“Stores are getting suspended and terminated like crazy,” he goes on. “You don’t have to look any further than Reddit or YouTube to see all of the countless complaints. So what’s going on in the ecommerce industry, and specifically, Walmart? Well, a lot of people are moving from Amazon over to Walmart automation, for a number of reasons.
For one, you can start scaling Walmart stores right away, unlike Amazon. Two, the profit margins are higher. And three, risk of account suspension is lower.”
Well, that statement was partially true. Unfortunately, it looks like point 3 regarding Walmart didn’t work out as planned. The thing is, Walmart was allowing third party selling over the course of the last year. And it’s true, most of that time it did have a very low suspension rate. In fact, at that time a lot of Ryan’s clients had their Walmart stores up, running, and profiting.
And then Walmart started suspending the stores.
Thankfully the Lunar Ecom team fought to unsuspend the stores, and most of them were. Unfortunately everyone was pretty shaken up and they were setback up to two months. Then Walmart started suspending again for a second time. It didn’t make any sense because the suspended stores were brand new and not even generating money yet.
AKA nothing had even been done to violate Walmarts guidelines. Even worse, Walmart never even gave a reason why they suspended so many of the stores.
Lunar Ecom once again tried to troubleshoot using the same methods they had with the first round of suspensions. Unfortunately, however, instead of Walmart reinstating the stores they closed ALL of them.
Ouch. And so at this point we started to get really concerned because who knows what Walmart’s gonna do next,” Ryan says. “Well as it turns out, a few weeks later, they just kept terminating new stores, whether they were selling or not (no suspensions, no warnings, nothing).”
“And honestly, if it was just my company, I would’ve probably felt better about it, because it would of told me that we’re doing something wrong and then we can fix it. But that wasn’t the case. It was companies (meaning stores/accounts) all over.
All my friends in the industry were seeing the same thing, and it was just a really crappy situation for everyone involved. And so we made the decision to just turn off all of our active Walmart stores because at this point, it just seems like Walmart is going to terminate everything at some point.”
So you’re probably wondering how Lunar Ecom handled all of their customers who paid for the Walmart dropshipping store. Don’t worry, they didn’t leave them hanging. Lunar Ecom swapped them all back to Amazon. Maybe in the future they’ll give Walmart another try.
And while Lunar Ecom did the best they could for their clients, I personally wouldn’t want to dabble in automated ecom stores. Between the suspensions, expensive cost, and low margins? I’ll pass.