RESEDA, Calif. — For small business owners like Barak Govani, the pandemic was just another push to move his West Hollywood clothing store online.
Now, about 20 pieces of men’s clothes, shoes and, other items are all that he has left from the inventory of his boutique shop, New York Speed. After he had closed the store, he sent all his merchandise to Amazon’s fulfillment center to streamline his new online retail store, Addicted Wear, as an Amazon third-party seller.
What You Need To Know
- The pandemic has caused business owners like Barak Govani to close up shop and resell online as an Amazon third-party seller
- One customer claimed a jacket that was sold by Govani's third-party account was a "knock-off"
- The complaint resulted in Govani's seller account to be deactivated
- Govani claims to have lost $1.5 million of inventory that was stored at Amazon's fulfillment center
“Amazon, it’s the future for what I saw in those days. I didn’t know that Amazon will be the thing that will ruin my business,” Govani said.
Things were going well, until one Amazon buyer filed a complaint alleging a Lucky Brand jacket that was purchased from his Amazon seller account was a "knock-off." Despite sending an invoice to the e-commerce giant to prove its authenticity, Govani’s seller account remains deactivated and his retail inventory worth $1.5 million is now gone.
Mario Simonyan is an attorney and founder of ESQGO, a law firm that specializes in intellectual property cases and Amazon third-party seller issues similar to what Govani is facing.
“One of the main concerns Amazon sellers have is the uncertainty," Simonyan said. "For example, if I wake up in the morning, is my account going to be suspended? In the eyes of Amazon, you are guilty until proven innocent."
In a recent subcommittee hearing on antitrust, commercial, and administrative law, Amazon came under fire for their treatment of third-party sellers.
“As part of this investigation, we’ve interviewed many small businesses and they’ve used the words like bullying, fear, and panic to describe their business with Amazon,” Congresswoman Lucy McBath said in the hearing.
Although Govani is just one of many Amazon sellers facing these issues, the situation caused him to rely on family and friends for help as he became over $1 million in debt.
“They took everything I worked for in my life and disposed it. And right now, I need to start from zero again at the age of 41,” Govani said.
While Govani still sees online sales as the future, he is not sure that being an Amazon seller again is worth the risk. Amazon declined to comment on this issue.