What You Need to Know Before Selling Your Amazon Business
Can I sell my Amazon business?
Yes and no. You can sell your business, of course, but you cannot sell an Amazon seller account. It’s in our contract with Amazon under “#18 Miscellaneous” and “P-4 Verification” where we are required to inform Amazon promptly of any change to our seller account. Also, under our Conditions of Use, “License and Access,” Amazon specifically states that we cannot sell or transfer any service they provide us (our seller account is a service). Lastly, under Seller Policies, “Can I transfer my seller account?”
Why can’t I sell my Amazon account? It’s part of the value of my company!
Amazon says a seller may only have one seller account in their lifetime and it belongs to Amazon. It is stated in our contract that an Amazon seller account cannot be sold or transferred. You are required to notify Amazon of any change to your business. See the above links.
What will Amazon do if I inform them?
They will help you close your account and will open a new account for the new owners. This takes a few months – for you – because of returns. You will be able to add the new owners to brand registry (assuming they are also buying your intellectual property). They can help your inventory be assigned to the new owners without needing to come back from the warehouse (assumes you are an FBA seller). They will sever all ties between you and the new owners in their system. OK, not really. They’ll make account annotations. Nothing is deleted on Amazon.
Know more: How To Enforce Your IP Rights With Amazon Brand Registry
What are the benefits to this approach?
You are doing things the Amazon way. You are open to start another business on Amazon (lots of caveats – see the Devil in the Details below) and you are not responsible for any mistakes the new owners make. This can be HUGE as some of my clients have found out the hard way.
What are the disadvantages to the Amazon way?
The new owners are starting as “just launched” sellers and lose all the seller feedback you’ve earned over the years. They must get approved for restricted categories and brands themselves. They lose anonymity with Amazon. They must be verified.
What about 1P sellers?
Companies who sell direct to Amazon have a contractual relationship with Amazon. Unlike 3P sellers who all sign the same contract, yours was likely customized. You need to read your contract carefully to understand if you can transfer this contract to a new owner or not and what notifications Amazon requires of you. It is likely they will want to vet the new owners. They may want the new owners to sign a new contract with them. It depends on your agreement.