Amazon and readers ripoff writers…

Lisa Kessler/L.A. Kessler - PERFECT - Out Now!
Just a reminder that Amazon is NOT a library. When you read and return a book it COSTS the author... It's June 1st and I owe Amazon at the moment because people are reading through the Muse series and returning the books when they finish.... :-/ Authors need to eat too... :-(

Kessler told BuzzFeed that readers buying and returning her eBooks is a new problem that started earlier this year. "Until May, I rarely ever had a returned eBook, and when I did it would be just one or two, which I chalked up to accidental purchases, totally understandable. But last month, there was a sudden swell of returns of an entire series of books."

This is not just costing authors the royalties they have to return. The authors also pay a digital delivery fee when the book is sold and Amazon does not return that to them.


Until now I didn’t realize that was possible, but you can return a Kindle book within 7 days. This is done for “accidental purchases”, but I can see some fast readers doing this and treating it like a library, as said.

I have a friend who has published two books on Amazon. Both are physical books only, and since it is very small volumes it is “print on demand”. He said he makes a larger royalty on print than on Kindle. This to me seems very odd, why a different royalty?

I love the convenience of Kindle. I love the convenience of music streaming. But I realize it is screwing the creatives over. :frowning:

Amazon does this with products sold, too. They allow customers to abuse their return privileges. In addition, Amazon will create competing products for anything with good sales, then promote theirs over the original. Vendors and creators should be forewarned. Amazon is a beast.


The cost of the Amazon marketplace is very high. Leaving small margins to the merchants.

A few years ago one out of two internet users in the US were heading solely to Amazon in any given day.

Amazon does this with products sold, too. They allow customers to abuse their return privileges.

Most large merchants do too. You can bring stuff back to Walmart or Home Depot or similar and they will liberally take it back. Costco says it will take back anything forever , although they tightened that policy up after people abused it buying a new TV every super bowl and bring back last year’s. So now you have 90 days on electronics.

Mrs.Goofy worked for a home shopping channel; they had returns up to 30% of sales. In the jewelry area they had people by diamonds and then return the same setting with CZ’s replaced. They had to install gemologists in the return department to cut out that kind of fraud.

If you buy something online from Home Depot and return it to the store, they will not stock it in the store even if they sell the identical item. They ship it back to their online depot; I asked my local manager why and he said “They’re separate businesses, although HD tries not to make it look that way.” He also said his store doesn’t get credit for online sales, so their storage and return desks are costs that the local store just has to eat.


Planet Money has an interesting podcast on the economics of returned goods.… the transcript is at

On average, American consumers return about 10% of the things we buy. And for online retail, the numbers could be more than double that … The volume is somewhere between 500 billion and $600 billion this year.

There is nothing efficient about opening up a trailer full of 26 pallets of returned goods that are not rewrapped nicely as they were delivered. You might have a thousand items. Every item is likely to be different.

Each returned item has to be inspected to see if it can be resold. For expensive stuff, this might be worth it. But for cheap stuff? No way. It is either sold in bulk or sent to landfills. People buy pallets of returned goods with no idea what’s in them with the hope of reselling for a profit online. People make youtube videos of opening the pallets. Others have built a new business model, buy pallets of stuff, put them in a vacant store, no shortage of those these days, and throw the doors open at a specific time. It’s like a feeding frenzy. It’s almost like a Black Friday every weekend.

Resellers shop the stores looking for bargains to resell online. There’s enough resellers that it’s a feeding frenzy, everyone looking for the profitable items among the junk. The reporter went with two resellers to one store, the Treasure Hunt Bin Megastore in Raleigh NC.

Asalyn and Makayla are resellers. They’re part of a growing category of entrepreneurs that buy and then resell the things the rest of us have returned … Today, two of their fiercest regular competitors have managed to beat them to the front of the line. So what they lack in position, they’re going to have to try to make up in strategy. They use binoculars to spot hidden treasures inside. Then they draw up a map and plan out little plays, almost like a football coach … OK, possibly one of us going to go after the fireplace and the blender, and the other will go after, like, the NuWave air fryer over here or the smokeless grill back there … As the last couple minutes tick down before the doors open, Asalyn and Makayla get all somber and quiet, kind of steely-eyed. It feels a little bit like one of those World War I movies when all the grim-faced soldiers are lined up shoulder to shoulder in the trenches, and they’re just waiting for the signal to run into no man’s land … When fortunes are won and lost is all over in about five minutes of vigorous digging.

After they snag their stuff, they pause before paying for it, checking prices online to make sure they can make a profit.

On average, they say, they’ll make a combined $800 or so a week, enough to cover tuition and school supplies and dog food.

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As investors I’m sure most Fools have heard Buffett talk about the importance of moats. In the Age of Chivalry even rich nobles had to put mosts around their castles.

Authors need to find ways to build moats!

Of course then buyers will be the ones complaining of being ripped off.

Welcome to the real world. You have to defend your rights vigorously as otherwise you lose them – advice from my American lawyer in Silicon Valley.

The Captain


A few years ago one out of two internet users in the US were heading solely to Amazon in any given day.

The new CEO of Amazon (replacing Jeff Bezos) is on Bloomberg Studio this week interviewed by Emily Chang.

He said in the US, only 15% of retail sales is online. Amazon may be the largest but there is plenty of competition out there. Amazon is still smaller than Walmart in sales.

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Thanks for the insight on the 15% of shopping being online. I have scanned elsewhere it is not growing nearly as fast as predicted. The earlier stat I provided was powerful and more so in the light of a faster growing online segment that is not materializing after all.

Yet roughly 7% of all retail sales if that holds up is a massive number in the US. The thing Amazon has that Walmart does not have are the AWS.

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