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jimKeymasterDaniel Moore, 48, has a business called Ink Jungle that sells ink cartridges.
He has £170,000 in reserve – and it is increasing by £40,000 a day, he said.
“The value they will be holding from us is disproportionately high versus the potential refunds processed by customer returns or non-delivery,” he said. His company turns over about £16m on Amazon and employs more than 20 staff. Daniel said the withheld funds meant he will be unable to pay his £191,000 VAT bill, which is due this week. He has contacted his local MP and the Financial Conduct Authority. (Click here to read what the BBC published about this)
Here’s what Ink jungle’s Daniel Moore had to say to Tonernews.com.
We won’t go bust, we have enough stock in reserve that we will have to run down but many smaller businesses could go to the wall over this. My gripe with Amazon is that they shouldn’t need to hold half of any companies revenue for what they state “to pay for returns” when they have our bank and card details as well as holding all of our stock in FBA. They are fully protected.
Our refunds totalled just £2k for the past 30 days so why are they now holding £250k which is increasing daily? Its simply a smash and grab to hold onto sellers funds to make interest from the funds now interest rates have increased, not to protect themselves. The reserve they hold should be based on the previous months return rate plus a % in case it increases, not two weeks of your revenue. We have been trading since 2009, they have plenty of data to analyse potential risk. The reserve they hold is increasing daily with no sign of ability to withdraw any of it.
Key points I want to make.
We didn’t sign up to Amazon holding up to 50% of our monthly revenue continuously. I can’t find any terms that I agreed to stating they would do this. No need to hold onto seller funds if they have our bank and debit card details. Disproportionate amount of funds being held. i.e why is Amazon holding £250k when only £2k funds were refunded in past 30 days? Poor comms from Amazon – sent emails to wrong email addresses. My emails were sent to my login email not my Account Notifications email so we missed the communication. Inability to talk to Amazon, emails being ignored. Not viable for most sellers to leave Amazon given its our largest channel. Sellers unable to buy stock, pay bills and wages. Actions taken by Amazon could be deemed as anti-competitive as it weakens our position to replenish stock and now unable to pay creditors which could lead to reduced credit lines from our wholesalers/distributors. Amazon lending sellers own money back to sellers at 14% whilst also making interest on seller funds now interest rates have increased.
Daniel Moore: Director
Ink Jungle Limited / http://www.inkjungle.co.uk
AuthorAugust 10, 2023 at 3:28 PM
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