I’m back on topic, Papy!
LOL - I LOVE podcasts and no, you don’t. I listen through the Overcast app, but you can also listen right on your computer via a link. I’m a Podcast fanatic - I listen in the car, while walking my dog, while working. News, true crime, comedy, history. I love them.
(and back off topic, sorry):
This. I have way too many products/variations to be all FBA but good golly I love it just for the time savings. If I could be all FBA I would in a heartbeat.
You have to remember one important thing. The FTC’s job is to protect consumers from anti-competitive behavior. Anti-trust laws are also ultimately to protect consumers. Sellers aren’t consumers, they’re businesses.
With this in mind, most of Amazon’s treatment of 3P sellers is in the right. Coercing sellers to lower prices ultimately benefits the consumer. There’s a reason why the FTC’s lawsuit focuses on things that potentially drive up prices for consumers. Killing off other marketplaces or other ecommerce stores does ultimately reduce competition, which is why that’s a concern. It’s not a concern for the well being of those businesses, it’s a concern that consumers will have less choice. Also another big argument that’s being made is Amazon’s giving favoritism to listings that provide poorer value to the consumer, either through favoring their own brands or the flooding of sponsored ads. The times amazon basics knocks off someone’s product, provides the same quality, and slashes the price in half are doing good by the consumer. They’re taking away a brand’s profits and giving it back to the consumer.
A lot of the FTC claims have valid arguments on Amazon’s side though. For example, the FTC I’m sure will come up with witnesses who will claim they kept off-amazon prices higher as a result of their fair pricing policy, whereas Amazon will show evidence of times they suppressed offers and successfully coerced the seller into lowering their on-amazon price, thus benefitting the consumer.
I also see nothing fundamentally wrong about suppressing an offer that has poor value compared to off-amazon prices. They don’t block the consumer from buying the product, they just remove the buy box, which is an indication that Amazon’s saying “this price is a rip off.” Which is true if the price is substantially lower somewhere else.
Overall the buy box is a great innovation by Amazon to control sellers and promote cutthroat price competition. They can’t change seller’s prices, but the threat of removing the buy box is enough to force sellers to make those changes themselves most of the time. Too many people here are caught in thinking only as a seller. You have to remember that Amazon allows sellers the privilege of being here for the sole purpose of serving the buyers (which in turn helps Amazon grow their business), NOT for the purpose of making money for yourself. That’s every seller’s goal obviously, but that is not a concern of Amazon’s.
My entire business is built around Amazon and the majority of my time is spent keeping up with changes on how they operate and changing how we operate in response. More sellers should be thinking of how they can make their business fit better with Amazon rather than hoping that something will change to favor them better.
What I gathered from the podcast is this will be the crux of Amazon’s defense: They state they are the most customer-centric company in the world, and all their decisions are based on that. Suppressing listings that are more expensive elsewhere? Well, yes - that benefits the customer.
Agree with this. I’m a small handmade seller on Amazon, but I’ve been on Etsy for many years and have weathered many, many changes. In (almost) every instance, you just have to roll with it and figure out what you need to do to make it work.
Thank you
And the question will be whether Amazon acted legally to do that.
I think about Temu right now: always delighting Buyers with an impossibly low price but in litigation about IP theft, illegal competition, violating business practices, sourcing, Buyer data collection through the app, requiring the app, etc.
Just because you can do it doesn’t make it legal to do it–no matter how delighted the customer is.
For whatever it’s worth, business use of the home comes off your taxes on form 8829.
I have never written my home office space off - not in all the years of being in business (was a portrait photographer before art). Accountants always said it’s a red flag for auditors. :0 I’m very by-the-book, but didn’t want to risk the hassle.
If you try to write off a portion of the house with electric, gas, water, up keep, etc., then it could trigger a flag but, if you are doing it correctly, it is no big deal. The easiest way to do it is to take the standard home office deduction which is based on square footage of home used times a set dollar amount (set by IRS) per square foot.
We have had a home deduction for 20+ years and have never had an issue. It’s like any other deduction … if you are not abusing it and have the paper to back it up, then there is no issue.
Agree, and we would do it correctly - but my accountants over the years have basically said the amount we’d write off wasn’t worth the risk. I did just move into a much larger space in our home (like 4x the size) for my business, so maybe I’ll ask my CPA again at the end of this year. I’m an S-Corp so not sure if that affects whether or not it’s worth it.
That’s what we’ve done for 40+ years now. I’m a sole proprietor filing Schedule C.
Yes, but using 8829 is a red flag. Do it on your schedule C with other expenses. You have been lucky. We have been taking deductions for the dedicated space we use for years along with utilities at a percentage of space used. My accountant who worked for the IRS explained how to do this way back in 1985 (different business venture). You don’t HAVE to use 8829 to do that and probably shouldn’t.
-Ana
From the IRS …
Topic No. 509, Business Use of Home
Simplified Option - While taxpayers can still figure the deduction using the regular method, many taxpayers may find the optional safe harbor method less burdensome. Revenue Procedure 2013-13PDF allows qualifying taxpayers to use a prescribed rate of $5 per square foot of the portion of the home used for business (up to a maximum of 300 square feet) to compute the business use of home deduction. Under this safe harbor method, depreciation is treated as zero and the taxpayer claims the deduction directly on Schedule C (Form 1040). Instead of using Form 8829, the taxpayer indicates the taxpayer’s election to use the safe harbor option by making two entries directly on the Schedule C for the square footage of the home and the square footage of the office. Deductions attributable to the home that are otherwise allowable without regard to business use (such as qualified residence interest, property taxes, and casualty losses) are allowed in full on Schedule A (Form 1040), Itemized Deductions. For more information, see Simplified Option for Home Office Deduction and FAQs – Simplified Method for Home Office Deduction.
Max deduction is $1500.
You can just take it. The IRS won’t question it, for one, it’s too small of an amount for them to care about, and it’s saying this is explicitly the “safe harbor” way of doing it. Basically if you have a computer at home that you use for business you can justify this deduction.
Basically what the IRS is saying is, you can take this small deduction for home use, no questions asked, or you can try to deduct more but if you do we want more information and may decide to question (and possibly disallow) it.
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