Tuesday, February 28, 2017

Turnover Tuesdays - Walmart and eBay Are Not Going As Smoothly as I Would LIke

For those who are not familiar, I started a series a while back called Turnover Tuesdays. Every Tuesday I like to highlight one item that I have resold. This will include profitable and non profitable sales. I hope that there is always something to learn.

The previous posts in the series can be found at the bottom of this post.

Walmart Was Going Great

If you've been playing along at home, I was hoping to use eBay and Walmart (mostly Walmart) to increase my sales and at a minimum mitigate the increased rent that I've begun to pay to allow for more merchant fulfillment and decreased Amazon storage fees.  Walmart does not allow for multi channel fulfillment from Amazon so you must fulfill outside of your Amazon inventory.  That requires space and a team to fulfill orders (or more time from you).

For a while, I was very excited about Walmart.  For the first couple of months I was getting a lot of orders on Walmart's platform.  Not all were very profitable, in fact some were actually losses but at least I was selling old inventory that was much less profitable on Amazon at that point (I wish I had been willing to lower some of them more as the price on some have continued to tank).

I was also selling some items that had great profits.

I was sure that the future was bright.

eBay Never Really Did Great

I was using Joe Lister to increase my eBay sales.  I made my first sale through Joe Lister in September and I had abut 50 sales since then.  More than half of them were sold in November and December and all of those items would likely have sold out from my Amazon inventory since it was Q4.  A few times I even needed to cancel my eBay orders because Joe Lister hadn't updated my eBay price after I increased my price on Amazon and it was selling for too little on eBay.   I had about 15 sales in January and February combined.  Again, these items were selling well on Amazon so I'm not sure I wasn't just canabalizing Amazon sales and paying $29 a month to Joe Lister and sometimes $.30 a listing to list on eBay even for items that didn't sell.

I just didn't sell enough with increased profits to justify the fees.  Prices on eBay are rarely higher than Amazon and the cost structure requires me usually to sell for significantly more on eBay than on Amazon in order to earn the same amount.  That translates into not many sales.

I still think there is a place for Joe Lister which I'll discuss later but I decided to cancel Joe Lister for now.

Walmart Troubles

Cancelled orders

I mentioned this in the previous post.  I had an issue with my software.  I updated my inventory levels within the walmart portal, but I did not update from within Geek Seller (Walmart management software). Walmart thought I had inventory so they would let me sell.  Every time the order would be sent to Geek Seller they thought I didn't have inventory and would cancel the order.  That led to a pretty bad preorder fulfillment cancellation rate and I missed out on some sales.  I have since corrected this issue.

Shipping Fees

You have to be very, very mindful of shipping fees on Walmart.  You have no control on where someone is going to buy the item from.  They could be on the entire other coast of the US.  You cannot exclude certain areas of the continental US (at least I don't think you can).  You have to ship to all 48 states.  Your margins better be good enough that it can withstand shipping cross-country  That can mean having good margins or figuring out items with cheap shipping even cross-country.  Flat rate boxes are your friend.  You will know your shipping fee maxes and sometimes it will be even cheaper.

Reasonable price not met

Sometimes you can publish an item for sale on Walmart only to come back later to an error message from Geek Seller that Walmart will not publish your listing because they feel the price is not reasonable.  I don't know how they determine this but I assume their scripts price compare with other sites and if your price is not favorable relative to other sites, it doesn't get published.

I understand the sentiment, I really do.  Walmart is making a statement that they care about their customers.  That's great.  That being said, it makes it quite tough for a small time seller who doesn't have the luxury of bulk purchases the way that other retailers can.  I can't buy it for as cheap as Target and I can't ship it for as cheap as Target and Target doesn't have to pay 15% off the top to Walmart with no discounted shipping available.  It's a major disadvantage.

There was one particular item that I bought for $4.  I wanted to sell it for $20 but then I realized I would have to pay $3 to Walmart, $2 to my fulfillment team and $10-12 to ship it.  If shipping was $12 I would actually be losing money if I sold it ($17 in fees).  Let's say that again, I would be losing money on a $4 item selling at $20.  That's assuming no returns or lost shipments so I tried to move it to $23.  Shipping at fulfillment is the same $12-$14 but I would be paying $3.45 to Walmart now.  If shipping was $12, I would be earning $1.55 for that $4 item but Walmart wouldn't let me publish it because it wasn't a reasonable price.  It's hard to have it both ways.  You want items to be cheap for customers but you want to take 15% and not fulfill.  You end up with lots of SKUs that just can't ever be sold profitably on Walmart and the catalog will forever be smaller than Amazon without major changes.

Keep in mind that the same item I sell on Amazon for $12 and earn $3 profit. Where do you think I will sell it?  More importantly, where do you think the customer will go to buy it?

I'm trying to learn some tricks around it (including disabling free shipping).   Some are working and some are not but it can be a frustrating experience, especially when you are paying monthly rent and monthly fees to Geek Seller ($10 a month so not the biggest deal).

I haven't given up on Walmart and hopefully I never will but it's a bit more challenging than I thought it would be.

Joe Lister Uses

I think that Joe Lister still has its place, I just won't be paying $29 a month for the time being.

Long Term Storage/Items Not Moving

I may go back to Joe Lister right before Long Term Storage Fees are being assessed.  The truth is that many of the items I sold on eBay were items that helped me avoid Long Term Storage Fees.  May not have been very profitable sales but the fees helped Joe Lister pay for itself just on avoiding those fees.  That's not true for most of the year.


If you can replenish your inventory, you aren't canabalizing Amazon sales.  You are just speeding up your sales and can replenish faster.  You have to weigh whether that increased speed is worth the extra fees.

About to Expire Items

This is similar to Long Term Storage Fee items.  If you have items that you need to sell in a hurry, like items that are close to the expiration date and you need to open every channel to make sure they sell, Joe Lister can be a good option.

If You Can get eBay Fees Lower

If you have an eBay store or something similar that will significantly lower your eBay fees you have a much better chance of being able to sell on eBay profitably since your cost structure is less you can sell the same item or less and make the same amount of money.  Again, you have to weigh the increased eBay monthly fee and the Joe Lister fee to see if it is worthwhile.

Anyone else with Walmart or eBay war stories?  I would love to hear them.

Week 1 - First attempt at reselling
Week 64 - The Buy Box
Week 65 - Amazon Restrictions and the Future of Selling on Amazon
Week 66 - Fun with Inventory Reimbursements
Week 67 - Q4 Storage Fees
Week 68 - Start Your Own Listings
Week 69 - A Long Tail Sale and Calculating Storage Fees
Week 70  - Prices Always Come Back Except When They Don't
Week 71 - Past Performance is No Guarantee of Future Results
Week 72 - Automation Beyond Amazon
Week 73 - Some Quick Holiday Tips
Week 74 - Update on Miles vs. Cashback Opportunity Costs
Week 75 - Pricing for the 4th Quarter Madness
Week 76 - Returns, Returns, Returns
Week 77 - Reimbursement
Week 78 - Q4 for Accelerated Inventory Turnover
Week 79 - How it is Going Outside of Amazon
Week 80 - 2017 Goals
Week 81 - I've Violated All of My Rules
Week 82 - When You Are That Shady Seller
Week 83 - January is part of Q4
Week 84 - My Returns Will be Inspected By Me
Week 85 - Business Expenses
Week 86 - Manage Inventory vs. Manage FBA Inventory
Week 87 - Why I Sell on Amazon