Twice a year I have the privilege of speaking at a leading conference and exhibition for people who sell merchandise online: the Seller's Conference for Online Entrepreneurs.
The event was held in Philadelphia, Pennsylvania last week. More than 100 Amazon third-party resellers from around the country attended, just a small percentage of the more than 1 million people in North America who make a full- or part-time living selling on the site.
Here are some highlights from the conference:
Avalara, a leading supplier of sales tax compliance software, has launched a new service called TrustFile to help sellers register for sales tax in all states where they may have nexus (a legal presence). It only costs $24 per month without any transaction limits. This is a very helpful service, especially for Amazon sellers whose merchandise is frequently stored by Amazon at remote warehouse locations.
Amazon now requires sellers who list merchandise on their overseas websites (e.g. Amazon United Kingdom or Amazon Canada) to maintain a local address where customers can return their merchandise if they are not satisfied. RR Donnelley, a leader in international mail and parcel delivery for over 100 years, has created a new service that will help sellers who list on the Amazon Canada, Australia and U.K. sites to comply with this requirement.
Many Amazon sellers work out of their homes, so maintaining a professional image is often difficult. 20Four7VA is a service that takes the virtual assistant concept to a new level, offering three tiers of professional support:
—Administrative-level support, which provides basic customer service, email management and cold calling.
—E-commerce support, with social media and blog management, research services (identifying products, competitors and manufacturers), auto-response email marketing and project management support.
—Specialist-level support, which covers full e-commerce website services, such as design, content creation, programming, shopping cart installation and affiliate program setup.
Prices range from $65 to $88 weekly (10 hours of support), $104 to $144 weekly (20 hours of support), and $173 to $240 weekly (40 hours of support).
If you are engaged in retail arbitrage (buying merchandise at retail price and then reselling it online for an even higher price) one of the biggest challenges is figuring out what your margin will be. OAXray offers a database product that solves this problem — scan an item's barcode, and the software will search Amazon, eBay and other sites and calculates your potential profit.
If you sell products on multiple platforms, it is difficult to manage your inventory, orders, shipping and pricing using different software products. Zoobilee offers a comprehensive all-in-one management tool with no setup fees or contracts. Zoobilee's founders also host "The Intentional Housewife," an extremely funny podcast for stay-at-home mompreneurs.
Most of the buzz at SCOE centered on private labeling, in which sellers buy generic unbranded merchandise at wholesale and then resell the items on Amazon under their own trademark or brand name. John Lawson, e-commerce expert and author of several books on Internet marketing, says that building a brand involves more than selling just one product under a private label: "I don't want to see you selling just a spatula; I want to see you selling forks, spoons and other kitchen tools as well. I want to see you looking like Williams-Sonoma."
In my own presentation, I offered the following advice for would-be private label resellers:
—Be 100 percent sure that the merchandise you buy to resell isn't counterfeit, especially if you are importing from China or elsewhere in Asia.
—Make sure the manufacturer covers you as an additional insured under their products liability insurance policy. Don't do business with a manufacturer that doesn't carry this insurance.
—Slapping your company name on a product isn't enough for it to be considered a private label. You should also be enhancing or customizing the product in some way so it stands out from the dozens of other Web retailers offering similar products.
—A trademark that isn't registered with the United States Patent and Trademark Office is probably too weak to be viable as a brand name over the long term.
—As a private labeler, you stand in the shoes of the manufacturer: You are responsible for complying with all federal, state and local laws (such as labeling requirements) that apply to U.S. manufacturers of your goods.
—If you are selling products for children, you are required to have them tested for safety by a nationally recognized laboratory before you sell them online.
—Always make sure you have the right to sell products under your private label without needing the original manufacturer's consent.
—Never negotiate a private label contract with a manufacturer without the assistance of a good e-commerce lawyer. There are no boilerplate contracts for these negotiations, so there are many variables that would have to be discussed to make sure you and your business are adequately protected.
Cliff Ennico ([email protected]) is a syndicated columnist, author and former host of the PBS television series "Money Hunt." This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our Web page at www.creators.com.