Amazon and China Knocked Me Down 2 Times

I have to say I am still not very happy about that but hey, all markets evolve and you have to roll with the punches.

In 2011, our online business was thriving, we had so many new brands, the website was known for having all the new sexy underwear, pushing bounderies by offering brands that were really specific, we introduced lace for men for instance.

 

But then, Chinese manufacturers started selling directly at a third of the price we were selling to or even less. They started selling through on amazon but also on aliexpress and later on wish. Copies have always been a big part of fashion. Designers always get influenced by other's designs. What was new, was that the Chinese factories were able to sell copies using the original brand images and even brand's name with the blessing of Amazon.
Even though the quality was not the same, we got many customers who discovered copies of the brands we carried at dirt cheap price and they were not happy, wondering why our prices were that expensive. Of course when you sell directly, from China, with no middle man and with no duty tax, it's a different game. They could offer retail prices even lower than the original product's wholesale price. Remember we told you the first brand we carried was N2N Bodywear ? Well, this brand got knock offs on every website using the original pictures, the original name and even the original designer's name. Now the American company is just the shadow of what it used to be. Unfortunately for us, it also was our biggest seller. This brand made 30% of our sales. 

Chinese copy at 13usd when the wholesale price was 28 usd

When we launched our own brand PetitQ we had the same issue, we had a collection of 12 items every 6 months but they were copied right away and put on amazon with our own pictures. Our first season went really well thanks to a viral video. But if you get viral, then you also get noticed by Chinese factories which will copy everything you do.
Amazon and its peers have killed many Western brands because of an unfair situation. They are actively responsible for this situation because they knowingly let Chinese factories use images and names they had no right to use.

As retailers we wondered if we should have sold these "cheap chinese brands" because there was a big demand for it and truth be told, some factories offered their own designs and their products were of good quality. But with the price difference compared to our own brand was it a bad move for us ? We completely reinvented ourselves by turning our 60+ brand retail into a 1 brand retail that we manufacture by ourselves in China, but that's a whole another story.

But these new beginnings have almost been completely squashed by Amazon. Again. We decided to use Amazon FBA to ship our customers in Europe, and move all our business to China where we now manufacture our products. But there was a glitch in processing our application and it took 6 months to fix it, and for the last 3 months it was not possible for us anymore to ship any new inventories to Amazon's warehouse. For 3 months, we had no new arrivals on our website when our whole business model  is based on having new products twice a week. Our revenue went down by 50%. We had to use all the resources we could find to fix this. We finally were able to reach directly to Amazon France's CEO by email and the situation was fixed within 30 minutes...

To make everything worse, Amazon's policy on images and products is very strict on what they call nudity. If only it were the same for copyright infrigements... Our products are easily put in the adult section, which has way less traffic, or our photos deleted (ever tried to sell underwear online with no photo ?) In the US, showing on a human body is forbidden, but even showing on a mannequin is forbidden. You need to invest in 3D pictures, but when you have more 100+ new products each months, each having 3-4 photos to show every angle, it's just a mess. When you have no money in the bank because you were always invested and you didn't get a loan (we'll talk about French banks one day) it's very difficult. In the end, Amazon has killed many of the biggest underwear retailers (Freshpair, Undergear, etc...) but brands can't get the same level of sales out of amazon because it's the kind of product that needs to be seen on a human being to be sold.

They say you always need to get some positive from a bad situation so I'll try to tell you what I learnt.

• Try to save money : Even though the business was thriving, we should have kept some money on the side. Honestly it wouldn't have been much. Since we only imported products, we had to pay when the suppliers shipped, meaning 2 weeks before the products being on the website so we were always running low on cash.
• You have to respect the brands, I am talking for amazon, aliexpress or wish here. When you searched for a brand, you shouldn't find knock-offs using the pictures of the brand.
• Have people dedicated at solving issues, when someone tries to contact you on linkedin or twitter for a professional matter, answer. By not answering Amazon made us lose a lot of money and it really gives them a bad image. For sure, we will try to live without Amazon if ever this opportunity appears. All those giants have a weird system with closeted services that can't talk to each other. It's very frustrating for the customer and not effective at all for the organization. You need a special team able to reach any information in the company.