17 {{ upvoteCount | shortNum }}
17 {{ upvoteCount | shortNum }}

Amazon likes Tennessee...but for how long? Should I bother with Amazon or prepare for the worst?

by petelta
14 replies
I have been wanting to start selling physical products through Amazon. I live in Tennessee and the laws are fine here. With all the recent changes in other states, should I even bother jumping into Amazon's affiliate program?

Or should I diversify my portfolio and focus more on Barnes and Noble, Walmart.com, LinkShare, and in-house affiliate programs...using Amazon only for a small portion of my products?

As I understand it, Amazon is pulling these states to piss off you, the affiliate. They need you to get steamy and send senators a letter of discontent. This is the best possible way to get the bills vetoed by a governor or get a state to agree to not apply such a bill...like Texas recently did.

All Amazon is doing with this is buying themselves time before they have to pay sales tax for purchases. Everything will be taxed at some point and internet sales have been lacking that aspect. Isn't it a losing battle Amazon is fighting by trying to extend the length they need to pay taxes?

They might win today... but will it be this way forever? I doubt it.

Walmart and many other local physical stores have joined forces to fight against online stores from avoiding sales tax. They claim it to be unfair and this is many online retailers only unique selling proposition. It would cause physical local stores to have an edge again...

Does Amazon eventually fold to legislation and have to pay sales tax? or will the bill get vetoed around the states like it did in Hawaii a few years back?

Curious to know more about this situation from some people going through it.

Travis
#amazon #bother #likes #long #prepare #tennesseebut #worst
  • Profile picture of the author Dan C. Rinnert
    Originally Posted by petelta View Post

    All Amazon is doing with this is buying themselves time before they have to pay sales tax for purchases.
    They don't have to pay sales taxes. They would have to collect sales taxes. The consumer will be the one that ultimately pays. Of course, it will be costly for Amazon to implement and manage the system because there are so many sales tax jurisdictions across the country.

    What Amazon wants is a national solution, and to not have to manage hundreds or thousands of different sales taxes and remit each to the appropriate state.

    Isn't it a losing battle Amazon is fighting by trying to extend the length they need to pay taxes?

    They might win today... but will it be this way forever? I doubt it.
    In North Carolina, which was the first or one of the first to want Amazon to collect sales taxes if they had affiliates in the state, there is movement afoot to repeal that law. So, while other states are moving forward, it appears there is a chance North Carolina may have learned its lesson.
    Signature

    Dan's content is irregularly read by handfuls of people. Join the elite few by reading his blog: dcrBlogs.com, following him on Twitter: dcrTweets.com or reading his fiction: dcrWrites.com but NOT by Clicking Here!

    Dan also writes content for hire, but you can't afford him anyway.
    {{ DiscussionBoard.errors[4187907].message }}
  • Profile picture of the author ladywriter
    I wonder about this as well. When I make a bit of money I plan to relocate the business to a "safe" state, but should I be walking on eggshells until then?

    Is there any way to see which states might be having Amazon problems next?
    Signature
    Effective Content From a Nurse: Check Out my Warrior for Hire thread
    {{ DiscussionBoard.errors[4190394].message }}
  • Profile picture of the author PPC-Coach
    Promote amazon in other countries. They don't care what state you live in.

    Signature
    {{ DiscussionBoard.errors[4191202].message }}
  • Profile picture of the author yukon
    Banned
    Originally Posted by Ron Hitson View Post

    It's not about Amazon, it's about states creating laws that will require online retailers to collect sales tax.

    It's much larger than Amazon...........

    California is next.......if it has not already happened. Yes, Amazon is cutting ties with Amazon.

    If you're an a affiliate for any online retailer, it's best to contact the compliance department of the retailer and inquire within.

    I was doing really well with Amazon while in Illinois, until the axe came down.
    Your wrong!

    It's 100% about Amazon.

    I live in South Carolina & Amazon started building a distribution center, as soon as sales tax was mentioned Amazon bailed (after starting construction).

    If I built a huge distribution center in your state, & every business had to collect sales tax except for my business, do you really believe thats a smart move for the state? It's a bad move If the states don't stand up & collect.

    Amazon/online has an unfair advantage over brick & mortar business, which keeps their prices lower, which keeps bringing in easy traffic.

    A business is a business!
    {{ DiscussionBoard.errors[4191254].message }}
  • Profile picture of the author JSProjects
    We've got a distribution center here in AZ. But I'm still starting to re-think things a little.
    {{ DiscussionBoard.errors[4191271].message }}
  • Profile picture of the author JohnMcCabe
    Originally Posted by petelta View Post

    Or should I diversify my portfolio and focus more on Barnes and Noble, Walmart.com, LinkShare, and in-house affiliate programs...using Amazon only for a small portion of my products?

    As I understand it, Amazon is pulling these states to piss off you, the affiliate. They need you to get steamy and send senators a letter of discontent. This is the best possible way to get the bills vetoed by a governor or get a state to agree to not apply such a bill...like Texas recently did.

    Travis
    Travis, if you're worried, I'd create the links so that you could quickly change them out for a new vendor. If you can generate the sales, Amazon's performance model is a big advantage. That said, you still want to test other vendors.

    Amazon isn't pulling out of states to get affiliates pissed off. They're doing it to avoid dealing with the mess. They're pulling the corporate equivalent of "I'm taking my ball and going home."
    {{ DiscussionBoard.errors[4191369].message }}
  • Profile picture of the author Monja
    i´d always say - diversify. the more diversification you have the less you can fail - i know it´s very general but actually it is really good to have several affiliate marketing programs and not just amazon on your site. the same as if you just use SEO for your website - diversification is a good key to successful business.
    Signature

    Free Business Class on Skillshare:
    http://skl.sh/2bvH8nS

    {{ DiscussionBoard.errors[4852324].message }}
  • Profile picture of the author Benjamin Ehinger
    It doesn't really matter what happens in the future. The answer is to diversify.....always. You never want to be counting on one source of income too much because if it goes away you are screwed.

    Benjamin Ehinger
    {{ DiscussionBoard.errors[4852430].message }}
  • Profile picture of the author Bill Cook
    I think Tennessee is going to be pretty safe for a while. I think Amazon is kinda tipping their hand that they will eventually have to collect sales tax, they just aren't ready to do it now.

    That being said, I am glad I left Illinois.

    Bill
    Signature
    1000 Free Links, No Credit Card, No Catch
    {{ DiscussionBoard.errors[4853174].message }}
  • Profile picture of the author mattflynn
    This whole issue is why I stopped doing anything with Amazon. Too much can change overnight and you lose all the income stream. To me, Amazon is playing a game of 'chicken' with these states and seeing who will give in first. But for affliates it's a risky game.
    {{ DiscussionBoard.errors[4853326].message }}
  • Profile picture of the author Smokin Joe
    Taxation of internet sales is coming folks. The Government is much too tax strapped. What Amazon is waiting for is them to get their act together and decide upon a standard rate of taxation. Only having to collect one rate and sent it to one place in 50 states.

    That is the answer to the problem.
    Signature
    The Memphis Gourmet
    {{ DiscussionBoard.errors[4853358].message }}

Trending Topics