The Problem With Amazon’s New Sourcing Service

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Paul Harvey pulls the rug off the New Sourcing Service from Amazon and insights from the Amazon call he received to checkout his views on the service and whether sellers would use it.

  • Lots of negative info on Amazon lately and how they treat Sellers
  • Taking a Seller’s product to a factory in China and asking them to make it for them but $4 cheaper
  • Amazon get hold of your factory details
  • They’ve called Danny’s supplier in the UK directly without his knowledge
  • A bit of a concern that Amazon are doing these things
  • Amazon is a data machine and seeking new growth areas all the time

Can’t trust Amazon

  • Paul’s Chinese sourcer he’s been with for years from when they started in the garage and are now upto 60 people
  • His supplier said he’d been contacted by Amazon and wanted to speak to Paul on sourcing as they wanted to get into sourcing
  • Paul spoke to the Amazon contact and drilled him on the new sourcing service
  • Amazon contact said they see new sellers struggling to source new products from China and the risks
  • They are looking at a Portal Service provider network with a whole list of factories and sourcers to go in the backend nad search for the products in a niche and find Amazon vetted suppliers and factories (their Amazon version of Alibaba)
  • Paul said he would never touch the new sourcing service because:
    • Assume Paul finds a supplier on the backend and there will be hundreds of people also seeing the same thing
    • How long until Paul finds a product that becomes a best-seller and Amazon makes it an Amazon Basics brand
    • Why use this service and then enable Amazon to take Paul out of the game
    • Paul told the rep he just doesn’t trust Amazon and wouldn’t trust taking these services
  • Paul said he’d aim this at a new seller only who might like this service
  • This rep then said that you shouldn’t be selling on Amazon and should diversify – this was very telling of Amazon’s thinking

Amazon Basics Targets

  • Liran has said previously go for products that are big but not so big that Amazon would come after and turn it into an Amazon Basics
  • Amazon rep was asking about the 3rd party inspections process that Paul uses
  • He explained his inspection in China and then another in the 3PL in the country selling in
  • Paul then explained that FBA then receive the goods and screw up and send out bad products to the customer and suddenly you find yourself suspended

Negotiate with Chinese Suppliers

  • How will you vet your Chinese products for this sourcing service
  • How will they negotiate with the Chinese – negotiate too hard and end up with a poor quality product and selling inferior goods and get account banned
  • Amazon are planning to roll this out in the next 2-3 months
  • Any experienced Amazon Seller would never buy-it



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