon will suffer major reputational damage unless they sort this out and ensure that only bona fide UK businesses are accredited as being in the UK.
Something similar to the tractor mark on food – we need a British logo for sellers who are verified as genuine UK businesses.