The myths of selling on Amazon

TL;DR

• Amazon myths can mislead sellers into making poor decisions. Understanding what’s true is key to succeeding on the platform.

• FBA simplifies logistics but doesn’t fix all issues like storage fees or inventory mismanagement. Stay proactive to make it work.

• Price alone doesn’t win the Buy Box. Focus on account health, shipping speed, and customer reviews to stay competitive.

• Not every seller needs to join holiday discount trends. Analyze your margins and demand to decide if discounts fit your strategy.

• A strong brand presence sets you apart from competitors. Use branding tools like A+ Content and focus on building trust with customers.

• High sales don’t always mean high profits. Monitor costs like Amazon fees, advertising, and shipping to ensure sustainable margins.

Selling on Amazon sounds like a dream, right? You list a product, sit back, and watch the sales roll in. At least, that’s what many people believe. But let’s be real—Amazon isn’t a magical money-making machine. It’s a powerful platform, sure, but it comes with its fair share of challenges, especially when misinformation and myths cloud your judgment.

You’ve probably heard things like, “All you need is one product to make millions,” or “Amazon takes care of everything.” Sounds too good to be true? That’s because it is. These myths can mislead sellers, waste time, and even hurt your business.

In this blog, we’re busting the most common myths about selling on Amazon. 

Quick guide:

• FBA solves all your logistical headaches

• Low prices always win the Buy Box

• Every seller should slash prices during holidays and big sales events

• I have to source products from Alibaba to sell on Amazon

• Amazon’s rules are easy to understand

• Seller support is here to help

• Lowering your price is the only way to beat competitors

• The more products you list, the more money you’ll make

• You don’t need to worry about branding when selling on Amazon

• High sales automatically mean high profits

• You can rely entirely on Amazon for traffic and sales

• The best-selling products are always the safest bet for new sellers

• You need a big budget to succeed on Amazon

• Not every shiny new Amazon program is built for your business

• Amazon is too crowded

• I can DIY selling on Amazon

#1: FBA solves all your logistical headaches

Let’s be honest—when you first hear about FBA (Fulfillment by Amazon), it sounds like a dream come true. Amazon stores your products, packs them, ships them to customers, and even handles returns. No more worrying about warehouses, shipping labels, or customer complaints, right?

Well, not exactly.

FBA does take a lot off your plate, but it doesn’t solve all your logistical headaches. For starters, FBA comes with its own challenges, like storage fees (which can skyrocket during the holiday season), inventory limits, and the risk of losing or damaging your products while they’re in Amazon’s warehouse. Oh, and let’s not forget that those fees for handling returns and long-term storage can add up fast, eating into your profit margins.

Another issue? FBA doesn’t mean you can stop managing your inventory. If you send too much stock, you’ll pay for storage fees. Send too little, and you risk stockouts—which hurt your sales and ranking. You’ll also need to regularly monitor Amazon’s inventory reports to catch mistakes, like lost or damaged items, because they don’t always reimburse you automatically.

To make FBA work for your business:

• Understand all the fees involved and calculating whether your product can still remain profitable

• Keep track of your stock levels to avoid unnecessary fees and missed sales opportunities

• Regularly review your reports to catch any lost or damaged items and file claims when needed

• If some products don’t sell quickly, consider alternatives like third-party storage or using Fulfilled by Merchant (FBM) for those items.

FBA can simplify logistics significantly, but it’s not entirely hands-free. With proper management and regular monitoring, it can be a valuable tool to help grow your Amazon business.

#2: Low prices always win the Buy Box

It’s easy to assume that offering the lowest price is the key to winning the Buy Box on Amazon, but that’s not how it works. While price is a factor, it’s not the only one. Amazon looks at several criteria to decide which seller gets the Buy Box, such as account health, shipping speed, customer reviews, and seller performance metrics.

A seller offering a slightly higher price but with fast delivery, excellent customer service, and high ratings can easily beat someone with a lower price but poor metrics. Amazon prioritizes the overall customer experience, so being the cheapest doesn’t always make you the best option in their eyes.

To improve your chances of winning the Buy Box, focus on delivering consistent performance. Keep your account health in good shape by responding to customer inquiries quickly and maintaining a high order defect rate. Offer competitive shipping options, such as fast or free delivery, and ensure that your products are always in stock. Monitoring your product’s pricing is still important, but don’t undercut yourself to the point where your profits suffer.

Winning the Buy Box isn’t just about offering the lowest price—it’s about providing the best overall value to the customer. By balancing competitive pricing with strong performance metrics, you can increase your chances of claiming that valuable spot.

Related blog post: The Amazon Buy Box - 10 Proven Strategies To Win

#3: Every seller should slash prices during holidays and big sales events

It might seem like every seller should join the price-cutting frenzy during Prime Day, Black Friday, or holiday sales, but this isn’t true for everyone. While these events can generate massive traffic, slashing prices blindly doesn’t work for all products or businesses. Sellers with tight margins may find themselves losing money rather than making it. Additionally, not all products benefit from seasonal hype. Niche items or those with steady demand year-round may not see a significant sales boost, even with discounts.

For some sellers, maintaining their usual pricing strategy during these events can be more profitable. Instead of focusing solely on discounts, you can promote bundles, offer free shipping, or create value-added deals that appeal to customers without sacrificing margins.

To decide whether discounts are right for you, analyze your product’s demand, competition, and margins carefully. Use tools like Amazon’s sales reports to see how your products perform during such events in previous years, if applicable. Test small promotions instead of slashing prices across your entire catalog. If a big sale doesn’t align with your business goals, focus on maintaining inventory and preparing for post-holiday demand, when sales often stabilize.

#4: I have to source products from Alibaba to sell on Amazon

Many new sellers believe they must use Alibaba to find products to sell on Amazon, but that’s not true. While Alibaba is a popular option for sourcing affordable goods in bulk, it’s not the only way to find products. There are plenty of alternatives, depending on your business model and the type of products you want to sell.

For instance, you can source from local wholesalers, manufacturers, or even artisan makers to create unique offerings. If you’re focusing on private label products, Alibaba is just one of many global sourcing platforms. Sites like Global Sources and IndiaMart also offer great options for finding suppliers. If you prefer not to deal with bulk inventory, you can explore dropshipping, where products are shipped directly from the supplier to the customer, or print-on-demand services for customized items.

Sourcing locally can also be a smart move, especially for sellers who want to avoid long lead times or high shipping costs. Many sellers find success by working with small businesses, local artisans, or even attending trade shows to discover unique products.

What’s most important is to choose a sourcing strategy that aligns with your goals. Whether it’s Alibaba, a local supplier, or a completely different approach, the focus should be on quality, profitability, and the ability to meet demand. Take time to research your options, request samples, and ensure your chosen supplier is reliable.

Related blog post: Are you struggling with inventory? Learn how to sell on Amazon without it

#5: Amazon’s rules are easy to understand

Ha! If only that were true. Amazon’s rules are anything but straightforward. From listing guidelines and product restrictions to account health metrics and reimbursement policies, their rules can feel like a maze. Just when you think you’ve got it figured out, Amazon updates its policies or introduces new terms, leaving sellers scrambling to keep up.

One of the biggest challenges is how vague or inconsistent some rules can seem. For example, you might think your product images are perfect, but then you receive a warning because they don’t meet some obscure guideline. Or you’re flagged for a policy violation, and the explanation feels more confusing than helpful.

To avoid headaches, it’s essential to stay informed and proactive. Regularly check Amazon’s Seller Central for updates, especially in the sections related to your product category. Take time to thoroughly read policies and guidelines—even the fine print. If something isn’t clear, look for resources like Amazon webinars, forums, or third-party blogs that break down complex rules into simpler terms.

And don’t assume you’ll never make mistakes. Almost every seller has run into a rule they didn’t fully understand. When that happens, learn from it, correct the issue, and move on. Or you can hire Amazon consulting agency to firefight the issue. 

Related blog post: Amazon restricted keyword list 2024

#6: Seller support is here to help

Hilarious, right? Anyone who’s dealt with Amazon Seller Support knows it can feel more like navigating a black hole than getting actual help. While Seller Support is technically there to assist, many sellers find the responses generic, slow, or, at times, completely irrelevant. It’s not uncommon to spend hours explaining your issue, only to receive a templated reply that doesn’t address the problem at all.

That being said, Seller Support isn’t useless—it’s just not always efficient. The trick is knowing how to work with them. When submitting a case, be as clear and concise as possible. Include screenshots, order numbers, and any supporting documents to make your issue easy to understand. Following up politely but persistently can also help move things along.

For more complex issues, forums like the Amazon Seller Forums or third-party support groups can be lifesavers. Experienced sellers often share tips and workarounds that can solve problems faster than waiting for Seller Support to respond.

It’s frustrating, but Seller Support is what it is. Instead of expecting instant solutions, treat it as one part of the process and lean on additional resources when needed. Sometimes, you’ll get lucky with a helpful rep, but most of the time, patience and persistence will be your best tools.

#7: Lowering your price is the only way to beat competitors

Lowering your price might seem like the easiest way to beat competitors, but it’s far from the only strategy—and often not the best one. Constantly slashing prices can lead to a race to the bottom, shrinking your profit margins and undervaluing your product in the long run.

Winning against competitors isn’t just about having the cheapest price. Customers also look for quality, trust, and convenience. A well-optimized listing with great images, detailed descriptions, and strong reviews can do wonders for standing out, even if your price is slightly higher. Similarly, offering faster shipping, better packaging, or additional value (like bundles or warranties) can make your product the preferred choice.

Another effective way to stay competitive is through advertising. Running Amazon PPC campaigns can help your product show up in front of the right audience, even if you’re not the cheapest option. Additionally, maintaining a good seller rating and excellent customer service builds trust, making customers more willing to pay a bit extra for your product.

Lowering your price should be a strategic decision, not a default reaction to competition. Focus on improving the overall value of your offering, and you’ll find that price isn’t the only factor that drives sales.

#8: The more products you list, the more money you’ll make

It’s easy to think that listing more products means making more money, but this isn’t always true. Simply flooding your Amazon store with products won’t guarantee sales—what matters is the quality of the products, how well they’re optimized, and whether they actually meet customer demand.

Listing too many products without proper research can backfire. You could end up with slow-moving inventory, high storage fees, and wasted advertising spend. Plus, managing a large catalog requires more time and resources for inventory tracking, listing updates, and customer support.

Instead of focusing on quantity, focus on listing the right products. Research your market, analyze demand, and choose items that have potential for steady sales and profitability. Once you’ve identified a product, invest time in Amazon optimization services to create a well-optimized listing with compelling images, detailed descriptions, and the right keywords.

It’s better to manage a smaller, profitable product lineup than to spread yourself thin with a large catalog that doesn’t perform. Quality over quantity is the smarter way to build a sustainable business on Amazon.

#9: You don’t need to worry about branding when selling on Amazon

Many sellers think branding doesn’t matter on Amazon since customers focus on price and reviews. But that’s far from the truth. Branding can make your product stand out in a crowded marketplace and build customer loyalty over time.

Without strong branding, your product risks becoming just another generic listing. A clear and professional brand identity—complete with a memorable logo, cohesive product packaging, and a consistent tone in your copy—helps you create a lasting impression. Customers are more likely to trust and choose products that feel credible and premium.

Investing in branding also helps when it comes to repeat business. If customers recognize your brand and associate it with quality, they’re more likely to buy from you again, even in a competitive space. Amazon tools like A+ Content and your Brand Storefront give you opportunities to showcase your brand and build trust.

Branding isn’t just for big companies. Even small sellers can create a brand that resonates with customers and gives them a reason to choose you over competitors. On Amazon, a strong brand can turn a one-time purchase into a long-term relationship.

Related blog post: Easily-missed brand-building opportunities for Amazon sellers

#10: High sales automatically mean high profits

It’s a common assumption that more sales equal more money in your pocket, but that’s not always the case. High sales don’t automatically translate into high profits because there are many costs involved in selling on Amazon. These include Amazon’s fees, advertising expenses, shipping costs, and product sourcing. If your margins are thin, even a surge in sales can leave you with very little profit—or even a loss.

For example, if you’re heavily discounting products to boost sales, those discounts can eat into your margins. Similarly, aggressive ad campaigns might drive a lot of traffic, but if your ad spend outweighs your profits, those high sales numbers won’t feel very rewarding.

To truly make your sales count, focus on optimizing your margins. Start by calculating all your costs, including Amazon fees, fulfillment expenses, and advertising, to determine your break-even point. Use tools like Amazon’s Revenue Calculator to understand your profitability per product. Then, look for ways to increase efficiency, such as improving your ad targeting, negotiating with suppliers, or bundling products to increase average order value.

High sales are exciting, but sustainable profits are what keep your business growing. By keeping a close eye on your costs and profitability, you can turn strong sales into real success.

#11: You can rely entirely on Amazon for traffic and sales

Relying only on Amazon for traffic and sales might sound convenient, but it’s not a good long-term strategy. Yes, Amazon has millions of shoppers, but so do your competitors. Without additional effort to promote your products, it’s easy to get lost in the crowd, especially if your product isn’t ranking on the first page.

Another issue is how much control Amazon has over your visibility. Changes to their algorithm or an unexpected suspension of your account could instantly cut off your sales. If you depend entirely on Amazon, your business becomes vulnerable to these shifts.

Instead, think about ways to bring traffic to your listings from outside Amazon. You can run ads on social media platforms like Facebook or Instagram, collaborate with influencers to showcase your product, or even build your own website to create a dedicated audience. These extra efforts help you reach more people and make your business less dependent on Amazon alone.

Amazon is an amazing tool for sales, but it works best when you combine it with your own marketing efforts. Diversifying where your traffic comes from ensures that your business stays strong, no matter what changes happen on Amazon.

#12: The best-selling products are always the safest bet for new sellers

It’s tempting to think that jumping on the bandwagon of best-selling products is the safest way to start selling on Amazon. After all, if something is already popular, it should be easy to sell, right? Not exactly. Best-selling products are often in highly competitive niches, meaning you’ll be up against established sellers with thousands of reviews, big advertising budgets, and optimized listings. Breaking into such markets can be tough, especially for new sellers.

Another issue is market saturation. By the time you’ve sourced and listed the product, dozens of other sellers may have done the same. You could end up fighting for scraps in a crowded space instead of building a profitable business.

Instead of going for the most popular products, focus on finding opportunities in underserved niches. Look for products with steady demand but less competition. Tools like Jungle Scout or Helium 10 can help you identify these opportunities by analyzing search volume, sales data, and competition levels.

The best-selling products might look appealing, but they’re not always the safest bet for new sellers. By starting with products that have lower competition and solid demand, you’ll have a much better chance of success.

#13: You need a big budget to succeed on Amazon

Many new sellers believe that only those with deep pockets can succeed on Amazon, but that’s not true. While having a bigger budget can help scale faster, it’s entirely possible to start small and grow over time. The key is to be smart about where you invest your money and focus on building a sustainable business.

You don’t need thousands of dollars to get started. Many successful sellers start with a limited budget by choosing low-cost products, testing smaller quantities, and gradually reinvesting profits. Tools like Amazon PPC can be used with minimal daily budgets to drive traffic without overspending. It’s all about starting lean and making data-driven decisions.

Instead of focusing on how much money you have, focus on optimizing what you do with it. Invest in a high-quality product, create an optimized listing with strong images and keywords, and test small ad campaigns to see what works. Over time, you can use your earnings to scale your operations.

You don’t need a big budget to succeed on Amazon—you just need a solid plan and the willingness to adapt and grow step by step. Many sellers with small budgets go on to build thriving businesses.

#14: Not every shiny new Amazon program is built for your business

Amazon constantly rolls out new programs and features, from premium advertising options to subscription-based tools. While these can be exciting and useful, not every program is a good fit for every seller. Jumping into every shiny new offering without evaluating it first can lead to unnecessary expenses or wasted time.

For example, programs like Amazon Transparency or the Climate Pledge Friendly badge may be great for some brands but might not align with your current goals or product line. Similarly, advanced ad formats like Sponsored Display can be powerful but require a clear strategy and budget to see results.

Before signing up for any new program, take time to understand how it works and how it aligns with your business needs. Ask yourself if it will genuinely improve your sales or operations. Research case studies, read reviews, and even test the program with a small budget if possible.

Amazon’s programs are designed to help sellers grow, but that doesn’t mean they’re all worth your time or money. Focus on tools and features that fit your goals, and skip the ones that don’t bring value to your business.

#15: Amazon is too crowded

Yes, Amazon is competitive, and millions of sellers are on the platform. But that doesn’t mean it’s impossible to succeed. The key is to approach the marketplace strategically rather than feeling overwhelmed by the numbers. Many sellers fail because they don’t research their niche, optimize their listings, or invest in advertising. With the right approach, you can still carve out your own space, even in crowded categories.

Instead of worrying about the competition, focus on standing out. Find underserved niches, create high-quality listings, and use Amazon tools like PPC to drive targeted traffic to your products. Pay attention to what competitors are doing and find ways to do it better, whether it’s through better branding, improved product features, or exceptional customer service.

Yes, Amazon is crowded, but it’s also one of the largest online marketplaces with millions of daily shoppers. There’s plenty of opportunity for sellers who are willing to put in the effort to stand out. Crowded doesn’t mean impossible—it just means you need a plan.

#16: I can DIY selling on Amazon

It’s tempting to think you can handle everything on your own when selling on Amazon, especially with all the resources and tools available online. While it’s true that many sellers start this way, managing every aspect of your business—from sourcing and listing creation to advertising and inventory management—can quickly become overwhelming.

Amazon has a lot of moving parts, and even small mistakes can lead to lost sales or penalties. For example, poorly optimized listings might not get the visibility they deserve, or an improperly set up ad campaign could drain your budget without generating results. As your business grows, these tasks become more complex and time-consuming, leaving less time for you to focus on strategy and growth.

This doesn’t mean you can’t succeed on your own—it just means that as your business scales, having the right support can make a big difference. Selling on Amazon is doable as a solo effort, but knowing when to seek support from Amazon consultants or use resources can help you avoid unnecessary stress and keep your business moving forward.