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Amazon Repricing Software Glitch Bankrupts Many UK FBA Sellers

December 15th, 2014 by Skip McGrath

Before I get into this, I wanted to let you know I had a bad fall the other night and although nothing broken, my left arm is in a sling.  I should be able to get out of it in about a week – but in the meantime I can only type one-handed.  So let me apologize in advance for any typos.

Now the story – Repricing software is used by a lot of sellers to win the buy box on Amazon.  Well a third party repricer by a company called Repricer Express in the UK had a glitch  a couple night ago and repriced millions of items at one-penny.  The glitch lasted about 3 hours but it was the busiest time of day and millions of items were sold at the price of one-penny.  Merchant Fulfilled sellers were able to cancel the orders, but FBA sellers were hit hard as Amazon was shipping as fast as the items came in.

People were buying expensive items like jewelry, appliances, and even mattresses.

Since the problem was caused by a 3rd party – Amazon bears no responsibility and will not be reimbursing sellers.  I saw a Facebook post from one FBA seller who said they lost 90,000 pounds (About $150,000) in three hours and that size loss may cause them to file for bankruptcy.

I had a short interview with Shmuli Goldberg, President of Feedvisor and algorithmic repricer, who said that over 75,000,000 items were sold during the time period.  I asked Shmuli if he though other repricers were at risk for this type of action and he thought not.  His system, Feedvisor has a 4 point checking system including a sanity check to prevent bogus prices from being sent to Amazon.  He feels that other companies have similar systems and that this is not an industry wide problem.  As for folks getting reimbursed by Repricer Express – they are certainly liable, but I seriously doubt that they are big enough financially and may be the first casualty.  I would be seriously surprised if anyone got any money back.

Although the Merchant Fulfilled sellers were able to cancel orders before they shipped they still had some damage as several customers posted negative feedback when their orders were cancelled.  Its not clear yet, whether Amazon will remove those feedbacks, but I suspect they will in time.  But in the meantime, those bad feedbacks can knock those seller out of the buy box during the hottest selling time of the year.

The lesson here is when you use any third party software or any software you may design yourself –then realize the risk is on you when something goes wrong.

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