Failure Friday: “Amazon permanently banned my seller account…”

Kelan, co-founder of TheSavvyCouple.com, started making money online at 13, flipping items he found around the house on eBay. By high school he'd run out of things to sell, so he found a dropshipping supplier who could ship products directly to buyers on Amazon and eBay. He kept at it through college, doing around $50,000 in dropshipping sales in a single year, at roughly a 10 percent profit margin — a solid side hustle for a college student, if not a blockbuster one.

The trouble started when he tried to scale. Right before Christmas, he found a faster way to list his supplier's entire inventory: instead of uploading each item by hand, he'd export their stock into an Excel sheet and upload it to Amazon all at once. He listed more than a thousand items this way, including hot sellers like yoga mats. Orders poured in — and that's when he realized the spreadsheet was wrong. He'd listed items the supplier didn't have in stock, and had to cancel more than 20 orders, right in the middle of the holiday rush.

Canceling orders is one of the fastest ways to get flagged as an Amazon seller, and Amazon does not treat it lightly. Kelan's account was banned, permanently, tied to his name, his social security number, and his credit cards. He tried opening new seller accounts afterward; Amazon shut down every one of them.

His lesson from the experience: start small, and only scale once real systems are in place. If you're dropshipping, supplier relationships matter as much as anything else in the business, because when something goes wrong on their end, the seller account on the line is yours. Kelan turned his attention to his blog, TheSavvyCouple.com, which he and his wife have since built into a multiple six-figure business.