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Amazon Seller Horror Story: The Poisoned Apple of Drop Shipping

Wed Oct 26, 2022 Selling on Amazon

When a stranger from the internet proposes using the drop shipping fulfillment model for your Amazon business with promises of increased sales and higher profits, be sure to do your due diligence before accepting that advice. Drop shipping on Amazon is like the magic blood-red apple used by the Evil Queen in her attempt to do away with Snow White. It often presents itself as safe and delightful, but many unsuspecting Amazon Sellers will find themselves poisoned when they take that bite.

As Amazon Sellers, you need to be fully aware of Amazon’s Drop Shipping policy. In this popular blog post, an Amazon suspension lawyer at our firm explains how drop shipping works, what is required under Amazon’s policy, and the common mistakes sellers make under this model.

Today we share a drop shipping Amazon Seller horror story with the hope that you will learn from their mistake and avoid experiencing the same.

Beware of the Poisoned Apple

Snow White LLC operated a successful private label Amazon business for two years while also keeping their seller account in good standing. As their business grew, they decided to hire an account manager to help them oversee the operations. When they found a freelance virtual assistant who promoted himself as an Amazon-expert with years of experience managing multiple Amazon Seller Accounts, they wasted no time and hired him right away.

Their newly hired account manager whom we will call “Mr. Evil Queen” almost immediately recommended that they transition to using a drop shipping fulfillment model wherein they would purchase products from another Amazon Seller and have them ship directly to Snow White LLC’s customers. As a quick side note, anyone who has read Amazon’s Drop Shipping Policy quickly recognizes this is clearly prohibited.

Further, Mr. Evil Queen also assured Snow White LLC that doing this form of drop shipping would exponentially increase their sales volume. While it was true that Snow White LLC did indeed observe an increase in sales volume, it was not long before things went haywire.

Due to the overwhelming number of orders received, the credit card used for purchasing inventory was temporarily declined and Snow White LLC’s entire drop shipping system was at a standstill. To avoid exceeding the target threshold for the Late Shipment Rate, Mr. Evil Queen confirmed the shipment of orders even though they had not yet been shipped, thereby causing multiple buyer complaints.

Because such activity is considered fraudulent and deceptive, Amazon suspended Snow White LLC’s seller account, locked them out of Seller Central, and withheld their sales proceeds amounting to $155,000 USD. It was a terrifying time for Snow White LLC. They went from feeling like they were at the top of their game to possibly losing their entire business overnight.

Snow White LLC did not delay in reaching out to us when they received the account suspension notice from Amazon. In trusting a professional legal team to fight for them, Snow White LLC learned the importance of getting the right advice from the right people.

Thankfully, this horror story has a happy ending. We successfully resolved this matter through Amazon’s Executive Team – Snow White LLC’s selling privileges were reinstated, funds were released, and access to Seller Central was restored.

Speak With An Amazon Seller Attorney at ESQgo®

If Amazon suspended your seller account due to alleged violations of their Drop Shipping Policy, an Amazon Seller Attorney at ESQgo® is here to help get your selling privileges back. Contact us today by calling 866-254-6503 or via our contact page. We offer a free initial 30-minute consultation.