Q&A: Is Amazon cycling off my listings?

QUESTION: I have been a Pro-Merchant seller on Amazon for over a year now, and my inventory has grown steadily. I am now up to around 18,000 items, and sales for the past couple of months have been really bad.

Is this a trend? Is Amazon hurting us by their technical gaffes? Is it a possible search engine issue with the buyers? Are there just too many sellers on Amazon today?

It seems odd that I'm averaging 30-40 books sold per day with an inventory of 18,000, yet last winter I had an inventory of 5000-6000 and was selling 40-50 per day. Does Amazon cycle their sellers?

ANSWER: Three issues always dog Amazon sellers:

• Seasonality - August and January are the biggest months by far for sales. I have nearly triple the volume in those two months.
  
  
• Age of your listings - Your best items tend to sell very quickly, then the stuff that there's not much demand for sits on the shelf indefinitely. The longer you've been in business, the more old listings you have, so the percentage of your items that sell on a daily basis declines. And it can decline very low unless you clean out your "deadwood" periodically. A few years ago when space started getting tight for me, I started ruthlessly going through my stock and trashing anything that had been listed for, say, two years and the current price was less than $20. This is a time-consuming process.
  
  
• Amazon's site instability. There are definitely periods when there's clearly something wrong at Amazon, whether it's the payments system not functioning right, or the listings just aren't showing up. I haven't ever believed that there's a plan at Amazon to reduce the visibility of the Marketplace listings. They make a huge percentage of profit on Marketplace sales and there's no inventory or personnel costs for Amazon, so it makes no sense for them to put up roadblocks to Marketplace sales.

Having said all that, I often think there's a conspiracy of incompetence at Amazon that gets in the way of sales. For example, a Marketplace seller like you or me will notice something malfunctioning on the site and will try to bring this to the technical department's attention, and there's no way to do it.

I've said it several times, and I'll say it again: Amazon has the world's largest consulting team (Pro-Merchant sellers) working for them free, 24/7 -- the kind of support that would be impossible to buy. We're continually troubleshooting their business and reporting the problems, and nobody's listening. To put it mildly, this is not a smart business practice.

We're making a huge amount of money for Amazon. If the company is going to survive for the next decade or so, Amazon will probably need to learn to listen to its third-party sellers.

I've noticed recently that my sales have been horrible on some days and other days, sales are very strong. For example, my sales on this past Saturday were double the volume of any previous day that week. That's the exact opposite of the way things should be, and that tells me something's seriously wrong. I suspect that it's related to all the changes Amazon is trying to do right now:

• killing zShops
• rolling out aStores
• new affiliate programs and affiliate stores

Those are the major things, and there's probably a dozen other issues.

I've always done about 90 percent to 95 percent of my sales on Amazon, I've sold far less on Half.com and eBay. I've never tried selling on the other networks like ABE.com or Alibris. With such a large inventory, you might look at that as an option for getting your sales velocity up.

Another thing I've noticed over the years is I lose about 5 percent of my inventory a year from Amazon -- it just disappears for some unknown reason. In other words, if you're using Amazon's open listings reports to manage your inventory, some of it could have disappeared from Amazon's system, you might have a couple thousand items that aren't listed on Amazon and that can certainly hurt your volume.