Amazon Home Services Review
Amazon Home Services was established in early 2014 to provide contractors (e.g., plumbers, electricians, etc.) with access to up to millions of Amazon customers in your area. It’s a big deal.
Like other third-party service providers, Amazon-approved contractors have passed through its vetting process, which in this case requires a contractor to document their respective liability insurance and licensure. Before a bike mechanic can offer his/her services through Amazon, an account needs to be established and approved, which takes about one to two weeks.
For a mobile bike shop mechanic, being able to sell your services through Amazon is a seemingly huge bonus. Beyond becoming an officially recognized Amazon partner with access to Amazon’s huge customer base, there are no sign-up fees, no subscription fees, and no lead fees. What’s more, it’s simple for an Amazon customer to click ‘have your bike professionally assembled.’ Just like that, you’ve got work.
What’s the catch?
First, Amazon assess a 20% fee. As a real-life example from a few years ago, if you lived in one of the wealthiest, most exclusive zip codes in the United States, 90210 (Beverly Hills), you could have selected Beeline Bikes (before they went out of business) to be the assembler of your $187 GMC Denali road bike. That particular Beeline location assembled Amazon-purchased bikes for $60. After Amazon’s cut, that Beeline franchisee kept $48. That didn’t include the cost of getting the Beeline van and mechanic to and from that Beverly Hills location, which might have cost that same $48, or more.
Second, Amazon just commoditized your mechanical skills, one of the few remaining bicycle-industry areas thought to be non-commoditizeable. You might be able to buy a new Dura Ace derailleur online for less than wholesale, but many people still need a bike mechanic to have that installed. Amazon’s Home Services program now allows for the bike mechanic to be purchased alongside your new bike or new bike component. The same race-to-the-bottom seen elsewhere in the bicycle industry is now chipping away at the service side, one of the few remaining profit centers for many bike shops. How so? As an Amazon bike mechanic, you’re of course competing with other Amazon-vetted “bike mechanics,” which by the way includes people who aren’t bike mechanics. How so?! As long as you clear Amazon’s contractor application process, which doesn’t include a bike-mechanic skills verification process, any Amazon-approved contractor can compete with you. As an example, the same Amazon approved contractor who sells their respective media-cabinet assembly services can also assemble new bicycles.
Let’s play the devil’s advocate. Who cares? You’re still getting paid, you’re getting exposure, you’re expanding your customer base, and it costs you nothing. For goodness sake you’re an Amazon partner! Good-ole’ American capitalism doing its job!
Maybe, but in each of the large handful of (real) bike mechanics I researched on Amazon, when taking an independent look at their respective shop-websites, the fees they charge for the same Amazon-listed services are higher on their shop’s website. In every instance. Often much higher. That same Beeline franchisee that once served Beverly Hills who assembled bikes for almost a net-nothing had been charging $99 for the same service if purchased directly through them.
“But doing Amazon jobs is customer-paid acquisition!” I beg to differ. Yes, you might have added a new name to your customer list, but that same customer can also see you’re cheaper if they contact you through Amazon. That’s the best-case scenario. They might also assume you’re just another lying bike shop trying to rip-off unsuspecting customers. So why not just match the same prices listed on Amazon with those of your shop? Doing that will almost certainly bump you well out of range of what other new-bike-assemblers will charge, who may or may not be actual bike mechanics. That means you’ll probably not receive many Amazon bike jobs. To the contrary, you could also decrease all of your shop’s prices, those that your customers see when they visit your shop’s website, to match your ultra-low Amazon rates. Cheap prices often equates to cheap customers. In my experience, cheap customers regularly attempt to negotiate on already-discounted prices, complain more, and demand more. For most businesses, not great customers.
Third: The customer controls everything.
But that’s OK, the customer should be in control, right? Sure. But with Amazon that means the customer chooses when you’ll appear, even if that means an extra 40-mile trip because your non-Amazon jobs aren’t very close. As an Amazon mechanic, when you’re contacted about a job, you’re usually given three possible time slots on different days. If none of those times work, you need to attempt to reschedule. But be careful about rescheduling because Amazon keeps tabs on how many times you do that, along with anything else you may need to change. Too many changes and Amazon reserves the right to ding your Amazon contractor status, which could mean fewer job opportunities. The customer can also indicate they’re not satisfied, with essentially anything about you or your work, and Amazon won’t charge them. Which means you don’t get paid. No recourse. No appeals. No your-side-of-the-story. Don’t forget to brief your Amazon customer on the required “guidance on basic tuning and maintenance” issues before you leave, which is also part of Amazon-procured bicycle mechanical services.
For the very few Amazon jobs I get each year, likely because my prices are notably higher on Amazon than most other local bicycle assemblers, almost every job has been accompanied with one or more issues. Scheduling is the biggest issue, often because the bike hasn’t been received by the customer. But that’s OK, because Amazon is regularly in-touch with me about those delivery delays. Except they’re not. I find out about those shipping delays from the customer, usually hours before the scheduled appointment. Another regular occurrence with Amazon jobs, one or more parts are missing or damaged. Amazon will make good on those damaged or missing parts, but that means the job will be delayed and I’ll need to return at a later date. That’s the best case scenario. More times than not, a customer will get nervous and simply return the entire bike, which I just unpacked. Now I’ll need to re-pack the bike. All for no pay. I’ve come to learn, very quickly, to simply eat the costs associated with broken/missing parts as well as the additional labor-time.
There's also direct pressure from Amazon to lower your already low prices. I’ve received emails from Amazon that suggest I lower my prices to give my mobile bike shop the best chance of getting work. It’s not only a race-to-the-bottom, it’s a race actively encouraged by Amazon. On a related note, Amazon’s customer service for their contractor partners is far from elegant. Phone calls seem to be answered by offshore customer service representatives who read from scripts. Email exchanges with their customer service department are quickly answered, but they’re also not very helpful.
Remember Covid? With zero notice, Amazon shuttered its entire Home Services Program in March 2020, and it remained closed for months. I'm familiar with numerous mobile bike shop operators around the country who used Amazon's Home Services program as a not-insignificant pillar of their respective businesses. Then one day, poof, it was gone. That shut-down coincided with one of the biggest bike-boom spikes in perhaps the entire history of the bicycle industry. Right at the time when LOTS of people wanted a bike or bike service, those mobile bike shops who depended so heavily on Amazon fell right on their respective faces. If you're really an independent business operator, for goodness sake, don't rely on Amazon.
So stay away from Amazon?
Not at all. I still officially participate in Amazon’s Home Services Program. "But if it’s such a stinky program, why?!" It’s another way I can get the shop's name out there, but on my terms. That led me to raise my prices to recapture Amazon’s 20% fee, plus a little more. For those savvy customers out there who look at my prices on Amazon, then look at my prices on my shop's own website, they'll see I'm the better deal, not Amazon.
Again, no surprise, I don’t receive much Amazon-related business. But the business I do receive is from people who are comfortable paying those prices. That's exactly the customer I’d like to attract.