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Selling Lego on Amazon.com

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For me the real power of Amazon is FBA and the ability to scale. Paying a reliable outfit peanuts to store, pick, pack and do customer service is very advantageous. To pay for your shipping to their fulfillment warehouses just throw some small items into the box along with your Lego. Be warned it won't be long until you figure out those small items have the ability to make you a **** ton of money and plastic bricks may drop off the radar very quickly.

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I'm giving Amazon a fair shake now as well.  I think it's a balancing act, but it's nice to have 2 large marketplaces to sell from.  They are comparable and for established sellers, one could work better, depending on the sales methods.  Some stuff sells higher in different instances on both EBay and Amazon, so it may or may not balance out in the end.  If you have large quantities and volume on Amazon, it's advantageous during price spikes.  For the casual seller, there may not be much difference.

For FBA, I can definitely see how it's nice when Amazon starts fulfilling orders and you can just see the money rolling in, as long as there isn't too many returns to stifle progress.  It's not a quick and dirty process to send stuff off to FBA, but I'm sure seasoned FBA'ers have a pretty good system put together to make it as efficient as they can.

FBA is also a lot more expensive than regular Amazon particularly when you're dealing with lower-priced items.  When your item starts getting around the $12 mark, the fees as a percentage of sale price start to skyrocket because the FBA fulfillment fees are fixed.  When you get to a sale price of around $7, the total fees are over 50% of the sale price.  

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throw some small items into the box along with your Lego. Be warned it won't be long until you figure out those small items have the ability to make you a **** ton of money and plastic bricks may drop off the radar very quickly.

???

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I am currently selling on Amazon a little, but shipping myself. Can you give me the easy version of how the FBA program works and the costs associated with program?

As i understand it, I PAY to ship Amazon my inventory initially, then pay them a monthly storage fee, then a slightly higher sales commission %, but then AMAZON ships the item out to the customer free? or low-cost to me? and it's almost always 2-day PRIME shipping?

If I am low volume seller, say 5-10 sets a month, is FBA even worth doing, or am I going to get killed by storage fees?

Thanks!

You can read all about it in the other thread, but the basic is that you ship to Amazon using Amazon's negotiated rate with UPS so it is cheap.  I only send them sets that will win the buy it box and sell right away.  I have never paid a storage fee.  I store it, and then send to them to sell, not to sit around.  Amazon then ships the items without any itemized shipping charge to you.  You can choose the $40 per month plan, or the $1 per item plan as an addition cost.  A low monthly volume isn't as efficient with FBA as a larger volume.  Feel free to PM me if you have any questions after reading the FBA thread.

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You can read all about it in the other thread, but the basic is that you ship to Amazon using Amazon's negotiated rate with UPS so it is cheap.  I only send them sets that will win the buy it box and sell right away.  I have never paid a storage fee.  I store it, and then send to them to sell, not to sit around.  Amazon then ships the items without any itemized shipping charge to you.  You can choose the $40 per month plan, or the $1 per item plan as an addition cost.  A low monthly volume isn't as efficient with FBA as a larger volume.  Feel free to PM me if you have any questions after reading the FBA thread.

your making a mistake i believe. Amazon charges you a fee to ship your item in addition to their regular commission fee. 

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your making a mistake i believe. Amazon charges you a fee to ship your item in addition to their regular commission fee. 

The fee of $17 that Amazon tells me I will pay when I sell my Dragon Mountain is very close to what I will pay when it sells regardless of how much shipping is on their end.  I understand that a shipping fee is built into their FBA fee structure, but it is very transparent and predictable.  With eBay, shipping is often an unknown until after the sale.

Example for Dragon Mountain 70503 listed at $79.95 FBA:

     Fee Preview
Type Amount
Amazon Referral Fee
$11.99
Variable Closing Fee
$0.00
Per Item Fee
$0.99
FBA Fulfillment Fees
$4.02
Hide FBA fulfillment fee details
Order Handling
$1.00
Pick & Pack
$1.04
Weight Handling
$1.98
Fee Estimate
$17.00 1
To see estimated fees on all your FBA products, go to: FBA Fee Report
1 The Fee Preview column showcases the core fees for Selling on Amazon and Fulfillment by Amazon for this product. This is an estimate only and excludes fees for Inventory Storage and any Optional Services you use.    

 

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Can anyone share with me their experiences with selling on Amazon.   I sold some stuff years ago and am now thinking of listing some items on there again.  I know their policies and prices have changed.  I am getting tired of the ebay fees and more the people purchasing on there trying to scam.  I am wondering if it makes sense to sell and ship self, or if there is a way to send them all items and fulfill for you.  What are the cost benefits or lack off from either way.  

 

 

Thanks for any information or experiences.  

This is a sore subject for me because I used to make so much money selling Lego sets on Amazon. Like, a ton of money. This was all done through FBA. FBA ships the item for you and the total cost even after fees was cheaper than it would have cost me to do it myself. Everything was good at first but over time FBA got worse and worse. Lost shipments, partially lost shipments, damaged shipments, misrouted inventory, inventory disappearing after being in their possession for months, etc, etc. They have a process to get your money back but it takes time and you have to stay on top of it. Once I got a ton of inventory in stock I couldn't keep up with all of the loose ends I had follow up on just to reconcile my inventory. And that's just their handling of my items. Then you have the customers who are much more free to return things when it is FBA and they can steal minifigs out of the box and return it for a full refund no questions asked. Once they do so, you can either pay for Amazon to send you the set or pay them to throw it away (wish I was kidding). Additionally, FBA fees just kept going up year after year.

Lastly, Amazon seller forums are filled with horror stories about their accounts being suspended and all of their inventory/money being frozen just on a whim of a person working in India or a computer system that has decided you sold a fraudulent set (even if you didn't). I was unwilling to continue to have tens of thousands of dollars of inventory and/or cash sitting under the sword of Damocles.

So, now I just (primarily) sell used sets on Amazon and make a lot less money overall but a lot more money per set. The FBA game is a game of numbers and thin profit margins so I could not afford the continued losses in the warehouses that I had to follow up on and the warehouse damaged items and the customer damaged items and all that. Also take into account the fees that keep going up and it was unsustainable. Example of a horror story that happened to me: I sent Amazon $1K (my cost) of Halloween specific Lego items, and I sent them in one month before Halloween. Of course they got misrouted and lost and were not recovered until mid November when nobody wanted them. I was going to make a few thousand in profit if they had been there to sell on time. Instead they got marooned and I missed out on selling a hot holiday item. After Halloween had passed, they only sold at a trickle and I made no profit. Come the following year people had moved on to another hot seasonal item so I was left to try to break even and it took years. The whole lot of inventory would have been sold out in 2 weeks with thousands in profits if their warehouse had not lost the shipment. There is no compensation for this type of thing of course.

As far as just selling items directly and shipping them yourself on Amazon, they charge a 15% fee. So, you are not left with much of a profit margin. Grocery stores make around 1-3% in profit. Amazon takes 15% and of course you have to pay for the physical item with capital. So, even if you get a $100 Lego set (with around 700-1000 pieces) for $70 (which is not always possible) and sell it for $100 on Amazon, Amazon pays you $85 after fees. It costs you $10-$15-ish to ship depending on size and weight and where it is going. So you are left with either no money or just a few dollars. Therefore you have to buy REALLY low and/or buy right at the correct moment when something is retiring in order to make any money. So, you have to try to pay $65 or less for sets that sell for $100. This kind of offer is not exactly on every street corner.

Hope this helps. As I said, it has been really sad for me. Amazon used to be so awesome for me.

p.s. then we have the issue of Amazon allowing counterfeit Legos to be sold with impunity on their site! This is one more way that it has been made difficult to make money as a legitimate seller on Amazon. You now have to compete against people selling fake Legos (if you sell minifigs primarily) I have written Jeff Bezos, TLG, Marvel/DC and the media about this issue with no satisfaction. Amazon was able to pull the confederate flag off their site in less than 24 hours, however, when they decided to. Just try to get a counterfeit Lego listing removed, however. Don't get me started on that topic!!! (too late?)

 

Edited by Johnny_Lemonhead
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Thing about Amazon is that if you want to sell during Xmas, you have to ramp up and do some selling in September through October.  For those of us that might sell less than 10 items per month (I average about 3 to 5 per month), and do our "profiteering" strictly as a hobby, you have to get busy during the pre-christmas rush.  I believe the rules are you have to sell 25 in a month and a half time to qualify for selling through Black Friday into the holiday season.  You have to have an unblemished track record, which shouldn't be too much of an issue.  Otherwise, to ebay with the rest of the scoundrals you must go. 

The other thing is I prefer shipping things myself.  I know that i'm going to package it to where collectors will want and appreciate receiving it in good condition, and then you get good feedback. Meaning, solid box, excessive bubble wrap, and packaging peanuts.  I don't know if Amazon has that sort of track record,  In fact, I know they don.t And so the care for the customer is not at the same level. 

So those of us that aren't in this for sheer quantity, that makes being a minor seller on Amazon a minor challenge for when things ramp up.  So, for those small timers, you have to have a goal of blowing out some useless items that won't sell that much anyway over the next few months to hopefully meet their criteria to qualify for christmas selling.  . 

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One thing as well to recognize about FBA is the effect that increasing competition has on the program. Amazon is a zero sum game where one seller at any given time is going to get the vast majority of sales on any given item (i.e., the seller who has the buy box). Generally, the seller who has the lowest price or near lowest price is going to get the buy box. With the increasing prevalence of automated repricing services and large volume sellers (i.e., 300+ copies of any given set), you end up with a lot of price battles to win the buy box. So you might see a set selling for $90 and think "great, I'll send mine in and sell them for $90" and then end up in a price battle where you have to either cut your price to $60 to win the buy box or wait until the much larger sellers work through their inventory. And this is only going to get worse as time goes on and the large resellers are working with larger and larger bases of capital.

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One thing as well to recognize about FBA is the effect that increasing competition has on the program. Amazon is a zero sum game where one seller at any given time is going to get the vast majority of sales on any given item (i.e., the seller who has the buy box). Generally, the seller who has the lowest price or near lowest price is going to get the buy box. With the increasing prevalence of automated repricing services and large volume sellers (i.e., 300+ copies of any given set), you end up with a lot of price battles to win the buy box. So you might see a set selling for $90 and think "great, I'll send mine in and sell them for $90" and then end up in a price battle where you have to either cut your price to $60 to win the buy box or wait until the much larger sellers work through their inventory. And this is only going to get worse as time goes on and the large resellers are working with larger and larger bases of capital.

Margin vs. volume... that's why I am a patient investor. I'm tiny. A cockroach compared to those guys. I can't compete with the big dogs, but remember cockroaches will outlive all of us. 

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Do you guys ever experience delays with tracking information for postage purchased from Amazon?  I dropped off some USPS Priority Mail packages and had them scanned at the Post Office yesterday but the tracking doesn't show anything as of this morning on either Amazon or the USPS website.  Packages that I dropped off at the same time using eBay/Paypal postage do show current tracking information though.  Is this typical for Amazon?

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Do you guys ever experience delays with tracking information for postage purchased from Amazon?  I dropped off some USPS Priority Mail packages and had them scanned at the Post Office yesterday but the tracking doesn't show anything as of this morning on either Amazon or the USPS website.  Packages that I dropped off at the same time using eBay/Paypal postage do show current tracking information though.  Is this typical for Amazon?

My experience yes. I shipped an item on Monday and only had the confirmation for a drop off. The item arrives to the buyer today and everything was updated.

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Am currently searching Amazon help forum on this, but thought I might get a faster answer here.  A buyer on Amzn made a purchase from me last night (fulfilled by me). I printed Priority mail label, boxed it up and it is sitting on my porch, waiting for mailman.  They just now requested a return due to "unauthorized purchase". I'm fine with that, I'd be happy to cancel the order if it doesn't cost me anything.  Will Amzn automatically refund my seller fees and postage (purchased through their site)?  What would you do? Quickly please. The mailman is due here any minute. :)

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Don't ship the item if the customer wants to return.  Customer can return for any reason they want on Amazon.  Don't waste your time shipping the item to have them ship it back.

 

Go into manage order tab>edit shipments>refund purchased shipping label...to get your refund

Edited by zobel0022
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Am currently searching Amazon help forum on this, but thought I might get a faster answer here.  A buyer on Amzn made a purchase from me last night (fulfilled by me). I printed Priority mail label, boxed it up and it is sitting on my porch, waiting for mailman.  They just now requested a return due to "unauthorized purchase". I'm fine with that, I'd be happy to cancel the order if it doesn't cost me anything.  Will Amzn automatically refund my seller fees and postage (purchased through their site)?  What would you do? Quickly please. The mailman is due here any minute. :)

I don't know your answer but you do not want a p/u.
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I recently had someone request a refund after they received the item. I just got the item back and I refunded them the initial purchase price minus the shipping - will amazon return the % they took for their fees?

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So, now I just (primarily) sell used sets on Amazon and make a lot less money overall but a lot more money per set. The FBA game is a game of numbers and thin profit margins so I could not afford the continued losses in the warehouses that I had to follow up on and the warehouse damaged items and the customer damaged items and all that. Also take into account the fees that keep going up and it was unsustainable. Example of a horror story that happened to me: I sent Amazon $1K (my cost) of Halloween specific Lego items, and I sent them in one month before Halloween. Of course they got misrouted and lost and were not recovered until mid November when nobody wanted them. I was going to make a few thousand in profit if they had been there to sell on time. Instead they got marooned and I missed out on selling a hot holiday item. After Halloween had passed, they only sold at a trickle and I made no profit. Come the following year people had moved on to another hot seasonal item so I was left to try to break even and it took years. The whole lot of inventory would have been sold out in 2 weeks with thousands in profits if their warehouse had not lost the shipment. There is no compensation for this type of thing of course.

 

 

I have a similar story about how I missed out on sales due to FBA's errors.  I had 20 LEGO Coast Guard sets that were up for sale on Amazon FBA.  Amazon removed the listing to try and consolidate it with two or three other listings.  During that transition, they somehow "lost" my sets, and the sets were missing for months and months.  By the time Amazon "found" the sets and they were back up for sale, the buy-box price had dropped below my break-even point.  If FBA hadn't messed up and the sets had been up for sale when I shipped them in, I would have made at least $10 per set.  That set was selling at a quick rate, and there wasn't much FBA competition at that point.  Thanks, Amazon.  Now I'm stuck with these sets until Thor knows when.

Also, I now have to recall these sets from FBA in order to avoid the long-term storage fee.  So I'm going to have 20 somewhat-big sets at home that I have no space for.

Edited by Jackson

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I recently had someone request a refund after they received the item. I just got the item back and I refunded them the initial purchase price minus the shipping - will amazon return the % they took for their fees?

I asked the same question of an Amazon rep recently.  They stated that if you do a full refund then all the fees will be reversed.  If you do a partial refund (in this case you're retaining the shipping fees) then they do charge fees (I'm not sure if it's prorated).  Had I know that before I did my partial refund I would have opted to just do a full refund and ask the seller to leave me good feedback.

From personal experience, when I didn't refund the buyer a $4.99 shipping fee I got $3 in Amazon fees on a $75 motherboard - now I would just refund the shipping fees in full and make the buyer happy.

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I had a customer purchase and item then they messaged me saying to ship to a different address. Thinking it was spam, I said, "Sorry, we cannot ship to another address that's not on file from the fulfillment order." Of course, they return the email and asked to cancel the order after we prepared for shipping because they were on vacation... WTF? I did a full refund and it seems that both the payment, shipping fee and Amazon fee were all reversed.

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Am currently searching Amazon help forum on this, but thought I might get a faster answer here.  A buyer on Amzn made a purchase from me last night (fulfilled by me). I printed Priority mail label, boxed it up and it is sitting on my porch, waiting for mailman.  They just now requested a return due to "unauthorized purchase". I'm fine with that, I'd be happy to cancel the order if it doesn't cost me anything.  Will Amzn automatically refund my seller fees and postage (purchased through their site)?  What would you do? Quickly please. The mailman is due here any minute. :)

Pull it from your outgoing packages and give full refund.  You will get seller fees back and made whole. That will happen at time Amazon processes refund.  Then go in and cancel shipping label.  It will take like two months for that refund to hit your account but it will eventually get there. When you process the postal refund they will give you a date when it should hit as it will be under review until that said time.  I assume the logic is that there making sure the postal label was never used. 

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I had a customer purchase and item then they messaged me saying to ship to a different address. Thinking it was spam, I said, "Sorry, we cannot ship to another address that's not on file from the fulfillment order." Of course, they return the email and asked to cancel the order after we prepared for shipping because they were on vacation... WTF? I did a full refund and it seems that both the payment, shipping fee and Amazon fee were all reversed.

Welcome to Amazon, where buyers can basically do whatever the f*** they want while sellers have to stand there and say "thank you sir, may I have another."

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I sold a SSD, buyer claimed that it was incomplete and returned for a refund.  I had Amazon send me the item to me for inspection.  Needless to say, the buyer got their full refund and I got an open set with missing minifigures and other pieces.  Appealing to Amazon.

 

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I sold a SSD, buyer claimed that it was incomplete and returned for a refund.  I had Amazon send me the item to me for inspection.  Needless to say, the buyer got their full refund and I got an open set with missing minifigures and other pieces.  Appealing to Amazon.

 

Good luck. You can always BrickLink the figures and any missing parts and sell it as used/complete.

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