Great discussion with CJ about what he is seeing the most and how to prevent some of them from happening first. There is a balance of taking chances and ensuring a going concern when it comes to getting the most from your business. I suggest introducing yourself to CJ at your next conference so if the need arises, you are familiar with him, and you can get right down to business.
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Transcript: (note- this is a new tool I am trying out so it is not perfect- it does seem to be getting better)
CJ: [00:00] Exactly, because you’re buying it and reselling it to consumers getting the same thing so your sale is legally protected under the first sale doctrine. It’s a body of law that we have here in the states, but the brand doesn’t recognize who you are, so that’s exactly the scenario we were talking about earlier where that brand, then we’ll try knock you off by saying you’re not an authorized distributor or they have distribution agreements. Amazon ignores them and that person for the brand gets frustrated then claims that you’re selling counterfeit products and that’s one of the things that we’re addressing more often these days than we were even just two or three months ago where we have, we have to reach out to them and say, you asserted a counterfeit complaint that you knew was false and now you’re costing 5,000, 10,000, $20,000 a month in sales to be lost and you’re responsible for that. And we’re 100 percent right. Uh, but that’s exactly the scenario that the sellers are facing more and more.
Cool voice guy: [00:55] Welcome to the. We focus on the people, the products, and the process of incomers selling today. Here’s your host, Steven Peterson.
Stephen: [01:09] He wanted to talk a few moments about some sponsors scope from several labs. Um, when’s the last time you created a listing? Right? And when you create that listing, you’ve got to come up with the keywords, right? It’s all key word dependent. I don’t care if it’s a private label or wholesale. You’ve got to get it right. Well, what’s the best way to get it right? And if you’re selling a similar product that’s really successful, you go and you take and use their keywords and that’s what scope does for you. So phenomenal tool brought to you again by seller labs. The leaders in technology when it comes to Amazon, right now, they are just crushing it with all their products, but scope allows you to get that listing right. Get ranked for those key words as fast as possible. Therefore you get the sales. So go to sellerlabs.com, forward slash scope.
Stephen: [01:58] Use the code word momentum. Save a little bit of money, get some free key words to test, try it out and see if you see an improvement. If you don’t adjust, what’s cool about what I love about a seller labs is that you then message and say, Hey, I didn’t get this right tyler, hey jeff, this isn’t working right. What am I doing wrong? And Boom, you’re going to get the help you need and that’s what you’re going to get from seller Lamson. And it’s a very special group. Had been very. I’ve been very fortunate to be connected with them. And again, I look over time they’ve delivered every single time, you know, same thing I can say for Karen from solutions for ecommerce. I mean, she’s been carrying my account for a couple years now, um, and our account, my wife and I, and she really does handle things for us.
Stephen: [02:39] Um, I mentioned, uh, just last week we created a new listing with, I forget how many variations, but again, all the flat files uploaded done as I needed. I pop in, so she’ll send me a template, I pop in some information and then boom, it’s handled, await. These pictures weren’t done right, blah, blah, blah. This UPC, Nita poom modified adjusted. And again, the communication been phenomenal too. I get an email back saying, hey, this was done or this, you’re missing this, Steve. Hey, you got to do this. So you know, we have those challenges too. And that’s why I like working with somebody who’s been doing it. I’ve been doing it for a long time to do, you know Karen also does listings for Ebay. Yep. Lots of them. So if you want to build out that channel, which of course you should, it’s q four. You should be selling everywhere you can.
Stephen: [03:24] Karen can help you with that too. So you gotTa tell her I’ve sent you. So you’re going to go to solutions four ecommerce forward slash momentum. You’re going to save 50 bucks every single month. You’ve got to save that $50. But more importantly you’re going to get an inventory health report. Um, did you just get hit with monthly longterm storage fees? Well guess what? If you haven’t, they’re coming. You want to get that inventory right? And she can help you with that. You gotta tell her I sent you again solutions the number for ecommerce forward slash momentum will get you into that. Save the 50 bucks, get that inventory health report though. That’s really, really important. Get that going right away and I don’t want to miss my coach when it comes to retail arbor online or when I have a question and I do not that we don’t, we don’t really do much of it anymore, but when I do have a question, I go to Gaye Lisby. Because why?
Stephen: [04:08] Because she’s really. She is a coach. I mean, she’s really phenomenal, but she also puts out a daily list and you’re going to get that list five days a week. You’re going to get tons of leads, the number of, uh, agreed to amount that you’re supposed to get. She at least she usually gets to those in the four days. And then the fifth day seems to be a bonus most of the time. Phenomenal Group, small amount of buyers where this list is going to. And the best thing is the nuggets that you learn. Hey, why is the red one better than the blue? One? Gaye can help you with those questions. I saw, hey, I got, um, I got to the dreaded letter about a brand. Here’s the, here’s the way you approach it. Hey, receipts, how do you, what’s the best practice? I saw her leading instructions, teaching me the accountant how to do a better job with it.
Stephen: [04:53] And it’s phenomenal. So it’s Gaye Lisby. He’s made a million dollars selling. Um, I’ll have the link in here. You’ve got to use the, my, my link and it does help me. I don’t want to say it that way, but um, it’s part of amazing freedom with Andy Slam, Iran Hirsch corn and nate’s lamins. So you know, you can trust. Okay, so come back to the website, take a look at it and you will get a savings and you can get two weeks free right now. Only through my link. You get two weeks free. Try it. You don’t like it? I get it back off. But right now is the time to make money. Get cashflow going right now. And so join you. Get two weeks free. The only way you’re gonna get the two weeks free is if you use my link. It’s on this episode. Come on out and give it a try. You will not be disappointed again. You’re going to see me in there. So reach out if I can help you too. Let’s get into the podcast.
Stephen: [05:40] Welcome back to the ECOMMERCE momentum podcast. This is episode 359. Cj Rosenbaum. Now Cj was on the show a year and a half ago, um, episode one 71 in back in February of 2017. You want to go back and listen to that. We spoke quite a bit about reinstatement back then because he was really into reinstatement. I’m still is, and he’s expanded his team and we really get into some details that are really, really neat that this, this, um, this advice is available to us almost 24 slash seven almost. That’s his goal. But what I asked them to do is really to help us prevent, you know, what can we do to prevent. And so what he’s done is he’s says, okay, I’ve had a bunch of these, and so here are the things that people who got suspended here are things they could have done upfront to prevent some of that.
Stephen: [06:32] And it’s real sound advice. Some of it is extra steps taken. Photos of your products going in, right as you’re sending them in. Well guess what? You know, if you got all your money tied up, thinking about right now, right? We’ve got a huge amount of Christmas inventory still sitting in our warehouse, right? It’s because we’re dripping it in. If that got frozen at this point, oh my goodness, you know, of the bills do we actually paid for it already? So now you know that cash isn’t going to come back. So those are the kinds of things that you got to start thinking about, especially as you scale up. Well, he gives you some really great advice for free on what you can do to prevent. Now present is not guaranteed. You can help hopefully stave off some of these challenges that are out there.
Stephen: [07:14] And we also get into why he stays in this industry and why he’s expanded so much. I think it’s really interesting because when you see him at a conference, it’s hard to get his time because everybody’s up there. Second is energy and you know, I mean, he’s not the typical lawyer charging you for all that stuff. They’re giving people free advice because it’s a long game and he wants a relationship. So it’s very, very cool to see. And probably the coolest thing is at the end he hits me with a, which I didn’t know that there is a charity that he’s involved with, um, and he’s asking for the Amazon smile. If you’re going to choose a charity he offers. One is a title Louis Campbell Foundation, Tui Louis l o U I s Campbell, c a, m P, b e l l foundation on Amazon. So if you’re going to buy presents, you’re going to buy.
Stephen: [07:59] I’m going to buy something as soon as I done with this. And I can choose the Amazon smile. And then chooses foundation. They benefit doesn’t cost anybody else any other money other than Amazon helps donate that money. So if you don’t have one chosen, this can be a great one. Tie Louis Campbell Foundation. I’m really great strong update and again, really going to help grow your business. Let’s get into the podcast. Alright, welcome back to the ECOMMERCE momentum podcast. We’re excited about today’s guest, three return guests. Um, and I think the time of year, I think the time is now for us to sharpen, uh, sharpen our businesses and really pay attention if you’re selling on Amazon, on what it takes to make sure that you can, um, if you do get suspended, you get reinstated, but then you know what you can do preventively. Um, and I think a CJ Rosenbaum is a great expert. I’m an attorney that’s been on episode one 71. Go back and listen to his story, how he got into this crazy business episode one 71. Um, back in February of 2017. Can you believe it’s been that long? Cj?
CJ: [09:07] Time flies, but like it was yesterday.
Stephen: [09:09] It does, it really does. When I saw you was like, we’ve never stopped the conversation. You know, it’s funny, every year we see each other around the country at different events in the conversation never stops. It’s just like a continuation. It’s like, oh yeah, we like, we never like, we never finish a paragraph. It just rolls right in. So tell me, uh, what is going on? So last time we talked we talked about reinstatement. That was what it was and, and how to get reinstated and all that kind of jazz is pretty much that. Still the same way. I mean, is there, has there been a lot of changes or adjustments to that?
CJ: [09:42] You know, I wouldn’t say it’s a lot of comes in waves. So certain aspects of the suspensions and certain aspects of intellectual property rights complaints or rights owner complaints, they come in waves. Like there was a wave of hacking problems. It was a wave of safety issues. There were waves of certain categories, suffering, suspensions. So I wouldn’t call it like drastic changes, just kind of roll in his waves for a couple of months. There’ll be big problems in something in an Amazon must go and focus on something else. So the algorithm changes to something else. Um, I’d say the big major changes what I’m seeing, our sellers are more likely to attack other sellers than we’ve seen in than we’ve seen ever before.
Stephen: [10:21] Now, do people understand that that’s illegal. I mean, I, I mean in theory, I mean if they get caught and all the rest of the judge. But this is serious. This is serious legal implication. Am I correct?
CJ: [10:32] It could. But to enforce your legal rights would mean taking the seller to court and Seller Verse Seller Litigation is certainly on the increase, but it’s also very unpalatable. Like no one wants to race to court. So do you. Does, does this seller create a risk by asserting baseless complaints against you? A hundred percent. They’re liable for every dollar that’s lost. Um, and we’ve been very successful with the larger brands who do that. Um, but again, to, to enforce your rights, to recover your damages means going to court when it’s seller, verse, seller.
Stephen: [11:03] Do Do. I mean, why would somebody especially larger, why would somebody do that? I mean, do they not realize that, um, that there is, I mean, you would think a larger company would understand the possible financial implications there you would think
CJ: [11:20] you would think, but it’s really not the case. I’ll give you, I’m not going to tell you which franchise of the NFL, but a major franchise in the Nhl with the NFL, the national football league was asserting complaints against people selling genuine products. And what I think happened is that there are a brand manager and a in a corporate job. And their job was to remove Amazon sellers and they couldn’t do it legitimately, but when they made a baseless complaint of counterfeit products, all of a sudden they were successful there. The problem that is that they’re now responsible for every dollar that, that seller has lost. Um, so it is an example. It happens time and time again. You have these people in these corporate positions and their role is to knock off Amazon sellers and they have to get it done by hook or by Crook. So they end up asserting baseless complaints.
Stephen: [12:09] It’s very interesting. I’m definitely seeing more of it. And you’re seeing more from overseas people creating these crazy stories buying product. I heard a great story and not a great story, but I heard a story of somebody calling somebody a customer and actually offering them something and then it never coming true. And um, then that person didn’t follow through and, but they never made the offer. It was done by a third party maliciously and it’s like, what people are doing this kind of crazy thing. Have you heard that one?
CJ: [12:39] We’ve seen that and I don’t know how to get the contact information, you know, but they do their software. We, we’ve seen that. We’ve seen people jump on listings sell similar products and then when the consumer complaints come in, it’s now landing on the legitimate sellers desk and that causes problems. We’ve also seen more dirty tricks by sellers versus sellers. Like, you know, the fake reviews used to be easy. This box, they would have like poor grammar, right? But now they’re well written and it sorta like the comment, you know, you clean up really nicely, which is sort of a backhanded insult. They’ll leave a pretty detailed two star review instead of a one star or five star or we’ve seen seller verse seller attacks where they’re leaving five star reviews that it totally, you know, come off as fake. So instead of like killing you with bad reviews, they’re killing sellers with fake positive reviews.
Stephen: [13:39] Crazy. Well that’s just tough. I mean is that is the good news that this stuff is getting found and then I assume that Amazon gets sharper and sharper at this stuff. I mean, and, and finds ways to, to get that stuff out of the system.
CJ: [13:55] That is the good news. The good news is as, as the, the nonsense sort of increases then morphs into other things. Amazon, it seems to be much faster at catching up with the curve and the reinstatements are coming in faster and faster. So I’m not sure if they’ve increased their training, if they’ve increased their personnel or if they’re just doing more training in terms of keeping up with the latest dirty tricks. Uh, but yeah, the reinstatements delphia coming in faster. It seems like the plans of action are being read by Savvier people on Amazon side of the fence.
Stephen: [14:29] Yeah. And, and I’ve seen a few stories in the news about sellers that, that went that pr route and negative news they don’t like. So I think that they are paying more attention. Interesting. Alright. Well let’s talk about this then because I think this is the time of year when we should start thinking about prevention. Um, and so when I, when I’m asking you to do is think about, I mean you handle so many is to think about the ones that you’ve seen, that you think that there’s an opportunity, something could have been done in advance to help sellers now who are just selling. And they’re like, Ooh, I didn’t think of that one. Can you give us some of those?
CJ: [15:04] Sure, sure. I also know what I did before getting on this call with you before getting on this Webinar as I went around her entire team with 32 people strong now fighting plans of action out of New York, analyzing accounts, dealing with rights owner complaints and that sort of thing. Um, I mean this is also kind of old advice, but it’s still accurate. You want to avoid problems. You gotta stay on top of whatever you’re selling in terms of the forums, like I don’t think anyone has the time to read the all the forums across the board. But if you’re selling like epionce cosmetics or you know johnny b haircare goods or whatever brand, goodyear selling, you need to like I would say at least daily, just do a search and look at the forums for other people having problems with those brands because the brands also come into waves and also in there’ll be a sweep and they’ll clean up their listings by asserting a lot of nonsense. And even though, you know, we can get you back on, if it’s not a big profit center for you, it might be a good idea to back off the brands that are getting more and more aggressive. So I think that every seller at least once a day or worst once a week to really do, do some background on the products that they’re selling to avoid problems.
Stephen: [16:16] Is there a. let me ask you this because you say foreigns, do you mean a seller forum on Amazon or other places too?
CJ: [16:23] No, I would start with the sell of forums on Amazon. They’re remarkably useful for that kind of information. Exactly. For that information. I would also search the facebook groups and between the, uh, the Amazon forums and the facebook groups, you’re going to gather a ton of information as to what’s going on in your particular category or your particular brand that you’re selling. I wonder if
Stephen: [16:46] there’s a way to get notified. I know like you can use some of the google news things in some, some things to get news when it’s posted about these brands and stuff, but I don’t know whether they dig into seller central or into a facebook to get notified when something’s posted about that product. Somebody knows it. Send me a note. I’ll, uh, I’ll, I’ll start. Um, I’ll look into it and I’ll put it up on, on these episodes.
CJ: [17:10] Okay. That’s a great idea for a new service for sellers. Yeah. There you go. Scrape information about particular brands or product lines to alert sellers as quickly as possible,
Stephen: [17:21] especially on seller central and never thought about that and I’m assuming you can get through their, through their API. You probably can get in there, some decent programmer can figure that out. That sounds like a good opportunity. Okay. So, so looking, you know, paying attention to the uh, the brands that for some reason are getting enforced and act because some of the challenges, right? I buy from a distributor, right. I buy, you know, I don’t know, I’m looking at it. My water bottle, I buy this water bottle from my distributor. It’s legit. I bought it. They’re a registered, a seller of that product and I get the rights to sell it. Right. I bought it from them and then I put it up on Amazon and then Amazon, some that that, that company says, Whoa, who’s that? We don’t know Steve. So why? And then that’s where those things have been happening lately in some cases. Correct.
CJ: [18:12] That’s exactly it because you’re buying it and reselling it. The consumers getting the same thing, so your sale is legally protected under the first sale doctrine. It’s a body of law that we have here in the states, but the brand doesn’t recognize who you are, so that’s exactly the scenario we were talking about earlier where that brand and it’ll try knock you off by saying you’re not an authorized distributor or they have distribution agreements. Amazon ignores them and that person for the brand gets frustrated and claims that you’re selling counterfeit products and that’s one of the things that we’re addressing more often these days than we were even just two or three months ago where we have. We have to reach out to them and say, you started a counterfeit complaint that you knew was false and now you’re costing five thousand ten thousand, $20,000 a month in sales to be lost and you’re responsible for that, and we’re 100 percent right, but that’s exactly the scenario that the seller. Okay,
Stephen: [19:06] more and more that one there. So let’s talk about preventing that be is that when I have to go back to my vendor, right? That distributor and say, hey look, I need an authorized letter that shows that I am allowed to sell this on Amazon. And even then that doesn’t prevent that. Right? But then you say, Hey, I want you to send this to the brand. That’s like the biggest scary thing for us who sell wholesale. We’re worried that they’re going to shut us down, but I guess it’s better to be shut down in the beginning. Is that where we’re kind of going with it?
CJ: [19:37] No, I think that would be ideal, but it’s not realistic. Okay. Well you want to do is have a genuine invoice from your distributor and you want to separately be able to show that your distributor is getting it from the brand itself. Um, I don’t think any. I think it’d be very hard to get an authorization letter from a distributor because they don’t have authorization from the brand, but independently you can do your own research to show that your distributor is getting the real deal, you know, from whoever the manufacturer is going to be. Another distributor for something.
Stephen: [20:08] What else? They could be another person in between. Okay.
CJ: [20:11] Correct. But at anytime you can track it back all the way back to the manufacturer or even online on your own, when you pull up a distributors website, I’ll often list of brands that they’re dealing with. We’ve even had investigators where you can actually go to the distributor and you watch the truck pulling up and it has the, you know, where they’re coming from, just like Amazon’s great commercial about how all the third party sellers are doing so well. You can reverse engineer you really, so you can track that. We call it supply chain. There are supply chain inauthentic suspensions where you have to really trace it not just back to your distributor, but then trace that distributor back to the brand. Do, do
Stephen: [20:48] realistically, and I guess as you’re going to be like dusty, of course it does. I guess there are counterfeits that gets slipped into those systems, uh, by nefarious people in the middle from time to time. Correct?
CJ: [21:00] There are, but the problem is no, I don’t see the problem as being anywhere near as big as the propaganda would lead people to believe because nowadays the genuine products and the counterfeits cost about the same. There’s no significant savings. That’s almost all dre market. Not that counterfeits don’t occur. They do, but I don’t think the problem is anywhere near as big as it’s. It’s as people purport it to be
Stephen: [21:26] alright, so it’s really just the brands trying to get control of their inventory. They don’t know. They built this system. The system wasn’t designed for Amazon to become the behemoths it has become and such a big part of their marketplace. And then they’re dealing with retailers, uh, in business going out of business. All this stuff is making it mckee.
CJ: [21:46] Yes. It, it’s really, it’s really price control. Okay. I don’t think the brands really care where it’s being sold. It’s price control and if they want their products sold for $39, 99, they don’t want to see Amazon sellers selling it for 20 bucks. So it’s really about controlling the price of the goods.
Stephen: [22:05] You know, I told this story a Andi Simon son, his warehouse Wednesday, I went to an auction this week and it was a um, it’s a wholesale auction. They have them, you know, pre Christmas and a lot of local retailers buy their stuff there. Whatever. There were two mega sellers selling Amazon private label products, all in Amazon boxes with the masons on the side or return boxes and everything. And it blows my mind, um, you know, a, they’re so common, I say the meat clause or the silicone baking pan a pads and it just goes on and on and on. But my, my example was this, I bought these meat clause. You familiar with the ones where you put them on your hands and you pull apart, meet like a in a crock pot or something like that. Right? So it’s one of those over private labeled, you know, there’s hundreds of varieties of the exact same thing all by the same place.
Stephen: [22:57] Anyway, I bought them for a dollar a piece and yet they were, I could have got more and got them cheaper, but the auctioneer gets thirty cents, right? He gets 30 percent. So that seller, that guy got seventy cents and he still made money because I asked him, I said, were these your private label product you out? No Way. He said, I bought these blah blah blah. So I’m assuming he’s buying them from Amazon liquidation or even two or three levels below that. But what blows my mind is now somebody could take those items. I could have taken them and throwing them on Amazon, on that person’s listing and sold them, you know, I have a dollar until Amazon fees or three bucks. Okay, so I could sell it for $6 and make 50 percent back. Not that I would do that, but you get what I’m saying and that that is how a lot of these problems come to fruition and so you, you take that, this is off label. You know, what a private label. But imagine that I could have done that with Nike’s or whatever and then then that’s, that’s a lot of it. When you’re paying such a low price, I could put it up for $7 and make just as much money as the guy who built that product and put it out there. It’s very, it’s got to be very frustrating for them.
CJ: [24:12] Yes, it, it, it wants the product. Especially if something like that that’s produced in such mass and copied by so many factories, you know, it’s, it’s by that time the product has sort of gone through its whole life cycle of ingenuity and now it’s just copycats everywhere at time to get off the gravy, off that train.
Stephen: [24:29] I only bought them for my son one for and to use for examples of products not to do and then one for my wife. So we have it for the house. That’s it. I don’t want to sell them. I’m out. Okay. So, so, uh, that’s, that’s a big preventative one. What else can we do?
CJ: [24:44] Well, I got to say it now that we’re in q four. Okay. A couple of things that we’re seeing more of this. I’m using FBA. We were seeing a lot of problems with when products are arriving at Fba and either they are damaged or Amazon is climbing, they’re damaged. Okay. So what I want people to start doing is as they’re selling more, as they’re shipping things to Fba, create an extra step in your process where you’re really taking a good look at it. And if you can photograph your products before you’re putting them on the pallets and wrapping them up, I’ll take some pictures because we’re seeing more and more suspensions where consumers are complaining about the condition of the products. They trace it all the way back to this third party seller even though it went through Fba and we have. We have to justify they were in great condition when we sent them to Fba. So I would start adding that as much as you can. A Pre FBA inspection that you’re keeping really good records of so you can show photographs that your products were in pristine condition when they were sent in. And this is sort of a new thing also. We’re seeing more and more of Amazon not logging in your inventory.
Stephen: [25:51] Yeah. I saw somebody this morning saying it is 117 items and the box was empty. They said, and it’s, of course it wasn’t true.
CJ: [25:59] Right. Who ships an empty box? It’s a what we’re seeing that Amazon. Then what they do is they sort of reverse engineer at defense to stealing your products and they don’t throw anything out there reselling everything as far as I can tell, um, but you really want to make sure that you’re labeling is dead on, that you’re, there’s no extra labels like you’re sending in pallet. You have to put on all four sides and on top, and again, you want to document everything in case you have a problem later on. So make sure the labeling is dead on totally in compliance. You’re weight is as accurate as possible and that you have pictures and documents to show, here are the four pallets, here are pictures of where the labels were located because this is a big source of free to Amazon and a source of huge losses to sellers where they’ll just not logging it in and then it becomes a fight and you really have to be able to show that you did comply and that your goods arrived. We recently had a case where it took all the way till we got to the arbitration hearing to show that all four pallets arrived, all four pallets arrived and that means that seller was out of his inventory for probably about six months before we nailed Amazon. And finally here it is here, the pictures, and we showed them and here’s the login, and we had one of their witnesses confirmed that they received all four pallets and they still argued about the labeling.
Stephen: [27:22] Well, what do they do with it? I mean, let’s face it, there’s, you know, Jeff Bezos is insane. Hey Cj, when that pallet of Steve’s bear clothes come in, pull it off to the side for me and I’m going to take some out and we’re gonna have some fun this weekend. I mean, nobody’s doing that, right? I mean, so. So what’s realistically happening? Is it just because there’s such a behemoth, you know, my town, I tell this story, this is God’s honest truth. There are five massive Amazon warehouses in my town, five and they’re half a million to a million square feet. I mean they’re just, I mean it takes you seconds to go pat. I mean it literally you could count 20 or 30 seconds as you’re driving by. It takes that long to go out and so I’m assuming in the corners of those places they got piles of crap that they just, it’s just whatever it is, right, is that’s what’s happening realistically or somebody is, is stuff falling off the back of the truck or what? What’s happening?
CJ: [28:13] I don’t think it’s anything nefarious. On average. I believe they’re receiving like three shipments per second and with that volume is going to be mistakes. The real problem lies in Amazon’s relentless defense about fighting these things and I gotta tell you, I blame the lawyers a bit, the guys who I have I work with on every week where they have to sort of invent and create reasons for Amazon not reimbursing you when you provide good evidence and I think that it becomes a profit center, not because the people in the warehouses, not because the people who are receiving the shipments is that when there’s a problem, they’re like so low to accept responsibility and you know, to Amazon it’s nothing like your extra thousand units is, is nothing to Amazon, but it’s vital to you. And then when that causes a problem like a suspension or you can’t get your cash back out to get new goods, it’s devastating to sellers. So I think it’s further up in the food chain. It’s not the warehouse people, uh, it’s a lack of a, it’s a lack of accepting responsibility for known problems. I’m not sure how far up the food chain, but when you do the aggregate amount, it’s tremendous numbers. Absolutely tremendous. You know, your thousand units, someone else’s 500 units, somebody else’s 20 units. Okay. And they know they have the merchandise and they know that they can identify where it came from.
Stephen: [29:41] So under fits Irob yeah. I wonder if it’s a um, a profit and loss. Um, I wonder if they do profit and loss by warehouse location. I mean you kind of assume that they do. I, I tell this story. So in my old industry, the retail stores, so it was always a trust thing. We would go and sell them or bring them product. We send them a bill and then at the end what didn’t sell, we would take back and we would credit them for what they returned. Right? So if we gave him 100 units and they gave us back 20, we send them a bill for 80. Okay. Then the industry changed and it went to more corporate stores and the stores would say, oh, we’re only gonna pay you based on what gets scanned. And so all the losses, people walking out with your product they gave up and the walmarts of the world, this is how they operate. And so you only get paid now for what you scan. So if we control it, we have zero control,
CJ: [30:34] no control of the security. And it was the same thing. I grew up working in a local candy store and with magazines who was the same thing. What you would do is when the month past, you’d rip off the covers and you returned that, the cover of the magazine, you know, to the, uh, the magazine distributor, you wouldn’t have to pay for what didn’t sell.
Stephen: [30:53] Well, that whole thing, that whole thing cost a fortune for that industry. And um, there’s no responsibility. And so I, I wonder if this is the same scenario a, you get, what I’m saying is that they are saying, hey look, you know, they, they probably have measurements of speed and accuracy and they probably get paid or incentives for that. And so by getting rid of these things, it allows them to stay for, I don’t know, maybe maybe I’m wrong. Maybe.
CJ: [31:20] I don’t think there’s any profit and loss, I think it’s profit and profit and I kind of envision it being like an insurance company where they don’t make money by paying claims they make money by getting premiums. Okay, alright. So is that warehouse really gonna, you know, pay out. I think it moves further up into the management food chain and how much they had to reimburse and they try and limit that as much as possible. Uh, kind of the same way they, they take your inventory when they hold your money. When we talk to sellers every single day, how Amazon is just withholding their money indefinitely and at certain dollar amounts it’s not worth pursuing it. You know, like let’s say Amazon steals five grand from you, you’re not going to pay $2,000 for an arbitration to chase down $5,000. Will give us an example why that would occur.
CJ: [32:07] Let’s say you’re selling a 100 products and to have a potential counterfeit issue or two complaints and whether the claim is real or the claim is baseless, it’s still two percent of your sales, yet they hold a hundred percent of your money, but the amount is not worth the fight, you know, where it’s at. Amazon, keep your $5,000 and move on rather than fight him for it. And I think when you do the same thing, you do the aggregate of it probably talking hundreds of thousands of sellers a month who were getting, getting ripped off, you know, but just enough that it’s not worth fighting over. You know, you don’t want to poke the bear. You’re still getting your livelihood. You know, here in the United States, a sellers are still super reliant upon Amazon, you know, unlike Europe and Australia where the market is more diversified. So I can’t tell you how many sellers we’ve talked to. I mean it’s countless number of sellers who have been screwed over for an amount that’s just not enough to fight over.
Stephen: [33:14] Tell me what you’re seeing in Europe. So where is the market when you look at Europe as opposed to the US? I know, I understand Amazon’s not as established. What are the other marketplaces that people are selling in Europe?
CJ: [33:25] Well, you have Amazon I think has about a quarter of the market yet. Ebay has about a quarter of the market and there are a whole bunch of other marketplaces. I don’t have the names of. All right. So it. So I didn’t realize they only have about half,
Stephen: [33:37] but half of the market between the two of them. That’s very surprising. Okay. Wow.
CJ: [33:41] We had, we had someone on from Ebay on on our Webinar, we not this Wednesday, a week ago, Wednesday and his name is Aaron Schneider for me Bay and he was talking some really great stuff about Ebay, how they don’t compete with the sellers and you can get into 100 foreign markets with the same account rather than, you know, Amazon’s a much more limited, you know, they don’t use the sellers for their r and d department, you know, they don’t track down your factories, they don’t steal your goods and sell it themselves. Ebay is not a seller on Ebay. Are you saying that that happens? I certainly think it happened.
Stephen: [34:18] Can you have you seen an example where that has been proven out yet? I mean, I’ve read it too and I’ve seen it and we all know that, you know, Amazon and my son brought this up the other day. He’s like, Oh yeah, I just get that on Amazon basics and I’m like,
CJ: [34:31] I certainly have, you know what Amazon basics is. I’d like, Whoa, I can only talk about generally because all the information we have is as confidential, including the arbitrations, but I’ve certainly had scenarios where a seller has bought products from Amazon. Okay. Through woot and through their other channels to resell on Amazon where they seize them a second time claiming a they were counterfeit. That has convinced me that there’s not some big giant shredder that Amazon’s using. Oh No, no, no. Whatever they have, they are selling in one fashion or another and I kind of envisioned the same. Like I’ll use Disney as an example, the same Disney product flowing in and out of Amazon sands over and over and over again, that for Cinderella doll being sent to Amazon. Then they use it being counterfeit. They sell it on woot. That seller puts it back on Amazon and over and over and over again.
Stephen: [35:28] Yeah, 100 percent. And matter of fact that that auction I went to, I believe that’s what that example was, is I think that was all Amazon seller disposed of it because know as long term storage fees and they disposed of it, they paid to dispose of it. Well, disposal doesn’t mean disposal. It means disposal out of their system. And then people buy tractor trailer loads of that stuff. Put it right back on Amazon, put her right back on. Amazon is not destruction. That’s correct. Yeah. There’s nobody in the back, you know, like you said, you’re dropping it through a shredder or a burning the uh, books in the back. Now they’re all coming back out. Alright. Give us another one that you’ve seen where people can put this something into practice to help you know, kind of, I don’t know if it’s the inevitable, but stave it off anyway or just delay these potential problems as they continue to sharpen their business.
CJ: [36:18] Alright. This is a big one. I would absolutely refrained from getting on listings where you don’t have inventory and this started I guess say about three months ago, give or take. Tell me what this is because I’m not heard of this one. It’s like it’s drop shipping, drop shipping, but what happens is you can jump on a listing, then you receive an inauthentic allegation against you and then you have to provide invoices. The problem is you don’t have invoices because she never purchased inventory and then you have sellers who would then getting invoices and photoshopping them or getting them from distributors, asking them to backdate them or making up their own, and if you’re already selling, if you already have a legitimate means of running your account it, it’s not a good idea to get into this. It’s just problematic and then you’re stuck in this cycle where you can’t provide the invoices with your plan of action because you never actually own the goods.
Stephen: [37:15] So where I can do a legitimate drop ship where there are lots of companies that will drop ship for you. Okay, there are legitimate. Then you have an account with them, that kind of thing. Are those safer? Because technically I am buying even though we don’t take control of it or is that
CJ: [37:32] much much safer? You actually have a contract you can point to or at least a friendly distributor who will confirm your arrangement in writing and then hopefully this Amazon staff is making more and more phone calls as time goes on, they’ll pick up the phone and say, yes, Steve Buys these from us. We have a contract with and they’re 100 percent genuine. We can trace it all the way back to the factory and that is a much, much safer way of doing it.
Stephen: [37:57] Most of the ones that are buying from me on Ebay and then selling it, um, and I have no because I’m selling it on Ebay. Right? So that in that scenario, that’s the scenario you’re talking about in the beginning, that’s just, you’re really risking your account.
CJ: [38:11] Yes. Or not even knowing where you’re going to find it yet, you know, your list, you’re on the list because you know, you can, will, you expect to be able to pick up the product, but you don’t really have anything in place yet at all.
Stephen: [38:21] Oh yeah. That, that’s a bad idea. Wow. Okay. All right. Any other ones that you want to get into?
CJ: [38:27] Uh, I would just always keep an eye out for specific brands that are really getting real aggressive to me that that’s really vital. Um, to really keep it. If you’re getting into something, if you’re about to buy a container full of a product, do some research beforehand. Um, and I got to tell you as I am a huge proponent, it’s a little bit off the subject you asked me about. I’m a huge proponent in sellers to start developing their own brands. Even if it’s the oven Mitts, develop your own brand, develop an asset file for a trademark. You can do it yourself because that’s really, that is the future that you actually develop an asset that you own and can sell where you can draw investment to yourself.
Stephen: [39:11] Well, what you described to me, you look at Europe, right where you just described that 75 percent of the market is not Amazon in Europe. That’s an opportunity, right? I mean, if you have your own brand and you’re going to sell there, that’s a great opportunity. Especially
CJ: [39:24] it’s a huge opportunity. And in Europe there are a lot more a brand protection laws in effect. You know, I took, we spoke a few moments ago about the first sale doctrine where you can buy and sell basically anything that you want as long as the consumer is receiving the same thing in Europe, brands have more protection, where permission to sell is part of their intellectual property law. So you develop a brand you can control who can sell it in Europe.
Stephen: [39:50] Oh Wow. Okay. All right. And these are the kinds of things that Cj’s a law firm offers. And, you know, one of the things I was thinking about, um, because you were traveling last week or whatever, and we were, we were in Chicago together a couple of weeks ago and I’ve been thinking about why, why this industry, I mean, you’re a smart guy, but I mean, why this industry? Uh, I mean, did you just luck into it? And I guess my question is why you stayed within this industry because you could, you know, you can practice in just about any industry you want. Um, why, what, what keeps you in this? Maybe that’s the better way to ask that.
CJ: [40:26] I love it. I got to tell you, I love it. I’m in this and we’ve grown so well because I absolutely love it. And not to say my day isn’t stressful. My Day is very stressful, everyone to use sellers that calls me your account is suspended Geeta Plan of action yesterday and you’re all stressed out. Uh, but I love dealing with entrepreneurs every day, all day long. I love the constantly changing climate. Um, I love seeing how sellers figure out a new angles to get products, either better products or the same products at better prices. Um, I love the creativity that goes along with an ever changing platform. Um, and I, I listened. Entrepreneurs are a different breed of people. I’m, I’m a lawyer but I’m also an entrepreneur at heart. So, uh, I’m in this area because I love it. The way I got into it is simply by recognizing somebody else’s great idea when I was at a rather low point in my life after a really long, nasty a custody fight, um, where a longterm client and a good friend of mine had purchased an Amazon based and he had a ton of money into it and the account got suspended and he looked for help and he was unhappy with the choices that were out there at the time.
CJ: [41:43] And he reached out to me and he said, listen, I know you’re going through all this stuff with your ex wife, but why don’t you look into this. I think this is really up your alley. Because I’d always represented entrepreneurs and I was a pretty hardcore trial lawyer and I looked at him like, this is really cool. And then I started just going to some of the events and meeting the sellers and I just fell in love with it. So I live and breathe this stuff. You know, this morning I was up at [5:00] AM, emailing some of the other lawyers on my team about issues and they’re the same way. I had six slash 15. I had rob Siegel, who’s one of our new associates. I’m writing me back. And so, uh, it’s really great since it’s also like kind of a second career to me, I’m really able to build it exactly the way I want with a focus on the client with a focus on speed, with a focus on ingenuity, which you need. And so, uh, I, I feel blessed. I feel blessed that I got to meet you because you’re one of these crazy entrepreneurs as well. Sandy is a great guy and I just, so I’m in it, I’m growing because I really love it.
Stephen: [42:49] It’s very cool to me to see in him, as you do every one of these things, you get stronger and stronger and knowledge, right? An experience every time you do make it to arbitration or even just the, just getting close to it, you learn a little bit more. And my bed is many, many things go away because you don’t have to take it that far. Right. And that’s again, that’s, that’s guidance. Do you guide companies, um, that are, that are developed? Um, I mean the heavy on retainer as they’re developing their business so they don’t have to, um, you know, do you get what I’m saying or do they come to you for advice? Just, hey, we’re going down this road and we want to do this kind of thing instead of doing all the, you know, the, after the fact stuff. Do you do some preventative stuff with people too?
CJ: [43:34] We do. We’re on retainer with a number of sellers, number of larger companies, that smaller ones where we kind of take a look to see if there are any major problems. We’re not, we don’t do like daily reviews or anything like that, we’re not like an account monitoring service, but people have us on retainer to take a look every week to say, okay, where are they, what performance notifications came in a kind of cross reference, what they’re selling with, what the problems were seeing, you know, from our 50,000 foot view. And we do, but generally people don’t call us unless there is a problem. I wish they have more of that to prevent problems. Uh, but we do do that for sellers. Small and large.
Stephen: [44:14] Yeah. Almost like a checkup. You know, one of the things that that’s very cool too is, uh, we are at a conference in Chicago a couple of weeks ago and people were coming up to you and you gave him your time. Yeah. I didn’t see you sending them bills. And so usually when an attorney says, Hey, bill in 15 minute increments, right. Um, I didn’t see any of that. People were able to come to you and talk to you about some specifics. I don’t know how deep you could go into conversation, but the fact that you’re approachable I think is very healthy and it’s good for you. It’s good for them and it’s good for you.
CJ: [44:41] Yeah. I got to say also, I learned who I am. I’m here. Many people have helped me over the years and I believe in paying it forward and we do that. We talk to sellers all day long without asking. We don’t charge for consultations. Some of these other people out there, they do. We don’t and we won’t take money unless either we think we have a really significant chance of success or if there’s a tremendous upside and like you know, let’s say you’re just dead in the water, but you were doing a million dollars a year and we’re going to charge a $2,000 to do the plan of action and try and get you back online. We’ll put an our retainer agreement. Listen, we think we’re going to lose, but if we’re successful, you’ll get your million dollar account back. So we don’t charge for consultations. I love the events and when I’m talking to sellers, I’m listening to them. They’re teaching me. I’m giving my two cents and trying to help them out and that it’s, it’s part of what I love. I mean, I’m clearly in this answer. I’m a very verbose guy.
Stephen: [45:41] Well, you love the talk just like me and although you’re probably a little smarter. Okay, so usually at the end of the call I asked for help people get unstuck and I just think that I don’t know that that’s where I want to go with you. I really when I want to do is get your contact information, but I’m thinking what I’d like to do is kind of see what you’re seeing or have you tell us what you’re seeing because you just. You were just in England last week or the week before. I mean, you’re doing a lot of extensive traveling, you’re seeing a lot of sellers, you’re seeing other marketplace, which is very exciting for me to hear. I’m interested to hear what you’re seeing and where you think things are going. Especially for just 2019. You don’t have to go too far out, so first best way to get in contact with you. If somebody has a question, they want a consultation. What’s, what’s the website?
CJ: [46:30] Amazon seller’s lawyer. DOTCOM sellers is plural, lawyer singular, and my email is in the top right hand corner and there’s a toll free number, you know, unlike Amazon, you can actually call and speak with us, uh, with our staff, you know, all, all the account reviews and all the plans of action come out of our New York office. It’s a beautiful town that I grew up in called Long Beach, Long Beach, New York. But we’ve also expanded where we have a swing shift with a train paralegal who can take your calls and get the information in and also give you free advice. And then what we recently did is my partner’s brother wanted to relocate to calve,
Stephen: [47:10] Fornia,
CJ: [47:11] right? And we didn’t want to lose it. His name is Vincent [inaudible]. He’s an incredible guy. He graduated from.
Stephen: [47:17] He’s gone for the week.
CJ: [47:18] I hope not. I hope not. So he graduated from beloit college. He’s been working with us for years and I’m like, you know what, why don’t you do this? Forget California, we’ll send you to Australia. It’s like, why? I’m like, you live in just a beautiful places, California and you’ll help us cover around the clock. So we’re now able to to help sellers from eight in the morning, eastern time all the way around the clock to [4:00] AM eastern time just by having one of our team located in Australia and it’s worked out really nicely. Um, it also helps us help our clients deal with Chinese factories because they’re also, he is awake during Chinese business hours if you’re doing sourcing from China. So we’re going to continue to do that. So while everything comes out in New York and no one hears working a bid night shift, we’re able to help sellers from [8:00] AM all the way to 40 and we’re not around the clock yet, but we’re pretty darn close.
Stephen: [48:22] Pretty close. And you can practice in every state, correct?
CJ: [48:25] Yes. Okay. Well, when it comes to the Amazon issues, we can, when it comes to like local lawsuits, then we cannot, between the five lawyers that are on our team now, it’s probably about a half a dozen state
Stephen: [48:37] admitted and give or take, but for the Amazon site, which is I think where most people are going to have challenges. Okay.
CJ: [48:42] Alright. Maps on sellers in every state in the union. And I think every continent except the Arctic ones.
Stephen: [48:48] I don’t know if they have warehouses there yet, but they will soon enough. Okay. So, so again, in rather than ask you for, you know, to get past stuck, I think we’re past that point with you. I think, uh, I’d like to see where you think things are going really for next year and the best practices that you see, the top sellers that you deal with, what they’re doing,
CJ: [49:09] brand development, developing your privately private label brand of developing an asset that you own. They’re still a fortune to be made and buying and selling other people’s products, other companies, products in retail arbitrage to still tons of money to be made. But I think as 2019 rolls around, they’re going to start squeezing more and more. There are more brands making deals with Amazon’s is more of the bigger brands controlling who sells their products. The whole transparency code will eventually be problematic for sellers. So I would explore the opportunities to develop your own products and also in light of our political climate, whether you are a trump fan or not, there are tremendous tariffs that are coming in January first and I think that we need to expand where we source sellers need to start looking at Taiwan and Vietnam and Thailand, Mexico, Mexico, and Costa Rica. Okay. You got to start looking for other countries other than China to source your products. And there’s a ton out there. Um, I think, you know, Tim Jordan, he does a lot of sourcing trips to Guatemala where they have these really great handicrafts. So developing your brand and finding other sources of goods other than China.
Stephen: [50:29] Dude, that’s awesome. Well, I really appreciate you taking the time. I think these are great ways to get your account or to keep your account in good standing. And, and you know, nothing’s guaranteed, nothing’s set in stone. Um, challenges are gonna happen. But man, if you can keep to the straight and narrow, if you do your best, like you said, monitoring your brands that you’re selling and really pay attention while you’re developing your own brand. You know, what a great transition you can make. So very, very cool. Thank you so much Cj. I really,
CJ: [50:58] yeah, I really appreciate you letting me know. Say my website, but if I could take a few moments to actually promote something else, I’d really appreciate it. You what it is. Okay. All of us might cut you off. Let’s say you interact with Amazon, also shop on Amazon and Amazon has a fantastic program called the Amazon smile program where if you shop through Amazon smile and you can then pick a charity of your choice and it doesn’t cost the buyer or anything. It doesn’t cost a third party, third party seller anything. It’s Amazon takes money out of pocket and donated to a charity. And the charity that I asked you to pick is called the Thai Louis Campbell Foundation. Tui, a tie. Louis Campbell Foundation,
Stephen: [51:43] Louis L E W I s
CJ: [51:45] oh o U I s
Stephen: [51:46] l o U I s foundation
CJ: [51:50] ty Louis Campbell Foundation Campbell,
Stephen: [51:52] Cam p b
CJ: [51:54] e l l
Stephen: [51:56] foundation. Wow, that’s a lot of words. Okay. So ty Louis Campbell Foundation. And what does it, um, what does, what do they do?
CJ: [52:04] They raise money to find better treatments and cures for pediatric cancers. Okay. Wow. All right. Now you got me. You got me on that one. Tactic. Foundation. My Buddy Lou was the dad. His wife Cindy was ty’s mom, tie dyed after awful to your fight, uh, with an aggressive form of brain cancer and they turned this awful tragedy into this incredible foundation. So if you’re shopping on Amazon, it’s a couple extra clicks and the pennies add up to dollars and the dollars add up to tens of thousands of dollars and it’s a fantastic organization. Tie. Louis Campbell Foundation.
Stephen: [52:40] Campbell Foundation. Okay. I’m going to put the link out on this website. On this episode. I’m, but I’m going to make my purchases and a tie. Louis Campbell Foundation will get the benefit this year. That’s a very, very cool. All right, well hey man, I really appreciate you taking the time. Again. I love what you’re doing. I love. I love the fact that you’re paying attention to people and giving them immediate answers. Staying Open. I know it’s not easy. I’m sure it’s expensive, but it’s a smart move. It’s the long play. You’ve got to develop the relationship and you guys are doing a great job with a very, very cool. Thank you so much.
CJ: [53:11] Thank you.
Stephen: [53:13] Great Guy. Great Advice. Again, take these things seriously. I mean taking those photos. Yes, it’s an extra step, but how much time suck is it trying to get ahold of somebody to get your. When they say your stuff was damaged, it wasn’t damaged or I saw a friend post at his box was empty. They said that and it’s a second or third time it’s happened to them. They’re saying, oh yeah, there was no products in the box. I mean, come on. Of course there were products and nobody ships in empty box, but that stuff happens. So is that extra step taking some pictures, you know, if you’re only. Especially if you send them in by the pallet that’s even really strong if you’re doing once or twice a week. Um, it’s not a big deal. I think I’m gonna have to start doing that for our clients because I just think it’s so important. Um, ecommerce momentum.com. ECOMMERCE momentum.com. Take care.
Cool voice guy: [53:55] Thanks for listening to the incomers momentum podcast. All the links mentioned today can be email@example.com. Under this episode number, please remember to subscribe and like us on itunes.