Licensing Agreements & Letters of Authorization Help When Selling Health & Beauty Products on Amazon
Amongst the wide range of topics I have learned about as a new Journalist for the firm, licensing agreements for the Health and Beauty Product category was certainly the most head-scratching!
Do you sell products in this category on Amazon? Do you sell for a specific brand as a third-party seller? If you do, best practices for your shop should be to source your product ingredients or materials directly from the brand or manufacturer and have an agreement that you are authorized to sell that brand’s products online as a third-party seller. This is the best way to protect yourself as an Amazon seller of these kinds of products.
A licensing agreement is also called a letter of authorization. These terms are interchangeable and both serve the same purpose.
I spoke with Alexa, a paralegal with the firm, who created a great video about this topic, about why some sellers may be reluctant to acquire a licensing agreement. She told me,
“Licensing Agreements/Letters of Authorizations were not as regularly required by Amazon previously, so many sellers may have found it unnecessary to pay whatever the brand or company was requesting to get these agreements.”
Acquiring a licensing agreement includes reaching out to the brand, showing them where you source your products, and requesting an agreement.
Because health and beauty products can affect the buyer’s health, brands want to protect themselves from any and all potential problems with products they have no control over distributing. If there is an issue with the product, having an agreement is an especially good way to help remedy the situation, because once you supply Amazon with these agreements, usually 95% of the time, they will just remove the complaint and move on.
As a third-party Amazon seller, if a customer has an issue with the product, Amazon may shut down the listing or account of the person who sold the items, even if it was the brand’s fault.
The brand will then only get involved with shutting someone’s account or listing down when the seller has infringed on some intellectual property. So, you won’t be discussing your suspended seller’s account with the brand, but with Amazon.
Rely on your Plan of Action as a first priority, as with any kind of Amazon seller’s account suspension. Search our website for tons of articles on expertly drafting this document, but the basics of a POA include: Address the root cause of the issue, explain the immediate steps you took to help the customer, and describe the systemic changes you will make to your shop to ensure the issue will not occur again.
Do you need help or guidance in navigating through your rights as an Amazon seller, or on how to acquire a licensing agreement?
We have a huge collection of resources on every facet of protecting yourself in your Amazon seller’s business.
This content was originally published here.