The threat of your Amazon seller account getting deactivated is terrifying. A deactivation could completely derail your business and leave you with no way to recoup your investment. That’s why it’s so important to understand why Amazon accounts get deactivated and what you can do to prevent it from happening to you.
Here’s what you need to know
Why Are Amazon Accounts Suspended?
If you’re reading this, you’ve likely heard stories of Amazon shutting businesses down and kicking them off their platform. It’s a nightmare that all sellers would like to avoid. The key question is: why does it happen?
To start, Amazon accounts are suspended for one reason: you (or the agency operating your Amazon account) broke Amazon’s Terms of Service while operating the account. Remember that selling on Amazon is not a right, it’s a privilege. If you want to be able to tap into a marketplace that manages hundreds of billions of dollars worth of product sales every year, you need to play by the rules.
The most common suspension on the Amazon marketplace is a Section 3 Violation. This means Amazon found out your business was dropshipping from stores like Walmart and Home Depot. Buying products from Walmart and selling them on Amazon is not legal and is against Amazon’s policies.
Walmart will start to cancel your orders and ban your credit card/billing address from placing orders with them if you continue to try and use them as a supplier. Once that happens, you won’t be able to meet Amazon’s delivery guarantees and shipment guidelines because you can’t order inventory. Not meeting these standards will result in Amazon terminating your business.
If you are running a fully compliant business model, on the other hand, it’s not hard to meet Amazon’s standards. It’s running an illegal dropshipping model that leads to bad account health and store suspensions. We have an entire article outlining this business model and why Amazon, Walmart, and Brands all hate it here.
Intellectual Property Rights Violations
Another common reason for Amazon account suspensions is intellectual property rights violations.
It’s a very large misconception in e-commerce that you can go buy a product from Alibaba or retail stores in the USA and sell those products on Amazon. In reality, this is as bad as dropshipping from Walmart, if not worse.
Brands have set rules for each reseller, including:
If a brand catches you selling their products without their explicit permission, they’ll send Cease and Desist letters to you or pursue lawsuits to protect their brand image. We have an entire article outlining what you need to do to ensure you are selling legally and building a long-term business, not a time bomb here.
What If My Amazon Account Is Suspended?
The good news is if your business is suspended, you are allowed to appeal the decision and explain the situation. These appeals must be carefully crafted because sometimes it won’t be a human reading your appeal, but rather an AI bot. You need to outline exactly what happened in immense detail end to end and make the appeal airtight.
Of course, League Of Ecom clients don’t ever have to deal with this issue. We make sure your store is 100% compliant with Amazon. Your business won’t ever be shut down and if it happens for any reason, our staff will get your account back and handle the entire appeal process.
Our stores are not suspended, but they go through random identity verifications so Amazon may pause operations and ask you to upload another driver’s license photo if it expired or update credit card info. These types of situations are handled within 24 to 48 hours and we are back online.
If you are operating a store running a Walmart to Amazon model and your business is suspended, you likely can’t ever sell again. Even if you can get reinstated, that process would take a minimum of 4 to 6 weeks.
Amazon will only shut down your business if you’re breaking the rules they have in place. If you don’t break the rules, Amazon won’t shut down your business.
If your account is suspended by Amazon, you can appeal the decision. League of Ecom would handle your entire appeal process if this was to ever happen, however, we run fully compliant businesses with no risk of suspensions. Amazon account suspension is never a scenario our clients encounter.