Pay by Invoice - Cash Flow Impact


#1

Has anyone noticed the new Pay by Invoice option, well I say option - there is no opt out ability so I suppose it’s another take it or leave option.
So business customer can wait upto 30 day to pay for the goods and then Amazon credit the seller account, unless of course you want to take the early pay option and pay another 1.5% fee, or they don’t pay and Amazon take another 7 days to credit the seller account.
I’m a small seller but this could have an impact to my cash flow/margin.
Thoughts anyone?


#2

I was thinking the same thing, but it’s “a new growth opportunity” according to Amazon. I’m just sure that if a business wanted your item, the thing that would make or break the deal is whether they get terms or not. As a small business, we don’t offer terms to anybody! We used to for a few, but every single one of them took longer than the terms to pay so we stopped doing it altogether. And guess what–we didn’t lose any customers by making them pay in advance.

Now I’m forced by Amazon to wait for my payment unless I want to part with an additional 1.5% on top of their already too-high fees to get paid right away. I may actually do that, but I am thinking Amazon should be absorbing all of the costs of this program and paying us right away without any surcharge.


#3

Since the program applies to everyone, there is no sales advantage to anyone. I could not find where they said what their invoice terms would be - net 30, or will they be offering net 60 or even net 90 day terms to some customers? The 1.5% is just another cost driving my minimum selling price higher. I have no idea how many business customers will have the ability to use this option.


#4

If you feel the need to pay 18 percent annualized for the immediate payment option, I’d guess that something else needs fixing.


#5

I do not like this.

I sell online because I do not have to put up with this crap.

Some orders are going to be cancelled.


#6

In the help files, they say “This new invoiced order payment process will be launched after June 30, 2018, although it may take longer to receive your first invoiced order due to the limited number of Amazon Business buyers qualified for Pay by Invoice”

So, limited number means what? Only the big businesses that likely won’t buy from third party vendors?

At least they are rolling it out over back to school and not Christmas for once!


#7

This option is good for Amazon NO FOR US THE SELLER’S My advise to everybody raised your prices to keep up with all the changes that will only benefit AMAZON


#8

Pay by Invoice … Buyer Side help page

Pay by Invoice … Seller Side help page

Pay by Invoice … Amazon suc… Wait or pay another 1.5%

I’m with Lake … I very well might cancel some orders.


#9

They did say Net 30 as an example in the email.
That means you pay 17% and add 1.5% if you want to be paid right away for business customers.
Sadly- I am staying on board until June when they implement this.

The cost is always to the seller.
Not to mention the constant returns and loss of 17 percent plus shipping both ways in most cases.
You do the math.

The cost is exceeding the gain combined with constant perfomance anxiety.

There will be a new game in town. This is going the direction of Ebay.

Amazon will become a dumping ground for the land of of misfit toys soon.


#10

Yes, another new stupid Amazon idea…what else is new! Always about what’s best for Amazon and never about what’s best for sellers. I’m also a very small business seller and need my payments asap, not 30+ days later.

With all the Fraud that Sellers are constantly complaining about, and then adding this new idea, just wait and see what this all looks like a year from now…scary! Now the crooks will all upscale and become Business Buyers! But what does Amazon care, they just want more and more buyers…


#11

Have any of you who have sold to a “business buyer” ever sold to a big business you have heard of.

All of the big businesses I have sold to through Amazon were not “business buyers” and I am certain paid by credit card.

Expect the folks who use you to drop ship to pay by invoice, and every freelancer who is strapped for cash.


#12

Wouldn’t that affect your order cancellation rate?


#13

Yes it would … To many would be an issue.


#14

You might need to think on this a bit differently.

Assuming you were always sold out, you would be missing out on that money. However, it is likely the case that you had the items in stock and that this is an additional sale.

Many businesses, probably even including your own, get payment terms from their suppliers. Net 30 is pretty standard. For some of my suppliers, I get Net 120 or even forward dating of 6 to 9 months. The supplier still gets their money, but it encourages me to order more, earlier since the cash flow impact is later. I am VERY sure that they see more business rather than having more inventory sitting on the shelf.

Dave


#15

I’m not certain about this, but wouldn’t leaving Amazon Business stop this? I thought at some point they would put in some type of fee for it. This way they are adding an incentive and our share of the cost is the 1.5% we should be getting extra for financing the 30 days.

I just hope Amazon does a better job monitoring their “7 days after payment” promise than they do the FBA no return reimbursements.


#16

For many of our sellers on Amazon, we are trying to move inventory and get cash flow- not have to wait another 30 or 60 days.
I am not a wholesale supplier so why should I be offering net sales to anyone on Amazon- business or otherwise?
You are telling me the pink leggings need terms?
I’m sorry but for me- this will not work.


#17

Yeah, this is a big nothing burger. The payments we get on Amazon “services” (which just means terms) is a tiny fraction of our overall payments.

If it was a large chunk, yes the new terms would matter, but it applies to so little sales that it doesn’t affect anything. We have a fair amount of sales to businesses, but very very few are signed up for this program. Heck, I think even our buyer account still has a person’s personal name and info on it. As long as it goes on the business credit card and gets shipped to the business address, most folks don’t know and won’t bother to change it in Amazon’s system.

I mean is anyone seeing even 1% of their sales come from this? I don’t think the sales with terms are a tenth of that even.


#18

At this time the number of sales with terms is minuscule. Clearly Amazon believes that is because few sellers have opted in, and they are going to make them a lot bigger by forcing sellers to accept these orders, saving the credit cad fees Amazon pays.

.


#19

The thing is I am retailing on Amazon … I am not a supplier for their business and so I have no desire to offer terms.

Net 30 barely covers getting inventory, shipping and stocking for FBA and the sale …
JMO


#20

This is just another asinine idea by Amazon. It won’t hurt Amazon’s cash flow, just the seller’s. Cash flow is the name of the game and I absolutely hate the idea that Amazon thinks it will just enable customers to take their good ole sweet time paying. When I sell an item, I want paid in my next disbursement. Not three, four or even six disbursements later.

:poop: on Amazon for this incredibly STUPID idea of forcing all sellers to take this.