Hey, I'm John Crestani and I've made millions of dollars online. And I'm going to
go over the reality of the Amazon FBA business opportunity. I've been seeing a
lot of people talk about. And I'm going to lay out point by point what you should
know before you even consider starting an Amazon business. Let's get it. Hey, John
Crestani here. I run a seven-figure internet business. I've been doing this
for years without any employees. I've seen a lot of people talk about Amazon
FBA. Start an Amazon business. And I'm just going to kind of like point out the
realities of the situation to help you understand before you invest thousands
or tens of thousands of dollars in starting an Amazon business so you don't
lose your shirt. So, the first thing to understand about Amazon is there are 6
million other sellers that you are competing with, okay? It's a very
competitive marketplace. You're literally competing with 6
million other people. Now, that's not to say there's a lot of people making money
here. But the reality is a look on my screen here, there have been a growing
number of articles talking about how people are losing tens upon tens of
thousands of dollars because people are being taught that they can get rich
quick. And right here, you'll see it was only after they'd sunk $40,000
and 9 months of nights and weekends that they realized that they
couldn't make any money on Amazon. So, reality is this is a super competitive
marketplace. And if you're not willing to invest, you're going to have to have at
least like $25,000 to really make it with FBA. Again, this is
a business and you're going to have to come out of pocket a lot of money. So, there's
a number of gurus, gurus out there that I've seen saying you can get started for
as little as $1,000. Are you joking me? A thousand dollars is will get you nowhere
on Amazon. You have to deal with physical products. You have to have customer
service, you have to have a support website. You have to buy all the products
months in advance labell them and send them from China
usually to an Amazon warehouse in Tennessee. You're coming out of pocket a
lot of money and you're spending a lot of time before you're even going to
begin to see a nickel on that. Okay? The second thing you have to realize is
costs, okay? To start the program, you have to pay 39 bucks, okay? No big
deal to be a member of Amazon FBA. But what they're not telling you is to store
your products in their warehouse. FBA means fulfillment by Amazon. It means you
ship your products months before you sell them to Amazon. And you actually
have to pay Amazon to store your products for them. Which sort of doesn't
make sense, right? Because they're making 25% cut on whatever they're selling
through their store. So, off the top, you're already paying Amazon 25%. And
you're paying them usually something like let's round it up to about a dollar
per foot of warehouse space per month. Now, I'm not going to do the math here
because these are not hypothetical situations. However much product you have,
you're going to have a bunch of feet that you're going to have to have your product
sitting in Amazon's warehouse for months. And you're going to have to be paying
Amazon the storage fees which are quite high. And on top of that, you're paying
them money. So, the costs are very real. And you're going to have to be willing to
come out of pocket thousands or more likely if you want success. Tens of
thousands of dollars to even hope that your business works out. And the reality
is for most Amazon sellers, you're going to have to go through product after product
after product after product to figure out a particular product that works. And
that markets well and that actually hits. So, you'll have to go through trial and
error many times before you do this. And all the time, you're paying Amazon for
storage fees. You're making a much lower margin than you think.
You're paying monthly fees and you've come out of pocket for all of those
products. Once again, you're still going to need to have
customer service, you're going to need to have a website. You're going to need to have
all of this sort of stuff to deal with just the inherent things with a product
based business. It's not easy to start a product-based business. It's not cheap,
The third thing you have to understand about Amazon is bands, okay? It's so easy
to get bands. I mean there was just an article out. Come over here. Look at this.
Amazon has banned thousands of sellers, okay? Here's 11 reasons Amazon can
ban your account, okay? They can ban you for any reason what they want. If your
products quality is not high enough, they can ban you. Okay? Let's say you kind of
don't want to invest as much and you want to kind of skimp on customer
service, right? Or product support. They can ban you if you don't respond to
customers, okay? Or if you don't deliver a product fast enough. Let's say you're
trying to fulfill the product on your own. They can ban you. Your entire account.
And all of the money you invested in product because your delivery took too
long or you deliver to a wrong address. For logistics, they can ban you for
abnormal account performance. If you make too much money in a day. Let's say, you
start selling a lot of your product, they can ban you. If you use the wrong UPC
code. There's a million reasons. If you get reviews the wrong way. Let's say you
ask your friends or family for reviews of your product because you're trying to
get your store off of it. They can ban you. They can ban you for a lot more
reasons than that. And they've recently been reports of thousands. I don't know
if you've read the news lately. But thousands. I think over 10 thousand
Amazon sellers were banned in a weekend. Just because Amazon did a sweep and they
just ban tons of accounts. Now, this will bring us to our fifth point which I'll
go over in a little bit. But bands are a serious problem on Amazon and again,
you're reliant on a single platform. So, if you don't sell that product on Amazon,
you are out a lot of money, okay? And that's a big cost. Everything you've
invested in your business, if you are banned, it all goes
away. And you've lost a lot of money. The fourth reality of Amazon FBA that the
gurus aren't telling you is that there's a lot of fraud on Amazon. The biggest
source of fraud is review fraud. Now, again, I already stated. This is a reason
that Amazon can ban your account. If you try to get reviews of your products in
an unfair way, let's say you ask your brother, your mother, somebody associated
with you, Amazon's the biggest company in the
world. Do you think they don't know if you're getting your mother, your brother,
your friends or your family to review your products? Of course they do.
They're very witty algorithms to figure that out. So, one of the things that
amazon has been doing lately is just banning lots of reviewers. A lot of
Amazon sellers have been using what are called review farms. They pay some
individuals usually in Russia or China to review their products or have a lot
of Chinese or Russian people review their products so their products can
look more appealing in the marketplace. Now, this has caused lots of problems for
Amazon. So, on one hand, they are banning accounts. So, if you do that, you'll get
your account banned and there have been other problems with that. So, you see you
know, there's amazon routinely. This is from Business Insider. Amazon routinely
removes accounts and vendors that violate its review policy. But new data
shows that it is drastically stepped up its enforcement this year. What that
means for you as a seller on Amazon is that once again, you are reliant on a
single platform and if they close your account, all of the money that you had
invested in product goes away. And you end up with a huge loss. And the margins
you're hoping to make are generally pretty small on products. So again, that's
a big problem. And you look... There's even a a reddit forum called the great Amazon
purge. There's a forum devoted to talking about all of the people who have been
banned from Amazon. It's a big problem. Now, the second side of the review fraud
is that people can also use it against you. I talked about how you can, you know,
hire Chinese or Russians to review product and move it up. But the opposite
can also be true. As if, let's say you're selling notepads, right? Big, big fat
notepads. And let's say you enter in the market and you start moving up the
rankings and people are buying more and more of your notepads on Amazon. Existing
people in that market can actually fraudulently review against you. And they
can hire a bunch of people to give you one star reviews and say that your
product quality is horrible and they can say that you don't deliver on product
etc. Now, look at this. You can have people hijack
your brand, deface it. Look at this. Phony fires. Sellers will buy their rivals
product light it on fire and post a picture to the reviews
claiming it exploded. Amazon is quick to suspend sellers for safety claims. You
can have your entire business shut down in the beginning because a competitor
bought your product and claimed it exploded. That's how easy it is to just
ruin your business. Again. And this is all going to come back to our number 1
point. Here's another example of the massive fraud that can go on and how
competitive it is. So, there's defacement. So, a competitor can actually click on
your listing and say that you've miss appropriately labeled the product you're
selling. They can say instead of selling notepads, you're actually selling
pornographic images. That would be another big problem. And the
sophisticated people on Amazon can hire 20 people to say, "Hey, I bought a product
from these guys. They're all pornographic images. This is a front. This is a front
for selling child pornography." And suddenly, boom! All of the money that you
invested in buying a product from China shipping it to Amazon's warehouse is all
gone in an instant. And it's going to take you lots of time and money to even try
to recover everything. Now, the number 1 problem with Amazon is a very obvious
one. And I have stated it a few times over the course of this training. But its
reliance on a single platform, okay? When you are selling on Amazon,
your entire business is reliant on a single platform. If you buy into a gurus
business opportunity about starting an Amazon FBA business, once again, this is
the business you're starting. You've put your entire business and made it fully
reliant on one company who has the power to say, "You can keep selling or you need
to stop selling or we will put your products at the top or we will put your
products at the bottom." Again, you have no control over your business.
Whenever you're reliant on a single platform, you don't have a business. Plain
and simple. So to all the gurus out there that are peddling Amazon FBA businesses,
these are not businesses. These are outlets. Amazon is a great outlet to sell
a product if you have a pre-existing product. If I own a notepad company or a
light company or a camera company, it is a great outlet to sell my cameras or my
lights or my furniture my lawn chairs or my pillows. But Amazon FBA is not a
business you necessarily want to start unless you have some key advantage. But
once again, if you're thinking that the way you're going to get rich is starting
in Amazon FBA business or if you've invested money already, you're playing a
risky game. I know people have made some money doing it but once again, it's a
very risky game and it's very cutthroat. So just be advised and be aware of the
risks associated with the business. Now, if you want to learn more about how to
start an internet business, I've been running a business online since 2012 and
I've been making millions of dollars a year without any employees just kind of
living like a digital nomad and doing my thing. I advise you to subscribe to my
channel. You'll get access to a couple free courses. I personally do affiliate
marketing. You can learn about that. You can also check out some of the free mini
courses that I have available. About copywriting. One of my friends does run
an Amazon FBA business so you can check out his material there of what he post
about. nd I have a number of other friends and mini courses on my channel
where you can learn more about how to be an internet entrepreneur. It's a really
great life. Put a like in the video if you
enjoyed this material. And put a comment below if you'd like me to expose more
kind of scams or expose the reality of more situations. If there's a specific
internet business that you're interested in but you're not sure of what the
actual reality is, please let me know in the comment, I'll do a deep dive into the
business model. Let you know my thoughts about the reality of the situation.
Without all of the guru talk around it. Looking forward to seeing you soon.
Subscribe to my channel. Love to see you on next video.